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It’s difficult to make sense of what’s happening in the rural economy.
On the one hand, leading economic indicators suggest a recovery is underway. As Chart 1 shows, unemployment is down and real wage growth is up. Two-wheeler sales are also up — suggesting a recovery in household demand. Yet, rural sentiment has weakened of late as shown in Chart 2.
What explains this dichotomy?
One possible explanation rests on the diverging fortunes of the landed and the landless, says a report by HSBC Global Research. The report classifies landless households as those owning less than one hectare of land,
