1. Emerging Trends in Indian Agriculture: Challenges, Possibilities and Solutions
Vijay Paul Sharma, Chairman
Commission for Agricultural Costs and Prices (CACP)
Ministry of Agriculture & Farmers Welfare
Government of India

2. Presentation Outline
Overview of Trends and Patterns in Indian Agriculture: Major Drivers
Key Challenges & Opportunities in Indian Agriculture
Policy Options and Strategies to Accelerate Agricultural Growth

3. EMERGING TRENDS IN INDIAN AGRICULTURE

4. Performance of Agriculture
Record Production in
Cereals – Million Tonnes
Pulses – 22.4 Million Tonnes
Oilseeds – 32.5 Million Tonnes
Record Production of Horticulture Crops
Fruits – 92.8 Million Tonnes
Vegetables – Million Tonnes
Source: DAC&FW

5. Performance of Agriculture
Livestock Sector
Largest Milk Producer – Million Tonnes
Fish Production
2nd Largest Producer (10.8 Million Tonnes)
Agri-Exports – ₹2.35 Lakh Crores
Growth in GVA from Agriculture & Allied Sectors – 4.9% in (0.7% in )

6. Structural Transformation
Still Single Largest Employer in the Economy?????
Employs about half of Workforce
138.3 Million Farming Households
Source: CSO (2014)

7. Changing Composition of Indian Agriculture: Rising Importance of High-Value Sub-Sectors

8. VALUE OF OUTPUT FROM AGRICULTURETE TE
High-Value: From <40% to about 50%
Source: CSO (2016)

9. Major Drivers of Change: Demand-Supply

10. Drivers of Change Higher Disposable Income Technology & Infrastructure
Rising Demand for High-Value Agri. Products
Higher Disposable Income
 Expenditure on Non-Food Items
Drivers of Change
Changing Demographics
2/3rd Population <35 yr
ing Urbanization
Technology & Infrastructure
Increasing Trade Opportunities

11. Composition of Consumer Expenditure: Rural
Source: NSSO (2013)

12. Composition of Consumer Expenditure: Urban
Source: NSSO (2013)

13. Diversification of Indian Diets: Rural Consumers
High-Value: From <40% to >50%
Source: NSSO (2013)

14. Diversification of Indian Diets: Urban Consumers
High-Value: From about 50% to >60%

15. Expanding Agricultural Trade Opportunities
Source: GoI (2017)

16. MAJOR CONSTRAINTS FACING INDIAN AGRICULTURE

17. Major Constraints/Issues
Low Value-Addition & Poor Post-Harvest Infrastructure
ing & Fragmenting Farms
Competition for Land
Major Constraints/Issues
Rising Imports of Edible Oils & Pulses
Low Prices
Availability of Labor & Rising Wages
Poor Access to Technology, Inputs, Services & Markets
Land Tenure Systems
Lack of Irrigation Facilities
High Risks;
Low Productivity; High Yield Gaps
Climate Change??
Institutional Bottlenecks

18. Marginalization of Farms & Swelling Bottom: Challenge of Linking Smallholders with Modern Markets/Food Chains
Av. Size (ha):
Source: GoI (2014)

19. Farm Size: Economic Viability
Source: GoI (2014)

20. Competition for Land: Agriculture & Non-Agri. Uses
Source: MOA&FW

21. Lack & Inefficient Use of Irrigation Facilities
Low Coverage of Irrigation (48%)
Maharashtra (18%); Jharkhand (15%)
Punjab (99%), Haryana (89%)
Inefficient Use of Water Resources
Low Cropping Intensity - 141%
<120% in Odisha, Jharkhand, Chhattisgarh
>185% in Punjab, Haryana, West Bengal
Source: GoI (2016)

22. Low Growth & High Fluctuations in Agriculture
Source: CSO (2017)

23. LOW YIELDS & HIGH YIELD GAPS: Role of Technology & Extension Services

24. High Yield Gaps - Wheat
Source: ICAR & DAC&FW

25. High Yield Gaps - Gram
Source: ICAR & DAC&FW

26. High Yield Gaps - Tur
Source: ICAR & DAC&FW

27. High Yield Gaps – Rapeseed & Mustard
Source: ICAR & DAC&FW

28. LACK OF AWARENESS ABOUT MSPs & QUALITY NORMS (FAQs)

29. Low Awareness about MSP
Less Coverage of Procurement Operations (Few States/Crops)
Market Prices < MSP in some Crops/ Regions
Source: NSS Report No.573: Some Aspects of Farming in India,

30. Paddy & Wheat Production & Procurement: TE2016-17
Rice
State
Share (%) in
Proc as % of Prod.
Prod.
Proc. WB
14.3
5.3
12.0 UP
11.8
6.6
18.5
Punjab
10.7
26.9
83.0
Odisha
7.2
9.7
44.7
A.P.
7.0
11.1
52.0
Bihar
6.4
3.9
19.9
Chhattisgarh
6.1
11.0
59.5 TN
6.0
2.3
12.4
Assam
4.9
0.1
0.6
Haryana
8.1
68.5 MP
3.6
2.8
26.2 TG
3.2
8.3
85.6
Karnataka
2.9
1.5
Jharkhand
0.3
3.8
All India
100.0
32.9
State
Share (%) in
Proc as % of Prod.
Prod.
Proc. UP
28.2
6.1
6.4 MP
19.1
21.8
33.9
Punjab
17.1
41.6
72.1
Haryana
12.0
25.3
62.2
Rajasthan
10.3
5.1
14.6
Bihar
4.9
0.0
All India
100.0
29.6
Source: FCI (2017)

31. Rice Price Trends: Prices Below MSP in Eastern States
Source:

32. Market Prices Below MSP: Tur
Source:

33. Market Prices Below MSP: Mustard
Source:

34. Rising Imports of Pulses & Edible Oils

35. Issues in Capital Formation & Agricultural Credit
Slow Down in Capital Formation in Agriculture
Declining Share of Public Investment
Significant  in Credit Flow to Agriculture (Rs Lakh Crore in to 9.6 Lakh Crore in
Interest Subvention Scheme – Crop Loans Only
Declining Share of Investment Credit
Regional and Inter-Farm Inequalities

36. Decline in Gross Capital Formation (at 2011-12 Prices)
Source: CSO (2016)

37. Share of Public & Private Sector in Capital Formation
Source: CSO (2016)

38. Share (%) of Crop Loan & Term Loan in Agricultural Credit
Source: NABARD (2017)

39. Agency-Wise Share (%) of Credit Flow to Agriculture
Source: NABARD (2017)

40. DRIVERS OF GROWTH IN FARM INCOME

41. Doubling Farmers Income
Improve Crop Productivity: Technology & Extension
Reduce Cost of Cultivation: Rational Utilization of Inputs
 Cropping Intensity (141%)
Irrigated Area & Efficiency (48%)
Remunerative Prices to Farmers
Reduce Post-Harvest Losses & Wastages
Diversification to Farm (Horticulture, Livestock, Fisheries) & Non-Farm Activities
Value-Addition & Agro-Processing
Divert Surplus Labour from Agriculture: Skill Building

42. III. POLICY INSTRUMENTS FOR AGRICULTURAL DEVELOPMENT
The Four Pillars

43. The Four Pillars of Agri. Development
Technology
Institutions
Infrastructure
Incentives
Strong R&D
HYV Seeds
Fertilizers
Farm Machinery
Irrigation Water Management
Value-Addition
Post-harvest Management
…………..
Extension Services
Land Reforms
Rural Financial Institutions
Risk Management Instruments
Market Information & Intelligence
Investment
Basic Rural Infrastructure Roads, Power, Communication
Irrigation
Post-Harvest & Market Dev
Agro- processing
………..
Price Policy: MSP, Proc. & PDS
Subsidies: Inputs & Services
Trade Policy
…………….
INNOVATIONS

44. Recent Initiatives Focus on Irrigation and Water Management
Pradhan Mantri Krishi Sinchai Yojana (PMKSY): Har Khet Ko Pani; Per Drop More Crop (Micro-Irrigation), Water Conservation, AIBP
Improve Crop Productivity & Increase Cropping Intensity
Improving Soil Productivity: Soil Health Card Scheme
Need to Promote Balanced Use of Fertilizers (N:P:K) & Micro-Nutrients
Risk Management
Pradhan Mantri Fasal Bima Yojna (PMFBY): Low Premium & More Coverage; 40% of Cropped Area to be Covered

45. Recent Initiatives
Organic Farming: Paramparagat Krishi Vikash Yojana(PKVY)
Agricultural Market Sector Reforms
APMC Act Amendments – Establishment of Private Mandis; Delisting of Perishables; Contract Farming, Direct Producer-Consumer Linkages; Unified Single License and Single Point Levy of Market Fee
e-National Agriculture Market (e-NAM)
Dairy Processing and Infrastructure Development Fund: Corpus of Rs. 8,000 crores over 3 years

46. Recent Initiatives Increased Flow of Credit to Agriculture
Target for : Rs. 10 Lakh Crore
Interest Subvention Scheme for Crop Loans
National Food Security Mission
Rice, Wheat, Pulses, Jute, Sugarcane, Cotton, Coarse Cereals;
60% Allocation for Development of Pulses
National Mission on Oilseeds & Oil Palm (NMOOP)
Mission for Integrated Development of Horticulture
Digital Agriculture: Use of ICT - Kisan Call Centres, DD Kisan Channel, Radio, …….

47. POLICY PRIORITIES TO ACCELERATE GROWTH

48. Policy Priorities Improve Crop Productivity
Increase in Public Investment in Agri. R&D, Extension, Rural Infrastructure, Post-harvest & Market Infrastructure including Storage & Processing
Bridge Yield Gaps
Accelerating Pace of Reforms in Laws related to Land Markets and Marketing of Agri. Products
Promotion of Farmers’ Organization/Groups, SHGs
Effective Price & Procurement Policy
Create Awareness about MSP & Quality Norms
Effective Participation of States - Decentralized Procurement
Effective Use of Price Stabilization Fund Scheme

49. Policy Priorities Rationalization of Pricing of Inputs
Irrigation Water, Power, and Fertilizers (Imbalanced use of N:P:K and Micro-nutrient Deficiency)
Address Distributional aspects of Agri. Credit
Access to Small and Marginal Farmers & Poorer Regions
Strengthen Rural Branch Network
Significant Regional and Inter-class Inequalities
Better Targeting of Input Subsidies – Without hurting Small and Marginal Farmers

50. Thank you !