Agriculture, allied sector resilient to Covid-19 shock: Economic Survey

Vibha Sharma

New Delhi, January 31

The performance of the agriculture and the allied sector has been resilient to the Covid-19 shock, the Centre’s report card for 2021-22 said adding that the sector grew at 3.6 per cent in 2020-21 and improved to 3.9 per cent in 2021- 22.

However, the Economic Survey tabled by Finance Minister Nirmala Sitharaman in the Parliament on Monday also calls for focus to shift more towards harnessing the potential of allied activities and crop diversification towards oilseeds, pulses, and horticulture.

“While the government has adopted the use of MSP as a signal to encourage crop diversification, there is also a need for coordinated action from the state governments to facilitate the shift to high value and less water consuming crops to enable the realisation of the objective of doubling farmers’ income in a sustainable way,” it says, adding that diversification “needs to be given priority by addressing the core issues of irrigation, investment, credit and markets in their cultivation”.

Crop diversification can be used as a tool to promote sustainable agriculture, reduction in import dependence, and higher incomes for the farmers, it says, adding that shifting some areas from staple cereals to high-value produce can lead to a sizable increase in the returns for farmers.

“This would also bring in water efficiency and sustainability of soil health. The existing cropping pattern is skewed towards the cultivation of sugarcane, paddy, and wheat which has led to the depletion of fresh groundwater resources at an alarming rate in many parts of our country,” it says.

Regions, where the crops like paddy, wheat, and sugarcane are grown, have high to extremely high-stress levels include a majority of wheat, paddy, and cane growing areas, including Punjab, Haryana, Jammu and Kashmir, Uttar Pradesh, Rajasthan, Gujarat, and Madhya Pradesh.

The survey also points to the fact that fragmentation of landholdings has led to alternate sources such as livestock, fishery, and wage labour becoming significantly important for an agricultural household.

“Increasing importance of allied sectors like animal husbandry, dairying, and fisheries in growth and income of the farmers indicates that focus needs to shift more towards harnessing the potential of allied activities.

“There is also a need to improve the productivity of small and marginal farmers through development and implementation of small holding farm technologies,” it adds.

R&D can play a major role in realisation of sustainable agriculture practice that efficiently meets the objectives of nutritional security and improvement in farm income, it says adding that “every rupee spent on agricultural research and development, yields better returns compared to returns on money spent on subsidies or other expenditures on inputs”.

“The increase in agriculture R & D therefore may improve productivity in the crop and allied sectors,” it says, calling for a need to explore options and promote use of alternative fertilisers like Nano Urea and organic fertiliser that protect the soil, are more productive and contribute to higher nutrient use efficiency.

It also calls for focus on new technology including drones and AI-based decision support systems, reduction in use of chemical fertilizers and use of low-cost organic inputs, and supporting start-ups for innovations.

Agriculture sector ‘experienced buoyant growth in the past two years’

“The sector, which is the largest employer of the workforce, accounted for a sizeable 18.8 per cent (2021- 22) in Gross Value Added (GVA) of the country registering a growth of 3.6 per cent in 2020-21 and 3.9 per cent in 2021-22.

“Growth in allied sectors including livestock, dairying, and fisheries has been the major drivers of overall growth in the sector. The agriculture and allied sectors grew at a positive growth rate of 3.6 per cent during 2020-21,” crediting it to “good monsoon and various government measures to enhance credit availability, improve investments, create market facilities, promote infrastructure development and increase the provision of quality inputs”.

Output this year

—During KMS 2020-21, 601.85 LMT rice was procured against an estimated target of 642.58 LMT.

—In the KMS 2021-22, 566.58 LMT of paddy (equivalent to 379.98 LMT rice) was procured as on January 16 2022.

—During RMS 2021-22, 433.44 LMT of wheat was procured against 389.92 LMT procured during RMS 2020-21.

—During the Kharif and Rabi Marketing Season 2020-21, approx. 11.87 LMT coarse grains procured, highest in past five years