Poverty reduction has been one of the major goals of development planning since independence and the planning process has been sensitive to the needs of the poor. Accordingly the development efforts have been directed in creating adequate livelihoods and provision of services for the better quality life of the poor. However, the poverty estimates as per methodology suggested by Tendulkar Committee put 41.8% of rural population below the poverty line which indicates the concerted efforts are needed to alleviate poverty in the rural development areas.
The Census of 2011 estimates that 833 million people continue to live in rural India. Approach to Twelfth Five Year Plan, therefore, emphasizes on the expansion of income opportunities in the farm sector and a progressive absorption into non-agricultural activity as one of the most potent weapons for reducing poverty in rural development areas. Thus, development and transformation of the rural economy require rapid expansion of employment and income opportunities, both on the farm and off farm along with improvements in health, education and skill development.