Bangalore:  Agriculture in India has a noteworthy history. And it has always been the chief economic sector. Employing two-thirds of the population, agriculture sector itself provides one-third of the GDP. India tops the second place in farm output and made agriculture as its biggest economic source. 

Agriculture sector is considered as the supplier of food, fodder, and raw materials for a vast section of the industry. Thus, the growth of Indian agriculture can be counted as the necessary condition for ‘inclusive growth’.

Half of the Indian Farmers in Debt: NSSO Researchers

The new study by the National Sample Survey Organization (NSSO) shows the 1 in 2 farmer households in debt. The report reveals that 43.42 million farmers out of 89.35 million are not capable to pay back the debt, they have.  Andhra Pradesh, Tamil Nadu and Punjab are topping in the debt list.

The survey analysis claims 81 percent of the farmers in AP in debt, following in a percentage of 74.5, Tamil Nadu top the second place of farmer debt chart, while Punjab with 65.4 percent, Kerala 64.4 percent and Karnataka 61.6 percent in the chart.

The figures top UP in the debt list while found out the 6.9 million farmers in debt, AP with 4.9 million and Maharashtra of it 3.6 million famers.

The survey did in 6,638 villages and took 51,770 sample studies from the year of 2003. Reportedly more than 50 percent of debts have gone for loan to source the capital or current expenditure for farming. Quoting this survey report, Union Minister of State Agriculture Harish Rawat mentioned ‘crop failures drive farmers into debt trap.

Established in 1950, the National Sample Survey reorganized in 1970 under a single Government organization and renamed as National Sample Survey Organization (NSSO). Involving in regular socio-economic surveys, NSSO is one of the renowned organizations of India on the same. For the impartial and independent data collection the organization works under the direct control of Governing Council.

Agriculture in India, Today

The growth of agriculture and allied sectors is still a decisive factor in the overall performance of the Indian economy. According to the Central Statistics Office’s (CSOs) report, the agriculture and allied sector accounted for 14.2 percent of the gross domestic product (GDP). This release of 2010-11 advance estimates shows the GDP at constant 2004-05 prices.

A rapid change in the GDP has occurred in the recent past years as in 2009-10, agriculture and allied sector accounted for 14.6 percent compared to the 15.7 percent of GDP it marked it 2008-09. And it was 19.0 percent in the years of 2004-05. Accounting the average GDP growth during 2004-05 to 2010-11, it has increased by 8.62 percent while agriculture sector marked the growth of only 3.46 percent. The role of agriculture sector still remains the major economic sector by producing 58 percent of the employment.

The Gross Capital Formation (GCF) in agriculture and allied sectors as a proportion to the GDP in the sector declined around 14 per cent during 2004-05 to 2006-07. Though, there is a remarkable improvement in this figure during the current Five Year Plan (2007-2012). It increased to 16.03 per cent in 2007-08 and further to 19.67 per cent in 2008-09 (provisional) and to 20.30 per cent in 2009-10. However, the GCF in agriculture and allied sectors relative to overall GDP has remained slow at around 2.5 to 3.0 percent. As a result the share of GCF in agriculture and allied sector in total GCF has remained in the range of 6.6 to 8.2 per cent during 2004-05 to 2009- 10. There is need to considerably increased investment in agriculture, both by the private and public sectors to make certain sustained target growth of 4 per cent per annum.

Will FDI in Retail Lend Hand for Farmers?

FDI in Retail offers 10 million employment opportunities in agro-processing, sorting, marketing, logistics management and front-end retail within next three years. Removing the exploitative middlemen from agro-products market, FDI in retail ensures secure remunerative prices. Providing a direct contact with the purchaser, it will benefit the farmers to get a better pay for their goods and services.

And a minimum invest of $100 million with a half amount insist to be invested for reducing the post-harvest losses. And it mainly suggest for building-up the back-end infrastructures which will include cold chains, refrigeration, transportation, packing, sorting and processing. Moreover the more efficient supply chains will help to avoid wasting agro-products especially agro-food items.

For encouraging the home-country development, a minimum of 30 percent of the sourcing should be done from Indian micro and small industry.

Though FDI in retail is presented as a well concern to farmers, government should have to think where should go the priority. As agriculture outputs depend on the input, there should be a proper pre-harvest plan in favour of the farmers in India. Agricultural inputs have the key role to determine the yields levels and to increase the level of production in long-term run. The further development in the yields depend on the application of technology we insist, then the use of quality seeds, fertilizers, pesticides, micronutrients and the irrigation channels.

The reduction of per capita availability of food grains has been a major issue today. To assure the nutritional security, government has the key role to ensure the increase in per capita availability of food grains. And also has to ensure availability of the right quantities of food items for common man. 

“Capital investment in agriculture as a percentage of the GDP has been stagnating in recent years, although the capital expenditure in agriculture as a percentage of the GDP in agriculture has shown some improvement in the current Five Year Plan. It may, however, also be noted that the agriculture sector GDP has itself been stagnating during the last three years from 2007-08 to 2009-10. The real challenge in agriculture sector is to enhance capital investment in the sector both by public and private sector in a sustained way.” The Economic survey of 2010-11, reports.