Structural change is depicted by growth in the gross domestic product (GDP), increase in the share of non-agricultural income and employment, and increase in wage rates and overall productivity. It is accompanied by population growth, changes in the demographic structure, including ruralurban population distribution, rising education levels, and developments in the communications sector that increase the exposure to the outside world. Rural economic transition is associated with urban centres growing and engulfing surrounding rural areas.
In the countryside, the demographic changes exert pressure on arable land, common land and water resources. Changes in the production technology along with mechanisation of agricultural occupations release the labour hitherto engaged in primary activities for work outside the agriculture sector. Such a shift towards non-farm activities has been the central feature of the social and economic change in recent decades. Thus, structural transformation is marked by an increase in overall GDP and per capita incomes, enabled by the shift towards sectors with higher productivity and greater urbanisation, with reduction in the proportion of the population residing in rural areas.
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