essay on agriculture reforms in india

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India’s New Farm Laws: Reform, Resistance, and the Road to Reconciliation

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The pulse  |  economy  |  south asia.

The new agricultural reforms are a necessity for Indian farmers; the Modi government, however, must do more to allay their fears.

India’s New Farm Laws: Reform, Resistance, and the Road to Reconciliation

In September this year, India passed three farm laws amidst parliamentary uproar. The laws have been met with much resistance, eliciting protests from farmers who have marched to New Delhi from the states surrounding the nation’s capital. Notwithstanding the optics, India’s farm laws bring about long anticipated and much needed agricultural reforms.  However, the Modi government’s commitment to farmers’ welfare will be tested in its ability to communicate and build bridges with the Indian farmer. And ultimately, the success of the farm bills will be determined by the existence of a conducive agricultural ecosystem.

The Reforms

  • The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 facilitates barrier free inter-state trade while also providing a framework for e-trading of agriculture produce.
  • The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020 facilitates contract farming and direct marketing.
  • The Essential Commodities (ECA) (Amendment) Bill, 2020 deregulates the production, storage, movement, and sale of several major foodstuffs, except in the case of extraordinary circumstances.

The new laws usher in long awaited reforms that have been part of the agricultural reform thinking for two decades, when the Shankarlal Guru Committee first advocated for a more liberal agricultural marketing structure. The earlier laws created structural problems and led to market distortions which are now finally being addressed.

The prior laws disincentivized private participation, for example. The listing of agricultural commodities under the ECA prevented their bulk procurement. Since the ECA applies uniformly to the supply chain , it has disincentivized private entry into agriculture due to unpredictability of regulations and threats of stockpile expropriation while creating a grey market of middlemen. Stockpiling limits also create a significant risk to the agriculture food processing industry and achieving economies of scale in agriculture.

They also led to poor investment in storage infrastructure. Due to frequent stock limits, there has not been adequate investment in storage infrastructure. India’s storage ecosystem is inadequate, its cold storage infrastructure is nascent, fragmented, and unorganized, and there is widespread wastage of food .

Furthermore, the prior laws thwarted exports. Products under ECA were subjected to a number of restrictions, including banning export of such commodities.

And lastly, they created a restrictive market. Under the prior laws, farmers were required to sell their produce only to the registered traders in Agricultural Produce Market Committees (APMCs).

The farmers’ concern surrounding these new laws is centered around fears of doing away with government procurement or the minimum support price (MSP) regime , corporatization of agriculture, and the collapse of the APMCs. There are significant vested interests that may be anxious of changes to the status quo, which includes states like Punjab and Haryana which are leading the protests and are major beneficiaries of revenues from APMCs. But the farmers’ fears also have some legitimacy.

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 states that in the case of a dispute, farmers and traders can approach the subdivisional magistrate, with appeals being referred to the additional collector or collector. Here, there is some merit in the farmers’ demand for keeping dispute resolution within the purview of the judiciary rather than the executive. Farmers are also concerned that these reforms could lead to a repeal of the MSP floor pricing. These specific legislative reforms do not alter the MSP regime, but due to misinformation or future reform considerations, the status of MSP has been included in the list of grievances. Also, disparities between different farmers could increase with these legislative changes. Some proactive farmers will modernize under these new rules and take advantage of a more flexible system, while other farmers prefer to stick with the traditional model they know well, even if it becomes less remunerative.

There have been voices within the government that want to do away with the MSP regime as the government ends up procuring more than it needs for consumption and the benefits of the regime are availed by merely 6 percent of the farmers. Similarly, some degree of corporatization of agriculture may be a necessity to improve agricultural productivity. India’s agricultural scenario is not very encouraging with about 55 percent of the total workforce engaged in agriculture and allied sectors while the contribution to the country’s gross value added (GVA) is merely 16 percent . The Indian farmers’ average land-holding size is less than 2 acres and contract farming can increase land holding and ensure some part of the currently engaged workforce migrates to other sectors of the economy.

Communicating these bitter truths that may, in the short-term, inconvenience some farmers is not an easy task. But the government also did its share to raise suspicion through the manner in which it implemented these reforms. The government passed the bills in the parliament in September through a mere voice vote amidst parliamentary uproar, it refused to refer the bills to parliamentary committees, did not engage farmers’ group in consultations, and initially ignored the farmers’ protests. Thus, it is unsurprising that there is a trust deficit between the protesting farmers and the government.

The Road to Reconciliation

One way to address the trust deficit and overcome the present deadlock is to provide assurances, even if it means amending the present laws. Assurances can ease farmers’ fears without diluting the agricultural reforms. For example, providing a written guarantee of MSP procurement by creating a new law may be cumbersome or even unnecessary but signals a willingness on the part of the government to meet the protestors half way. Similarly, the dispute resolution mechanism in the existing laws can be brought within the ambit of the judiciary – either directly or by creating an agricultural disputes tribunal. The government has signaled it is willing to make changes within the laws and provide reasonable assurances. However, it has not necessarily taken any concrete steps in that direction.

Finally, while the farm bills are positive, the government must not lose sight of the fact that no reform is a magic bullet. Ultimately, the success of these reforms will be decided by the agricultural ecosystem and how receptive it is to the new reforms. Reforms will yield fruits when they are accompanied by large scale investment in agricultural infrastructure – both public and private. Farmers will reap the benefits of contract farming and competitive markets when they have enough bargaining power by being organized into farmer producer organizations. A competitive and free market will be established when there is adequate market density with private markets emerging alongside the existing APMCs.

Mahatma Gandhi famously said that you cannot achieve durable reform by becoming impatient. The government may genuinely have the farmers’ interest in its heart, but this needs to be communicated to the farmers who are the main beneficiaries of these reforms. Being patient with the Indian farmer and making accommodation to alleviate her fears is one way the government can successfully instrument key reforms within Indian agriculture.

Kriti Upadhyaya is a research associate for the CSIS Wadhwani Chair in U.S.-India Policy Studies, where she specializes in Indian federal economic reforms and maintains CSIS’s India Reforms Scorecard. Full bio here .

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Agriculture Reforms – The Big Picture – RSTV IAS UPSC

  • September 29, 2020

The Big Picture- RSTV , UPSC Articles

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Agriculture Reforms

Topic: General Studies 2: Issues and challenges pertaining to the federal structure Public Distribution System- objectives, functioning, limitations, revamping; issues of buffer stocks and food security Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Context: Three Bills on agriculture reforms were introduced in the Parliament to replace the ordinances issued during the lockdown

  • The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020
  • The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020
  • The Essential Commodities (Amendment) Bill, 2020

What do the ordinances entail?

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance has following provisions

  • Opens up agricultural sale and marketing outside the notified Agricultural Produce Market Committee (APMC) mandis for farmers
  • Removes barriers to inter-State trade
  • Provides a framework for electronic trading of agricultural produce.
  • Prohibits State governments from collecting market fee, cess or levy for trade outside the APMC markets.

The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Ordinance relates to contract farming. It has following provisions

  • Provides framework on trade agreements for the sale and purchase of farm produce.
  • The mutually agreed remunerative price framework envisaged in the legislation is touted as one that would protect and empower farmers .
  • The written farming agreement, entered into prior to the production or rearing of any farm produce, lists the terms and conditions for supply, quality, grade, standards and price of farm produce and services.

The Essential Commodities (Amendment) Ordinance

  • Removes cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodities. The amendment will deregulate the production, storage , movement and distribution of these food commodities.
  • The central government is allowed regulation of supply during war, famine, extraordinary price rise and natural calamity, while providing exemptions for exporters and processors at such times as well.
  • Imposition of any stock limit on agricultural produce must be based on price rise. A stock limit may be imposed only if there is a 100% increase in retail price of horticultural produce; and a 50% increase in the retail price of non-perishable agricultural food items

Why are these bills being opposed?

  • Since agriculture and markets are State subjects – entry 14 and 28 respectively in List II – the ordinances are being seen as a direct encroachment upon the functions of the States
  • The provisions are viewed as against the spirit of cooperative federalism enshrined in the Constitution.
  • Justification by Centre: The Centre, however, argues that trade and commerce in food items is part of the concurrent list, thus giving it constitutional propriety.
  • Critics view the dismantling of the monopoly of the APMCs as a sign of ending the assured procurement of food grains at minimum support prices (MSP).
  • To the Centre’s ‘one nation, one market’ call, critics have sought ‘one nation, one MSP’.
  • Critics argue that ensuring a larger number of farmers get the MSP for their produce and addressing weakness in the APMCs, instead of making these State mechanisms redundant is the need of the hour.
  • This law nowhere states that the current system of minimum support price (MSP)-based procurement of foodgrains (essentially wheat and paddy) by government agencies would end. Such purchases in state-regulated APMC (agricultural produce market committee) mandis will continue as before. The APMCs wouldn’t stop functioning either; nothing prevents farmers from selling their produce or traders and processors from buying in these mandis.
  • All the law does is provide farmers an alternative platform to sell. This could be a factory premise/processing plant, produce collection centre, cold storage, warehouse, silo or even the farmgate. Transactions in such “trade areas” will not be charged APMC market fee or cess. These levies shall apply only in trades that take place within the boundaries of the regulated market yards or mandis set up under the respective state APMC acts.
  • The Price Assurance Bill, while offering protection to farmers against price exploitation, does not prescribe the mechanism for price fixation.
  • There is apprehension that the free hand given to private corporate houses could lead to farmer exploitation .
  • Critics are apprehensive about formal contractual obligations owing to the unorganised nature of the farm sector and lack of resources for a legal battle with private corporate entities.
  • Easing of regulation of food items would lead to exporters, processors and traders hoarding farm produce during the harvest season, when prices are generally lower, and releasing it later when prices increase.
  • This could undermine food security since the States would have no information about the availability of stocks within the State.
  • Critics anticipate irrational volatility in the prices of essentials and increased black marketing.
  • Several reforms at the level of the central government as well as at the State level have been introduced and welcomed by farmers. However, in this particular case, the issue is not about the Bills; it is also about the process of their introduction.
  • The government has failed to have or hold any discussion with the various stakeholders including farmers and middlemen.
  • This is also true when it comes to consultation with State governments even though the subject of trade and agriculture are part of subjects on the State list. The attempt to pass the Bills without proper consultation adds to the mistrust among various stakeholders including State governments.
  • Entry of two of the biggest corporate groups (Adani and Reliance) in food and agricultural retail

What are the farmers’ concerns?

Farmers are apprehensive about getting Minimum Support Price for their produce. Other concerns include the upper hand of agri-businesses and big retailers in negotiations, thus putting farmers at a disadvantage. The benefits for small farmers from companies are likely to reduce the engagement of sponsors with them. The farmers also fear that the companies may dictate prices of the commodities.

What farmers need and are asking for is legally guaranteed remunerative prices, that the government should commit within the same legislation to maximum procurement of various commodities tied with local food schemes, market intervention from the state, agri-credit reforms to benefit small and marginal holders and particular neglected regions, as well as reforms in crop insurance and disaster compensation. It is also important to empower FPOs as enabled players in the market and keep them out of the purview of overzealous regulation.

Important value additions

  • Article 246 adopts a threefold distribution of legislative power between the Union and the states.
  • List-I- the Union List
  • List-II- the State List
  • List-III- the Concurrent List

Connecting the dots:

  • Will the dismantling of APMC monopoly actually lead to these mandis becoming redundant? Will it result in corporate agri-businesses establishing direct connection with farmers and eliminating market intermediaries? Discuss.
  • Corporatisation of agriculture
  • IAS UPSC IASbaba RSTV Debate , RSTV Big Picture UPSC IAS

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Upsc quiz – 2020 : iasbaba’s daily current affairs quiz [day 96], press information bureau (pib) ias upsc – 21st september to 27th september – 2020.

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essay on agriculture reforms in india

Development of Agriculture in India: Evolution, Modern Reform and Challenges

essay on agriculture reforms in india

Exploring the Dynamics of Development of Agriculture in India Worldwide

Agricultural development in India aims to increase farm production to meet rising population demands . It involves expanding cropped areas, crop diversity, irrigation, fertilizers, and mechanization.

Agriculture has developed at different places in different parts of the world. Developing countries with large populations usually practice intensive agriculture where crops are grown on small holdings mostly for subsistence

Sowing Progress: The Evolution of Indian Agriculture from Independence to Green Revolution

  • Pre-Independence Challenges: Indian agriculture was primarily subsistence-based before Independence and faced challenges like droughts and famines in the first half of the 20th century.
  • Partition Impact: During partition, a significant portion of irrigated land went to Pakistan, reducing the proportion of irrigated land in Independent India.
  • Post-Independence Agricultural Strategy: After Independence, the government focused on increasing foodgrain production by switching from cash crops to food crops , intensifying cropping on existing land, and bringing fallow land under cultivation.
  • To address this, Intensive Agricultural District Programme (IADP) and Intensive Agricultural Area Programme (IAAP) were launched, but two consecutive mid-1960s droughts led to a food crisis.
  • This helped India to achieve self sufficiency in foodgrain production.
  • However, the Green Revolution was initially limited to irrigated areas, creating regional disparities.
  • Agricultural Diversification: Government promoted development of dairy farming, poultry, horticulture, livestock rearing, and aquaculture.
  • The policy of liberalization and a free-market economy in the 1990s influenced the direction of Indian agricultural development.

For better understanding of the nature of farming in India, consider the following two examples which compare farming activities of the average farmer in India and USA.

Small farmer Munna lal in Uttar Pradesh owns 1.5-hectare farmland with fertile soil, utilizes high-yielding seeds with advice of experts and grows wheat, rice, and pulses in his farms and sells them in nearby markets. He rents a tractor for plowing, irrigates from a nearby tubewell. . He also raises buffaloes and hens and sells milk and is also a member of a cooperative society. 

than that of an Indian farm. A typical farm size in the USA is about 250 hectares. A farmer named Joe owns a land of 300 hectares in Lowa. He focuses on crops like corn, soybean, wheat, cotton, and sugarbeet, practices Further, he performs and modern equipment, utilizes chemical fertilizers and pesticides, uses and marketing. Thus Joe operates his farm as a business.

Harvesting Progress: Advancements in Agricultural Output and Technology in India

  • Crops like rice, wheat, sugarcane, oilseeds, and cotton have seen substantial production and yield growth.
  • It paved the way for modern agricultural practices , including the adoption of high-yielding seed varieties, chemical fertilizers, pesticides, and farm machinery. 
  • The net irrigated area in the country has also expanded.
  • The use of chemical fertilizers has increased 15-fold since the mid-1960s, contributing to enhanced agricultural productivity.

Nurturing Growth: Overcoming Challenges for Sustainable Development of Indian Agriculture

Indian agriculture is adversely affected by various issues impacting development of agriculture in India and livelihood of farmers. 

  • Poor monsoons and fluctuations in rainfall patterns in regions like Rajasthan result in both droughts and floods, impacting crop production.
  • Rainfed areas, especially drylands, face low yields.
  • As a result, many turn to credit from institutions and moneylenders, leading to indebtedness.

NMSA is an initiative to by promoting location specific integrated/composite farming systems and to conserve natural resources through appropriate soil and moisture conservation measures. The Government has been promoting in the country through schemes such as Paramparagat Krishi Vikas Yojana (PKVY) and Rashtriya Vikas Yojana (RKVY).

  • Among the three revenue systems operational during the British period, i.e., Mahalwari, Ryotwari, and Zamindari , the last one was most exploitative for the peasants.
  • Land holdings are often fragmented , making them economically unviable.
  • Commercialization and modernization are more prevalent in irrigated regions.
  • Vast Underemployment: The agricultural sector in India experiences substantial underemployment, especially in unirrigated areas, leading to seasonal unemployment.
  • Issues like alkalization, salinization, waterlogging, and excessive chemical use have compromised soil fertility. 
  • Rainfed areas also face soil erosion and degradation due to human activities.

Tacking all these issues will surely contribute to development of agriculture in India.

Revitalizing Indian Agriculture through Technological and Institutional Reforms

To address the above problems comprehensively, various technological and Institutional measures has been initiated by the government. 

, a spiritual heir of Mahatma Gandhi, launched the Bhoodan movement in India. He started this movement from after some poor landless villagers demanded some land for their economic well-being. As a beginning, offered 80 acres of land to be distributed among 80 land-less villagers. This act was known as . Later he traveled and introduced his ideas widely all over India. Some zamindars, owners of many villages, offered to distribute some villages among the landless. It was known as . However, many land-owners chose to provide some part of their land to the poor farmers due to the fear of land ceiling act. This Bhoodan-Gramdan movement initiated by Vinoba Bhave is also known as the .

  • Collectivization: Efforts were made to consolidate land holdings and foster cooperation among farmers.
  • Abolition of Zamindari : The zamindari system was abolished to ensure equitable land distribution.
  • Land Reforms : Land reform laws were enacted, though their implementation varied.
  • Green Revolution : The Green Revolution, driven by technology adoption, aimed to boost agricultural productivity.
  • White Revolution : The White Revolution, or Operation Flood, focused on dairy production and distribution.

Agriculture Reforms

  • Comprehensive Land Development : In the 1980s and 1990s, a comprehensive land development program was initiated, combining institutional and technical reforms.
  • Crop Insurance: Crop insurance against natural disasters was introduced.
  • Grameen Banks: Grameen banks and cooperative societies provided farmers with access to loans at lower interest rates.
  • Kisan Credit Card (KCC) : The KCC scheme aimed to provide credit to farmers.
  • Personal Accident Insurance Scheme (PAIS) which aimed to offer insurance coverage to farmers.

The Farmer’s Portal is a platform for farmers to seek any information related to agriculture. , agriculture storage, crops, extension activities, seeds, pesticides, farm machineries, etc. is provided. package and practices, programmes, welfare schemes are also given. related to soil fertility, storage, insurance, training, etc. are available in an interactive map. scheme guidelines, etc.

  • Weather Bulletins and Agricultural Programs: These  were introduced on radio and television for better dissemination of information. 
  • Minimum Support Price (MSP) : The government announced MSPs for important crops to protect farmers from exploitation by middlemen and ensure sustainable development of Agriculture in India.
  • Primary activities like hunting , gathering, pastoralism, mining, and mainly agriculture play a crucial role in meeting the demands of a growing population. 
  • As the majority of the population in the world is dependent on agriculture, the ongoing development of agriculture in India is essential for ensuring food security and fostering sustainable economic growth in both developing and developed regions.

People engaged in primary activities are called red collar workers due to the outdoor nature of their work. ): It is defined as the number of crops a farmer grows in a given agricultural year on the same field and is another means for intensification of production from the same plot of land. It is related to the tremendous increase in production of honey and horticulture . The regions where farmers specialize in vegetables only, the farming is known as truck farming. The distance of truck farms from the market is governed by the distance that a truck can cover overnight, hence the name truck farming. Milk-producing animals are known as “milch animals” e.g. cows, buffaloes, goats and camels.  It is an excessive accumulation of water-soluble salts in soil. Typically, it is a table salt, NaCl In this type of farming, organic manure and natural pesticides are used instead of chemicals. No genetic modification is done to increase the yield of the crop. security It is said to exists when all people, at all times, have access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life.

Also Read: Diverse Types of Agriculture: Understanding Forms and Practices Worldwide

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Home » Agriculture » Role of Agriculture in Indian Economy » Government initiatives, policies and measures

Nowadays Government of India is giving more priority for the welfare of farmers. In this regard it is implementing several farmers welfare schemes to re-vitalize agriculture sector and to improve their economic conditions.  Therefore, the government has rolled out new initiatives, schemes, programmes and plans to benefit all the farmers.

Small Farmers Agribusiness Consortium (SFAC) is the lead agency for implementing eNAM under the aegis of Ministry of Agriculture and Farmers’ Welfare, Government of India.

National Mission for Sustainable Agriculture (NMSA) has been formulated for enhancing agricultural productivity especially in rainfed areas focusing on integrated farming, water use efficiency, soil health management and synergizing resource conservation.

Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) has been formulated with the vision of extending the coverage of irrigation ‘Har Khet ko pani’ and improving water use efficiency ‘More crop per drop’ in a focused manner with end-to-end solution on source creation, distribution, management, field application and extension activities.

The Paramparagat Krishi Vikas Yojana (PKVY), an initiative to promote organic farming in the country, was launched by the NDA government in 2015.

According to the scheme, farmers will be encouraged to form groups or clusters and take to organic farming methods over large areas in the country.

Pradhan Mantri Fasal Bima Yojana (PMFBY) is the government sponsored crop insurance scheme that integrates multiple stakeholders on a single platform.

Gramin Bhandaran Yojana, or Rural Godown Scheme, is an Indian government initiative to offer subsidies to individuals or organizations which build or repair rural godowns.

This scheme aims to provide protection mechanism to the farmers and cattle rearers against any eventual loss of their animals due to death and to demonstrate the benefit of the insurance of livestock to the people and popularize it with the ultimate goal of attaining qualitative improvement in livestock and their products.

 

The government approved a dedicated Rs5,000 crore fund to bring more land area under micro-irrigation as part of its objective to boost agriculture production and farmers income.

The fund has been set up under NABARD, which will provide this amount to states on concessional rate of interest to promote micro-irrigation, which currently has a coverage of only 10 million hectares as against the potential of 70 million hectares.

 

Rainfed Area Development Programme (RADP) was implemented as a sub-scheme under Rashtriya Krishi Vikas Yojana (RKVY).

The scheme of National Watershed Development Project for Rainfed Areas (NWDPRA) was launched in 1990-91 based on twin concepts of integrated watershed management and sustainable farming systems.

requires that imposition of any stock limit on agricultural produce only occur if there is a steep price rise.

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paper cover thumbnail

Agricultural Reforms in India

Profile image of Mahendra Dev

Indian Public Policy Review

Issue: Jan-Feb 2021 This paper explores the recent farm laws passed by parliament and their impact on farmers’ income. The laws collectively offer greater freedom to cultivators to sell their produce at better prices and allow farmers to enter into contracts with processors, aggregators, wholesalers, large retailers and exporters at mutually agreed crop prices. The laws also encourage private investment into storage and warehousing by removing stockholding limits. To make these reforms work, some conditions may have to be fulfilled and imperfections and concerns have to be addressed, which are elaborated in the paper. Finally, the paper focuses on other agricultural reforms to improve the supply-side factors, such as rationalization of subsidies, land reforms, use of technology, strengthening institutions and governance, and improving rural infrastructure.

Related Papers

Dr. Navjit Singh

Agriculture once known as the backbone of Indian Economy is at present at its worst, thanks to the anti farmer, pro-Industry policy of the various Indian Governments since 1991. India is once considered as the &quot;Ann Data&quot; of the entire world is struggling even to manage the own demand-supply problem of various agricultural commodities. The farmers are committing suicides, are celebrating &quot;Crop Holidays&quot; and are fighting with Govt. for illegal acquisition of land for developing Real estate or other commercially viable projects at the cost of Agriculture. The aim of this paper is to bring out the present scenario in the field of agriculture that leads to the minimum contribution of Agriculture in the Indian GDP, once the main contributor. This paper will discuss the various issues like less technical support to farmers, poor quality seeds, inappropriate storage, Minimum Support Price, irrigation, the problem of credit availability and above all the impact of Liberal...

essay on agriculture reforms in india

Anjali Tandon

India Studies in Business and Economics

Siraj Hussain

This chapter deals with key structural issues facing Indian agriculture since Independence. In the context of federal fiscal relations as well as shared responsibilities towards agricultural development, it examines spending on capital formation and subsidies in agriculture vis-à-vis other economic sectors. It then deals with reforms in the subsidy regime (relating to both inputs and ouput) and the implications of the agri-marketing laws enacted in 2020, since retracted. The agriculture sector (including irrigation) has always received relatively lower priority in public expenditure. Morever, the spending bias has been more towards input subsidies rather than on investment, which may affect agriculture growth in due course. The institutional, price and legislative reforms and structural changes identified in the paper suggest that the agricultural sector requires handholding. The Government of India and state governments should work in tandem to accelerate rural infrastructure, targ...

Current Science

Sendhil Ramadas

Indian agriculture is essentially monsoon-and market-dependent, and suffers frequent distresses posing threat to the welfare of farmers as well as interest in farming. Declining farm productivity and income have serious implications on rural prosperity and overall economy. Hence, increasing the real farm income, i.e. nominal (actual) income adjusted to inflation has become a priority for the state and policy planners. The Government of India, in its budget 2016–17 proposed to double the farmers’ income by 2022 (marking the 75th year of Independence) by addressing the agrarian distress and crisis. Indian agricultural databases lack farmer income series. Nevertheless, it has been estimated from survey data that the farm income growth, currently hovering around 1%, has declined since 2011–12. We discuss here the farm income trends across holding sizes and states, as well as disaggregated sources of farm income using the National Sample Survey Office (NSSO) data for 2003 and 2013. The potential pathways integrating science and technology (S&T), institutions and policy to double the farmers’ income are explored in this Commentary.

MTID discussion papers

David Orden

Devender Pratap

Global Journal of Emerging Market Economies

Kirit Parikh

Kamal Vatta

Dr Jai P Rai

Together with its allied sectors, agriculture is unquestionably the largest livelihood provider in India. This is of particular importance in the vast rural areas of the country. According to an estimate by The Agricultural and Processed Food Products Export Development Authority (APEDA), agriculture is the source of livelihood to approximately 47 per cent of the country’s population. Agriculture also contributes significantly (13.9%) to the Gross Domestic Product (GDP) of the nation and thus, plays vital role in the national economy. The Central Statistics Office (CSO) has estimated the share of agriculture (including allied sectors, viz. livestock, forestry and fisheries) being as much as 16.1 per cent of the Gross Value Added (GVA) during the year 2014–15 at 2011–12 prices. During the first quarter of the year 2016, agriculture and allied sectors have been reported to grow year-on-year at the rate of 1.9 per cent and thus, contributed 14.2 per cent of GVA.

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NITI Aayog pitches for Agricultural Reforms

essay on agriculture reforms in india

NITI Aayog pitches for Agricultural Reforms 

Syllabus: GS3/ Agriculture

  • Niti Aayog recently pitched for reforms envisaging more private sector role in India’s agriculture sector.

Agriculture in India

  • India is one of the major players in the agriculture sector worldwide and it is the primary source of livelihood for ~55% of India’s population. 
  • Has the world’s largest cattle herd (buffaloes), 
  • Has largest area planted to wheat , rice, and cotton, and 
  • Is the largest producer of milk, pulses, and spices in the world. 
  • It is the second-largest producer of fruit, vegetables, tea, farmed fish, cotton, sugarcane, wheat, rice, cotton, and sugar. 
  • Agriculture sector in India holds the record for second-largest agricultural land in the world generating employment for about half of the country’s population .

About the NITI Aayog’s plan for reforms

  • Advancement in science-led technology, 
  • An enhanced role for the private sector in both pre and post-harvest phases, 
  • Liberalised output markets, 
  • An active land lease market, and 
  • Emphasis on efficiency 
  • These will equip agriculture to address the challenges of the twenty-first century and contribute towards the goal of Viksit Bharat .
  • Elaborating on the need to liberalise the sectors, the paper has proposed providing a facilitating regulatory environment and r esponsible public and private investments in and for agriculture.
  • Introduction and promotion of knowledge and skill intensive practices within agriculture, 
  • Private and corporate sector investments in agriculture, 
  • New institutions of producers, 
  • Integrated food system-based mechanisms, and 
  • New types of linkages between producers and end users, which in turn will lead to modernisation of the sector.
  • “This requires deployment of state-of-the-art technology in agriculture, smart farming and maximising the value of main and by-products,” it said.
  • Further, it proposes to introduce a system of competition among states to improve “ease of doing farming and farm business” .
  • According to the paper, agriculture will play a key role in India in achieving the goal of Viksit Bharat, inclusive development, green growth and gainful employment during Amrit Kaal.
  • In addition, the United Nations’ Sustainable Development Agenda 2030 cannot be achieved without paying attention to agriculture, as 11 out of the 17 Sustainable Development Goals (SDGs) are directly linked to agriculture, it said. 
  • Cautioning that the instrument of minimum support price (MSP) should not cause distortions in market signals , the paper suggests that India should use a combination of two instruments, namely procurement and price deficiency payment , to pay MSP to farmers.

Issues faced by the sector

  • India is much lower than other advanced and emerging market economies due to various factors, like fragmented landholdings, lower farm mechanization and lower public and private investment in agriculture.
  • Current overproduction of crops like rice, wheat and sugarcane, has led to rapid depletion of the ground-water table, soil degradation and massive air pollution raising questions about the environmental sustainability of current agricultural practices in India.
  • This led to indiscriminate use of fertilisers resulting in irreparable ecological damage, soil infertility, and a toxic food chain . 
  • Although India is the second largest irrigated country of the world after China, only one-third of the cropped area is under irrigation.
  • In spite of the large scale mechanization of agriculture in some parts of the country most of the agricultural operations in larger parts are carried on by human hand using simple and conventional tools and implements like wooden plough, sickle, etc.
  • Agricultural marketing still continues to be in a bad shape in rural India. 
  • In the absence of sound marketing facilities, the farmers have to depend upon local traders and middlemen for the disposal of their farm produce which is sold at throw-away price.

Government initiatives for the sector

  • It was initially launched in 2010-11 in 7 pilot States as a  Centrally Sponsored Scheme
  • It aims to achieve rapid development in India through use of Information & Communication Technology (ICT) for timely access to agriculture related information to the farmers.
  • It is a pan-India electronic trading portal which networks the existing APMC mandis to create a unified national market for agricultural commodities.
  • It was launched from the Kharif 2016 season and provides insurance cover for all stages of the crop cycle including post-harvest risks in specified instances, with a low premium contribution by farmers.
  • It has been formulated for enhancing agricultural productivity especially in rainfed areas focusing on integrated farming, water use efficiency, soil health management and synergizing resource conservation.
  • It has been formulated with the vision of extending the coverage of irrigation ‘Har Khet ko pani’ and improving water use efficiency ‘More crop per drop’ in a focused manner with end-to-end solution on source creation, distribution, management, field application and extension activities.
  • It is aimed at ensuring remunerative prices to the farmers for their produce as announced in the Union Budget for 2018.
  • The Government has extended the facility of KCC to the farmers practicing animal husbandry and fisheries-related activities.
  • Under it, drip/sprinkler irrigation is being encouraged for optimal utilization of water, reducing the cost of inputs and increasing productivity.

Niti Aayog has pitched for reforms envisaging more private sector role in India’s agriculture sector. Examine the significance of private sector participation in the sector.

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Agriculture and Farming Community in India: Challenges, Problems and Possible Solutions

  • October 2021
  • In book: Indian Agriculture, Farmer and Labour: Issues and Reforms (pp.1-15)
  • Edition: First
  • Publisher: Bharti publications

Mohammad Mubashir at Sher-e-Kashmir University of Agricultural Sciences and Technology of Kashmir

  • Sher-e-Kashmir University of Agricultural Sciences and Technology of Kashmir

Arshad Bhat at University of Kashmir

  • University of Kashmir

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  1. Agricultural Reforms in India: Latest Reforms and Their Impact

    Agricultural Reforms in India: Latest Reforms and Their ...

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    Agriculture Reforms. This article is based on "Reforming Indian Agriculture" which was published in Economic and Political Weekly on 14/03/2020. It talks about challenges and solutions pertaining to India's Agriculture sector. India's agriculture policies have had multiple mandates, including a production imperative (national food ...

  3. Agricultural reform in India: farmers versus the state

    For the past four months, thousands of farmers have been camping on the outskirts of New Delhi in protest against three new agricultural laws passed by the Indian government in September. Each of the three laws (The Farmers' Produce Trade and Commerce Act 2020, the Farmers' Empowerment and Protection Agreement on Price Assurance and Farm ...

  4. PDF Agricultural Challenges and Policies for the 21st Century

    review­­papers­on­various­themes­to­bring­ research ­findings­on ... 3.10 Reforms in Policies and Regulations Affecting Agriculture 29 4 Conclusion 34 ... 7 Changes in Cultivators and Agricultural Labour in Rural India 19 8 Child and Women Health Indicators at All-India Level: 2015-16 21

  5. PDF Transforming Agriculture for Challenges of 21 Century

    8. Policy Interventions, Regulations and Reforms 1. Growth to Efficiency Since1970-71, agricultural output and value added in agriculture in India moved on a growth trajectory of around 2.8 per cent in most of the period. The growth rate moved up and down depending upon the increase/decrease in real prices of agriculture commodities.

  6. (PDF) Transforming Indian Agriculture: Trends, Innovations, and

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  7. PDF Reforms in Agriculture: Promise and Challenges

    The agriculture sector in India has been starved of capital and investment. The government aims to create a vibrant ecosystem by facilitating private sector participation that could result in a world class agriculture business and marketing chain. Eventually, these reforms are expected to provide a consistent, standardised and predictable policy

  8. PDF Agricultural reform in India: farmers versus the state

    Agricultural reform in India: farmers versus the state. Three new agricultural laws intended to modernise Indian national farm produce markets are angering farmers. We investigate why farmers are so concerned and what if anything the laws mean for the environmental footprint of farming in India. For the past four months, thousands of farmers ...

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    in agriculture vis-à-vis other economic sectors. It then deals with reforms in the subsidy regime (relating to both inputs and ouput) and the implic. tions of the agri-marketing laws enacted in 2020. The agriculture sector (including irrigation) has always recei. ed relatively low priority in public expenditure. Morever, the spending bias has ...

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    These legislations sought to bring much needed reforms in the agricultural marketing system such as removing restrictions of private stock holding of agricultural produce or creating trading areas free of middlemen and take the market to the farmer. Essential Commodities (Amendment) Act, 2020.

  11. India's New Farm Laws: Reform, Resistance, and the Road to

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    Agriculture & Farmers Welfare has developed major digital applications to boost technology adoption among farmers. Usually, the Policy Reforms in Agriculture is a debated topic in public discourse for the last several decades (Kavya, 2020). The Central Government introduced three agricultural reform bills in June 2020.

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    Challenges Faced by Farm sector in India and Reforms ...

  15. PDF Indian Economic Reforms and their Impact on Agriculture Sector

    The impact of economic reform on agriculture is a mixed one. She has attained near self-sufficiency in food grains. Both green revolution and liberalisation of India's agriculture have favourable effects on overall as well as agricultural GDP. But the structural adjustment programme for agriculture has increased the vulnerability of ...

  16. PDF Indian Agriculture: Before and After Economic Reforms

    1.1 Reforms in Agriculture A common criticism of India's economic reforms is that they have been excessively focused on industrial and trade policy, neglecting agriculture which provides the livelihood of 60 percent of the population. Critics point to the deceleration in agricultural growth in the second half of the 1990s (shown in Table 1)

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