Home > Making Agriculture India's Growth Engine > Volume 1, Issue 1

Growth opportunities in agriculture must be explored

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Prof. Ramesh Chand

At the time of India's Independence, Russia had a system of collective farming, China had a commune system. It provided for the combined cultivation of all the farmers' land. It did not contain the individual land of a farmer. Our first Prime Minister, Pandit Jawaharlal Nehru, wanted such a system in India. Chaudhary Charan Singh wrote a book in opposition to that policy: Joint Farming X-Rayed. He believed that India's farmers are more connected to the land than their children.

No matter how much you tell them about the economic benefits of collective farming, because of the mother-son relationship with the land, they will never be ready for it, nor should we attempt it. He also gives good arguments in favour of it in the book. This also shows his vision towards agriculture. also how he viewed agriculture, peasants and the rural system. His words are still relevant after all these years. He advocated for rural development with the rural cottage industry in focus, which is what we are talking about again today. Today we are emphasizing on agriculture-industry linkages.

To make agriculture the engine of economic growth, we have to think around agriculture in terms of the environment around agriculture. If we think away from that environment, there will be a paradox and not much success. If we move our sector according to time and circumstances, there will be more chances of success and there will be no stalemate. We hear every day that the country's agenda is a developed India. The goal of developed India will only guide the country's priorities furthermore. The Prime Minister has also asked the NITI Aayog to formulate a vision that India of 2047 should be a developed India. The country is moving forward on two things. One is to make the country developed and the other is to make it developed with the participation of all.

To achieve the goal of a developed India, our economy needs seven to eight per cent growth in output over the next 24 years. If we continue at this rate for so many years, our per capita income will be enough to be called a developed country. According to the World Bank, a country with a per capita income of $12,000 i.e. Rs 10 lakh or more can be called developed. Currently, the per capita income is around Rs 1,70,000. We have to multiply it 6 to 7 times in 24 years. The country has decided to follow this path of development and all policies will be formulated around it.

To achieve such growth for 24 years all activities have to be included, be it agriculture, industry or services. But in my opinion, the agricultural sector has the greatest responsibility. There are many reasons for this. We divide the economy into 12 parts and the largest is the agricultural sector. Manufacturing is now close to that. Agriculture accounts for 18 to 20 per cent of the country's income. If the segment with such a large share does not grow at a rate of 3.5% to 4% per annum, it will be very difficult, may even be impossible, to achieve the goal of developed India. Therefore, the role of the agricultural sector is important. It will not succeed in achieving the dream of a developed India without ensuring a high growth rate.

This is nothing to be disappointed about. When you set a goal, you look for ways to reach it. If the growth of the agricultural sector is not up to the desired level, the country will still develop, but we will not get the growth we want in the country - one sans poverty, malnutrition, people not going hungry to bed and development being inclusive. Forty percent of the population may have a higher income, but the rest remain the same. That growth will not be inclusive.

The question is whether it can play the role we expect the agricultural sector to play. I am an optimistic person and I think there is no reason why the agricultural sector will lag behind its role in developing the country. But for that we have to change our perspective. I come from a farming family, so I have an emotional connection to the agricultural sector. In my opinion, first of all, we should change our attitude towards the agricultural sector from negative to positive. That doesn't mean I should close my eyes that there isn't a problem or challenge there. There are problems there, but also great opportunities. I can give dozens of examples of this.

Some of our states have been growing so fast in the agricultural sector for 20 years that there is not as fast growth even in the non-agricultural sectors. Andhra Pradesh, Telangana, Madhya Pradesh are examples. The growth rate of agriculture in these states is more than six per cent. There industry growth is not so much. From there comes a confidence that if these states can achieve agricultural growth at the rate of 6-7%, why can’t we adopt their policy and take agriculture beyond this growth rate across the country. This example is not of one farmer, one village or one district, it is the example of the whole state and they are all big states. This gives us the confidence that agriculture can be the engine of economic growth if the right policies are put in place.

Sometimes the question is raised that the condition of agriculture is bad, farmers are committing suicide. I would like to give an example with full empathy. If a village has 1,000 youth and 5-10% of them are malnourished or sick for some reason, wouldn't that village try to prepare sportspersons? We can change the fate of 80-90% of people by taking the right steps. But these things must not just be said, they must also be made a reality. I would like to draw your attention here to a couple of things about how it is possible to have a high growth rate in agriculture for a long time. The agricultural sector has been and will continue to be a major source of employment.

The question is where the growth opportunities in agriculture will come from. There are many regions where productivity is still very low. In Assam, for example, the average productivity of cows and buffaloes is less than two litres per day. From this you can guess that if the two litres holder wants to come to the 8 litres level like in Punjab or Haryana, there is a 400% growth opportunity for him. Similarly, look at the productivity of another crop. Somewhere you will find that we harvest 18 to 20 quintals of wheat per acre and there are many areas where we can get only 6 to 7 quintals of wheat. Similarly, there are possibilities in other crops, cattle, fisheries, agro-forestry.

Another opportunity is arising in quality food. You may have noticed that in many places in the villages, milk is sold at Rs 35 to Rs 40 per litre and sometimes at Rs 200-300 per litre. You can double to triple your income by producing milk. There are a lot of consumers in this country today who are willing to pay the price for quality. It's not just about milk. You should also look at rice. It sells for Rs 30 per kg and over Rs 100 per kg also. Thus we see that there are quite a lot of possibilities regarding quality. New kinds of demands are emerging in agriculture.

Agriculture is no longer just a means of food, but now people are using it to maintain their health and ward off diseases. Soaps, toothpastes and a lot of industrial products are also now made of bio varieties. There are also possibilities in green credit. The government has recently announced this. There is an opportunity to use solar energy. Even tourism possibilities are coming up in the agricultural sector. Many people are so tired of living in the city that they want to move to the village. But for all these we have to spread the positive and use the resources of development.

Minimum Support Price (MSP) has its own significance. I told the parliamentary committee the other day that in many places if you ensure MSP, the growth will double. Uttar Pradesh is one of them. There are many states where no matter how much you pay MSP, there will be no growth. There's saturation, something else has to be done there. But there are states where MSP is not available. There, if you give MSP, the growth rate will double.

Growth will be even faster if farmers have access to markets. Several steps have been taken in this direction as well. There was also an attempt to break the nexus of middlemen, but from the understanding of some farmer brothers, that was probably not right. You may have heard of Open Network Digital Commerce (ONDC). Just as an industry person can sell their product on Amazon or any other platform so can a farmer, farmers organization or anyone else sell their product online on ONDC.

You give information about the quantity, quality, price etc. on the website. Whoever needs he will see on the website and buy without any middleman. I reviewed it the other day. I find this to be the most disruptive technology. Similarly, the cooperative sector should play a role, which has been limited to the dairy sector right now. Even where cooperatives are not doing well, the dairy sector is doing well.are not doing well, the dairy sector is doing well. (The new Ministry of (Article is based on the keynote address at RURAL VOICE AGRICULTURE CONCLAVE and NACOF AWARDS 2023)

According to the World Bank, a country with a per capita income of Rs 10 lakh or more can be called developed. Currently, it is around Rs 1,70,000. We have to multiply it 6 to 7 times in 24 years. The country has decided to follow this path of development.


Prof. Ramesh Chand
The author is Member, NITI Aayog

रूरल वर्ल्ड पत्रिका कृषि नीति, किसानों के मुद्दों, नई तकनीक, एग्री-बिजनेस और नई योजनाओं से जुड़ी तथ्यपरक जानकारी देती है।

हर अंक में किसी अहम मुद्दे पर विशेषज्ञों के लेख, इंटरव्यू, ग्राउंड रिपोर्ट और समाचार होते हैं।

RNI No: DELBIL/2024/86754 Email: [email protected]


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