The correct answer is option 'C', the Great Leap Forward.

The Great Leap Forward was a policy implemented in China from 1958 to 1961 under the leadership of Mao Zedong. It aimed to rapidly transform China from an agrarian economy into a socialist industrialized state. The policy had two main components: the establishment of rural communes and a crash program of village industrialization.

1. Establishment of Rural Communes:
The Great Leap Forward aimed to organize peasants into large collective farms known as communes. The communes were intended to facilitate the process of agricultural collectivization and increase agricultural productivity. Under this policy, individual farming households were merged into larger units, where land, labor, and other resources were pooled together. Communes consisted of thousands of households and were responsible for agricultural production, industrial activities, and social services.

2. Crash Program of Village Industrialization:
In addition to the establishment of rural communes, the Great Leap Forward also emphasized the development of small-scale industries in rural areas. The policy encouraged the establishment of backyard steel furnaces, small-scale factories, and rural workshops to accelerate industrial production. The idea was to utilize the labor force in the countryside and promote self-sufficiency in industrial production. However, these backyard industries often lacked the necessary expertise, equipment, and infrastructure, resulting in low-quality products and inefficiencies.

The Great Leap Forward had ambitious goals of rapidly transforming China's economy and catapulting it into the ranks of industrialized nations. However, the policy ultimately led to disastrous consequences. The emphasis on quantity over quality and the lack of technical expertise resulted in widespread inefficiencies and a decline in agricultural productivity. The backyard steel furnaces, in particular, produced low-quality steel that was unfit for use, wasting valuable resources and labor.

The policy also led to a severe famine known as the Great Chinese Famine, which resulted in the deaths of millions of people due to starvation and malnutrition. The focus on communal living and the excessive demands placed on peasants by the state led to the misallocation of resources and a breakdown in agricultural production.

In summary, the Great Leap Forward aimed to combine the establishment of rural communes with a crash program of village industrialization. However, the policy ultimately led to disastrous consequences, including a decline in agricultural productivity, inefficient industrial production, and a severe famine.