Rural infrastructure and agricultural development

G Hiamguanglung *

Women planting rice at a Paddy Field :: June 2010

The provision of rural infrastructure in developing countries is integral to their development and yet it often does not receive adequate attention from researchers or policymakers. Whenever infrastructure is discussed, it is usually with respect to hard infrastructure, such as roads. In addition to hard infrastructure, there exists another type of infrastructure, namely soft infrastructure. Hard infrastructure, it is argued, provides the framework within which soft infrastructure can be made available in developing countries. Soft infrastructure consists of rural services such as banking, credit, extension, seed provision, transport, communications and marketing of rural produce. Institutional infrastructure, such as agricultural extension, is also considered to be a soft infrastructure.

Generally, when the research community refers to infrastructure, it means hard infrastructure such as roads, telecommunications, electrification and irrigation. But focusing only on hard infrastructure provides a partial picture; other types of infrastructure, notably institutional and 'soft' infrastructure, are equally important for agricultural development in particular and rural economy in general.

Agriculture is one of the cornerstones of rural development in developing countries. For the agricultural sector to achieve its potential, investments in both hard and soft infrastructure are necessary. Since agriculture is the backbone of rural economies, effective links need to be established between this sector and the larger rural economy, through judicious investments in both hard and soft rural infrastructure. Again absence of institutional infrastructure can lead to unsound agricultural development planning. For example, local data on climate, physiography, soils, water, vegetation and population need to be collected, stored and analysed before planning agricultural development activities.

Studies have shown, for example, that improved access to all-season roads enhances the use of inputs such as fertilizer, increases aggregate farm output and has a similar positive influence on marketed surplus from rural areas. Furthermore, better access to towns has resulted in increased purchase of agricultural inputs, in addition to that of non-food goods and services in developing rural economies. Thus, the provision of infrastructure in rural areas is of great significance to overall regional development, but particularly to that of the agricultural sector.

Improving access to infrastructure along with developing labour-saving and yield-augmenting technologies is the main challenge. Long-term investments in institutional infrastructure, especially that pertaining to agricultural research in peripheral regions, are essential in order to address this concern adequately. There has to be a concerted effort to improve access to rural services through investments in both hard and soft infrastructure in the peripheral regions. The evidence from many studies clearly reveals that improved access to rural services lead to greater household expenditures for consumer goods, agricultural inputs and other services. Improvements in transportation in peripheral areas, and an increase in locally available services, are key factors in the development of the regional economy.

A. Impact of Infrastructure Development on Agricultural Productivity:

1) Irrigation, the sector specific infrastructure, mainly enhances yields and moves the production frontiers outward.

2) The impact of roads, the broader infrastructure, may come from many fronts. Lower transportation costs directly translate into farmers' savings in input purchase and bring their agricultural produce to markets.

3) The savings in input cost enable farmers to buy more fertilizer, further increasing yields.

4) Moreover, better access to transportation can help shift land from low value cereal production to high value-added fruit and vegetable production because of the reduction in perishability risks.

5) In addition to the impact on agricultural products, roads are important for poverty reduction through increased in income of the rural farmer etc.

B. Role of Road Network:

The road network is commonly considered as prime index of development. Road transportation can be a marker of economic development of an area as it provides the basic infrastructure for any kind of investment and the harnessing of its economic potential. In upland areas the road network has special significance since it provides the only mode of transport and communication. Several negative aspects, such as landslide, soil erosion, and forest damage are associated with road construction and traffic. Moreover, in the fragile landscape, landslides, soil erosion, and hydrological imbalance occur naturally and road construction accelerates the effects of these ongoing processes. Nevertheless, the main aim of road development is to provide infrastructural facilities and social transformation. It provides exposure to new techniques, methods, and ideas to modify traditional practices. Therefore, development of a road network is indicated as the most important felt need for benefits to trickle down to local inhabitants.

The analytical studies on the introduction and extension of basic facilities in a rural landscape in relations to the development of a road network in a high-altitude, remote location in the India revealed that in general, the infrastructure was concentrated along a road or within a distance of two kilometers, and declined with increasing distance from the road. However, the distribution of primary education units and postal services was not affected by road development but the impact of a road was clearly visible.

The major human and animal health-care facilities were concentrated at a few easily accessible points, and the location of other facilities was determined by distance from the road. Drinking water supplied by government agencies and an electricity network were initially introduced along the road network and then extended whereas telecommunication facilities (telephone and telegraph) and financial institutions were established only along the road. A road network is one the most felt need for socioeconomic development in remote and inaccessible mountains areas that are cut off from mainstream development

The result of improve access to rural infrastructure, the peripheral farming population will become more active in the rural economy through greater interaction and linkages with towns. Towns will increasingly gear towards providing broader 'region-serving' activities as opposed to limited 'town-serving' activities, thus can play a role in regional integration and development. Ultimately, this can help reduce inequalities between the centre and periphery, and encourage the marketing of outputs and the purchase of food, consumer durables and services.

Enhance agricultural development can spurred on by the provision of rural infrastructure such as agricultural technology (e.g. irrigation) and agricultural services (e.g. extension, credit, input/output markets), could serve to enhance incomes and strengthen demand linkages to the rest of the regional rural economy.

Under this scenario the provision of rural infrastructure becomes an engine for regional economic growth and development.

C. Role of Public and Private Sector:

The differing roles of public and private-sector investment in rural infrastructure are also very important. Public-sector investment, mostly in hard infrastructure, has tended to 'open up' underdeveloped regions to private-sector investment in soft infrastructure. Increasing emphasis is being placed on the role of private-sector investment in rural service provision, especially for services related to agricultural production, processing and marketing.

Comparisons need to be made between established private-sector systems, successful public sector systems and recently liberalized systems of rural service provision, in order to understand their implications for the development of smallholder agriculture. With the withdrawal of the public sector from many rural areas of India as a consequence of recent market reforms and structural adjustment programmes, the question of the roles of the public and private sectors' investment becomes of increased importance for the development of farming areas. It is this coupling of public and private-sector investments which has the potential to promote centre periphery integration and reinforce agricultural development not only in India, but also in other regions of the developing world.

D. Need of Comprehensive Planning

Many of the findings provide valuable insights into the importance of rural service infrastructure for economic development. Their findings also underline the importance of comprehensive, rather than piecemeal, planning in order to provide a complete array of services required, including agricultural research and extension, input and output marketing, transport, credit and communications. All of these will be necessary to establish a firm basis for regional growth and development. However, that comprehensive planning does not imply uniform policies for a region, but instead is cognizant of the differing needs of the centre and periphery, with a long-term view towards greater regional integration and development than in the past.

Conclusion

A successful rural infrastructural development plan integrates the multiple objectives of various sectoral polices related to agricultural and economic growth, food security, poverty alleviation and human development. As such, it can neither be neglected, nor be subsumed under these sectoral policies, as is so often the case. With respect to the agricultural sector, addressing only one type of infrastructure, such as fertilizer distribution, while neglecting others, is unlikely to yield the desired outcome of facilitating overall development of smallholder agriculture.

Another problem relating to the agricultural sector is the formulation of uniform or single policies for an entire region. The centre-periphery perspective is valid in many rural areas of developing countries and calls for a greater awareness of differences between centre and periphery regions. Improvements in the agricultural sector and strengthening the links between agriculture and other rural activities can only come about with a concomitant increase in both hard and soft infrastructure.