The Indian agriculture accounts for 13.7 percent of the country’s gross domestic product. If the allied services and food processing industry are included, it reaches18 percent. The sector employs a little less than 50 percent of population of the country, and plays vital role in the economy.
India is the largest producer of milk and the second largest producer of rice and wheat, and stands second in the overall farm output. According to the Department of Economics and Statistics (DES), the country produced 264 million tonnes of foodgrains during 2013-14, as compared to 257 million tonnes of 2012-13.
Despite the slowdown in the world economy in the recent years, the Indian GDP grew 5.3 percent during April-September 2014, as against of 4.9 percent in the corresponding period of previous year. But due to decreasing Kharif output, agricultural growth slipped to 3.2 percent from 3.8 percent during the same period.
As per the estimates of erstwhile Planning Commission, if the agriculture sector grows at 4 percent, its GDP contribution will reach to Rs 1315,614 Crore by 2029-2030. But the government’s target is to double the figure, which can be achieved by exploring the underutilised resources and adopting best practices.
According to Anil B Jain, Managing Director, Jain Irrigation, “About 8 percent growth in agriculture is needed and feasible. If achieved, it would result in a prosperous rural India and a much stronger India. The sector needs to ensure progress on initiatives like soil conditioning, right fertilisers, nutrients irrigation, water efficient irrigation, waste water treatment, biotechnology, better seeds and planting materials, precision agriculture and other modern practices.”
THE FOCAL POINT
“There are lakhs of tracts of land which are classified as wasteland due to low rainfall. We need to convert these tracts into agricultural land. Millet and sorghum can be grown in these tracts which have better protein than other crops. It would provide nutritional security to the nation,” says Dr. Ajit Kumar, Vice Chancellor, National Institute of Food Technology Entrepreneurship and Management (NIFTEM). He further emphasises on the use of water in a scientific manner.
To achieve the target, other aspects should be considered seriously. Dr. KC Ravi, Vice President, Commercial Acceptance and Public Policy South Asia, Syngenta India, says, “Soil erosion has degraded 120.72 million hectare of land in India, and 8.4 million hectares land has soil salinity and water logging problem. There is a need to shift R&D from irrigated land to crop and cropping system in the drylands.”
Government’s seriousness was highlighted in Union Agriculture Minister Radha Mohan Singh’s recent remark: “Pradhan Mantri Sinchai Yojana will play a vital role in bringing water to every agricultural land in the country. We are providing Soil Health Cards to farmers which will be a tool to identify the nutritional requirement of the soil and apt laboratory analysis for increasing the agriculture production and productivity.”
The Government has announced an investment of Rs 50,000 crore to revive four fertiliser plants and to set up two new plants to produce farm nutrients. The move is seen as a measure to reduce the country’s dependence on the import of necessary nutrients for the sector.
Presenting a broader picture, the minister opined that the second Green Revolution will take place in the eastern states of the country which have abundant water. Cautioning about the negative impact of using high volume chemical fertilisers in Haryana and Punjab since Green Revolution, he emphasises on the use of organic bio-fertilisers.
LABOUR SHORTAGE AND MECHANISATION
For a sector which engages more than 60 percent of rural people, generating 35 percent of over all income is apparently much lower compared with construction sector’s 37 percent of rural income. This rapid increase in non-farm income highlights the trend of labour migration from agriculture. Despite an increase of 10 Crore in rural population from 74 Crore in 2001 to 84 Crore in 2011, the farming sector registered a drop of 1.3 Crore workforce.
This shift from farm jobs to non-farm jobs, and the resultant labour shortage and consequential increase in wages obviously make way for farm mechanisation, which is seen as a wayout.
Under the 12th Plan, the Government has set up a sub-mission on farm mechanisation, which includes custom-hiring facility for agricultural machinery as one of its major components. The mission aims at catalysing an accelerated, but inclusive growth of agricultural mechanisation in India. It focuses on increasing the access of small and marginal farmers to machineries. This development, however, is not without concerns among many who believe that machines will take away jobs.
According to Mrityunjaya Singh, Managing Director, CLAAS India & SAARC, “Labour has become expensive, and also there is a shortage of availability. Machines can do the same job in two hours what a bunch of labourers can do in a full day. The idea is not to replace labourers but to provide the solution to farmers.”
“Custom hiring can provide mechanisation to the small and marginal farmers. There has to be farmer training programmes of machines. Small tractors can be suitable for them. Though the Government is promoting farm mechanisation, the policies should be constant,” suggests, Bimal Kumar, VP – Marketing, International Tractors Ltd.
Increasing farm output has posed a challenge to the country’s already strained and ill-equipped warehousing capacity. Every year, during the rainy season, foodgrains rot in the open due to lack of warehousing capacity. Food Corporation of India and Central Warehousing Corporation with private operators are now faced with an uphill task.
In the cold chain sector too, we are lagging behind; every year Rs 44,000 Crore is lost in the country due to wastage of fruits and vegetables. India produces 200 million metric tonne of fruits and vegetables while the existing cold chain’s capacity is 30 million metric tonnes.
The NIFTEM’s Vice-Chancellor urges private players to set up primary processing centres in the villages, where big investment is required.
“Only increasing agricultural productivity is not the solution, there is a need to utilise the agricultural waste to produce husk power, biogas, bio-fertiliser and in various other means so that the farmers can get good return,” says Narendra Singh, Agriculture Minister of Bihar. He urges the industry to set up sugar factories in his state.
Banks see agriculture credit as a bad debt or a loss-making effort. They seem being compelled to do their bit because of the RBI’s guidelines which stipulate them to finance at least 18 percent to agriculture. The fact is that banks do not have the expertise to evaluate the risk and expertise to monitor the portfolio.
According to an expert from the industry, “If a banker lends to a company, it gets the money paid through monthly instalments. Whereas, in agriculture, monthly EMIs cannot be fixed. India’s agriculture is dependent on Monsoon. If bad Monsoon affects agriculture then it is not easy for a farmer to pay back the money on fixed instalments. So, there is a need for the banks to get expertise in agri financing.”
Apart from exploring underutilised resources, India needs to focus on the fundamentals of agriculture such as improving soil health, introduction of high productive seeds, modern agriculture practices and apt marketing facilities for agricultural produce. It would encourage farmers to adopt best practices.