The Ministry of Rural Development aims to improve the quality of life in rural areas of the country and acts as the nodal agency for most development and welfare activities in rural India.[1]  The Ministry comprises of two Departments, the Department of Rural Development and the Department of Land Resources. The Department of Rural Development works to enhance employment opportunities, ensure social security for the vulnerable, and facilitate infrastructure development for economic growth in rural areas.¹  The Department of Land Resources works to ensure sustainable development of rainfed cultivable and degraded lands, and optimise the use of land resources in the country.[2]

This note looks at the proposed expenditure for the Ministry for 2024-25 and trends in budgeting over the years.  It also analyses broader trends in the sector and challenges faced by the Ministry in implementing its programmes.

Union Budget Highlights 2024-25

In 2024-25, the Ministry of Rural Development has been allocated Rs 1,80,233 crore.[3]^,[4]  The Department of Rural Development has been allocated Rs 1,77,566 crore, 4% higher than the revised estimates of 2023-24.  The Department of Land Resources has been allocated Rs 2,667 crore, which is a 41% increase over the revised estimates of 2023-24.

Table 1: Budgetary Allocation to the Ministry of Rural Development (in Rs crore)

Department	22-23 Actuals	23-24 RE	24-25 BE	% Change*
Rural Development	1,76,837	1,71,069	1,77,566	4%
Land Resources	1,002	1,898	2,667	41%
Total	1,77,839	1,72,967	1,80,233	4%

Note: BE is budget estimate and RE is revised estimate.
*% change is change in 2024-25 BE over 2023-24 RE.
Sources: Demands for Grants of the Ministry of Rural Development 2024-25; PRS.

Budget Highlights[5] Three crore houses will be provided under the PM Awas Yojana in rural and urban areas. Phase-IV of the Pradhan Mantri Gram Sadak Yojana will be launched to provide all-weather road connectivity to 25.000 rural habitations. Unique land parcel identification number (ULPIN) will be assigned for all lands in rural areas.  Initiatives will be taken for establishment of land registry and linking it to farmers registry.

State of the rural economy

As of 2021, 65% of India’s population lives in rural areas, and 47% of the people depend on agriculture for livelihood.[6]  In 2023-24, rural areas of the country experienced higher retail inflation compared to urban areas and agriculture sector saw a decline in growth.[7]^,[8]

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