Page 125 - DECO502_INDIAN_ECONOMIC_POLICY_ENGLISH

Unit 11: Sectoral Performance I: Agriculture: Growth Productivity Trends and Crop Patterns

Table 3 : Agricultural Exports as a percentage of Total Exports Notes
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` crores
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`
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Agril. Exports Total Exports (1) as %
(1) (2) of (2)
1990-91 6,013 32,527 18.5
1996-97 24,161 118,817 20.3
2000-01 28,657 201,356 14.2
2005-06 61,194 456,418 10.8
2006-07 62,411 571,779 10.92
2007-08 79,040 6,55,864 12.05
2008-09 85,952 8,40,755 10.22
2009-10 87,523 8,45,125 10.59
Source : Agricultural Statistics at a Glance (2010), Economic Survey 2009-10.
(v) Role of Agricultural Sector in Economic Planning : Importance of agriculture in the national
economy is indicated by many facts. For example, agriculture is the main support for India’s
transport systems, secure bulk of their business from the movement of agricultural goods. Internal
trade is mostly an agricultural products.
Further, good crops implying large purchasing lower with the farmers lead to greater demand
for manufactures and, therefore, better prices. In other words, prosperity of the farmers is also
the prosperity of industries. Likewise, bad crops lead to a depression an business. Generally, it
is the failure in the agricultural front that has led to failure of economic planning in particular
periods.
Agricultural Development Essential for Economic Growth

The significance of agriculture in India arises also from the fact that the development in agriculture is
an essential condition for the development of the national economy. Ragnar Nurkse argues that the
surplus pelation in agriculture should be shifted to the newly stated industries. Nurkse’s thesis is
that agricultural productivity will be increased on the one hand and on the other industrial units
would be set up with the use of surplus labour.
The Nurksian thesis, though widely welcome one time, has been questioned recently :
(a) Industrialisation does not consist only shifting of workers from agriculture to industries requires
a particular set of motives and values which agricultural economy cannot supply. A change
agriculture itself is essential before such motivative and values are evolved.
(b) The marketable agricultural surplus will have to be increased considerably to feed the growing
under population and to provide raw materials to industries.
(c) New uses have been discovered for foodgrain and other agricultural crops. With fossil oils
become increasingly expensive, ethanol is being used as an alternative fuel. Corn, sugarcanes,
beetroot and other crops increasingly converted into ethanol and alcohol.
(d) The new industries and the fast growth services sector, however fast they may develop, will be
able to provide adequate employment for the even growing millions in India. There is a limit to
capacity of employment in industries in the short pride Necessarily, therefore, increased
employment will have to be found in agriculture and in rural industries.
In other words, rapid economic development require rapid agricultural development either to prector
to go hand in hand with it. Indian planners learnt a big lesson during the Second and Third Five-Year
Plan cods and in recent years, during 2002-03, for example, when failure of the agricultural sector
spelt disaster to the entire planning process.

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