Role Of Agriculture In National Economy: Part 1

By: Prof. R K Yadav, Deptt of Genetics and Plant Breeding C.S. Azad Univ. of Agril. & Tech. Kanpur & Executive Editor-ICN Group)

KANPUR: Agriculture is most important sector of national economic system and considered the backbone of the Indian economy. Despite the fact that in last six decades of planned development era since India became a republic, a tremendous success India has achieved in the field of industries, agriculture and allied activities of agriculture still continues to provide employment to around 60 per cent the total workforce.

India is the world’s  largest producer of pulses, rice, wheat spice and spice products. India has many areas to choose for business such as dairy, meat, poultry, fisheries and food grains etc. India has emerged as second largest producer of fruits and vegetables in the world.

According to the data provided by Department of Economics and Statistics (DES) the food grain production have touched the level of 264 million tons during 2013-14 ever highest in the primary sector but after that   it has declined during 2014-15 and 2015-16 due to different erroneous weather conditions. Indian agriculture live dominate in production of different agricultural produce like, paddy, wheat, pulses, groundnuts ,rapeseeds and natural products, vegetables, fruits, sugarcane, tea, jute, cotton tobacco leaves including livestock, forest and fisheries products.

Contribution of Agriculture in National Income:

India is agriculture based country where more than 60 per cent of population depends upon agriculture or allied activities. This structures the main source of income. The commitment of agribusiness in the national income in India is all the more, subsequently, it is said that agriculture in India is main stream of Indian economy.

The agriculture, forestry and fisheries cumulatively contribute about 14.6 per cent to GDP during 2010-11. The contribution of agriculture alone in initial two decades towards the total national outputs was between 48 per cent to 60 per cent but after that it shows continuously the declining trends.During 2005-06 it declined to 15.5 per cent and during 2010-11 it declined to 12.4 per cent to the GDP at current prices. Here two important factors emphasized (i)  agriculture contribute even now major share in national income and (ii) the share of agriculture in national income, however, has been continuously decreasing and the share of manufacturing and service sectors are increasing. The percentage share of agriculture in Gross Domestic Product at factor cost is shown in Table 1.

Table 1. Gross Domestic Product at factor cost (Agriculture / Total)  

  ( Rs. in Crores )

Year Total Agriculture Percentage share of agriculture
At current price At constant price(2004-05) At current price At constant price(2004-05) At current price At constant price(2004-05)
2005-06 3390503 3253073 536822 502996 15.5 5.5
2006-07 3953276 3564364 604672 523745 14.7 4.1
2007-08 4582086 3896636 716276 556956 14.3 6.3
2008-09 5303567 4158676 806646 555442 13.4 -0.3
2009-10 6108903 4516071 928586 557715 12.3 0.4
2010-11 7248860 4284366 1143517 610905 12.4 9.5

Source: Agricultural Statistics at a glance,  2016

A comparative analysis between the position of agriculture in India and that  in other countries with regard to the share of agriculture in national income reveals that it is much higher in India than in other developed countries. In the United Kingdom, U.S.A. and Australia, agriculture contributes only 1.6 per cent, 5.5 per cent , 4 per cent and 5 per cent respectively of the national income.

The more developed a country, the smaller is the share of agriculture in  national output. India is having a good share of agriculture in national output. India has not yet reached the stage of developed economy while agriculture sector in India has still a dominant one in the country’s economy.

Agriculture and employment pattern:  

The well being of farmers“ Kisan ki Samvriddhi” is  vital to the nation’s prosperity. Farmer is sentinel of our food security. ‘Annadata Sukhi Bhav’ has been one of the fundamental civilization values.  It is the time the Government is taking several steps to usher in second Green Revolution in the entire country. India lives in villages.

Agriculture sector is the soul of Indian economy and for the people of India. The share of agriculture in employment was 48.9 per cent of the work force. In other words, Agriculture is the principal source of livelihood for more than 58 per cent of the population of this country.

As against this situation in the U.K. and U.S.A. only 2 to 3 per cent of the working population engaged in agriculture.In France the proportion is about 7 per cent and in Australia this is about 6 per cent. It is only developing or under developing countries where the working population engaged in agriculture is quite high. For instance it is  70 per cent in Myanmar , 61.62 per cent in Congo and 32.88 per cent in Indonesia.