India’s AgricultureStrategies to meet a 6% growth rate

Group 7 Sunil Kumar (140036)Vivek Jaiswal (140027)Amit Pandey (140042)Rajendra Dhanavi (140016)Pooja Anchan (140006)Sweta Soni (140063)

FacultyProf. Kanan

Contents

Executive Summary SWOT Analysis Key Strategies Challenges to Implementation The way forward

Executive Summary

Advantage India2nd largest Agricultural

Land• At 179.9 million hectares, India holds the second largest agricultural land in

the world. Of this around 60 million of land is irrigated.

Favorable Climatic conditions

• With 20 agri-climatic regions, all 15 major climates in the world exists in India. The country also possess 46 of the 60 soil types in the world.

Record production of food grains

• Total food grains production in India reached an all time high of 259.32 million tonnes in FY12. Rice and Wheat production in the country stood at 105.3 and 94.9 million tonnes respectively.

Largest producer of major agricultural and

horticulture crops

• India is the largest producer of pulses, milk, tea, cashew and jute; and the second largest producer of wheat, rice, fruits and vegetables, sugarcane, cotton and oilseeds.

Increasing farm mechanization

• India is one of the largest manufacturers of various farm equipment like tractors, harvesters and tillers. India manufactures one-third of tractors in the world; the number of tractors in the country is estimated to reach 16 million by 2030 from 4 million in 2012.

Executive Summary

Concerns

1950 1965 1976 1985 1991 1999 20090102030405060

% Share of agricultural output in India’s GDP

% Share

It is projected that India will need to grow its agricultural output by 12% to feed its people in 2020. Much of this has to come by growing more on the same amount of land. This Land, however is weakening and withering….

The Economic Times, 12th July 2011

Analysis of the Problem

Issue under study –India being an agricultural country, 70% of its population is employed in agriculture, although it contributes only 13% to India’s GDP. With the years passing it’s share in India’s GDP is on the verge of declination which would be a major threat to India’s economy. It is time to boost agricultural productivity and to achieve prosperity. The government’s target are in the range of 4% and actual performance is even lower. In some states the agriculture growth is more than 10%.

Objective – How can we achieve 6% + growth on annual basis in the coming years?What strategies need to be adopted?

SWOT Analysis

Strengths

S WO T• Large arable land area : 52% of the landmass as cultivable

land as against 11% in the world.• 179.9 million hectares of arable land – 60 millions hectares

irrigated.• Variety of Climate Conditions (15/25 major climates, 46/60

soil types)• Extensive network of agricultural research system.• Inherent agriculture competency• Sufficient availability of surface water• A hard population.

SWOT Analysis

Weakness

S WO T• Lower productivity led agricultural growth.• Changing shares of Acreage and production of major

crops/crop groups.• Shift in production mix• Fragmental land holding• Declining input use efficiency• Depletion and degradation of land resources. • Inefficient management of nutrients• Handling losses (Poor storage – especially cold storage

capabilities)• Lack of access to formal credit schemes• Lot of intermediaries in back and front end supply chain

SWOT Analysis

Opportunities

S WO T• Increase food exports• Venture into JV into Africa• Technological Development in Agriculture• Agricultural education• Bridgeable yield crops• Exports• Agro-based industry• Untapped potential in NE• Horticulture

SWOT Analysis

Threat

S WO T• Chinese access to African markets• Food imports to India• Unsustainable resource use• Unsustainable Regional Development• Global warming• Production of inferior quality of crops• Dependence on rainfall• Rising input costs

Need Analysis for 6% increased agricultural growth

To Achieve

Boost Competitiveness of Indian agriculture Enrich quality and status of natural resources Develop eminent human resources to overcome challenges Advance food security Refine value addition and processing of food commodities Proper risk management Easy access to genetic resources Enhance scope for comprehensive growth

Need Analysis for 6% increased agricultural growth

Impact – Increase in prosperity

Self reliant farmers

Increase in output

Increase in agricultural

share in GDPIncome security

Strengthening global

competitiveness

Key Strategies - Implementation

Resource Management

Improved area under irrigation Accelerated Irrigation Benefit Programme (AIBP) implemented by GOI need to

be replicated at massive scale. Assured irrigation helps in bringing about a shift from mono-cropping to double

cropping or Multiple cropping, improvement in yield levels and shift in areas/regions which hold the key to term output growth

Water and Water Quality Conservation Watershed management Inter-basin water transfer Public involvement and capacity building Flood control and protection works Afforestation

Key Strategies - Implementation

Farmer’s Education and welfare

Educate farmers on best farming practices Contribute to remove malnourishment and hunger in both rural and

urban areas Empowerment of small farmers Access to financial services like – banks, insurance Social welfare schemes to increase employment opportunities to

empower them Farmers normally rely on farm saved seeds, which leads to low seed

replacement rate and poor yield. A central sector scheme for developing and strengthening infrastructure facilities for Production and Distribution of Quality Seeds

Key Strategies - Implementation

Infrastructure Improvement

Need for appropriate price incentives and reduction in fertilizer subsidy is the need of the hour to encourage sustainable practice

Public spending on Research and Development to agriculture GDP in India is in the range of 0.5 to 0.59. An Public Private partnership needs to be implemented to improve spending

Bring in efficiencies, especially in food supply chains Investment in logistic – warehouses and cold storage Direct procurement from farmers will likely result in higher prices for

the farmer and lower ones for the consumers FDI in multi-brand retail would help bring in investment in

warehousing, storage capacities and improved logistics.

Key Strategies - Implementation

Resource Management

Water Conservation Watershed management Water quality conservation Inter-basin water transfer Recycle and re-use water Public involvement and capacity building Improve area under irrigation Flood control and protection works Afforestation

Key Strategies - Implementation

Value addition – 3 steps

Economies of Aggregation Bargaining and claim making power from joint purchase, production and sale

Simple Value AdditionCleaningDryingGradingPackingStoringTransportation

Complex Value AdditionChanging form, conversion to products