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2335 IST, Tuesday, June 29, 2010
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Agriculture: An Overview

More than sixty years after India's independence, agriculture and agro industries remain crucial to the country's growing economy. Agriculture and allied sectors contribute nearly 22 per cent of Gross Domestic Product, while about 65-70 per cent of the population is dependent on agriculture for their livelihood. Thirty years ago, India saw a landmark "green revolution" that led to the introduction of new technologies and the high-yield variety of seeds, resulting in higher productivity and a dramatic improvement in the living standards of a large number of farmers. The technolgical changes have since continued apace as Indian agriculture aggressively enters new markets and grows new crops, taking advantage of the country's diversity of climate and geography. India has also made rapid strides in agricultural research and created a sophisticated food processing industry. Over the years, India has not only become self-sufficient and achieved food security for its millions of citizens, but has also become an exporter of food grains.

The average growth rate of agriculture and allied sectors during the last two years that is, 2006–07 and 2007–08 has been more than 4 per cent as compared to the average annual growth of 2.5 per cent during the 10th Five-Year Plan.

The current revival in the agriculture sector has been possible mainly due to a number of initiatives taken in recent years. While public sector investment in the farm sector has grown from 1.8 per cent of sectoral gross domestic product (GDP) in 2000–01 to 3.5 per cent in 2006–07, private sector investment has increased from 8.9 per cent in 2003–04 to 9.9 per cent in 2006–07.

According to a monthly review by the Centre for Monitoring Indian Economy (CMIE), agricultural production is likely to increase significantly and has projected a growth of 3.2 per cent during fiscal year 2009, for the GDP of agriculture and allied sectors. The allied sectors comprising livestock, forestry and logging, and fishing are likely to see a growth of 4.8 per cent during fiscal year 2009.

A Rabobank report titled "Indian agri-biotech sector: Emerging scenario, issues and challenges" said the agri-biotech sector in India has been growing at a whopping 30 per cent since the last five years, and it is likely to sustain the growth in the future as well. The report further states that agricultural biotech in India has immense potential, and India can become a major grower of transgenic rice and several genetically engineered vegetables by 2010.

The food processing sector, which contributes 9 per cent to the GDP, is presently growing at 13.5 per cent against 6.5 per cent in 2003–04, and is going to be an important driver of the Indian economy.

India has become the world's largest producer across a range of commodities due to its favourable agro-climatic conditions and rich natural resource base.

While it is the largest producer of coconuts, mangoes, bananas, milk and dairy products, cashew nuts, pulses, ginger, turmeric and black pepper, India is also the second largest producer of rice, wheat, sugar, cotton, fruits and vegetables.

According to the government's agri-trade promotion body, APEDA, India's exports of agricultural and processed food products posted a 38 per cent increase in the 2007–08 fiscal, bolstered by an increase in shipments of coarse cereals like maize, jowar and barley. According to official data, India exported about 17.5 million tonnes of agricultural and processed foods worth about US$ 6.39 billion in FY 2007–08 against 10.9 million tonnes valued at about US$ 4.37 billion in the previous year.

The National Horticulture Mission (NHM) aims at doubling horticulture production by 2012. Under the NHM, US$ 220.66 million has been earmarked for horticulture development during this year.

The Indian state of Gujarat is striving to become a horticulture hub. With a two-fold increase in the land already allotted to horticulture, the state government now plans to bring in another 20 million hectares.

In the North-East states of Nagaland, Manipur and Meghalaya, cultivation of the jatropha shrub, (a cash crop yielding the promise of oil for production of bio-diesel, grown primarily in wastelands) is becoming increasingly popular. Around 4,000 cultivators in Nagaland and Manipur have taken up jatropha as an alternative crop. Jatropha is also widely cultivated across the western border of West Bengal, Jharkhand, Orissa, and across Chhattisgarh.

Tanflora, Asia’s largest rose production farm, is a equal joint venture between Tamil Nadu state government-owned TIDCO and MNA & Associates. With marketing tie-ups with major importers and auction centres in Japan, Europe, Australia, Middle and Far East countries, Tanflora is the first project to be declared as the country’s agri-export zone for cut roses.

Its production is expected to touch 25 million roses during the current year (12 million in 2008). Moreover, from US$ 1.60 million revenues in 2007–08, Tanflora is hoping to double it by March 31, 2009. It is looking at US$ 8.02 million revenue by 2010.

Besides, the Cabinet has given its nod for establishment of the Indian Grape Processing Board (IGPB) at Pune, to foster sustainable development of the wine industry.

The Government will allocate US$ 1.18 million for a period of over three years to IGPB which will focus on research and development, quality upgradation market research and information, domestic and international promotion of Indian wine.

The Agricultural Equipment industry plays a key role in supporting the performance of the agricultural sector in India. Farming activities are increasingly getting mechanised, and the availability, quality and performance of agricultural equipment has an increasing impact on improving the output and productivity of the agricultural sector.

While India manufactures and deploys a range of agricultural equipment across the industry value chain, tractors and tillers are the two that constitute the bulk of the industry.

Indian agricultural equipment is increasingly finding acceptance in global markets. Tractor exports from India have been registering continuous growth over the past five years. From US$ 78 million in FY01, tractor exports rose to US$ 235 million in FY05, a CAGR of 31 per cent. Sizeable quantities are exported to Africa, the Middle East, Asia, South America and other nations.

( Source: India Brand Equity Foundation and india.gov.in)

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