Rural economic growth is essential. While generally economic growth is the best broader strategy to reduce rural poverty and develop the rural sector, economic growth within the rural economy is also the best strategy to promote rural development and reduce potential for major disparity between the urban and rural sectors, regions and in the rural economy.
The basic objective of all rural development programmes has been the welfare of the millions.
The concept of rural development has changed significantly during the last 3 decades (Harris. 1982; Chambers. 1983; ADB. 2000).
Until the 1970s, rural development was impossible to tell apart with agricultural development and therefore, focused on increasing agricultural production.
Inclusive rural development is a more specific concept than the concept of rural development.
In broad terms, inclusive rural development is about improving the quality of life of all members of rural society.
The fundamental importance of infrastructure in rural development cannot be underestimated (ADB, et al. 2005c; Cook et al. 2005).
There are clear cross-country differences in the level and quality of rural development between those that developed rural infrastructure and those that neglected to do so.
Similar distinction in rural development also exist within countries. Jalan and Ravallion (Jalan and Ravallion. 2002) noted that the differences in rural infrastructure across counties have strong explanatory power for subsequent consumption growth at the farm household level in rural China.
The impact of high quality rural infrastructure on the quality of life of the rural population can be significant. Infrastructure contributes to inclusive rural development in many different ways.
First, rural infrastructure provides rural people with access to the markets and basic services that they need. Second, it influences rural economic growth and employment opportunities and thereby incomes and social development (ADB et al. 2005c).
The Republic of Korea, Taipei, China, Malaysia, and Vietnam, which recognized the broader and vital importance of rural infrastructure for long-term overall economic development, poverty reduction, and inclusive rural development, correctly and wisely considered it mainly as a public good.
This recognition has been crucial in sustaining their commitment to develop rural infrastructure primarily through public investments. Inclusive rural development, or a lack of it, is closely linked to institutions (ADB, et al. 2005c; Acemoglu. 2003; North. 1991).
Countries with effective institutions have not only achieved faster growth in rural areas but have also allowed greater opportunities for the majority of the rural population to benefit from that growth.
A failure to develop a dynamic rural nonfarm economy has some major indirect consequences on inclusive rural development.
To make rural economy more dynamic, the rural nonfarm economy should be integrated with the expanding urban and global markets.
There are few condition need to be fulfil to inclusive rural development. Access to adequate health services must be provided for the rural population, particularly to the low-income households.