These types of investment not only have a large impact on poverty reduction for each additional rupee spent, but they also give rise to the greatest growth in agricultural productivity. Better roads bring new sources of employment, and they enable goods to move to and from markets with greater ease. Additional government spending on irrigation and rural electrification will have little or no effect on either poverty or growth at this point in time. While these investments were essential in the past for agricultural growth, today only enough should be invested to maintain current levels of irrigation and power. Therefore, it contributes little to solving the poverty problem in the long run.
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