INDIAN AGRICULTURE SECTOR IS A SUCCESS STORY: ECONOMIC SURVEY 2023-24

Syllabus: Indian Economy: Economic Survey

•Source: PIB*

Key Highlights of Agriculture and Allied sector from the Economic Survey:

Category | Highlights

Success Story of Indian Agriculture | From food deficit and importing country in the 1960s to net exporter of agricultural products.

Growth Rate and Employment | Agriculture sector registered an average annual growth rate of 4.18% over the last five years; supports 42.3% of the population and contributes 18.2% to GDP.

Investment in Agriculture Research | Investment yields high returns; for every rupee invested, there is a payoff of ₹13.85.

Foodgrain and Oilseed Production | Record production of 329.7 million tonnes in 2022-23; oilseeds area increased by 17.5% from 2014-15 to 2023-24.

e-NAM Scheme and FPOs | e-NAM portal registered over 1.77 crore farmers; 8,195 FPOs registered, with significant financial support provided.

Agricultural Price Support | MSP increased for all crops since 2018-19 with a margin of at least 50% over production costs.

Social Security for Farmers | PMKMY provides monthly pensions to farmers; 23.41 lakh farmers enrolled as of July 2024.

Crop Insurance | PMFBY offers comprehensive risk cover for crops; insured area reached 610 lakh ha in 2023-24.

Allied Sectors Growth | Livestock and fisheries sectors show significant growth, contributing to farm incomes and economic stability.

Food Processing Sector | GVA increased from ₹1.30 lakh crore in 2013-14 to ₹1.92 lakh crore in 2022-23; sector accounts for significant share in India’s exports.

Three Great Challenges | Agriculture must address food and nutritional security, climate change adaptation/mitigation, and sustainable use of water, energy, and land.

Transition to Nutritional Security | Need to shift from basic food security to nutritional security; demand for pulses, millets, fruits, vegetables, milk, and meat is growing.

Policy Recommendations |

1.Invoke export bans only in exceptional cases; allow farmers to benefit from higher international prices.
2.Re-examine inflation-targeting framework to exclude food prices; address hardships for low-income consumers via direct benefit transfers or coupons.
3.Increase Total Net Irrigated Area; promote efficient water utilization technologies like drip irrigation and fertigation.
4.Promote crop-neutral incentive structures to address climate considerations.

Private Sector Investment | Vital for technological advancement, improved production methods, marketing infrastructure, and reduction in post-harvest losses.

Structural Transformation Needed | Requires transformation due to water scarcity and climate change; reverse migration during COVID and extreme weather conditions in 2024 highlight the need for policy reevaluation.

Sustainable Farming Initiatives | PM-PRANAM initiative promotes reduced use of chemical fertilizers and adoption of sustainable practices.

Key points from the Economic Survey for Allied Sectors:

Sector/Area | Details

Overall Growth | Allied sectors in agriculture are emerging as robust growth centers for improving farm incomes.

Livestock Sector | CAGR: 7.38% (2014-15 to 2022-23)

Contribution to total GVA: Increased from 24.32% to 30.38%

Total GVA contribution: 4.66% (2022-23)

Fisheries Sector | CAGR: 8.9% (2014-15 to 2022-23)

Contribution to agricultural GVA: 6.72%

Record fish production: 17.54 million tons (2022-23), ranking third globally

Government Initiatives | AHIDF: Supports investments in dairy/meat processing, animal feed, and breed improvement

408 projects sanctioned (₹13.861 crore)

Creates 40,000 jobs, benefits 42 lakh farmers

PMMSY: Enhances fish production and infrastructure

FIDF allocated ₹5.59 thousand crore for 121 projects

Food Processing Sector | GVA: Increased from ₹1.30 lakh crore (2013-14) to ₹1.92 lakh crore (2022-23)

Contribution to manufacturing GVA: 7.66% (2022-23)

Processed food exports: Increased from 14.9% (2017-18) to 23.4% (2022-23), totaling USD 46.44 billion