role of indian agriculture

8/8/2019 Role of Indian Agriculture

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ROLE OFROLE OF

AGRICULTURE INAGRICULTURE IN

INDIAN ECONOMYINDIAN ECONOMY

SECTION DSECTION DVSHALVAIBVSHALVAIB

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1


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ROLE OF AGRICULTUREROLE OF AGRICULTURE

IN INDIAN ECONOMYIN INDIAN ECONOMYyy Submitted To:Submitted To:

Dr. Tapan Kumar NayakDr. Tapan Kumar Nayak

Prof . Sanjay Kumar ManglaProf . Sanjay Kumar Mangla

yy Submitted By:Submitted By:

Shivi Bindra BMShivi Bindra BM--

0919809198

Shobhit Jaiswal BMShobhit Jaiswal BM--0919909199

Tanushree Das BMTanushree Das BM--0922409224

Vaibhav Jain BMVaibhav Jain BM--0923009230

Vijay Kumar Barma BMVijay Kumar Barma BM--0923409234

Priyanka Sharma BMPriyanka Sharma BM--092400924010/26/20102


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INDEXINDEX

yy AbstractAbstract

yy IntroductionIntroduction

yy JustificationJustification

yy ObjectivesObjectives

yy Literature ReviewLiterature Review

yy Role of AgricultureRole of Agriculture

yy Cropping Pattern inCropping Pattern inIndiaIndia

yy Indias AgriculturalIndias AgriculturalDevelopment StrategyDevelopment Strategy

yy Agricultural ProductivityAgricultural Productivityin Indiain India

yy Low Productivity CausesLow Productivity Causes

yy Increasing AgriculturalIncreasing AgriculturalProductivityProductivity

yy Agricultural MarketingAgricultural Marketing

yy Agricultural Pricing PolicyAgricultural Pricing Policy

yy SummarySummary10/26/20103


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ABSTRACTABSTRACT

yy Indian agriculture is at crossroads and one of theIndian agriculture is at crossroads and one of themajor challenges is to reverse deceleration inmajor challenges is to reverse deceleration in

agricultural growth. Main reason for deceleration inagricultural growth. Main reason for deceleration inagricultural growth is:agricultural growth is:

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y Declining investment particularly public investmentin agriculture research and development and

irrigation, combined with inefficiency of institutionsproviding inputs and services including rural creditand extension.


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ABSTRACT(contd..)ABSTRACT(contd..)

yy Other factors such as:Other factors such as:

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yy Land FragmentationLand Fragmentation

yy OutOut--dated tenancy laws,dated tenancy laws,

yy Lack of Modern Market and Rural Infrastructure,Lack of Modern Market and Rural Infrastructure,

yy Inappropriate input pricing policies, etc.Inappropriate input pricing policies, etc.


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INTRODUCTIONINTRODUCTION

yy Agriculture is said to be the BACK BONE of IndianAgriculture is said to be the BACK BONE of IndianEconomy and supporting it, it provides livelihoodEconomy and supporting it, it provides livelihood

to about oneto about one--third of the Indian population.third of the Indian population.

yy It contributes about oneIt contributes about one--third of gross value addedthird of gross value addedin India, the single largest contributor to the GDP.in India, the single largest contributor to the GDP.

yy

Approx 43% ofI

ndias land is used for AgriculturalApprox 43% ofI

ndias land is used for Agriculturalpurposes. Its role in economic development apart, itpurposes. Its role in economic development apart, itis a way of life and, therefore, in its developmentis a way of life and, therefore, in its developmentlays the general well being of the people.lays the general well being of the people.

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JUSTIFICATIONJUSTIFICATION

yy The sensex and certain sectors of the economy haveThe sensex and certain sectors of the economy haveseen unprecedented growth, but yet the mostseen unprecedented growth, but yet the most

important sector to the country which shapes theimportant sector to the country which shapes thebackbone of Indian Economy has been laggingbackbone of Indian Economy has been laggingbehind.behind.

yy With more than half the population in the countryWith more than half the population in the country

still associated with agriculture, urgent reformsstill associated with agriculture, urgent reformsneed to be made so that this sector in itself can growneed to be made so that this sector in itself can growrapidly.rapidly.

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JUSTIFICATION(contd..)JUSTIFICATION(contd..)

yy Contributing to almost one fourth of the nations grossContributing to almost one fourth of the nations grossdomestic product (GDP), it provides employment todomestic product (GDP), it provides employment tomillions of people living in the rural areas.millions of people living in the rural areas.

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y With the tremendous increase in population, the landholdings of farmers have shrunk to abysmal levels. Thefarmers themselves have become grossly indebted and ifthe rains are not on their side and the crop fails, then they

are often staring at unemployment and mere survival.


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OBJECTIVEOBJECTIVE

yy Summarizing Indian Agriculture in papers is verySummarizing Indian Agriculture in papers is verytough task. In this report we will be generallytough task. In this report we will be generallyfocusing on:focusing on:

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Role of Agriculture,Role of Agriculture,

Cropping Pattern in India,Cropping Pattern in India,

Indias Agricultural development Strategy,Indias Agricultural development Strategy,

Agricultural Productivity in India,Agricultural Productivity in India,

Causes of Low Productivity,Causes of Low Productivity,

Agricultural MarketingAgricultural Marketing

Agricultural PolicyAgricultural Policy


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LITERTURE REVIEWLITERTURE REVIEW

yy Efficiency measurements have been attempted in IndianEfficiency measurements have been attempted in Indianagriculture since 1970s. Efficiency has been measured andagriculture since 1970s. Efficiency has been measured anddecomposed in two various components using bothdecomposed in two various components using both

parametric as well as nonparametric as well as non--parametric methods. The twoparametric methods. The twoprinciple methods that have been employed to analyze theprinciple methods that have been employed to analyze theefficiency are :efficiency are :

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yy Data Development AnalysisData Development Analysis

yy Stochastic Frontier Analysis also known as SFA.Stochastic Frontier Analysis also known as SFA.


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y Kaliranjan (1981), points outthat giventhesameaccesstoinput, theresponsiveness of thesmall farmersto economicopportunitiesisthesameasthecase withthelarge farmers.Hisstudy is based on 70 farmers from Coimbatore districtinthestate of Tamil Nadu.

y Batteseand Coelli (1995), performed astochastic frontieranalysis usinga panel data for 10 years. They documented

thatschoolingincreaseefficiency whiletheage decreasesit.

y Tedeseand Krishnamurthy(1997), suggestsamethodology toobtaineconomicefficiency of firms usingreturnsto scale.He documentsthathalf of thericesample farmersinKarnatakaareeconomically efficient.


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ROLE OF AGRICULTUREROLE OF AGRICULTURE

yy IndiaIndia isis aa predominantpredominant agriculturalagricultural country,country, thethe statisticsstatistics showsshows thatthat

predominancepredominance continuedcontinued overover aa centurycentury.. InIn termsterms ofof percentagepercentage

sharesshares therethere occursoccurs aa marginalmarginal downwarddownward shiftshift fromfrom 7676%% toto 6262%% inin

thethe populationpopulation dependingdepending onon agricultureagriculture.. ThoughThough inin termsterms ofof thethe

peoplepeople whowho dependsdepends onon agricultureagriculture therethere isis aa bigbig increaseincrease whichwhich

havehave affectedaffected thethe availabilityavailability ofof landland perper capitacapita.. ItIt alsoalso contributescontributes

aroundaround 2929%% ofof GDPGDP..

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Contribution to National IncomeContribution to National Income::

yy Today Agriculture contributes a major part ofToday Agriculture contributes a major part ofNational Income in India. As according to theNational Income in India. As according to the

distribution of National Income by industrial origindistribution of National Income by industrial originfor the period 1950for the period 1950--51 to 197951 to 1979--80 clearly shows80 clearly showsaround 40% share of various agriculturalaround 40% share of various agriculturalcommodities, ancillary activities and animalcommodities, ancillary activities and animalhusbandry.husbandry. During the fifties, it contributed aroundDuring the fifties, it contributed around

half of the National outputhalf of the National output. Though there occurs fall. Though there occurs fallin eighties and nineties which now stood to 25% inin eighties and nineties which now stood to 25% in20022002--03 but still it maintains good share in the03 but still it maintains good share in thenational income.national income.

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Major source of LivelihoodMajor source of Livelihood::

yy If six out of ten peoples in any country depends onIf six out of ten peoples in any country depends onAgriculture then dont we say that country asAgriculture then dont we say that country asAGRICULTURAL COUNTRY, this is what is theAGRICULTURAL COUNTRY, this is what is theratio in India in dependency on Agriculture.ratio in India in dependency on Agriculture.

yy Over the years 1921Over the years 1921--2001, the size of labor force2001, the size of labor forcedependent on agriculture had face a drastic changedependent on agriculture had face a drastic changeand it had been doubled during this period.and it had been doubled during this period.

yy This sector is plagued by underemployment,This sector is plagued by underemployment,disguised unemployment and low productivitydisguised unemployment and low productivityemployment.employment.

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Provider of EmploymentProvider of Employment::

yy Majority of the Indian masses has beenMajority of the Indian masses has beenoverwhelmed by the work and being providedoverwhelmed by the work and being provided

employment because of the Agriculture.employment because of the Agriculture.

yy About 70% peoples in rural areas earn theirAbout 70% peoples in rural areas earn theirlivelihood from cultivation and allied agrolivelihood from cultivation and allied agro--industries.industries.

yy In 1995, agriculture provided employment toIn 1995, agriculture provided employment toaround 97 million persons, which now is increasedaround 97 million persons, which now is increasedto 235 million.to 235 million.

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Industrial DevelopmentIndustrial Development::

yy Agriculture has big role in the development of theAgriculture has big role in the development of theindustries specially the agroindustries specially the agro--based industries such asbased industries such astextiles, sugar, tea, and paper.textiles, sugar, tea, and paper.

yy We have various other industries like handloomWe have various other industries like handloomweaving and other cottage industries, which alsoweaving and other cottage industries, which alsodepends for input from agriculture. The prosperity ofdepends for input from agriculture. The prosperity ofthese agrothese agro--based industries directly depends onbased industries directly depends onavailability of inputs from agricultural sectors.availability of inputs from agricultural sectors.

yy There also lies links or dependency between prosperityThere also lies links or dependency between prosperityof industries and agricultural prosperity that demand forof industries and agricultural prosperity that demand forindustrial products, depends upon the income of theindustrial products, depends upon the income of thefarmers, which in turn depends upon agriculturalfarmers, which in turn depends upon agricultural

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International TradeInternational Trade::

yy Indian agriculture plays a significant role in theIndian agriculture plays a significant role in thecountrys International trade.countrys International trade.

yy Countrys foreign trade especially in the export ofCountrys foreign trade especially in the export oftraditional commodities like jute, tea, tobacco andtraditional commodities like jute, tea, tobacco andcoffee depends a great deal on supplies ofcoffee depends a great deal on supplies ofagricultural sector.agricultural sector.

yyWhen crop failure occurs the country becomes a netWhen crop failure occurs the country becomes a netimporter of food grains. Therefore, the balance ofimporter of food grains. Therefore, the balance oftrade in the country is affected a great deal by thetrade in the country is affected a great deal by theperformance of this sector.performance of this sector.

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Capital Formation & InvestmentCapital Formation & Investment::

yy Agricultural assets like land, irrigation facilities, tractors,Agricultural assets like land, irrigation facilities, tractors,agriculture implements; ploughs, pump sets andagriculture implements; ploughs, pump sets andstorages are the major part of production assets of thestorages are the major part of production assets of the

country. Government revenues also depend a great dealcountry. Government revenues also depend a great dealon agricultural prosperity. The direct contribution ofon agricultural prosperity. The direct contribution ofagricultural taxes to the revenues of the centre and theagricultural taxes to the revenues of the centre and thestates is not significant but indirectly the agriculturestates is not significant but indirectly the agriculturethrough its effect on the whole economy of the countrythrough its effect on the whole economy of the country

has a considerable influence on the revenues of thehas a considerable influence on the revenues of thecentral and state government. Since agriculturalcentral and state government. Since agriculturalcontributes about 25% of the national income, this sectorcontributes about 25% of the national income, this sectoris the primary source of savings and hence capitalis the primary source of savings and hence capitalformation for the economy.formation for the economy.

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Food & FodderFood & Fodder::yy In India, agricultureIn India, agriculture

basically meets almost allbasically meets almost allthe food requirements ofthe food requirements ofthe people. In order tothe people. In order to

sustain the livestock,sustain the livestock,fodder is also beingfodder is also beingprovided by the agricultureprovided by the agriculturewhose number runs towhose number runs toseveral crores.several crores.

IncomeIncome::

yy On account of agriculturalOn account of agriculturalpredominance the incomepredominance the incomeof large majority of peopleof large majority of peopledepends on agriculturaldepends on agricultural

production. Indirectly, aproduction. Indirectly, aconsiderable part of tradeconsiderable part of tradeand commerce depends onand commerce depends onagricultural production.agricultural production.With low income ofWith low income ofagricultural workers thereagricultural workers thereis demand recession in theis demand recession in thewhole economy, whichwhole economy, whichaffects other sectors as well.affects other sectors as well.

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Cost of LivingCost of Living::

yy CostCost ofof livingliving ofof peoplepeople inincountrycountry isis greatlygreatly affectedaffectedwithwith agriculturalagricultural

prosperityprosperity.. AgricultureAgriculture isisknownknown asas GAMBLEGAMBLE ININRAINSRAINS becausebecause ofofuncertaintyuncertainty ofof thethemonsoonsmonsoons.. InIn drought,drought,

availabilityavailability ofof foodfood grainsgrainsisis directlydirectly affectedaffected whichwhichleadsleads toto riserise inin foodfood graingrainpricesprices..

Economy PlanningEconomy Planning::

yy Importance of agriculture inImportance of agriculture inthe National Economy can bethe National Economy can beillustrated by many facts, as itillustrated by many facts, as itis the backbone of the Indianis the backbone of the Indian

economy.economy.

yy For example, agriculture is theFor example, agriculture is themain support for Indiasmain support for Indiastransport system, sincetransport system, sincerailways and roadways securerailways and roadways secure

bulk of their business from thebulk of their business from themovement of business.movement of business.Agriculture growth has directAgriculture growth has directimpact on poverty eradication.impact on poverty eradication.

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Per Capita RatioPer Capita Ratio::

yy AgricultureAgriculture hashas lowlow capitalcapital outputoutput ratioratio..

yy ItIt meansmeans itit requiresrequires lesserlesser capitacapita perper unitunit ofof outputoutput producedproduced

comparedcompared withwith thethe industriesindustries andand thereforetherefore aa capitalcapital poorpooreconomyeconomy hashas toto placeplace reliancereliance onon developmentdevelopment ofof agricultureagriculturewhichwhich wouldwould increaseincrease employmentemployment withwith thethe increaseincrease ininproductionproduction inin thethe ruralrural areasareas..

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Impact on RevenueImpact on Revenue::

yy GovernmentGovernment revenuesrevenues alsoalsodependsdepends aa greatgreat dealdeal ononagriculturalagricultural prosperityprosperity.. TheThe

directdirect contributioncontribution ofofagriculturalagricultural taxestaxes toto thetherevenuesrevenues ofof thethe centrecentre andandthethe statesstates isis notnot significantsignificantbutbut indirectlyindirectly agricultureagriculturethroughthrough itsits effecteffect onon thethe

wholewhole economyeconomy ofof thethecountrycountry hashas aa considerableconsiderableinfluenceinfluence onon thethe revenuesrevenuesofof CentralCentral StateStategovernmentgovernment..

ProblemProblem::

yy TrendTrend ofof migrationmigration fromfromRuralRural toto UrbanUrban areasareas hashascreatedcreated aa dualdual problemproblem..

OnOn thethe oneone hand,hand,

ItIt hashas depriveddeprived ruralrural areasareasofof skilledskilled andand educatededucatedpersonspersons andand onon otherother

hand,hand,

HasHas createdcreated problemproblem ofofUrbanUrban CongestionCongestion..

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CROPPING PATTERN INCROPPING PATTERN IN

INDIAINDIA


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Cropping activities go on all the year-

round in India, provided water is

available for irrigation

A broad picture of the major croppingpatterns in India can be presented by

taking the major crops into

consideration.

CROPPING PATTERNCROPPING PATTERN


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To begin with, the south-westerly

monsoon crops (KHARIF), bajra, maize,

ragi, groundnut and cotton.

Among the post-monsoon crops (RABI),wheat, gram etc can also be considered

to be the base crops for describing the

cropping patterns.

CROPPING PATTERNCROPPING PATTERN


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Thelandmaybeoccupiedbyonecropsduringone

season (mono-cropping),orbytwocrops (double-

cropping)whichmaybegrowninayearinsequence.Oflate,thetrendisevenmorethantwocrops

(multiple-cropping)inayear.

Inany locality,theprevalentcroppingsystemsarethecumulativeresultsofpastandpresent

decisionsbyindividuals,communitiesor

governmentsandtheiragencies. These

decisionsareusuallybasedonexperience,tradition,expectedprofit,personalpreferences

andresources,socialandpoliticalpressures

etc.


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INDIAs AGRICULTURALINDIAs AGRICULTURALDEVELOPMENT STRATEGYDEVELOPMENT STRATEGY


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Fertilizer is a necessary input for increasingFertilizer is a necessary input for increasingagriculture productivity. The most commonly usedagriculture productivity. The most commonly usedfertilizer in India is manure which is preparedfertilizer in India is manure which is preparedfrom cow dung and other waste products.from cow dung and other waste products.

Fertilizers are classified into 3Fertilizers are classified into 3categories:nitrogenous,phosphatic and potash.categories:nitrogenous,phosphatic and potash.These fertilizer are useful in two ways.These fertilizer are useful in two ways.

first, they are useful in raising productivityfirst, they are useful in raising productivityof landof land

second, they are useful in restoring fertility ofsecond, they are useful in restoring fertility offallow land.fallow land.

Useoffertilizer


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Use of human labourUse of human labour

yy Human labour play an important role inHuman labour play an important role inagriculture production.In developed region,theagriculture production.In developed region,theuse of human labour was comparatively lessuse of human labour was comparatively lessthan that in less development region but thethan that in less development region but thepeculiarity of this type of household was thatpeculiarity of this type of household was thatmostmost

of the labour family.of the labour family.

yy Human labour is substitute by machineHuman labour is substitute by machine

labour. The maximum human labour waslabour. The maximum human labour wasused in the case of Landlabour linkage.used in the case of Landlabour linkage.


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Extensive cultivationExtensive cultivation

Extensive cultivation means increasing theExtensive cultivation means increasing thetotal area under cultivation.The total areatotal area under cultivation.The total areaunder crop can be increased by bringingunder crop can be increased by bringingunder cultivation,cultivable land which wasunder cultivation,cultivable land which waslying waste or making uncultivable landlying waste or making uncultivable land

suitable for growing crops throughsuitable for growing crops throughagriculture reaserch.agriculture reaserch.


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Intensive cultivationIntensive cultivation

Intensive cultivation implies growing more on the samearea.

Howcanthisbedone? Thiscanbedonethrough

Theuseofbetterandmodernmethodofcultivation,

useofbetterquality,seeds,fertilizer,pesticides,proper

irrigationfacilities. Inotherwordbyusingbetter

inputwecangrowmoreonthesamepieceoflandForex- thetraditionalmethodofcultivationinvolves

Growingasinglecropandthenleavingthelandfallow

Fortherestoftheyeartorestoreitsfertility.


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Strategy to improveStrategy to improve

product qualityproduct quality


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SeedsSeeds

Good quality seed is an important factor inGood quality seed is an important factor inagriculture productivity. The use of good qualityagriculture productivity. The use of good qualityseeds leads to higher land productivity. However, itseeds leads to higher land productivity. However, it

is seen that many farmers are not in a position to useis seen that many farmers are not in a position to usegood quality seeds due to many reasons.good quality seeds due to many reasons.

(a)(a) FarmersFarmers dodo notnot havehave enoughenough resourcesresources totopurchasepurchase thesethese seedsseeds..

(b)(b) FarmersFarmers areare unwillingunwilling toto acceptaccept thethe HYV(highHYV(high

yieldingyielding variety)variety) seedsseeds..


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More than5%

of the crop inI

ndia is damaged byMore than5%

of the crop inI

ndia is damaged bypests,insects and also weeds. It because of thepests,insects and also weeds. It because of thelack of use of pesticides. However, we must notlack of use of pesticides. However, we must notmake indiscriminate use of toxic pesticides asmake indiscriminate use of toxic pesticides asthey can have an adverse effect not only onthey can have an adverse effect not only onhuman health but can also lead to environmentalhuman health but can also lead to environmentaldegradation through soil,water and air pollution.degradation through soil,water and air pollution.

pesticides


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AGRICULTUREAGRICULTURE

PRODUCTIVITY IN INDIAPRODUCTIVITY IN INDIA


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o Productivity per worker engaged in Agricultural operation.

yy Indias agricultural sector faces number of problems. The very andIndias agricultural sector faces number of problems. The very and

most prominent agricultural problem is LOW PRODUCTION andmost prominent agricultural problem is LOW PRODUCTION and

LOW PRODUCTIVITY. The agricultural productivity is relativelyLOW PRODUCTIVITY. The agricultural productivity is relatively

low in India as compared to other countries.low in India as compared to other countries.

yy It can be measured in two ways:It can be measured in two ways:

o Productivity per Unit of land.

AGRICULTURE PRODUCTIVITY ININDIA


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Productivity per worker engagedProductivity per worker engaged

InIn Agriculture,Agriculture, productivityproductivity perper workerworker isis 11//33 ofof thetheproductivityproductivity perper workerworker inin largelarge industrialindustrial establishmentsestablishments..

SimilarSimilar toto this,this, capitalcapital intensityintensity perper workerworker isis lowerlower ininAgricultureAgriculture asas comparedcompared toto otherother sectorssectors..

AgriculturalAgricultural productivityproductivity perper workerworker variesvaries aa greatgreat dealdeal inindifferentdifferent regionregion ofof thethe countrycountry..

TheThe AgriculturalAgricultural productivityproductivity perper workerworker cancan bebe increasedincreased ififthethe workersworkers areare ableable toto dodo hardhard workwork.. AlsoAlso thethe croppingcroppingpatternpattern andand alsoalso thethe productivityproductivity ofof landland onon whichwhich workersworkersoperatesoperates mattersmatters aa lotlot inin thisthis regardregard..


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Productivity of LandProductivity of Land

ItIt meansmeans YIELD/HECTAREYIELD/HECTARE ofof landland..

IndexIndex numbernumber ofof yield/hectareyield/hectare ofof landland hashas gonegone upup fromfrom 9292..66 inin19701970--7171 toto 103103 inin 19851985--8686 andand toto 154154..55 inin 19961996--9797 andand fellfell toto 149149 inin

19991999--20002000..

IfIf wewe talktalk aboutabout thethe planningplanning period,period, thethe firstfirst twotwo plansplans hadhad

continuouscontinuous growthgrowth ofof agriculturalagricultural productivityproductivity whichwhich tormentedtormentedinin IIIIII planplan..


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Productivity of Land(contd..)Productivity of Land(contd..)

AfterAfter that,that, thethe newnew agriculturalagricultural strategystrategy camecame inin whichwhich

yield/hectareyield/hectare beganbegan toto increaseincrease..

TheThe productivityproductivity ofof landland isis improvingimproving andand infactinfact averageaverageyield/hectareyield/hectare inin IndiaIndia isis muchmuch belowbelow thethe worldsworlds averageaverage inin allall

cropscrops..

GreenGreen RevolutionRevolution hashas helpedhelped inin improvingimproving IndianIndian agricultureagriculture

productionproduction..

ByBy adoptionadoption ofof properproper strategies,strategies, itit hashas pushedpushed upup thethe levellevel ofof

ProductivityProductivity..


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LOW AGRICULTURALLOW AGRICULTURAL

PRODUCTIVITY IN INDIAPRODUCTIVITY IN INDIA


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CAUSES OF LOWCAUSES OF LOWAGRICULTURAL PRODUCTIVITYAGRICULTURAL PRODUCTIVITY

Pressure of populationPressure of population::

CountrysCountrys populationpopulation isis muchmuch greatergreater thanthan itsits shareshare inin thethe landland ofof thethe

worldworld..

WithWith greatergreater pressurepressure onon existingexisting land,land, thethe prospectsprospects ofof improvementimprovement inin

landland areare reducedreduced partlypartly becausebecause ofof lowlow perper capitacapita savingsaving andand investmentinvestment

andand existingexisting lowlow levellevel ofof investmentinvestment inin landland..

AllAll thesethese factorsfactors affectaffect ProductivityProductivity..


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CAUSES OF LOW AGRICULTURALCAUSES OF LOW AGRICULTURALPRODUCTIVITY(contd..)PRODUCTIVITY(contd..)

Size of HoldingsSize of Holdings::

TheThe sizesize ofof holdingsholdings areare small,small, scatteredscattered andand fragmentedfragmented..

NonNon--availabilityavailability ofof irrigationirrigation facilitiesfacilities andand poorpoor rainfallrainfall..

DueDue toto increaseincrease inin Population,Population, sizesize ofof familiesfamilies areare increasingincreasing andand nono

increaseincrease inin thethe availabilityavailability ofof cultivablecultivable landland..

AllAll thesethese proveprove aa bigbig handicaphandicap forfor improvingimproving agriculturalagricultural productivityproductivity..


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Nature of SoilNature of Soil::

TwoTwo--thirdthird ofof landland dependsdepends onon rainrain..I

nadequateI

nadequate rainfallrainfall affectsaffects thethesoilsoil productivityproductivity..

CroppingCropping continuouslycontinuously withoutwithout replenishingreplenishing ofof lostlost fertilityfertility leadsleads toto

depletiondepletion ofof conditioncondition ofof soilsoil..

TheseThese allall involvesinvolves bigbig expenditureexpenditure beyondbeyond thethe meansmeans ofof commoncommon

farmersfarmers..


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Lack of Irrigation facilitiesLack of Irrigation facilities::

IfIf wewe seesee thethe areaarea underunder irrigation,irrigation, onlyonly oneone--thirdthird ofof totaltotal

cultivatedcultivated areaarea isis providedprovided withwith irrigationirrigation facilitiesfacilities andand thethe restrest

ofof thethe areaarea hashas toto dependdepend onon rainfallrainfall..

InIn Irrigation,Irrigation, optimumoptimum useuse ofof waterwater isis notnot mademade onon accountaccount ofof

nonnon--availabilityavailability ofof suitablesuitable waterwater channelschannels etcetc..

ThisThis allall leadsleads toto thethe lowlow--productivityproductivity inin agricultureagriculture..


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Use of ManuresUse of Manures::

WastageWastage ofof organicorganic manuresmanures inin thethe ruralrural areasareas andand urbanurban wastewaste inin

citiescities andand townstowns whichwhich cancan bebe fruitfullyfruitfully utilizedutilized forfor increasingincreasing thethe

fertilityfertility..

ForFor AgriculturalAgricultural purpose,purpose, therethere isis aa needneed forfor institutionalizedinstitutionalized efforteffort

forfor conservationconservation ofof thethe manuresmanures..

UseUse ofof chemicalchemical fertilizersfertilizers willwill alsoalso affectaffect thethe AgriculturalAgricultural

ProductivityProductivity..


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SOME IMPORTANT FACTSSOME IMPORTANT FACTS

yy India's food grain production was 212 million tonnes in the last yearIndia's food grain production was 212 million tonnes in the last year

yy It should increase to 250 million tonnes by 2010It should increase to 250 million tonnes by 2010

yy India may become a net importer of foodgarins,in near future and face aIndia may become a net importer of foodgarins,in near future and face a

deficit of 36 million tonnes by 2020(Prof B.Bhattacharya, IIFT in Yojna,deficit of 36 million tonnes by 2020(Prof B.Bhattacharya, IIFT in Yojna,January 2001),when India's population is projected to be 1.3 billion.January 2001),when India's population is projected to be 1.3 billion.

yy Though there has been significant gain in the productivity of food grains,Though there has been significant gain in the productivity of food grains,due to sustained efforts, from 522 kg/ha in 1950due to sustained efforts, from 522 kg/ha in 1950--51 to 1697 kg/ha in51 to 1697 kg/ha in19991999--2000, it remains very low as compared to international standards.2000, it remains very low as compared to international standards.

yy China produces 40% more food than India on just 60% of the landChina produces 40% more food than India on just 60% of the landareas(arable land) of India (CIIareas(arable land) of India (CII--McKinsey Study).McKinsMcKinsey Study).McKins


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Causes of Low Agricultural Productivity(Contu)Causes of Low Agricultural Productivity(Contu)

yy About 63% of the net sown area is rainfed, where productivity is muchAbout 63% of the net sown area is rainfed, where productivity is muchless than irrigated area.less than irrigated area.

yy 58% rice seeds are non58% rice seeds are non--certified. The hybrid are cultivated only in 2.44 tocertified. The hybrid are cultivated only in 2.44 to

31.5% of the area under vegetables.31.5% of the area under vegetables.

yy Fretilizer use is 100 kg/ha as against more than 300 kg/ha in china.Fretilizer use is 100 kg/ha as against more than 300 kg/ha in china.

yy Imbalance in use of fertilizer.Imbalance in use of fertilizer.

yy Inefficient use of water,nutrients and pesticides, which impair soil andInefficient use of water,nutrients and pesticides, which impair soil and

crop health.For example,our cotton yields are less than 20 percent of thecrop health.For example,our cotton yields are less than 20 percent of theyields in Egypt and the US, though we use 25 times as much water to raiseyields in Egypt and the US, though we use 25 times as much water to raisea tonne of cotton(Dr.M.S.Swaminathan, Hindu Survey, 2000a tonne of cotton(Dr.M.S.Swaminathan, Hindu Survey, 2000--01)01)

..


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Facts(contd..)Facts(contd..)

yy The average yield in India is less than 50% of the potential yield indicating wideThe average yield in India is less than 50% of the potential yield indicating widegap in diffusion of technology.gap in diffusion of technology.

yy Declining public investments in agriculture.Declining public investments in agriculture.

yy Poor postPoor post--harvest and processing facilities sometimes lead to glut in the marketharvest and processing facilities sometimes lead to glut in the marketand force the farmers distress sale, which demotivates them.and force the farmers distress sale, which demotivates them.

yy Lack of incentive for making improvements on landLack of incentive for making improvements on land

yy Subdivision and fragmentation of land holdingSubdivision and fragmentation of land holding

yy Lack of proper irrigation facilities.Lack of proper irrigation facilities.

yy Dependence on traditional methods of cultivationDependence on traditional methods of cultivation

yy Lack of proper credit facilities.Lack of proper credit facilities.


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Crop Average Indian

Yield(Tonnes/ha)

Potential Indian

Yield(Tonnes/ha)*

*

Rice 2.9 4to 5

Wheat 2.6 4to 5

Pulses 0.6 2to2.5

Potato 17 70

Tomato 18 60

Cabbage 23 65

Banana 32 60Pineaaple 14 80


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INCREASING AGRICULTURALINCREASING AGRICULTURAL

PRODUCTIVITYPRODUCTIVITY

yy a) Ea) Extensive cultivationxtensive cultivation--Increasing the total area underIncreasing the total area undercultivation by bringing cultivable land which is lying wastecultivation by bringing cultivable land which is lying waste

or making uncultivable land suitable for growing cropsor making uncultivable land suitable for growing cropsthrough agricultural research.through agricultural research.

yy bb) In) Intensive cultivationtensive cultivation--GrGrowing more on the same area byowing more on the same area by

using better and modern methods of cultivation, use ofusing better and modern methods of cultivation, use ofbetter quality seeds, fertilizers, pesticides, proper irrigationbetter quality seeds, fertilizers, pesticides, proper irrigationfacilities.facilities.


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c)c)AboAbolition of intermediarieslition of intermediaries

d)Providing security to tenant farmers(tenant farmers who take land on rent and shared)Providing security to tenant farmers(tenant farmers who take land on rent and shareproduce with the land owners)produce with the land owners)

e)Cee)Ceiliili

ng on land holdindsng on land holdinds-- maximum limit to which an individual can own agricultural land.maximum limit to which an individual can own agricultural land.

f)Conf)Consolsolidation of land holdings.idation of land holdings.

g)Provg)Provisiision of credit facilitieson of credit facilities

h)Availh)Availabiability of better quality of inputs:lity of better quality of inputs:

SeedsSeeds

fertilizersfertilizers

pesticidespesticides


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AGRICULTURALAGRICULTURAL

MARKETINGMARKETING


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yy BartersystemBartersystem

yy Commercialization ofagricultureCommercialization ofagriculture

yy AgriculturalmarketingAgriculturalmarketing


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yy Earlieritinvolved buyingandEarlieritinvolved buyingand

selling of products.selling of products.

yy Accordingto NationalAccordingto National

Commission of AgricultureitCommission of Agricultureit

starts withdecision to producestarts withdecision to producesalable farmcommodity andsalable farmcommodity and

involves allthetransactioninvolves allthetransaction

processes.processes.


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ThreeimportantfunctionsareThreeimportantfunctionsare

yy AssemblingAssembling

yy ProcessingProcessing

yy DistributionDistribution


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ExistingsystemsinmarketingExistingsystemsinmarketing

yy Saleto money lenders andtraders.Saleto money lenders andtraders.

yy Haats andShanties.Haats andShanties.

yy Mandies and wholesalemarket.Mandies and wholesalemarket.

yy CoCo--operativemarket.operativemarket.


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DisabilitiesfacedinmarketingDisabilitiesfacedinmarketing

yy Lack of knowledge of hybrid seeds.Lack of knowledge of hybrid seeds.

yy Low quality of seeds.Low quality of seeds.

yy Above factors discourage the farmersAbove factors discourage the farmers


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RequisitesofgoodmarketingRequisitesofgoodmarketing

yy Quality of produce should be good.Quality of produce should be good.

yyLooking after the needs of farmer.Looking after the needs of farmer.

yy Good means of transport andGood means of transport and

communication.communication.

yy Market at convenient distance.Market at convenient distance.

yy Grading and standardization.Grading and standardization.


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Agricultural PriceAgricultural Price

PolicyPolicy


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The main objectives of the Government's price policy

for agricultural produce, aims at ensuring

remunerative prices to the growers for their producewith a view to encourage higher investment and

production. Towards the end, minimum support prices

for major agricultural products are announced each

year which are fixed after taking into account, the

recommendations of the Commission forAgriculturalCosts and Prices (CACP).


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The CACP while recommending prices takes into

account all-important factors, viz.

1.Cost of Production

2.Changes in Input Prices

3.Input/Output Price Parity

4.Trends in Market Prices

5.Inter-crop Price Parity

6.Demand and Supply Situation

7.Effect on Industrial Cost Structure

8.Effect on General Price Level

9.Effect on Cost of Living

10.International Market Price Situation

11.Parity between Prices Paid and Prices

Received by farmers (Terms of Trade).


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Of all the factors, cost of production is themost tangible factor and it takes into account all

operational and fixed demands. Governmentorganises Price Support Scheme(PSS) of the

commodities, through various public and

cooperative agencies such as ,FCI(food

corporation of india) ,Tobacco Board, etc., forwhich the Market Selling Prices are fixed.

For commodities not covered under PSS,

Government also arranges for market

intervention on specific request from the States

for specific quantity at a mutually agreed price.

The losses, if any, are borne by the Centre and

State on 50:50 basis. The price policy paid rich

dividends.


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SUMMARYSUMMARY

yy In our report, we have found that agriculture sector has aIn our report, we have found that agriculture sector has apivotal role in Indian economy.pivotal role in Indian economy.

yy Agricultural production has increased just upto theAgricultural production has increased just upto thePOINT OF SELF SUFFICIENCY.POINT OF SELF SUFFICIENCY.

yy Measures are taken by government to increaseMeasures are taken by government to increaseAgricultural production and its development strategy.Agricultural production and its development strategy.

yy Credit facilities are provided to farmers.Credit facilities are provided to farmers.

yy Policy measures are of significant importance.Policy measures are of significant importance.

10/26/201063


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tHaNk YoUtHaNk YoU

role of indian agriculture

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