India’s Chief Economic Advisor V. Anantha Nageswaran | photo credit: Reuters
India’s agriculture has performed well, but the sector needs ‘reorientation’ amid some challenges such as the adverse effects of climate change and rising input costs, according to the economic survey for 2022-23 tabled in Parliament on January 31.
Other challenges are fragmented land holdings, suboptimal agricultural mechanization, low productivity, hidden unemployment, and rising input costs, among others.
Read also | Inflation of 6.8% not too high to deter private consumption or weaken the incentive to invest
“Although Indian agriculture has performed well, the sector needs reorientation amid some challenges…” he said.
Stating that the performance of the agricultural sector remains critical to growth and employment in the country, the survey indicates that investment in the sector must be encouraged through an affordable, timely and inclusive approach to the provision of credit.
It can be noted that more than 75% of female rural workers are employed in the agricultural sector. This implies a need for upskilling and job creation for women in agriculture-related sectors such as food processing.
“Here, Self-Help Groups (SHGs) can play a crucial role in transforming the potential of rural women into concrete development outcomes in financial inclusion, livelihood diversification and skills development,” says investigation.
According to the survey, the agricultural sector has experienced an average annual growth of 4.6% over the past six years. It increased by 3% in 2021-22 compared to 3.3% in 2020-21.
In recent years, India has also rapidly become the net exporter of agricultural products. In 2021-22, agricultural exports hit a record high of $50.2 billion.
The survey indicates that this growth is partly attributable to the good monsoon years and partly to the various reforms undertaken by the government to improve agricultural productivity.
Policies such as Soil Health Maps, Micro-Irrigation Fund, and Organic and Natural Farming have helped farmers optimize resource use and reduce cultivation costs. The promotion of Farmer Producer Organizations (FPOs) and the National Agricultural Market (e-NAM) Extension Platform have empowered farmers, improved their resources and enabled them to obtain good yields.
Read also | Poor soil management will erode food security
The Agri Infrastructure Fund (AIF) has supported the creation of various agricultural infrastructures. Kisan Rail deals exclusively with the transport of perishable food products. The Cluster Development Program (CDP) has encouraged the integrated and market-oriented development of horticulture clusters.
Support for the creation of an ecosystem of start-ups in agriculture and related sectors is also provided to farmers.
All of these measures are aimed at sustaining agricultural productivity growth and maintaining its contribution to overall economic growth over the medium term, the Study added.