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AGRICULTURE IS THE BACKBONE OF THE INDIAN ECONOMY.DESPITE OUR MAJOR EMPHASIS ON THE INDUSTRIAL DEVELOPMENT, AGRICULTURE CONTINUES TO OCCUPY A PLACE OF PRIDE IN OUR ECONOMY.
Role of Agriculture
i)Share in national income Agriculture is India's big economy.Although the share of agriculture in the total national income has been gradually decreasing on account of development of the secondary and tertiary sectors it's contribution continues to be significant. IN 1950, the share of agriculture was 57% but it is only 26% now. The more developed a country is the lesser is the contribution of agriculture. ii)Source of Employment Today almost 60% of the population depends directly or indirectly on agriculture. The greater independence of working population on agriculture indicates the underdevelopment of non-agricultural activities in the country. iii)Importance in industrial development Agriculture provides raw materials to pour leading industries such as cotton textiles and sugar industries.Not only this the workers in industries depend on agriculture for their food.Agriculture also provides the market for a variety of goods. iv)Importance in international trade A number of the agricultural commodities like tea, coffee, spices and tobacco constitutes our main items of exports.These amount to almost 15% of our total exports.Hence agriculture provides foreign exchange which helps us to buy machines from abroad. It also maintains a balance of payments and make our country self-sufficient. v)Development of tertiary sector Tertiary sector provides helpful services to the industries and agriculture like banking, warehousing etc. Internal trade is mostly done in agricultural produce. For example, various means of transport get bulk of their business by the movement of agricultural goods. vi)Revenue to the government State government get a major part of their revenue in terms of land revenue, irrigation charges, agricultural income tax etc.Central government also earns revenue from export duties on the agricultural production. Moreover our government can raise substantial revenue by imposing agricultural income tax.However this has not been possible due to some political reasons. vii)International importance Our agriculture has brought fame to the country.India enjoys first position in the world as far as the production of tea and groundnuts are concerned. viii)Internal trade agriculture plays a important role in the internal trade.It is because of the fact that 90% of of our population spends 60% of their income on the purchase of the items like food, tea, milk etc.
2 billion in 2007-08 to US$ 3. milk and dairy products. around 70 per cent of the country's agricultural and processed food exports are to developing countries in the Middle East. Africa and South America.9 per cent. sugarcane to notch up by 15.3 per cent to 229. according to the Annual Report 2009-10 of the Ministry of Agriculture. 2010. turmeric and black pepper. cashew nuts. sugar. Asia. Furthermore. as per a Ministry of Agriculture press release dated August 3. Exports According to the government's agri-trade promotion body. respectively. against one per cent in the year-ago period on the back of better Kharif crop output. Agricultural and Processed Food Products Export Development Authority (APEDA). The Indian Agricultural Scenario The total geographical area of India is 328. while 193.1 per cent during the season to 18. the sector provided employment to 55 per cent of the work force. As per the Centre for Monitoring Indian Economy (CMIE) farm output will grow by 10 per cent to 114 million tonne (MT) in the 2010 Kharif season. Major agricultural crops.23 per cent (provisional) of the total exports. and 10.7 per cent in the year.4 per cent to 26.8 per cent in the first six months of the current fiscal (2010-11). Oilseeds production is expected to rise by 11. An amount of US$ 19 billion has been allocated for the Ministry of Agriculture during the Eleventh Five Year Plan.5 per cent and 4. It is also the second largest producer of rice. fruits and vegetables.14 billion during April-May 2010-11. India's agriculture and allied sector grew by 3. animal products.2 per cent in 2010-11. and fruits and vegetables. wheat.4 per cent each in the first two quarters of the current fiscal.26 billion in 2010-11 (inclusive of State Plan Scheme Rashtriya Krishi Vikas Yojana). At present. oilseeds.Agriculture Last Updated: November 2010 Agriculture is one of the strongholds of the Indian economy and accounts for 14. Capital investment in agriculture has increased from US$ 1. the country's farm sector grew by 2.7 million hectares of which 140. India is the largest producer of coconuts. in the same period last year. mangoes. fruits and vegetables.9 million bales in the last season. The Eleventh Plan allocation has been considerably higher over the Tenth Plan allocation. while Rabi season is expected to report a 2 per cent increase at 116.6 MT. The agency pegs the overall foodgrain output growth up by 5.9 per cent and 0.7 million hectares is the gross cropped area.6 per cent to 321 MT and cotton to grow by 12. sugarcane.6 per cent of the country's gross domestic product (GDP) in 2009-10. . are projected to grow by 7. India's exports of agricultural and floricultural products.1 per cent. Production India has become the world's largest producer across a range of commodities due to its favourable agro-climatic conditions and rich natural resource base. against 1. 2010.7 MT.3 million hectares is net sown area. while production of non-food crops as a whole is projected to grow by 9. cotton. cereals and processed food products was worth US$ 1. According to the GDP data released by the Central Statistical Organisation (CSO) on November 30. pulses. cotton.9 million bales compared to 23. including foodgrain. ginger. according to APEDA. bananas. The Government is giving highest priority to agriculture and allied sector. India's agri-export turnover is expected to rise to nearly US$ 18 billion by 2014.
RKVY has encouraged states to step up allocations to this sector. Mr Pranab Mukherjee has made the following announcements for the agriculture sector: y y y y y y y Provision of US$ 86. which involves concurrent attention to soil health. For the year 2010-11. 8 MT and 2 MT respectively.4 million for sustaining the gains already made in the green revolution areas through conservation farming. by the year 2011-12 The Rashtriya Krishi Vikas Yojna (RKVY) was operationalised with effect from August 2007 with an outlay of US$ 5.5 billion in 2008-09. Allocation to agriculture and allied sectors was 5. according to the Annual Report 2009-10 of the Ministry of Agriculture. 2009 In addition to the 10 mega food park projects already being set up.5 billion in 2008-09. Namdhari Seeds. with an outlay of US$ 1.3 million According to the Annual Report 2009-10 of the Ministry of Agriculture. During 2009-10.43 billion this fiscal to the states under RKVY. water conservation and preservation of biodiversity Banks have been consistently meeting the targets set for agricultural credit flow in the past few years.000 pulses and oil-seed villages in rain-fed areas in 2010-11 and to provide an integrated intervention for water harvesting. Rasi and Vibha Seeds have already ventured into the export markets in the region. the government has decided to set up five more such parks External commercial borrowings are to be available for cold storage or cold room facility. private sector investment has increased from US$ 14 billion in 2004-05 to US$ 25.24 billion during the 11th Five Year Plan (2007±2012). Investments The public and private sector investment in agriculture have been steadily increasing since 2004-05. according to the Annual Report 2009-10 of the Ministry of Agriculture The government has allocated US$ 1. an initiative of Mahindra Farm Equipment.84 per cent in 200809. for preservation or storage of agricultural and allied products. West Bengal and Orissa Provision of US$ 65. 87 per cent more than in 2009-10 at US$ 763. While some of the companies like J K Seeds. Nuziveedu Seeds.11 per cent of total State Plan Expenditure in 2006-07 and this has gone up to 5. the National Horticulture Mission (NHM) was launched in 2005-06.2 million to organise 60.61 billion in 2004-05 to US$ 5. The RKVY scheme aims at incentivising states to increase outlays for agriculture and allied sectors in order to achieve 4 per cent growth in the sector in the current five-year plPlan (2007-12). Eastern Uttar Pradesh.5 billion Under the Agricultural Debt Waiver and Debt Relief Scheme (2008). 201 new nurseries were set up under NHM y y y . said Pawan Goenka. the agricultural credit flow target has been set at US$ 81.Indian seed companies are eyeing the export markets in SAARC (South Asian Association for Regional Cooperation) and African countries with a host of hybrid seeds and best farm practices.9 million to extend the green revolution to the eastern region of the country comprising Bihar.3 billion during the 11th Five-Year Plan (2007-12). including for farm level pre-cooling. Government Initiatives In the Union Budget 2010-11. the Finance Minister. Nath Seeds. It aims at enhancing the production of rice. Mahindra Samriddhi. time frame for the repayment of the loan has been extended till June 30. Chattisgarh. utomotive and Farm Equipment Sectors. Jharkhand. marine products and meat A number of other initiatives are already in place for the agriculture sector. Mahindra & Mahindra. 2010 from six months up to December 31. The RKVY scheme aims at incentivising states to increase outlays for agriculture and allied sectors in order to achieve 4 per cent growth in the sector in the current five-year plan. wheat and pulses by 10 MT. eyes having 600 Mahindra Samriddhi centres and five million farmers under its ambit by 2020. While public sector investments in agriculture have increased from US$ 3. watershed management and soil health to improve productivity of the dry land farming areas Provision of US$ 43. President. which include y The National Food Security Mission was launched in 2007-08.
in the 12th Five Year Plan (2012-17). the Cabinet Committee on Economic Affairs (CCEA) approved US$ 142.5 million for the National Horticulture Board to implement its existing schemes and promote 25. Agriculture also plays a significant role in the growth of socio-economic sector in India. including fruits. 2010. The services enhanced by the Green Revolution in the agriculture sector of Indian economy are as follows: y y y y y y Acquiring more area for cultivation purposes Expanding irrigation facilities Use of improved and advanced high-yielding variety of seeds Implementing better techniques that emerged from agriculture research Water management Plan protection activities through prudent use of fertilizers. Besides the above. which will further push the production of such crops in India. ornamentals. and cropping applications . agriculture has acquired 18 percent of India's GDP. according to Mr Srikant Kumar Jena. India has put a lot of effort to be self-sufficient in the food production and this endeavor of India has led to the Green Revolution. y Agriculture Sector of Indian Economy Agriculture Sector of Indian Economy is one of the most significant part of India. the government provides subsidy on decontrolled (whose MRP is not decided by the government) nutrients such as Phosphorus (K) and Potash (S). Animal Husbandry.43 billion in 2010-11 as subsidy to decontrolled fertilisers under the nutrient-based subsidy policy that came into effect from April 1. Horticulture. Pisciculture. Minister of State for Chemicals and Fertilisers. International Competence Centre for Organic Agriculture.8 billion three years back and now it could be more than US$ 21. The Indian organic product market. The Green Revolution came into existence with the aim to improve the agriculture in India.3 billion The government will provide US$ 6. according to the Department of Industrial Policy and Promotion¶s (DIPP). Since then. the sector was estimated worth over US$ 12. The country also has substantial reserves for the same. potatoes.000 integrated commercial horticulture projects in the 11th Plan period ending 2012. Development of Seeds. As being stated by the economic data of financial year 2006-07. Aquaculture and Cultivation of Vegetables and Mushrooms under controlled conditions and services related to agro and allied sector.15 billion in the next five years. vegetables. according to a study conducted by the Horticulture Society of India. According to K Kasturirangan. as per Mukesh Gupta. which includes value-addition to farm products. In the earlier times. The report said that rising income will create more demand for horticultural products. y The agriculture sector of India has occupied almost 43 percent of India's geographical area. The horticulture sector encompasses a wide range of commodities. medicinals and aromatic crops.41 million. currently pegged at US$ 322. Agriculture is still the only largest contributor to India's GDP even after a decline in the same in the agriculture share of India. tuber crops. FDI is not allowed in any other agricultural sector/activity.y y y y 100 per cent foreign direct investment (FDI) is allowed under automatic route in Floriculture. Road Ahead The country's demand for horticulture products is expected to grow by over 20 per cent to touch 360 MT in 2020-21. consolidated FDI Policy The Planning Commission is working on an ambitious action plan to boost secondary agriculture. is expected to reach US$ 2. Planning Commission Member. President. pesticides. A budget estimate of US$ 11. India depends heavily on the agriculture sector.9 billion has been set for fertiliser subsidy during the 2010-11 In April 2010. Agriculture is the only means of living for almost two-thirds of the employed class in India. Under the new nutrient-based subsidy policy (NBS). India was largely dependent upon food imports but the successive stories of the agriculture sector of Indian economy has made it self-sufficing in grain production. especially on the food production unit after the 1960 crisis in food sector.
A Technology Mission was introduced in 1986 right after the success of National Pulse Development Programme to boost the oilseeds sector in Indian economy. a National Pulse Development Programme that covered almost 13 states.All these measures taken by the Green Revolution led to an alarming rise in the wheat and rice production of India's agriculture. fruits. oilseeds. . Taking into account this fact. and bio-diesel are also on the list of the services to be taken by the Green Revolution to improve the agriculture in India. A new seed policy was planned to provide entree to superior quality seeds and plant material for fruits. vegetables. But the entire year's agriculture cannot possibly depend upon only one season. An increase in the growth rate and irrigation area. medicinal plants. flowers. improving the soil quality. The Indian government also set up Ministry of Food Processing Industries to stimulate the agriculture sector of Indian economy and make it more lucrative. Pulses too came under this programme. vegetables. and flowers. was set up in 1986 with the aim to introduce the improved technologies to the farmers. improved water management. Considering the quantum leap witnessed by the wheat and rice production unit of India's agriculture. herbs. India's agriculture sector highly depends upon the monsoon season as heavy rainfall during the time leads to a rich harvest. and diversifying into high value outputs. pulses. a second Green Revolution is likely to be formed to overcome the such restrictions.
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