Thursday, October 23, 2008

Indian Agriculture... Can we be on TOP?

Agriculture in India is one of the most prominent sectors in its economy. Agriculture and allied sectors like forestry, logging and fishing accounted for 18.6% of the GDP in 2005 and employed 60% of the country's population. It accounts for 8.56 % of India’s exports. About 43 % of India's geographical area is used for agricultural activity. Despite a steady decline of its share in the GDP, agriculture is still the largest economic sector and plays a significant role in the overall socio-economic development of India.
The monsoons play a critical role in the Indian sub-continent's agriculture in determining whether the harvest will be bountiful, average, or poor in any given year. The entire rainfall in the sub-continent is concentrated in the few monsoon months.

Agriculture In India
  • One of the most prominent sectors in its economy.
  • Accounted for 18.6% of the GDP in 2005  (includes alied sectors like logging,forestry and fishing)
  • Employed 60% of the country's population
  • About 43 % of India's geographical area is used for agricultural activity
  • The monsoons play a critical role in the Indian sub-continent's agriculture

Read the following paragraph.!! Be Proud!!

India is the largest producer in the world of milk, cashew nuts, coconuts, tea, ginger, turmeric and black pepper. It also has the world's largest cattle population (193 million). India ranks second worldwide in farm output. It is the second largest producer of wheat, sugar, groundnut and inland fish. It is the third largest producer of tobacco and rice. India accounts for 10 per cent of the world fruit production with first rank in the production of banana and sapota.

Now.. read the following... and ...... no!! no more proud!! i feel shame!!

  • International comparisons reveal that the average yield in India is generally 30% to 50% of the highest average yield in the world
  • China ranks first worldwide in farm output. Just under half of China's labor force is engaged in agriculture, even though only about 15.4% of the land is suitable for cultivation.
  • According to the United Nations World Food Program , in 2003 China fed 20% of the world's population with only 7% of the world's arable land

Just look at the following table and find your self where our India stands!
    Country                       Cultivated Area                        Total Agri Products in millions of USD

  • India                                          15,00000km2                             158424
  • China                                         13,00000km2                                298928
  • Japan                                         50,000km2                               78576 
Recently I happened to read a supplement with Gulf News.  The following extract from it, made me cry!!
While the country(refering to NetherLands) comprises only .008% of the world's land area, it is the world's third largest agricultural exporter!!!!!!!!!!!

This is the case of Netherlands

But Why?? Why??? India has all the resources but still we lag in terms of total output.
The low productivity results from following:

  1. Illiteracy, general socio-economic backwardness, reforms and inadequate or inefficient finance and marketing services for farm produce.
  2. The average size of land holdings is very small (less than 20,000 m²) and are subject to fragmentation, due to land ceiling acts and in some cases, family disputes. Such small holdings are often over-manned, resulting in disguised unemployment and low productivity of labour.
  3. Adoption of modern agricultural practices and use of technology is inadequate, hampered by ignorance of such practices, high costs and impracticality in the case of small land holdings.
  4. Irrigation facilities are inadequate, as revealed by the fact that only 53.6% of the land was irrigated in 2000–01,which result in farmers still being dependent on rainfall, specifically the Monsoon season. A good monsoon results in a robust growth for the economy as a whole, while a poor monsoon leads to a sluggish growth.
In India we have the so called CORPORATE GIANTS in all fields!
Look at petroleum; we have Reliance, Indianoil which are Fortune 500 companies!
Loot at banking; we have SBI(again fortune 500), ICICI...
Look at IT services.... we have TCS,Infosys.. (fortune 2000)

What about agriculture? There are no major players!! not even single one!
Some popular names include REI agro,Lakshmi Overseas,Amul, which are into food processing, and some names like TATA Chemicals,GSFC which makes fertilizers.. But none of them are Giants!! We cant even call them Large! None has a market cap of above 5,000cr!

We have now some movements taking place in agri sector.. Mukesh Ambani's Reliance Industries is going farming with a huge investment.. They are planning about 15,000 acres of land in N.India.. Also Telecom Giant Bharthi is also looking at farming!

What are they actually upto?? are they really into uplifting Indian Agriculture?? or are they eyeing the huge real estate potential? The thousands of acres of land being acquired now at virtually "PULLU VILA"  (cheapest price) will be huge GoldMine after few years considering the real estate value!  (another Unitech?? )

Recently when Bush commented that growing population and reduction in poverty in India and China the reason for world food crisis, we people had nothing great to boast, except some protests done for political gains! 

(well, Bush has no right to blame India! coz he announced subsidy to farmers who use their corn to produce oil!! which led to reduction in corn available for food industry!)

When any new industy is discovered, a group of countries with potential for that indusrty is awaken. Industrial revoultion in europe, Oil industry in Gulf, Electronics in japan, manufacturing outsourcing in china.........................................

India has plenty of land.. Labour available cheap. In current situation, raising finance wont be a big deal. Overflowing rivers in north india.. We are blessed with sea on 3 sides to facilitate the exports... We have everything we want !! but....

.......... Despite having all the potentials of becoming world's biggest exporter of food, India is not tapping its resources!!!

Cijo Thomas


No comments:

Post a Comment