PEST ANALYSIS

Realizing the importance of Indian agricultural production for economic development, the central Government of India has played an active role in all aspects of agricultural development. Planning is centralized, and planned priorities, policies, and resource allocations are decided at the central level. Food and price policy also are decided by the central government. Thus, although agriculture in India is constitutionally the responsibility of the states rather than the central government, the latter plays a key role in formulating policy and providing financial resources for agriculture. The main objectives of the Government's price policy for agricultural produce, aims at ensuring remunerative prices to the growers for their produce with a view to encourage higher investment and production. Minimum support prices for major agricultural products are announced each year which are fixed after taking into account, the recommendations of the Commission for Agricultural Costs and Prices (CACP). For example, the Government of India has also approved proposals for joint ventures, foreign collaborations, industrial licenses and 100% export in or with the agricultural sector, envisaging an investment of over $ 18.2 Billion (Agbola, 2004).One of the most critical obstacles of policies applications in agricultural sector is in ensuring food security access of the population to sufficient food to meet nutritional requirements. Food security issues tend to cover not only issues related to availability and stability of food supplies but also issues of access to this supply. This last is related to the resources needed to procure the required quantity of food. However, these issues in India are considered to be sensitive and hence, where a large percentage of the population is dependent on agricultureneed a certain degree of autonomy and flexibility in determining their domestic agriculturalpolicies. The Economist Intelligence Unit Report (2005) also implies that the governmentdoes not fully understand its importance. These would have to be geared towards improvingproductivity, enhancing income levels, reducing vulnerability to market fluctuations ensuringstability of prices and so on.2.2.2 Economic India is a two-tier economy, with a cutting-edge and globally competitive knowledgedrivenservice sector that employs the brightest of the middle classes on the one hand, and asprawling largely rain-fed agricultural sector that employs the majority of the vast and poorlyeducated labour force, on the other. The agricultural sector, with fishing and forestry,accounts for around 20% of GDP, services 53% and manufacturing 27%. Agriculturerepresents an important economic activity for a large population of the developing

coiryarn. ready-made garments. 2006). 2006). such as cotton and jute. decreasing to 27 percent in2003 (India Economic Survey. on the part of government. This drop in agriculture's share was somewhat misleading because agricultural products. The government was forced tocontinue the subsidies but at a somewhat lower level (Yeoh and Siang.Over the period 1994-2005. and privatization. The other attractive features of the Indian agro industry that have the capacity to lureforeigners with promising benefits are the deep sea fishing. 2005). industriallicensing.Agriculturalexports from India were 44 percent of total exports in FY 1960. milk and milkproducts. Therecent economic system giving a free hand to multinational corporations in agriculture sectorhas further caused a rapid shrinkage of the traditional practices and replacement of folk cropvarieties with high yielding and hybrid varieties. The composition of agricultural and alliedproducts for export from India changed mainly because of the continuing growth of demandin the domestic market. The traditional modeof agricultural practice has been destroyed. The cut in the fertilizer subsidy was a result of the government'scommitment to reduce New Delhi's fiscal deficit by removing grants and subsidies from thebudget.The serious foreign-exchange crisis in 1990 led to anumber of well-publicized economic reforms in the early 1990s dealing with trade. the consumer food segment has the toppriority. the drive for market liberalization andglobalization has severely imposed on the rural household economies. which escalated . fabrics. and jute manufactures since the 1960s. to shore up the constant foreign-exchangeshortage (Edward. 2004). The reforms had an impact on the agricultural sector through thecentral government's effort to withdraw the fertilizer subsidy and place greater emphasis onagricultural exports. This demand cut into the surplus available for export despite acontinuing desire.ventures / foreign collaborations. that were exported in rawform in the 1950s. have been exported as cotton yarn. The government allocations on the agriculturesector constantly register a decline (The Economist Intelligence Unit Report. The government action led to a reduction in the use of chemical fertilizers andprotests by farmers and opposition from political parties. Both in terms of foreign investmentand number of joint. meat and poultry segments.worldIndia¶s agricultural sector provides employment for about 60% of the country¶s workforceand accounts for one-fifth of GDP (Meisinger. aqua culture. 2006).

More than 60% of the India¶s populationis dependent on the agriculture (Palmer-Jones and Sen.3 Social Since its independence in 1950s. those people employed in agricultural sector. so the trade liberalization may lead to an adverse impact on the Indianagriculture sector and women may suffer. show that the lower government investment inagriculture and market driven system has adversely affected the livelihood of rural India. fish farming. The prices of their product are determined by local variables rather thaninternational markets. hundreds of foreign students have attendedIndian state agricultural universities.Large numbers of women are engaged inagriculture.Nilekani (2006) suggest that in India a majority of the farmers come under the category ofsmall and medium farmers and are solely dependent on the local market rather thaninternational market. horticulture and floriculture. medicinal plants. Numerous foreign scientists havereceived special and advanced training in India. are those less educated. foreign aid has made a significant contribution to theagricultural progress in rural India. The farm credit system in Indian agriculture. aquaculture. 2003).evolved over decades has been instrumental in enhancing production and marketing of farmproduce and stimulating capital formation in agriculture. including the Technical Cooperation Scheme of the Colombo Plan for CooperativeEconomic and Social Development in Asia and the Pacific and the Technical CooperationScheme of the Commonwealth of Nations Assistance Program. During the period of 55years independence. whichwill necessitate larger investments. 2.2. The last ten years ofdevelopment in the agriculture sector in India.India is one of the oldestcivilizations with a kaleidoscopic variety and rich cultural heritage. Credit for Indian agriculture has toexpand at a faster rate than before because of the need to step-up agricultural growth togenerate surplus for exports. However. and also because of change in the product mix towards animalhusbandry. In the late 1980s and early 1990s. living in rural areas. India has been sharingits agricultural technology with other developing countries. Increasingly since independence. it has achieved multifaceted socio-economic progress and is now thetenth industrialized country in the world and the sixth nation to have gone into outer space toconquer nature for the benefit of the people. primarily in the production and . India provided shortand long-term training courses to hundreds of foreign specialists each year under a variety ofprograms.the cost of agriculturalproduction while stagnating productivity.

The Government's long-term vision on ³Informationand Communication Technology (ICT) in the Agriculture Sector´ aims to bring farmers. About 36. as much as 46.researchers. an overwhelmingly large proportion. women are often left behind to take care of bothfamily and the farm on their own.9 percentare women.e. tissue culture. while about 43.4 million) are engaged as hiredagricultural labour (Palmer-Jones and Sen. Farmers can find out the chemical composition of their land through labtesting to know how fertile their land is and what should they grow to make maximumprofits. Women¶s rolesrange from managers to landless labour. varietal development through some clonal variations. new hybrids of different crops. It is. obvious that women playno small role in food production. research in the area of vaccine production.5% (40. 2004). as globalization shifts agriculture to capitaland chemical intensive system. A land information systemhas already started using geographic information systems (GIS) and remote sensing to helpthe farmers to plan their activities and facilitate decision-making and planning at the locallevel (India. Achievements of Indian agriculture supported by technology like development of High Yielding Varieties (HYV) of seeds. 2. Also considering the irrigation needs in Indian .4 Technological The last few decades have witnessed a visible transition in the industrial landscape of India. women bear disproportionate costs of both displacement andhealth hazards.processing of food. 2003). developing better quality products and transgenic in crops such as brinjal. Of the rural workforce. application of modern biotechnologies like DNA finger printing.Technology has helped society to cut across the traditional boundaries for getting convertedinto an emerging information society. With male-selectivemigration from rural areas on the increase. i. therefore. 27. tomato. terminator gene technology and genetic cloning will hold the key in raising the productivity (Ghosh. 80% areemployed in the agriculture sector. In 21st century agriculture.5 percent of cultivatorsin the rural areas are female..4 percent (48. cauliflower and cabbage have strengthened the field. According to the 2001 census.2. scientists and administrators together by establishing a system known as³Agriculture Online´ for the exchange of ideas and information. 2003). In other words the mode of female participation inagricultural production varies with the land owning status to farm household.6 million) work as cultivators on theirown/family landholding. while in the case of agricultural labour. Also.

agriculture. With all the benefits that technology can provide. there is an important issue of providing sufficient and appropriate education for the labour to increase their skils in technology application that could be beneficially used for agro sector. emphasis has to be given to promote and prove the cost-reducing micro-irrigation technology of drips irrigation which helps conserve water reduces fertilizer inputs and ensures higher productivity. .

the "Reinventing Government" initiative was a major effort to exert presidential control over the bureaucracy.Bureaucratic Politics While the Constitution places the president as head of the executive branch with the power to appoint a variety of government officers. but Congress is taxed to the limit simply to consider requested changes. Reformers have proposed such schemes as zero-based budgeting and sunset laws to try to force Congress to consider base expenditures and whether agencies should be renewed at all. it is difficult to determine if his appointees actually make policy as the president desires The incoming president spends months filling all of the positions. and support for his/her program among top political and congressional leaders. In November and December. develops interest. The OMB reviews agency requests and holds budget hearings in August through September of the year before. this initiative involved hundreds of specific recommendations to reduce red tape and achieve efficiencies. state and local. and private and non-profit organizations in the same field. which prepare and submit budget requests by July. the OMB presents a revised budget to the president and a budget message is prepared and presented to Congress in January of the year in which the fiscal year starts.1 to only 2. Spearheaded by Vice President Al Gore. protecting those who report policy and administrative abuses. Budgeting is incremental. wins favorable media coverage for his agency and uses strategies that exploit opportunities.8 million employees. enthusiasm. accepting as legitimate the previous year's expenditures and focusing instead on requested changes. Rather. . The Budgetary Process The budget is the single most important policy statement of government and the battles of who gets what is at the heart of the political process. Networks develop around shifting career lines among federal. It is credited with being one factor behind the decline in federal employment from 3. In January. almost two years before the start of the federal fiscal year on October 1. The president and the OMB develop guidelines for all federal agencies. Congress has tried to increase its influence with the Whistleblower Protection Act of 1989. Over time. Cabinet departments have grown increasingly top heavy with the addition of more layers at the top levels. The Politics of Budgeting A good bureaucratic politician cultivates a base of support for requests among the public and among people served by his/her agency. the Office of Management and Budget presents long-range forecasts of revenues and expenditures to the president. every bureaucracy tends to develop its own agency culture which is difficult to control. however. During the Clinton administration. people inside an agency contact their friends and associates when a position becomes vacant and applicants are able to apply through the OPM well before formal lists of vacancies are printed.

Examples are the Equal Opportunity Employment Commission (EEOC). program budgeting would remedy this. partly because their functions extend across many industries. Seemingly. the Federal Deposit Insurance Corporation insures bank deposits and the Food and Drug Administration determines what drugs that doctors can prescribe." cutting across policy programs. Interest Groups and Bureaucratic Decision Making Interest groups scrutinize federal agencies even more closely than Congress. committee hearings on federal programs. Federal regulators issue thousands of pages of rules and regulations. the Sierra Club is one of . The capture theory of regulation warns that some regulatory commissions may come to represent the industries they are supposed to regulate rather than the public interest. congressional investigations. and the appropriations process itself. boosting their popularity in their districts by aiding constituents with their problems in dealing with the bureaucracy. solicit comments. Congressional Constraints on the Bureaucracy Congress has placed a number of constraints on the federal bureaucracy: 1. and the Environmental Protection Agency (EPA). budget requests are usually grouped into generic categories like "personnel" and "supplies. 2. members of Congress engage in casework. and overlap of program functions served by the same resource). the Occupational Safety and Health Administration (OSHA). hold hearings. difficulty in assigning overhead expenses to specific programs. especially Social Security and Internal Revenue Service files. and hold hearings. For instance. but this is difficult to implement for a variety of reasons (bureaucratic resistance due to added paperwork or perceived loss of power. Other congressional constraints come in the form of Senate confirmation of federal appointments. The Federal Communications Commission has been accused of this vis-a-vis the television industry. conduct inspections and investigations of complaints. 3. require submission of forms. with some broad exceptions. The Privacy Act of 1974 required agencies to keep confidential the personal records of individuals. The Administrative Procedures Act of 1946 (APA) required agencies to post proposed rules in the Federal Register.Decision-making is further hampered because submitted budgets are nonprogrammatic²that is. The Federal Reserve controls interest rates. for instance. Activist agencies created by Congress are least likely to be captured. and levy fines and penalties. The Freedom of Information Act of 1966 (FOIA) gave citizens a formal route for forcing agencies to divulge information. Also. Economists believe that these regulations stymie innovation and productivity while driving up the cost of living. Regulatory Battles Federal bureaucracies regulate almost all aspects of American life. bringing good and bad points to the attention of Congress and the press.

Bureaucratic agencies have been very successful in defending themselves in court. Interest groups also testify at hearings. Hierarchical language also shows where many technomanagers are coming from. solicit media support. may owe much to interest groups which lobby Congress on their behalf at appropriations time (the EEOC owes its existence to civil rights groups. The failed effort sprang from an all too typical view of the organization as segmented and separate functions and divisions. It didn't work." "my people. Bureaucracy and technology Far too many organizations are ruled by bureaucrats and technocrats either in management or staff support roles. hold press conferences. when their actions have been judged as "arbitrary and unreasonable. in turn. "How many people work for you?" (to which one dissatisfied manager replied." He said it with a straight face and everyone in the room nodded knowingly. In talking about cross training and moving people around. undertake advertising campaigns. One of their (often unconscious) driving motives is to "eliminate the human factor. Here are some telltale signs and examples of Technomanagement: y Bureaucratic language is a dead giveaway of a technomanager." and "down the organization" show the need many technomanagers have to dominate and control.several groups which monitors the Environmental Protection Agency. Judicial oversight tends to focus upon whether or not agencies are acting beyond the authority granted them by Congress and whether or not they are abiding by rules of fairness. Agencies. "about half"). y A senior manager in a professional services company assigned a staff support person to fix the marketing efforts of their divisions. one bureaucrat called it "rotationality. and mobilize grass-roots followers. . systems. "subordinates" (and its especially repulsive companion "superiors"). Business development (sales) people weren't effectively trained and supported to position to the larger strategy or new market position (they got a one day information session and a few updates). when they have exceeded the authority given them. "staying on top of things." They feel that their technology." and when they have failed in their legal duties. and processes would work so much better if it weren¶t for all the people always messing things up. and they have large numbers of attorneys who specialize in administrative law. But marketing couldn't be separated from running the business. for example). They succeed because they have elaborate administrative process to protect their decisions. Judicial Constraints on the Bureaucracy Bureaucratic decisions are subject to review by the federal courts who can also issue injunctions to an executive agency before it issues a regulation. The courts typically have stepped in when agencies have violated the laws of Congress.

operational performance data. and team members are reduced to numbers." y . reports on one of his studies of "IT (Information Technology) assumptions about people and learning." "all people can and should learn whatever is required to use the technology. professor of management at the Sloan School of Management. and written extensively on quality improvement." and "people already know how to communicate and manage. Not only is the organization weakened and demoralized ² while customer service plummets ² but. Broad business perspectives and strategies. etc." and "tighten belts" in short-term attempts to bring costs down." Some of his most deadly findings include "technology leads and people adapt. therefore. Technomanaged companies are head-office-driven. and cross-functional skills are kept by management. But some efforts are getting badly out of balance as customers. the cause. So the structure of the organization couldn't support working across a broader market that called for integrated divisions serving customers through regional (rather than head office) management. There are few mechanisms or channels to systematically collect field input on emerging or latent market needs/trends. While they work hard to quantify the "voice of the customer. and perspectives are the starting point for all activities. Edgar Schein. Having researched. Technomanagers often "cut heads. Accountants aren't out in the real world looking behind and beneath the numbers and learning how revenues are built. goals. y Management's needs. y y y The quality movement gave rise to a new breed of technomanager ² the qualicrat. Field professionals have little input to product development priorities. I am a big convert to. Employees serve their managerial masters and do as they are told. and graphs. Massachusetts Institute of Technology. in addition. problem-solving and decisionmaking authority. and evangelist for. the fundamental cost structure hasn't really been changed.A key division that provided the umbrella strategic services to position and pull through the core business services was forced to continually justify itself as a stand alone. partners. or by working through the entrenched hierarchy. In a financial crunch. by screaming the loudest (or to the right political player). marketing focus. charts." "trim the fat. consulted. it's often a long-term disaster." the face of current customers (and especially potential new customers) is often lost. Their only means of providing input is on committees (which take months to meet and decide anything). While wholesale slashing and burning can be a short-term success. So costs creep back up. These support professionals see the world strictly through data and analysis and their quality improvement tools and techniques. profitable business to the accountants running the company. accounting systems. IT needs only to enhance these processes. Managers and their staff professionals are the brains and employees are the hands.

in both a practical and theoretical sense. In the 1920s. an upper limit for the incomes of party officials. Such a government is in principle impossible under capitalism. ordinary people using their moral and social instincts have regarded the privileges which existed in the Soviet Union and the other nominally socialist countries as something which has distorted their picture and ideal of socialism. treating them as naive conceptions out of sync with the times. Marxism has repeatedly raised the question of social equality and attempted to resolve it.. The director of a similar factory who was not a party member could expect an income of 500 rubles. Lenin emphasised that in the Second International at that time there was a tendency to pass over these Marxist ideas in silence. They manage the organization from the inside out. forgot that Christianity was originally revolutionary.Technomanaged organizations have things backwards. a so-called party maximum was introduced. for example. He wrote that the masses yearned for a government which guaranteed low prices and fair wages and which itself did not consume too much money. Customers are made to fit the organization. In their estimation of the Paris Commune. Lenin developed this idea in his book The State and Revolution. the following was standard practice: a factory director who was a party member received 300 rubles for his work. People serve the systems or processes. They regarded this measure as an effective way of preventing the state from being transformed from an instrument which serves society into an institution which stands above society. i. It is no accident that official public opinion has always judged the conditions in those countries with nationalised property from the standpoint of the extent to which the principles of social equality were upheld. Although such facts have been often used for openly demagogic purposes. In this regard one sometimes comes across interesting examples. rather like those ideologues of Christianity who.technology drives behaviour Social Bureaucracy The aim of socialism is the establishment of social equality among men. Shortly after the October Revolution a number of measures were adopted with the aim of reducing the social differences between specific groups.e. Marx and Engels regarded the fact that the wage of an official was not to exceed that of a worker to be of great significance. following the transformation of the church into a state institution. Economic bureaucracy . In order to preclude privileges for the functionaries.

The tasks of Gossnab included honing the operational details for detailed assortments of funded goods according to the general allocations outlined by Gosplan. which had more operational significance for investment planning. but this was not always the case. the financial state committees. The reforms of Prime Minister Alexei Kosygin of 1965 assumed. the head of the Communist Party of the USSR and the head of the state were the same person.Each of the fifteen union republics had its own state apparatus. followed by more than forty state committees and agencies with ministerial status involved in economic affairs. In addition. Gosplan was primarily responsible for executing the directives of the Council of Ministries and preparing annual operational plans for the industrial ministries with the participation of the latter. and also had summary departments. and machinery. Gosplan had considerable responsibilities concerning supply planning and distribution of production (supplies) among ministries. and chairmen of agencies with ministerial status. The Council of Ministers was responsible for the enactment of the economic policies of the Communist Party by the state bureaucracy. chairmen of various state committees. and supervised national economic planning. Gossnab SSSR assisted Gosplan with the allocation of key material inputs (funded goods) to the ministries. The chairman of the Council occupied the most powerful position in the state apparatus. in effect the position of prime minister. By the late 1970s Gossnab handled only one-half of the value of rationed goods. Although there was an elected government (the Supreme Soviet). it coordinated and directed the activities of the state committees and the ministries. At various stages of Soviet history. ferrous metals. Despite reform efforts. which paralleled that of the USSR as a whole. dealing with functions that crossed functional bodies. the USSR Council of Ministers (Sovet Ministrov SSSR) conducted the business of government and constituted the highest oversight and executive body of the Soviet economic bureaucracy. among other things. and other functional state committees. Gossnab applied itself to the creation of a wholesale trade system based on direct contracts between suppliers and users. markets for . State economic committees were subordinated to the Council of Ministries of the USSR in the vast Soviet economic bureaucracy. Gosplan was subdivided into industrial departments. The Council of Ministers was the main source of economic legislation. Other state economic committees can be divided into three groups: Gossnab SSSR (the State Committee for Material Technical Supply). It was composed of industrial ministers. the assignment to Gossnab of the responsibility for the allocation of producer goods. such as finance. The ministerial supply organizations that had dominated the rationing of funded goods largely disappeared. Gosplan was charged with the preparation of long-term (five-year) plans and longer-term perspective plans. Gosplan SSSR (the state planning committee) was the most important such agency. Gossnab acted as an executive arm of Gosplan in matters of supply planning by maintaining actual warehouses and distribution points from which ministries drew materials. and credit and currency systems. it also arbitrated disputes among ministries or state committees and dealt with the problem of regional coordination. such as coal. It was authorized to reverse the decisions of ministries and make and execute the key resource-allocation decisions of the Soviet economy. state budget.

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