The rural nonagricultural/nonfarm sector (RNFS)—which provides employment opportunities for a vast number of people in the global peripheries–is an important arena for policies related to alternative strategies for rural development. The existing literature suggests RNFS as an alternative rural economic sector for employment generation and better wage opportunities that leads to empowerment of the rural workforce. This paper argues instead, that unlike what the present literature suggests, the development of the RNFS in countries like India is essentially the development of market relations, including capitalist market relations, in rural areas, but outside the agricultural sector. The promotion of the RNFS coincides with strategies of promoting an export oriented-flexible mode of capitalist production as part of global neoliberal structural adjustment programs. This paper is based on a study of the export oriented coir industry – an important form of rural nonfarm activity– in Kerala, India. Based on the study of the coir industry, this research adds new insights on how contemporary flexible capitalism re-creates the logic of classical capital-labor relations– through class, gender and caste differentiation– to realize its profit accumulation goals.

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