The Big Picture – State of Indian Agriculture & Rural Economy

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State of Indian agriculture and Rural economy

Agriculture in India contributes 14 percent to India’s GDP and employs nearly 50 percent of the population. However agriculture sector has failed to gain the momentum due to lack of sound policies making it one of the most vulnerable sector of Indian economy.

Following are some of the issues that needs to be looked at

• Agriculture is a primary sector employing nearly half of India’s population. However despite the fact that it has managed to employ vast chunk of population the growth rate of 3.2 percent per annum is way below our potential .This can be attributed to absence of sound agricultural policy which involves all the stake holders on board.
• A holistic approach towards addressing Structural constraints of agriculture needs to be done they are

1. Increasing the percentage of irrigated land(only 40 % of the land is irrigated)
2. Providing electricity(replicating Gujarat model)
3. Soil health cards(It is introduced but now the Holistic implementation of the scheme is important)
4. Rethinking fertilizer subsidy(issue of fertilizer Over subsidy, and encouraging organic farming)
5. APMC reforms (Proper implementation of model APMC act is needed)
6. Ensuring Subsidy goes to creative development of rural population

• A strong revolutionary agricultural policy at grass root level is the much awaited reform because Major subsidies of agriculture are not reaching small farmers(95% have < 1 hectare)
• The growth rate of agriculture insurance and credit is mere 4 and 2.5% respectively which is way below the prescribed growth targets. The present Crop insurance schemes are not serving the purpose due to issue of premium.(Pradhan Mantri Fasal Bima yojana envision to resolve the issue of insurance premium) and lack of awareness
• Domestic issues like responding to adverse impacts of climate change and also formulating a strong actionable climate change policy is needed(The present NAPCC and SAPCC is not getting off the ground)
• International issues like Getting a strong verdict at WTO regarding issues of Subsidies, public stock holding, and Special safe guard mechanisms is imperative to protect the interest of farmers and all the necessary stake holders involved.
• Adequate measures to address issue of MSP of pulses and a strong policy towards Efficient use of ground water (Punjab is an arid area that grows rice (rice being tropical crop) using ground water leading to its depletion) is needed.

Q.1)”Even though Agriculture contributes 14 percent to India’s GDP and employs nearly 50 percent of the population the fruits of agriculture are not as sweet as it should be”. In the above context Critically examine the state of Indian agriculture and  issues associated with it.