Agriculture and the allied sector proved to be the most resilient to the Covid-19 shock as it registered a growth of 3.6 per cent in 2020-21 and improved to 3.9 per cent in 2021-22, driving the overall Indian economy’s real GDP expansion of 9.2 per cent in 2021-22, according to the Economic Survey 2021-22.
It also said that the growth in the allied sector is in line with the recommendations of the Committee on Doubling Farmers’ Income.
Stating that the agriculture sector has experienced buoyant growth in the past two years, the Economic Survey noted that the agriculture and allied sector is the largest employer of workforce as it accounted for a sizeable 18.8 per cent (2021-22) in Gross Value Added (GVA) of the country.
Growth in allied sectors including livestock, dairying and fisheries has been the major drivers of overall growth in the sector, and these are steadily emerging to be high growth sectors.
“The livestock sector has grown at a CAGR of 8.15 per cent over the last five years ending 2019-20. As revealed by the latest Situation Assessment Survey (SAS), the sector has been a stable source of income across groups of agricultural households accounting for about 15 per cent of their average monthly income,” the Economic Survey said.
“This improvement in the contribution of allied sectors is in line with the recommendations of the Committee on Doubling Farmers’ Income which has suggested a greater focus on allied sectors to improve farmers’ income.”
The latest SAS report has also shown that the 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 including 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 productivity of small and marginal farmers through development and implementation of small holding farm technologies,” the document said.
The document also discusses how Minimum Support Price (MSP) policy is being used to promote crop diversification. Important findings of the latest Situation Assessment Survey suggested the net receipts from crop production alone have increased by 22.6 per cent as compared to the previous SAS Report of 2014 although there is a visible diversification in the sources of income of the farmers.
While the government has adopted the use of MSP as 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 realisation of the objective of doubling farmers’ income in a sustainable way.
The government has also taken measures to augment production and domestic supply of oilseeds and edible oils, interventions made in the sugar sector and promotion of crop diversification.
The government has placed focus on the food processing sector, which is not only a major market of agricultural produce but is also a significant employer of the surplus workforce engaged in agriculture.
Pointing out that India runs one of the largest food management programmes in the world, the Economic Survey said: “The government has further extended the coverage of the food security network through additional provisions of food grains through the schemes like PM Gareeb Kalyan Yojana (PMGKY).”