India: The Growth Story-Agriculture

Agriculture in India has a significant history. Today, India ranks second worldwide in farm output. Agriculture and allied sectors like forestry and fisheries accounted for 16.6% of the GDP in 2009, about 50% of the total workforce. The economic contribution of agriculture to India’s GDP is steadily declining with the country’s broad-based economic growth. Still, agriculture is demographically the broadest economic sector and plays a significant role in the overall socio-economic fabric of India.

Per 2010 FAO world agriculture statistics, India is the world’s largest producer of many fresh fruits and vegetables, milk, major spices, select fresh meats, select fibrous crops such as jute, several staples such as millets and castor oil seed. India is the second largest producer of wheat and rice, the world’s major food staples. India is also the world’s second or third largest producer of several dry fruits, agriculture-based textile raw materials, roots and tuber crops, pulses, farmed fish, eggs, coconut, sugarcane and numerous vegetables. India ranked within the world’s five largest producers of over 80% of agricultural produce items, including many cash crops such as coffee and cotton, in 2010. India is also one of the world’s five largest producers of livestock and poultry meat, with one of the fastest growth rates, as of 2011.

Indian agriculture since 1947
Over 50 years since its independence, India has made immense progress towards food security. Indian population has tripled, but food-grain production more than quadrupled: there has thus been substantial increase in available food-grain per capita. Prior to the mid-1960s India relied on imports and food aid to meet domestic requirements. However, two years of severe drought in 1965 and 1966 convinced India to reform its agricultural policy, and that India could not rely on foreign aid and foreign imports for food security. India adopted significant policy reforms focused on the goal of foodgrain self-sufficiency. This ushered in India’s Green Revolution.

It began with the decision to adopt superior yielding, disease resistant wheat varieties in combination with better farming knowledge to improve productivity. The Indian state of Punjab led India’s green revolution and earned itself the distinction of being the country’s bread basket. With agricultural policy success in wheat, India’s Green Revolution technology spread to rice. However, since irrigation infrastructure was very poor, Indian farmer innovated with tube-wells, to harvest ground water.When gains from the new technology reached their limits in the states of initial adoption, the technology spread in the 1970s and 1980s to the states of eastern India – Bihar,[Orissa] and West Bengal.

The lasting benefits of the improved seeds and new technology extended principally to the irrigated areas which account for about onethird of the harvested crop area. In the 1980s, Indian agriculture policy shifted to “evolution of a production pattern in line with the demand pattern” leading to a shift in emphasis to other agricultural commodities like oilseed, fruit and vegetables. Farmers began adopting improved methods and technologies in dairying, fisheries and livestock, and meeting the diversified food needs of India’s growing population.

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As with Rice, the lasting benefits of improved seeds and improved farming technologies now largely depends on whether India develops infrastructure such as irrigation network, flood control systems, reliable electricity production capacity, all season rural and urban highways, cold storage to prevent food spoilage, modern retail, and competitive buyers of produce from the Indian farmer. This is increasingly the focus of Indian agriculture policy. India’s agricultural economy is undergoing structural changes.

Between 1970 and 2011, the GDP share of agriculture has fallen from 43 to 16 percent. This isn’t because of reduced importance of agriculture, or a consequence of agricultural policy.

This is largely because of the rapid economic growth in services, industrial output, and non-agricultural sectors in India between 2000 to 2010. The initial increase in production was centered on the irrigated areas of the Indian states of Punjab, Haryana and western Uttar Pradesh.With both the farmers and the government officials focusing on farm productivity and knowledge transfer, India’s total foodgrain production soared.

A hectare of Indian wheat farms that produced an average of 0.8 tons in 1948, produced 4.7 tons of wheat in 1975 from the same land. Such rapid growths in farm productivity enabled India to become self-sufficient by the 1970s. It also empowered the smallholder farmers to seek further means to increase food staples produced per hectare.

By 2000, Indian farms were adopting wheat varieties capable of yielding 6 tons of wheat per hectare. Accomplishments As of 2011, India had a large and diverse agricultural sector, accounting, on average, for about 16 percent of GDP and 10 percent of export earnings. India’s arable land area of 159.7 million hectares (394.6 million acres) is the second largest in the world, after the United States. Its gross irrigated crop area of 82.6 million hectares (215.6 million acres) is the largest in the world. India has grown to become among the top three global producers of a broad range of crops, including wheat, rice, pulses, cotton, peanuts, fruits, and vegetables.Worldwide, as of 2011, India had the largest herds of buffalo and cattle, is the largest producer of milk, and has one of the largest and fastest growing poultry industries.

The following table presents the twenty most important agricultural products in India, by economic value, in 2009. Included in the table is the average productivity of India’s farms for each produce. For context and comparison, included is the average of the most productive farms in the world and name of country where the most productive farms existed in 2010. The table suggests India has large potential for further accomplishments from productivity increases, in increased agricultural output and agricultural incomes. The Statistics Office of the Food and Agriculture Organization reported that, per final numbers for 2009, India had grown to become the world’s largest producer of the following agricultural produce.

Lemons and limes
Buffalo milk, whole, fresh
Castor oil seeds
Sunflower seeds
Mangoes, mangosteens, guavas

Indigenous Buffalo Meat
Fruit, tropical
Chick peas
Areca nuts
Other Bastfibres
Pigeon peas
Chillies and peppers, dry
Anise, badian, fennel, coriander
Goat milk, whole, fresh
Per final numbers for 2009, India is the
world’s second largest producer of the
following agricultural produce.
Vegetables, fresh
Sugar cane
Groundnuts, with shell
Cauliflowers and broccoli
Peas, green
Sesame seed
Cashew nuts, with shell
Silk-worm cocoons, reelable
Cow milk, whole, fresh
Cotton lint
Eggplants (aubergines)
Nutmeg, mace and cardamoms
Indigenous Goat Meat
Cabbages and other brassicas
Pumpkins, squash and gourds

In 2009, India was the world’s third largest producer of eggs, oranges, coconuts, tomatoes, peas and beans. In addition to growth in total output, agriculture in India has shown an increase in average agricultural output per hectare in last 60 years.

The table below presents average farm productivity in India over three farming years for some crops. Improving road and power generation infrastructure, knowledge gains and reforms has allowed India to increase farm productivity between 40% to 500% over 40 years. India’s recent accomplishments in crop yields while being impressive, are still just 30% to 60% of the best crop yields achievable in the farms of developed as well as other developing countries. Additionally, despite these gains in farm productivity, losses after harvest due to poor infrastructure and unorganized retail cause India to experience some of the highest food losses in the world.

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