Agriculture Sector in India - Review in 2016
3 March 2016
Published on 20 Feb 2013
At the Hortiindia workshop-cum-exhibition at Technology Park, Greater Noida, experts demonstrated innovative methods of food cultivation. Watch how horticulturists are able to obtain high yield of tomato by using effective greenhouse technology. (Audio in Hindi)
27 February 2016
16 December 2015
Raising Farm Productivity and Making Farming Remunerative for Farmers
Niti Ayog Occasional Paper
14 June 2015
S.P. Kothari, Deputy Dean, Sloan School of Business, MIT wrote in Education Times, 9 March 2015 that 118.6 millions farmers are producing food for a population of over 1.2 billion people in India.
Total agricultural land in India is 183.19 million hectares
So average availability of land is 183.19 million hectares/118.6 million = 1.544 hectares
Total Agricultural Land in India and Average Landholding Size
Employment in Agriculture Sector in India
Directorate of Economics and Statistics, Department of Agriculture and Cooperation, Government of India
Agricultural Census 2010 - 2011
Table 1. Number of Holdings, Operated Area and Average Size of Holdings
Area, Production and Yield of Principal Crops in Various Countries during 2012
Area - '000 Hectares
Production - '000 Tonnes
Yield - Kg/Hectare
Country Area Production Yield
'000 Hectares '000 Tonnes Kg/Hectare
China 30398 205936 6775
India 42410 157800 3721
Indonesia 13446 69056 5136
Bangladesh 11423 50497 4421
Viet Nam 7753 43662 5631
Japan 1581 10654 6739
World 217320 671497 3090 100.00
China 24270 121030 4987 18.02
India 29860 94880 3177 14.13
France 5303 40301 7599 6.00
Germany 3061 22432 7328 3.34
World 26095 1842266 70599 100.00
Brazil 9705 721077 74297 39.14
India 5090 361037 70931 19.60
China 1803 124038 68806 6.73
Th ailand 1282 98400 76750 5.34
Groundnut (in shell)
World 24591 40475 1646 100.00
China 4719 16857 3572 41.65
India 4770 4695 984 11.60
Nigeria 2420 3071 1269 7.59
USA 651 3058 4699 7.55
Source: Table 7.1
World Bank Observations on Indian Agriculture
17 May 2012
While agriculture’s share in India’s economy has progressively declined to less than 15%. But the sector’s importance in India’s economic and social fabric goes well beyond this indicator. The majority of India’s poor are found in rural areas.
India is a global agricultural powerhouse. It is the world’s largest producer of milk, pulses, and spices, and has the world’s largest cattle herd (buffaloes), as well as the largest area under wheat, rice and cotton. It is the second largest producer of rice, wheat, cotton, sugarcane, farmed fish, sheep & goat meat, fruit, vegetables and tea. The country has some 195 m ha under cultivation of which some 63 percent are rainfed (roughly 125m ha) while 37 percent are irrigated (70m ha). In addition, forests cover some 65m ha of India’s land.
Three agriculture sector challenges will be important to India’s overall development and the improved welfare of its rural poor:
1. Raising agricultural productivity per unit of land:
2. Reducing rural poverty through a socially inclusive strategy that comprises both agriculture as well as non-farm employment: There is a clear need for a faster shifting of workers to nonfarm sector. Hence, poverty alleviation is a central pillar of the rural development efforts of the Government and the World Bank.
Policy makers will thus need to initiate and build a solid foundation for a much more productive, internationally competitive, and diversified agricultural sector.
Priority Areas for Support
1. Enhancing agricultural productivity, competitiveness, and rural growth
Promoting new technologies and reforming agricultural research and extension: Major reform and strengthening of India’s agricultural research and extension systems is one of the most important needs for agricultural growth. These services have declined over time due to chronic underfunding of infrastructure and operations, no replacement of aging researchers or broad access to state-of-the-art technologies. Research now has little to provide beyond the time-worn packages of the past. Public extension services are struggling and offer little new knowledge to farmers. There is too little connection between research and extension, or between these services and the private sector.
Improving Water Resources and Irrigation/Drainage Management: Agriculture is India’s largest user of water. Piped conveyance, better on-farm management of water, and use of more efficient delivery mechanisms such as drip irrigation are among the actions that could be taken. There is also a need to manage as opposed to exploit the use of groundwater. Incentives to pump less water such as levying electricity charges or community monitoring of use have not yet succeeded beyond sporadic initiatives. Other key priorities include: (i) modernizing Irrigation and Drainage Departments to integrate the participation of farmers and other agencies in managing irrigation water; (ii) improving cost recovery; (iii) rationalizing public expenditures, with priority to completing schemes with the highest returns; and (iv) allocating sufficient resources for operations and maintenance for the sustainability of investments.
Facilitating agricultural diversification to higher-value commodities: Encouraging farmers to diversify to higher value commodities will be a significant factor for higher agricultural growth, Moreover, considerable potential exists for expanding agro-processing and building competitive value chains from producers to urban centers and export markets. While diversification initiatives should be left to farmers and entrepreneurs, the Government can, first and foremost, liberalize constraints to marketing, transport, export and processing.
Promoting high growth commodities: Some agricultural sub-sectors have particularly high potential for expansion, notably dairy. The livestock sector, primarily due to dairy, contributes over a quarter of agricultural GDP and is a source of income for 70% of India’s rural families, mostly those who are poor and headed by women. Growth in milk production, at about 4% per annum, has been brisk, but future domestic demand is expected to grow by at least 5% per annum. Milk production is constrained, however, by the poor genetic quality of cows, inadequate nutrients, inaccessible veterinary care, and other factors. A targeted program to tackle these constraints could boost production and have good impact on poverty.
Developing markets, agricultural credit and public expenditures: Private sector investment in marketing, value chains and agro-processing is growing, but much slower than potential. There are restrictions on privates sector. They have to lifted gradually to enable diversification and minimize consumer prices. Improving access to rural finance for farmers is another need as it remains difficult for farmers to get credit. Subsidies on power, fertilizers and irrigation have progressively come to dominate Government expenditures on the sector, and are now four times larger than investment expenditures, crowding out top priorities such as agricultural research and extension.
2. Poverty alleviation and community actions
Self Help Groups
While agricultural growth will, in itself, provide the base for increasing incomes, for the 170 million or so rural persons that are below the poverty line, additional measures are required to make this growth inclusive. For instance, a rural livelihoods program that empowers communities to become self-reliant has been found to be particularly effective and well-suited for scaling-up. This program promotes the formation of self-help groups, increases community savings, and promotes local initiatives to increase incomes and employment. By federating to become larger entities, these institutions of the poor gain the strength to negotiate better prices and market access for their products, and also gain the political power over local governments to provide them with better technical and social services. These self-help groups are particularly effective at reaching women and impoverished families.
3. Sustaining the environment and future agricultural productivity
In parts of India, the over-pumping of water for agricultural use is leading to falling groundwater levels. Conversely, water-logging is leading to the build-up of salts in the soils of some irrigated areas. In rain-fed areas on the other hand, where the majority of the rural population live, agricultural practices need adapting to reduce soil erosion and increase the absorption of rainfall. Overexploited and degrading forest land need mitigation measures. There are proven solutions to nearly all of these problems. The most comprehensive is through watershed management programs, where communities engage in land planning and adopt agricultural practices that protect soils, increase water absorption and raise productivity through higher yields and crop diversification. At issue, however, is how to scale up such initiatives to cover larger areas of the country. Climate change must also be considered. More extreme events – droughts, floods, erratic rains – are expected and would have greatest impact in rain-fed areas. The watershed program, allied with initiatives from agricultural research and extension, may be the most suited agricultural program for promoting new varieties of crops and improved farm practices. But other thrusts, such as the livelihoods program and development of off-farm employment may also be key.
World Bank Support
Over the past five to ten years, the Bank has been supporting:
R&D in Agricultural Technology through two national level projects with pan-India implementation (the National Agriculture Technology Project and the National Agriculture Innovation Project) coordinated by the Government of India’s Indian Council for Agricultural Research (ICAR).
Dissemination of Agricultural Technology: New approaches towards the dissemination of agricultural technology such as the Agriculture Technology Management Agency (ATMA) model have contributed to diversification of agricultural production in Assam and Uttar Pradesh. This extension approach is now being scaled-up across India.
Better delivery of irrigation water: World Bank support for the better delivery of irrigation water ranges from projects covering large irrigation infrastructure to local tanks and ponds. Projects also support the strengthening of water institutions in several states (Andhra Pradesh, Karnataka, Maharashtra, Rajasthan, Tamil Nadu, Uttar Pradesh) improved groundwater management practices (for instance, in the upcoming Rajasthan Agriculture Competitiveness Project).
Sustainable agricultural practices through watershed and rainfed agriculture development (Karnataka, Himachal Pradesh, Uttarakhand), soil reclamation efforts (Uttar Pradesh) and, more recently, improved groundwater management practices (for instance, in the upcoming Rajasthan Agriculture Competitiveness Project).
Improved access to rural credit and greater gender involvement in rural economic activities through rural livelihood initiatives undertaken by a number of states (Andhra Pradesh, Bihar, Madhya Pradesh, Orissa, Rajasthan, Tamil Nadu) and soon to be scaled up by GOI with Bank support through a National Rural Livelihood Mission.
Agricultural insurance by advising GOI on how to improve the actuarial design and implementation of the insurance program (e.g. rating methodology and product design, index insurance, use of mobile and remote sensing technology to measure yields, etc.).
Improved farmer access to agriculture markets through policy reforms and investments under the Maharashtra Agricultural Competitiveness Project which aims to reform regulated wholesale markets and provide farmers with alternative market opportunities.
The land policy agenda through analytical work as well as non-lending technical assistance in support of GOI’s National Land Records Modernization Program.
Better rural connectivity through IDA support to the Prime Minister’s National Rural Roads Program (PMGSY), and by connecting rural poor and smallholder farmers through collective action to public services through Self-Help Groups (and SHG federations), Water User Associations and Farmer Producer Organizations. Recently the Bank’s Board of Executive Directors approved the National Rural Livelihood Mission, which supports SHG approaches through a pan-India approach.
Labour Saving and Cost Reduction through Machinery in Sugar Cane Cultivation
Updated 5 March 2016, 3 March 2016, 14 June 2015