New techniques and practices are costly and demand expertise, so the government will have to play a major role in incentivising people to adopt them
The agriculture sector employs directly or indirectly half of the total workforce but it contributes only 19.9% to the national GDP, while the services sector which includes only 20% of the workforce contributes 66.1% to the GDP (Economic Survey 2019-20). The soaring growth of agriculture due to Green Revolution has now given way to the growth in the industrial and services sectors. The contribution of agriculture sector has decreased from more than 50% of the GDP in the 1950s to 15.4% in 2015-2016 (Economic Survey).
Despite being the highest producer of various crops, Indian agriculture has lower yield potential, that is, the quantity of crop produced per unit of land as compared to the world’s top crop producing countries like China, Brazil, and USA. Even though India is the world’s second largest producer of rice but its yield potential/productivity is lower than of Brazil, China and USA. The same pattern is found in pulses of which India is the second highest producer in the world. Agricultural growth in India has been reasonably unstable over the past few decades, ranging from 5.8% in 2005-06 to 0.4% in 2009-10, 0.2% in 2014-2015 and 3.5% in March 2022 (Economic Survey 2019-20).
History of Agriculture in India
The British during the colonial period promoted more cash crops instead of food crops for their own profits. The decades of neglect of agriculture sector under colonial rule made it a major challenge for India after independence. To address the immediate food security issue, India imported food grains from US under PL-480 scheme 1956. Three million tonnes of grains were imported and ten million tonnes in 1966. Amidst US arm twisting and successive droughts, the then Indian PM Shri Lal Bahadur Shastri adopted food self sufficiency as his top policy priority. He gave the slogan of “Jai Jawan Jai Kisan” and launched the Green Revolution under the supervision of Indian geneticist MS Swaminathan which revolutionised Indian agriculture. Under the Green Revolution high yielding varieties (HYVs) of seeds were introduced in India for the first time. These HYV seeds were drought and pest resistant and required proper irrigation. Green revolution was first launched in Punjab, Haryana and Tamil Nadu because these regions had adequate irrigation facilities for crops like rice and wheat. Cash crops like cotton, oilseeds and jute were not included. This revolution focused on inland productivity. In order to increase farm production, the revolution also focused on developing the irrigation system and other productivity factors such as fertilisers, insecticides and weedicides and on promoting commercial farming modern machinery like tractors, harvesters and drillers.
The Green Revolution substantially increased the agricultural productivity of wheat and rice in India and from a food-deficient country India became a food-surplus country. Many farmers moved from subsistence farming to commercial farming.
Challenges in Indian agriculture
Despite record production of certain major agricultural produce and rise in export, Indian farm sector faces some challenges, such as, low crop yield/productivity, small land holdings, monsoon dependency, low share of exports in global market, lag in farm mechanisation, burden of loans, farmer suicide, inadequate storage facilities, absence of supply chain management, etc. All this puts a load on the already struggling industry, limiting its growth.
Dependence on monsoon
The growth of India’s agriculture has been dependent on monsoon and as a result it has been volatile. There is only 36% of irrigated land of the total agricultural land (World Bank data). Reliance on seasonal rainfall lowers productivity. Moreover, change in climatic conditions and erratic weather pattern such as cyclones and droughts can impact yields of agricultural crops.
Marginal land holdings
In India nearly 85% of agriculture land holding are small and marginal (<2 hectares). Raising farm productivity is critical for long term increase in farmers’ income in India, as land fragmentation means that many Indian farmers are having farming plots of such a small sizes that even doubling their incomes would leave them with meagre earnings.
Slower agricultural growth rate
The Ashok Dalwai Committee report on doubling farmers’ income estimated that it will require an agricultural growth rate of 10-11% per annum until 2022-2023. However, agricultural growth rate and farmers’ income growth rate has been stagnating and well below the required rate of growth.
Lack of mechanisation
In India majority of farming is done by conventional agricultural tools. According to the Census 2018-19, 76.5% of farmers have less than 2 ha of land (avg land holding 1.15 ha). This is another obstacle in the use of modern tools in agriculture.
Scarcity of capital
Due to absence of any well operated institutional mechanism, farmers are bound to take capital from money lenders, and because of the overwhelming dominance of money lenders they charge exorbitant rates of interest. This has socio-economic implications for farmers and they are bound to sell their land and fall in the debt trap.
Poor penetration of forward and backward linkages in agriculture
Food processing units need to have strong backward linkages with farmers, farmers’ producer organisations, self help groups, etc. Further, to be able to sell processed food, strong forward linkages are needed with the wholesalers, retailers, and exporters.
Inadequate storage facilities and transport connectivity
India has poor rural roads, which affect the timely supply of inputs and timely transfer of outputs from the farm. In other areas, regional floods, poor quality and inefficient farming practices, lack of cold storage, harvest spoilage causes 30% loss to the farmers’ produce. Because of absence of godowns and warehouses, farmers are forced to sell their produce at very low cost. According to the Parsee committee, lack of adequate storage facilities leads to 6.6% of food wastage. Absence of cold storage leads to 20% wastage of fruits and vegetables.
Issues related to subsidies
Agricultural subsidies were introduced to incentivise farmers to take up loans. Green Revolution subsidies also intended to reduce the cost of production for farmers and to check food price inflation and to protect consumers. However, today it has become apparent that subsidies are inflicting significant damage on different aspects of economy, e.g, subsidised urea has led to the massive overuse of nitrogenous fertilisers, leading to damaged soils and pollution of local water bodies. Similarly, power subsidies have not only led to an alarming overuse of ground water but also severely damaged the health of power distribution companies. Credit subsidies like loan waivers have weakened the Indian banking system (due to NPAs) having negative spillover effect on the economy. Output price subsidy in the form of minimum support price (MSP) basically applied only to a handful of crops, especially wheat and rice, that are produced by the government in a handful of states, resulting in excessive production of wheat and rice which has caused depletion of the groundwater table and soil quality deterioration.
Consumer oriented policies
Whenever there is a price rise in any agricultural commodity the government imposes restrictions on exports to protect Indian consumers. This creates hindrances for farmers in taking advantage of high prices in foreign markets. This coupled with the Essential Commodities Act (ECA) has meant lower private investment in export infrastructure such as warehouses and cold storage system. This lack of storage infrastructure has compelled farmers to go for distress sale.
Flawed agricultural marketing policies
Due to the restrictions imposed by the Agricultural Produce Market Committee Acts (APMCA) passed by various states, Indian farmers today can only sell their produce at the farm or local markets (haats) to village aggregators APMC mandis and to the government at MSP.
Soil health card scheme: It was launched in 2015 to help farmers in deciding amount of fertilisers to be used.
To increase the area under irrigation, PMKSY (Pradhan Mantri Krishi Sinchai Yojana) was launched with an objective of “Har Khet Ko Pani” and to promote local rain harvest management.
The e-NAM programme was launched with the objective of One Nation One Market to provide pan-India access for farmers, rather than a dedicated local APMC market.
Crop diversification and better prices: PM AASHA (Pradhan Mantri Annadata Aaysanrak Shan Abhiyan) Yojana was launched to realise better prices in crop diversification. Oil seeds and copra was also included.
Agriculture export policy: Was launched in 2018 with a target of achieving 60 billion dollar worth of agricultural exports by 2022.
However, due to unawareness about the schemes and lack of supporting measures, most of the agricultural schemes are not implemented properly.
Action to be taken
Food processing sector: India is the second largest producer of fruits and vegetables in the world but hardly 2% of total produce is being processed. The development of food processing sector can increase shelf life of fruits and reduce wastage.
Export orientation: India’s agricultural export supply chain is poor as compared to other countries. According to the WTO trade statistics 2017, China holds 4.1% of world agri food exports, while India shares only 2.27% of it. Better transportation, storage facilities and branding will promote our crops.
Non-farming income: If any natural disaster happens, allied sectors such as dairy, cattle rearing, fisheries, etc, can provide alternative source of income to farmers.
Higher productivity: In order to increase productivity, technological intervention is a must. Precision farming or drip irrigation, drones and sensors can help to reduce the input costs of farming. Now it is high time to go for climatic-specific agriculture and collective farming which can boost agriculture production in the country.
Research and development: China spends 60% of agricultural GDP on R&D while India spends only 30% which is less than even Bangladesh’s 38%. That is why we have not seen any notable innovation in Indian agriculture after the Green Revolution. By agricultural research we can provide better inputs and increase farm production.
Crop diversification: In order to curb excessive dependence on a few crops, we have to go for crop diversification. We need to incentivise our farmers to grow coarse grains like millets. It helps the farmers against pest attacks and provides security also against weather aberrations. Farmers can adopt crops that require less water instead of water intensive crops.
Innovative agricultural practices
Aquaponics: Farmers must be encouraged to adopt innovative measures like aquaponics, which is a collective activity of aquaculture and agriculture that reduces the need of chemical fertilisers and hence saves the environment and also removes dependence on one crop.
Urban farming: Innovative measures such as plant scrappers can also be adopted which will promote urban agriculture, reducing the pressure on traditional farming and dependence on villages.
Biofuel: It is a renewable energy source that is derived from microbial plant and animal material. Ethanol, green diesel and bio diesel are biofuels that have a positive impact on farm income.
These techniques and practices are costly and demand expertise, so the government will have to play a major role in promoting these activities by incentivising people to adopt such practices.
Finally, agriculture being a state subject needs a collective approach of both central and state governments for its development.
The writer is a student at SKUAST Kashmir. [email protected]