Economic Survey: Urgent farm reforms must for achieving 4% growth
New Delhi: With agriculture growth rate falling short of the 4 percent target in last five years, the sector needs urgent reforms to boost crop yields and private investment in infrastructure so as to motivate farmers and feed the growing population, the Economic Survey said on Wednesday.
The farm sector achieved 3.6 percent growth during the 11th Five year Plan (2007-12), falling short of the 4 percent growth target, although it was much higher than growth of 2.5 and 2.4 percent during 9th and 10th Plans, it added.
The agriculture sector is broadly a story of success in the past few years, "yet, India is at a juncture where further reforms are urgently required to achieve greater efficiency and productivity in agriculture for sustaining growth", the Survey said.
There is need for stable policies where markets play an appropriate role, private investment in infrastructure is stepped up, the public distribution system (PDS) is revamped, food price and food stock management improves, and a predictable trade policy is adopted for agriculture, it added.
These initiatives need to be coupled with skills development and better research and development (R&D) along with improved delivery of credit and seeds.
Stating that the country faces the stiff challenge of feeding its growing population, the Survey said that there are constraints and challenges that need to be addressed so that the farming community is motivated to produce more and the target of 4 percent agri-growth is met in the 12th Plan.
"Improvement in yields holds the key for India to remain self-sufficient in foodgrains and also make a place for itself in many agricultural crops and products in the international market," the Survey noted.
The Survey also called for "urgent attention" for efficient management of food stocks, timely offloading of stocks, and a stable and predictable trade policy.
"...This policy of stocking foodgrains well above the buffer norms comes under criticism on the grounds of hoarding and creating artificial shortages in the market, thereby jacking up the prices of essential commodities," it noticed.
Noting that declining per capita availability of foodgrains has been a major concern, the report said steps need to be taken to improve nutritional security, that includes adequate supply of foodgrains and protein-rich items.
To improve agri-marketing, the Survey suggested reforms to encourage private sector to develop market linkages.
"Recently, the government allowed FDI in retail, which has been supported by many farmer organisations as well, and it can pave the way for investment in new technology and marketing of agricultural produce in India," the report said.
The report also stressed on substantial increase in funds for farm research to address the challenge of producing more with limited resources by adopting a more sustainable agricultural practice in the backdrop of climate change.
"Climate change can have serious implications for our agriculture sector and create greater instability in food production," it said, suggesting changes in crop insurance.
Measures need to be taken to promote the use of quality seeds, cultivation of drought-resistant varieties of crops, judicious use of available water, balanced use of fertilisers, farm mechanisation to improve efficiency levels, and wider use of irrigation facilities.
That apart, the Survey emphasised the need to put in place a strategy for farm development in the eastern and north -eastern regions amid saturation in crop yields in Green Revolution belt especially in Punjab and Haryana.
It also called for strengthening farm statistics for agricultural development planning and policy making.