Introduction:
Agriculture stands as a fundamental pillar of the Indian economy. Notwithstanding a continuous decline in the contribution of the agriculture and allied activities sector to the overall GDP, dropping from approximately 52% in FY1951 to around 18.3% in FY 2022-23, the workforce engaged in agriculture has witnessed an increase from 77.2 million to 148 million between 1950 and 2023.
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Reasons for the diminishing share of agriculture in GDP:
- Growth Disparities: In FY 2022-23, while agriculture grew at 3.4%, manufacturing and services grew at 1.1% and -8.4%, respectively, highlighting the disparities in sectoral growth.
- Stagnant Agricultural Productivity: Despite technological advancements, the yield per hectare in agriculture has not experienced significant growth, limiting the sector’s contribution to GDP. For example, the yield per hectare of major crops like wheat and rice has plateaued in recent years.
- Traditional Agricultural Practices: The persistence of traditional practices, such as subsistence farming, hampers the scalability and modernization of agriculture, impacting its economic contribution.
- Land Fragmentation: With the increasing population, landholdings have fragmented, making it challenging for farmers to adopt efficient and large-scale agricultural practices, affecting productivity, especially in states like Kerala and West Bengal.
- Dependence on Monsoon: Irregular monsoons and climate change can lead to droughts or floods, adversely affecting crop production and contributing to the volatility of the agricultural sector.
Critical Appraisal of Employment in Agriculture:
- Disguised Unemployment: Small land holdings, often subject to fragmentation, lead to over-manning, disguised unemployment, and reduced labor productivity.
- Low Productivity: Indian cultivators exhibit poor per capita output compared to those in developed countries, necessitating a higher labor force for fieldwork.
- Limited Opportunities in Non-Farm Sectors: Poor farmers with low skill sets face limited opportunities in non-farm sectors, contributing to subsistence farming and perpetuating the cycle of poverty.
- Compulsion for Farm Employment: Lack of skills makes rural populations opt for agriculture due to a lack of readiness for employment in other industries.
Challenges:
- Limited Technological Adoption: The slow adoption of modern technologies and mechanization in farming practices hampers efficiency, reduces productivity, and limits income potential for farmers.
- Small Land Holdings: Predominance of small and fragmented land holdings limits economies of scale, leading to lower overall agricultural output and income.
- Dependence on Monsoons: High dependence on monsoons for irrigation results in vulnerability to erratic rainfall patterns, affecting crop yields and income stability.
- Inadequate Market Access: Limited access to organized markets and price volatility leads to farmer exploitation, lower prices for produce, and struggles to maximize income.
- Credit Accessibility Issues: Limited access to credit for small and marginal farmers hinders investment in modern farming practices, reducing productivity and income potential.
- Climate Change Risks: The increasing frequency of extreme weather events due to climate change poses risks to crop production, affecting income and livelihoods.
- Policy Implementation Gaps: Ineffective policy execution can hinder the intended benefits for farmers, impacting income levels.
- Rural Infrastructure Deficiencies: Inadequate rural infrastructure, including roads and transportation, hampers timely and cost-effective transportation of agricultural produce, affecting market access and income.
Measures:
- Irrigation Investment: Government initiatives like PMKSY and Atal Bhujal Yojana focus on increasing irrigation investment for improved water management, aiming to reduce scarcity.
- Crop Diversification Promotion: PMFBY and RKVY encourage crop diversification, easing pressure on water and soil resources, and promoting sustainable practices.
- Infrastructure Enhancement: PMGSY enhances rural connectivity, while e-NAM creates a national market, improving farmers’ access and facilitating better prices.
- Subsidies for Inputs: The government provides subsidies for seeds, fertilizers, and irrigation equipment, reducing cultivation costs. Crop insurance subsidies offer financial support in case of losses.
- Technology Adoption: PM-KISAN supports small farmers, enabling technology investment for improved productivity. KCC scheme provides credit access for technology and inputs investment.
Conclusion:
The dual narrative of declining income in agriculture amid its pivotal role in employment underscores the sector’s complexity. Holistic policies are imperative, striking a balance between economic growth and safeguarding livelihoods. Sustainable measures are essential to navigate the challenges and harness the enduring significance of agriculture in India’s socio-economic fabric.
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