Agriculture holds immense potential to create more jobs and boost the economy. By modernizing farming techniques, investing in agricultural infrastructure, and promoting value-added activities like food processing and agribusiness, we can transform the sector into a vibrant source of employment. Harnessing technology, improving access to markets, and providing better training for farmers can lead to increased productivity and a wider range of job opportunities. By tapping into agriculture’s full potential, we can address unemployment, enhance rural livelihoods, and ensure sustainable growth for the country.
Tags: GS-3, Economy- Growth & Development- Agriculture Sector- Employment
Context:
- The potential of the agriculture sector in India to create more jobs by re-imagining agricultural practices and viewing farms as factories for value addition.
- The reduction in the number of workers in unincorporated non-agricultural establishments may have been, to some extent, offset by an expansion in formal sector employment.
Current Employment Trends:
- Decline in Unincorporated Non-agricultural Establishments:
- From 11.13 crore workers in 2015-16 to 10.96 crore in 2022-23.
- Mainly observed in the manufacturing sector, dropping from 3.60 crore to 3.06 crore workers during the same period.
- Sectoral Shifts in Employment:
- Trade sector employment increased marginally from 3.87 crore to 3.90 crore.
- “Other services” sector saw a slight rise from 3.65 crore to 4 crore workers.
- Impact of Economic Shocks:
- Economic events like demonetization, GST rollout, and pandemic-induced lockdowns contributed to these shifts.
- These shocks particularly affected small-scale, informal enterprises that typically act as a safety net during economic downturns.
- Productivity and Wage Levels in Informal Sector:
- Workers in unincorporated sector enterprises earned an average annual emolument of Rs 1,24,482 during 2022-23.
- Highlighting the low productivity and wage disparity prevalent in the informal sector, which serves as a critical employment buffer.
Importance of Informal Sector:
- Employment Generation:
- According to the National Sample Survey Office (NSSO), about 82-85% of India’s total workforce is employed in the informal sector.
- It absorbs a large number of unskilled and semi-skilled workers who might otherwise face unemployment, acting as a crucial employment generator.
- Contribution to GDP:
- Estimates vary, but it is reported to contribute around 45-50% of the GDP.
- This contribution underscores its role in national income and economic output, especially in sectors like agriculture, services, and small-scale manufacturing.
- Labor Market Inclusivity:
- It promotes labour market inclusivity by offering employment to those with limited formal education or training, enhancing overall workforce participation and economic mobility.
- Contribution to Rural Economy:
- It supports rural economies by providing income opportunities, reducing urban migration pressure, and sustaining rural communities’ economic vitality.
- Support for Micro and Small Enterprises (MSEs):
- MSEs in the informal sector benefit from low entry barriers and minimal regulatory burdens, allowing them to operate with lower costs compared to formal enterprises.
Need for Formal Sector Expansion:
- Economic Diversification and Growth:
- Expanding formal sectors like manufacturing and high-productivity services diversifies the economy.
- Reduces reliance on agriculture and construction, promoting balanced economic growth.
- Higher Productivity and Efficiency:
- Formal sectors invest in technology, infrastructure, and skilled labour.
- Achieves higher productivity per worker, enhancing economic efficiency and competitiveness.
- Improved Working Conditions and Wage Levels:
- Formal sector jobs offer better working conditions, safety standards, and regular wages.
- Improves quality of life for workers and reduces income inequality.
- Integration into Global Value Chains:
- Formal sector expansion enables integration into global markets and value chains.
- Increases exports, attracts foreign investment, and elevates global economic status.
Harnessing Agriculture for Job Creation:
- Promoting Agro-processing Industries: Investing in agro-processing enhances agricultural product value and generates jobs in processing, packaging, and marketing.
- Strengthening Agricultural Infrastructure: Improving rural infrastructure like roads, storage, and market linkages reduces wastage and boosts logistics and maintenance employment.
- Enhancing Skill Development in Agriculture: Vocational training in agriculture and agro-processing boosts productivity, entrepreneurship, and prepares youth for diverse roles.
- Facilitating Access to Finance and Technology: Access to finance and technology promotes modern agricultural practices, boosting productivity and technology-related employment.
- Promoting Sustainable Agricultural Practices: Encouraging sustainable practices ensures environmental stewardship and creates jobs in advisory services and training.
Value Addition in Agriculture:
- Higher Economic Value:
- Processing raw agricultural produce into value-added products increases their shelf life and enhances their economic value.
- For example, tomato paste or onion paste fetch higher prices compared to raw tomatoes or onions.
- Job Creation:
- Establishing processing units locally creates employment opportunities.
- These jobs range from processing plant operators to quality control staff, logistics handlers, and administrative roles, contributing to local economic development.
- Stabilising Income:
- Farmers can benefit from more stable incomes as value-added products are less susceptible to price volatility compared to raw produce.
- This stability helps in better financial planning and risk management.
- reduced Wastage:
- Value addition can significantly reduce post-harvest losses by utilising surplus or lower-grade produce that may not fetch good prices in the raw form.
- This contributes to food security and efficient resource utilisation.
- Diversification:
- Processing agricultural products diversifies the rural economy, reducing dependency on a single crop or commodity.
- It also encourages agricultural diversification as farmers may grow crops suitable for processing rather than focusing solely on raw sales.
- Market Expansion:
- Value-added products often have broader market appeal and can be sold in regional, national, or even international markets, thus expanding market opportunities for farmers and processors alike.
Way forward:
- Policy Support:
- Subsidies and Incentives: Introduce subsidies or financial incentives for setting up processing units and upgrading technology.
- Regulatory Support: Simplify licensing and regulatory procedures for food processing units to encourage more investments.
- Market Access: Facilitate easier access to domestic and international markets through trade agreements and promotional activities.
- Infrastructure Development:
- Cold Chain Facilities: Improve cold storage and transportation infrastructure to maintain quality and reduce post-harvest losses.
- Processing Units: Establish and upgrade processing units near agricultural hubs to minimise transportation costs and enhance efficiency.
- Rural Connectivity: Enhance rural connectivity through roads, electricity, and internet access to support processing units and facilitate market linkages.
- Technology Adoption:
- Processing Technologies: Promote adoption of modern processing technologies for efficient and high-quality production of value-added products.
- Information Technology: Utilise IT solutions for inventory management, quality control, and market intelligence to improve operational efficiency.
- Research and Development: Invest in research and development for innovative processing techniques and new product development.
- Capacity Building:
- Skill Development: Conduct training programs for farmers, processors, and workers on modern agricultural practices, food safety standards, and processing techniques.
- Entrepreneurship Development: Support entrepreneurship in the food processing sector through skill development and financial assistance.
- Market Expansion and Promotion:
- Market Intelligence: Provide market information and support for identifying potential markets and consumer preferences.
- Promotional Campaigns: Conduct promotional campaigns to create awareness about value-added agricultural products and their benefits.
- Certification and Standards: Ensure compliance with quality standards and certifications to build consumer trust and access premium markets.
- Financial Support:
- Access to Credit: Ensure easy availability of credit and financial support for setting up processing units and upgrading technology.
- Risk Mitigation: Introduce insurance schemes and risk management tools to protect investments in processing and value addition.
- Collaboration and Partnerships:
- Public-Private Partnerships: Foster partnerships between government agencies, private sector entities, and research institutions to leverage resources and expertise.
- International Collaboration: Engage in international collaborations for technology transfer, market access, and best practices in food processing.
UPSC Civil Services Examination, Previous Year Questions (PYQs)
Prelims
Q:1 Disguised unemployment generally means (2013)
- large number of people remain unemployed
- alternative employment is not available
- marginal productivity of labour is zero
- productivity of workers is low
Ans: (c)
Mains
Q:1 Can the strategy of regional-resource based manufacturing help in promoting employment in India? (2019)
Q:2 Normally countries shift from agriculture to industry and then later to services, but India shifted directly from agriculture to services. What are the reasons for the huge growth of services vis-a-vis industry in the country? Can India become a developed country without a strong industrial base? (2014)
Conclusion
To fully tap into the potential of agriculture for job creation, India needs to adopt a vision of the “farm as a factory” and invest in value addition and infrastructure that supports agricultural processing and related activities.
Source: IE
FAQs
Q: Why is agriculture important for job creation?
Answer: Agriculture is crucial for job creation because it employs a large portion of the population, especially in rural areas. By improving agricultural practices and investing in this sector, we can generate more jobs and boost the economy.
Q: How can modern technology help create more jobs in agriculture?
Answer: Modern technology, such as advanced farming equipment, irrigation systems, and digital tools, can make farming more efficient. This can lead to higher productivity and create new job opportunities in equipment maintenance, tech support, and data analysis.
Q: What role do agricultural startups play in job creation?
Answer: Agricultural startups can introduce innovative solutions, such as organic farming, hydroponics, and agri-tech. These startups not only increase efficiency but also create jobs in research, development, marketing, and distribution.
Q: How can training and education help increase jobs in agriculture?
Answer: Training and education can equip farmers with modern farming techniques, financial literacy, and business skills. This knowledge can help them increase their productivity and profitability, leading to more employment opportunities in farming and related industries.
Q: What government policies can support job creation in agriculture?
Answer: Government policies that provide subsidies for modern equipment, offer low-interest loans, and invest in rural infrastructure can support job creation. Additionally, schemes that promote agribusiness and food processing industries can create numerous jobs in these sectors.
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