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Indian Economy

Notes 6.2.2 Strategy used in the Agricultural Sector

You must understand that to cause increase in agricultural production and also increase in rural
employment, the Five Year Plans use various programmes such as: establishing of community
development programmes and agricultural extension services all through the country,
agricultural machinery, expansion of irrigation amenities, fertilisers, pesticides, high-yielding
varieties of seeds and expansion of transportation, power, marketing and of institutional credit.
To decrease the pressure of population on land, the strategy utilised by the Planning Commission
was rural development that is, set up agro-based industries and handicrafts in rural regions, to
promote rural transport and communications and to motivate the movement of people from
agriculture to industries and service sectors.
Ultimately, to bring about equality and justice in rural India, the strategy utilised by the Planning
Commission was land reforms which involved the elimination of intermediaries, like the
Zamindars, the defence of tenants via tenancy legislation, ceiling of land holdings and distribution
of excess land among landless labourers and small and marginal farmers.

6.2.3 Pattern of Investment in the Agricultural Sector

It is important for you to note that at the outset, a word of explanation is essential about the
meaning and content of “agricultural sector”. In the first three Plans, “agricultural sector” was
comprised of agriculture as well as allied sectors (horticulture, animal husbandry and fisheries)
and irrigation and flood control. In the consecutive Plans, “rural development” and “special
area programmes, were inserted and “irrigation and flood control” was omitted. In Table 6.1,
outlay on agriculture is comprised of agriculture and allied sectors, special region programmes
and rural development, irrigation and flood control.
It would be obvious that the total outlay in each Plan had enhanced and, correspondingly, the
outlay on agriculture allied sectors had also risen. But, the percentage of plan outlay on agriculture
and allied sectors to total plan outlay differed between 31 per cent and 14.9 per cent from the
First Plan to the Tenth Plan.
Table 6.1: Pattern of Government Outlay on Agriculture and Allied Sectors

(` Crore)
Plans Periods Total Plan Agriculture %age of Agriculture and
Expenditure and Allied Allied Sectors to
(Actual) Sectors Total Outlay
I Plan (Actual) 1951-56 1,960 600 31
II Plan 1956-61 4,670 950 20
III Plan 1961-66 8,580 1,750 21
IV Plan 1969-74 15,800 3,670 24
V Plan 1974-79 39,430 8,740 22
VI Plan 1980-85 1,09,300 26,100 24
VII Plan 1985-90 2,18,730 47,100 23
VIII Plan " 1992-97 4,75,480 1,01,590 21
IX Plan 1997-02 8,59,200 1,76,217 20,5
X Plan 2002-07 15,25,639 3,05,055 20,0
XI Plan 2007-12 36,76,936 7,23,465 19,7
XII Plan 2012-17 76,69,807 13,23,119 17.3

Source: Indian Economy, Datt and Sundharam, S. Chand

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