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Synopsis Basically India is an agricultural country and agricultural growth has direct impact on poverty alleviation and country’s prosperity. As such India is mainly dependent on integration of its agriculture with industry. After Independence, the role and importance of rural agro-based industries as well as development of infrastructure facilities in the economic upliftment of the rural people has been recognized. Agro-based industries help to improve the state income and facilitating an equitable distribution of the same among different sectors and regions in e4conomy. Furthermore, they help to promote decentralization of development in the economy. Large-scale employment opportunities are generated by these industries on one hand, and on the other contribute enormously to the process of self sustained growth. Agro-based industries are instrumental in harnessing the dormant potentials of agriculture and industry and through their mutual integration, they accelerate the pace of rural development. In the present study, an attempt has been made to analyze the importance of agro-based industries in the rural economy.