Rural areas are also known as the 'countryside' or a 'village' in India. It has a very low population density. In rural areas, agriculture is the chief source of livelihood along with fishing, cottage industries, pottery etc.
The quest to discover the real rural India still continues in great earnest. Almost every economic agency today has a definition of rural India. Here are a few definitions: According to the Planning Commission, a town with a maximum population of 15,000 is considered rural in nature. In these areas the panchayat makes all the decisions. There are five people in the panchayat. The National Sample Survey Organization (NSSO) defines ‘rural’ as follows:
An area with a population density of up to 400 per square kilometer,
Villages with clear surveyed boundaries but no municipal board,
A minimum of 75% of male working population involved in agriculture and allied activities.
RBI defines rural areas as those areas with a population of less than 49,000 (tier -3 to tier-6 cities).
It is generally said that the rural areas house up to 70% of India's population. Rural India contributes a large chunk to India's GDP by way of agriculture, self-employment, services, construction etc. As per a strict measure used by the National Sample Survey in its 63rd round, called monthly per capita expenditure, rural expenditure accounts for 55% of total national monthly expenditure. The rural population currently accounts for one-third of the total Indian FMCG sales.