INTRODUCTION TO AGRIBUSINESS

Agribusiness Management

Agriculture;

Agriculture may be defined as the art of science &

the business of producing crops and livestock for
economic purposes.

Business:
Any physical activity undertaken by people with
the aim of making maximum profit.
Management;
Is defined as a process by which a co-operative
group directs actions towards common goals.

Agribusiness:
Agri. Business can be defined as all the activities
concerned with agriculture including farming,
management, financing, processing, marketing,
growing of seeds & the nursery stock, manufacture of
fertilizers, chemicals implements, processing
machinery transportation etc.

Role of Agriculture in economy:

1. Share in national income
2. Largest employment providing sector.
3. Provision of food surplus to the expanding
population.
4. Contribution to capital formation.
5. Providing row materials to industries.
6. Market to industrial products.
7. Importance in international trade.

1. Share in national income;

About 30% of our GDP comes from agri. Alone . it
was around 57% in the beginning of 1950 with
gradual economic development in industry & service
sector the share of agri. Has been declined. Agriculture
is the backbone for any country’s economic
development.it is popular belief that economic
development takes place because of rapid
industrialization but industrial developments itself
cannot take place with out agriculture
Specifically agriculture contributes to economic
development in four ways
.a) product contribution(i.e. making availability of raw
materials)
b) market contribution (i.e. provides market for the
goods of industrial sectors.
c) factor contribution (i.e. making available labour &
capital to the non agri.sector.
d) foreign exchange contribution.

2) Largest Employment providing Sector:

Agriculture has been a major source of livelihood for
our people. A large percentage i.e. 70% of working
population is engaged in agriculture as there is
economic development in industrial & service sector
the dependence on agri for livelihood must decline &
more & more people must get absorbed in industrial &
service sector i.e secondary 8 tertiary sectors. But this
has not happened in our country.
 In the year 1951, 70% of working popl was engaged
in agril & in the year 2000, 60% of the working popl is
engaged in agril due to rapid increase in popl the
observate number of people engaged in agril is
increasing by day by day to satisfy the demand of food
& the problem of unemployment.
3) Provision of food surplus to the expanding pop
l:
Because of the heavy pressure of popl there is rapid
increase in the demand for food at a faster rate & this
demand could be satisfied only if there is development
in agril, sciences & agril industries.
4) contribution to capital formation:
increases to a sufficiently high degree economic
development connate be achieved. As agril. Is the
largest industry in many development countries it
plays an important role in pushing up the rate of
capital formation & if it fails to do to the process of
economic development will suffer a setback.
5) providing raw material to industries :
Agril. Cultural provides raw materials to various
industries of national importance for economic
development like sugar industry. Jute industry cotton
textile industry. Vanaspati ghee & other food
processing industries.
6) Market for industrial products:
As more than 2/3 of the popl of developing
countries lives in rural areas the rural consumption of
industrial goods is nearly three times more than the
urban consumption there is direct relationship of
industrial products & the popl that is staying in the
village. If the agril productivity is less there will be less
income of the people & this will adversely affect the
marketing of industrial product so as to boost the
process of industrial development the income of the
rural sector should be increased causing in turn an
increased demand for industrial products.