Topic 1 CSC Agrl Productivity

8/6/2019 Topic 1 CSC Agrl Productivity

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Agricultural Productivity in India Issues and Challenges

.Measures to Boost Productivity and Innovations in

Agricultural Lendings by Banks: Future Trends

(Topic 1Rank 2)

CENTRAL STAFF COLLEGE

8 UNDERHILL ROAD

CIVIL LINESDELHI-110054

UNDER THE GUIDANCE OF: MR. RAKESH SHUKLA

Participants:*Hari Narayan Nishad * Ravindra kumar

*Pranati Sahoo *Mamta Sahoo

* Banita Rana *Purushottam Prasad

*Santosh kumar


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A) INTRODUCTION

Agriculture is the backbone of the Indian economy and the villages are the life

lines of growth of India.

Agriculture is a very important sector for the sustained growth of the Indian economy. About 70

per cent of the rural households and 8 per cent of urban households are still primarily dependent

on agriculture for employment. Since some three-quarters of the population live in rural areas, a

majority of households thus depend principally on this sector. Though industrialization of the

Indian Economy has adversely affected the share of agriculture in the GDP, the fact cannot be

ignored that India has undergone a series of successful agricultural revolution starting with thegreen revolution in wheat and rice in the 1960 s and 1970 s the white revolution in the milk to

the yellow revolution in oilseeds in 1980 s. As a result, India has achieved self sufficiency in

agriculture.

The principle change in 20th

century was green revolution during which all countries experienced

a massive increase in yield per unit area in time owing largely to greater control of production

factor. It is the 20th

century that must be considered the century of science based agriculture. It is

also characterized as blue print century in which more centralized engineering approach to

agriculture including the setting of production targets was a central driver for increased

agricultural output and 21

st

century will be marked by a return to a more location specificecological approach to agriculture.

A) Indian agriculture current scenario

Deceleration in agricultural growth: Growth declined from 3.62% during 1984-95 to

less than 2% in 1995-96 to 2004-05.

Share of agriculture in GDP declined from 24.4% in 1996-97 to 18.7% in 2007.

Technology fatigue: less emphasis on efficient and sustainable use of soil, nutrients

and water leading to declination in the productivity.

Declining public investments in agriculture.


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PRIORITY SECTOR ADVANCES

(Growth Over Last 2 Years)

Data excludes IBPC of Rs 500 crore issued in favour of ICICI Bank

33410

40198

43412

14587

18571 19947

11026

13829 14213

3561 47415734

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

Mar.06 Mar.07 Mar.08

Priority

Sector

Agriculture

- Direct

Agri.

- Indirect

Agri.

6

Graph: Advances in priority sectorcurrent scene

C) Factors responsible for less agricultural productivity in India

Weak framework for sustainable water management and irrigation

Traditional method

Small land holding

Inadequate infrastructure and services in rural areas

Over-regulation of domestic agricultural trade.

Rural poor have little access to credit


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Table:1 VISION 2013- Activity wise targets Direct Agriculture

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March March March March March March CAGR

2008 2009 2010 2011 2012 2013

Dairy 478 700 1030 1500 2200 3200 46.27%age Growth 46.44 47.14 45.63 46.67 45.45

Poultry 63 125 200 300 430 600 56.95

%age Growth 98.41 60.00 50.00 43.33 39.53

Fisheries 43 90 145 225 300 400 56.21

%age Growth 109.30 61. 11 55.17 33. 33 33.33

Crop loan 8000 10200 13200 17000 21800 28000 28.47

%age Growth 27.50 29.41 28.79 28.24 28.44

Agriculture machinery 1873 2230 2750 3400 4230 5300 23.13

%age Growth 19.06 23.32 23.64 24.41 25.30

Processing by individuals 250 350 500 700 960 1300 39.06

%age Growth 40.00 42.86 40.00 37.14 35.42

Plantation 222 280 425 650 1000 1500 46.54

%age Growth 26.13 51.79 52.94 53.85 50.00

Minor Irrigation 165 240 350 500 680 900 40.40

%age Growth 45.45 45.83 42.86 36.00 32.35

Debt Swap from Money lenders 100 250 400 750 1100

%age Growth 15 0.0 0 60. 00 8 7. 50 4 6. 67

Advance against warehouse

receipts 20 100 150 225 340 500 90.37

%age Growth 400.00 50.00 50.00 51.11 47.06

Others 3099 2585 3000 3500 4110 4700 8.69

Total 14213 17000 22000 28400 36800 47500 27.29

19.61 29.41 29.09 29.58 29.08

D.1) Measures to boost productivity:

Improving water resources and Irrigation/drainage management

Strengthening rural non-farm sector growth.

Improving access to land

Improving access to rural finance

Information and communication technology

Technological Prospective.

D.2) Govt. initiatives

AIBP (accelerated irrigation benefit programme) launched, to enhance irrigation

potential by 5.1 million hectares.

National Horticulture Mission: To cover 340 districts in 18 states and 2 UTs.

National dairy Development Board to promote dairying in 326 districts under

National Dairy Plan.

National Fisheries Development Board to promote inland as well as marine

fisheries.


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F.1) Risk management strategies:

Table -2: Risk Management Strategies in Agriculture

Informal Mechanisms Formal Mechanisms

Market

based

Publicly

provided

ExAnteStrategies

On-farm Avoiding exposure to riskCrop diversification and

inter-cropping

Plot diversification

Mixed farming

Diversification of incomesource

Buffer stock accumulationof crops or liquid assets

Adoption of advanced

cropping techniques

(fertilization, irrigation,resistant varieties)

Agriculturalextension

Supply of

quality

seeds, inputs, etc

Pestmanagement

systemsInfrastructures

(roads,

dams, irrigation

systems)

Sharing

risk with

others

Crop sharing

Sharing of agricultural

equipment, irrigation

sources, etcInformal risk pool

Contract

marketing

futures

contractsInsurance

ExP

ostStrategie

Coping

with

shocks

Credit Social

assistance

(calamity relief,foodfor-work,

etc)

Reschedulingloans

Agricultural

insurance

Relaxations in

grainprocurement

proceduresSupply of

fodder

Cash transfer


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G) Role of the banking sector in increasing agricultural productivity in India

Kishan credit card scheme

Insurance Training and consultancy

Warehousing and cold storage

Agro-tech and agro-clinic

SBI and Cargil India

G) Conclusion

Finally we can conclude that the Indian agricultural productivity suffers mainly because of the

expensive credit, a distorted market, intermediaries (who increase cost rather than add value),

controlled prices and poor infrastructure. It has also suffered because of poor irrigation facilities,use of traditional technology and practices, farmer s poor economic status, fragmented

landholdings, lack of post harvest infrastructure and lack of farm extension and if even a part of

these measures mentioned above are followed we are sure that we will be part of not only the

green revolution but the whole rainbow revolution. Banks should consider these facts to invest

more in infrastructure facilities like irrigation facilities, processing, storage and marketing

activities. Such agricultural infrastructure can be improved by banks, as a there are ample

prospects for banks to invest in the above activities and make banks more participative through

policy implementation and create a conducive environment so that the agriculture sector can be

cared for like any other sector.

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Topic 1 CSC Agrl Productivity