Prospects of Commercial Agriculture in India

The Indian nation is on the move. The people are astir. Agriculture is blooming. Industry is booming. The legacy of self-deprecation and self-doubt inherited from the colonial period have given way to a new-found dynamism, confidence and sense of self-determination. 

Strategy to Complement the Economic Liberalization

India needs a new strategy to complement the economic reforms, a strategy designed to take full advantage of the country’s agro-climatic advantages, huge tracks of cultivable land and large internal market to stimulate a rapid development of the rural economy.

Agriculture as an Engine for Industrialization

The rapid development of South Korea, Taiwan, and Malaysia provides ample evidence that an agriculture-driven strategy can act as a powerful engine for raising rural incomes, industrialization and employment generation. More recently, commercial agriculture has been a powerful engine for economic development in Thailand, where 70% of the population is still employed in the farm sector.

India’s Competitive Advantage in Agriculture

India possesses four outstanding competitive advantages in agriculture comparable to those of any other country in the world. 

• It has regions which are climatically favorable for cultivation of every commercially-important plant species grown in other parts of the world – ranging from temperate orchard crops such as almonds and apples to tropical mangoes and pineapple. 
• The country already possesses the largest acreage of irrigated land in the world with 40% of the potential still to be tapped. 
• The gap between present productivity and proven technological potential is very large for most crops; yet even so, the country is already among the world’s top three producers of tea, cotton, sugar, food grains, groundnut, coffee, eggs and milk. 
• Lastly, the country has an abundance of available skilled, educated, technical and scientific manpower.

Creating Rural Jobs as a Counter to Urban Migration

According to one estimate, for every ton of additional foodgrains produced in India, one new job is created in the economy. Rising productivity in agriculture can stimulate the growth of agro-industries, food processing and distribution, and demand for new industrial plants and machinery. It will also increase demand for consumer good, household appliances and tourism in the rural sector, creating a boom in related sectors.

Growing Domestic Demand

Indians consume an average of 40 grams per day of horticulture products compared to a normal nutritional demand of 90 grams. As incomes rise, the domestic market for horticulture products is projected to increase by 60% over the next six years. Overall, there is scope for placing an additional 1 million acres under horticulture crops. This will generate demand for 100 new commercial hybrid seed production units in the country.

Tremendous Export Opportunities

India has the potential to become a global leader in agriculture. 

• Agriculture exports, including textiles, have risen from Rs 10,000 crores to Rs 40,000 crores over the past five years. 
• Grape and mango exports to Western Europe are rapidly increasing. 
• Floriculture is a $40 billion global industry that is projected to reach $70 billion. 
• Exports of processed fruits and vegetable, cotton textiles, sugar, and fish have vast potential. 
• Despite being the second largest producer of silk in the world, India’s share of world silk trade is less than 5%.

Closing the Productivity Gap

India agriculture suffers from low productivity of its soil and water resources. Raising productivity means increasing profitability. The average yield of tomato in India is 12 tons per acre versus 34 tons in the USA, but yields as high as 38 tons have been achieved by commercial farmers in India generating net profit in excess of Rs 50,000 per acre. Average net incomes ranging between Rs 40,000 and Rs 1,00,000 per acre are now being achieved by some modern farmers employing advanced cultivation practices on a range of vegetable, flower and fruit crops.

HIGH PROFIT AGRICULTURE Actual yields & profits of a scientific farmer in Tamil Nadu
Crop	Yield per acre	Net Profit
Red Cabbage	15,500 kg	Rs 70,000
Capsicum	16,000 kg	Rs 52,000
Tomato	30,000 kg	Rs 45,000

India’s Unique Opportunity

Never before has India been poised for such rapid economic progress. Never before have the opportunities been so great or the country so ready. Now what is needed is to generate a widespread awareness of the potentials at all levels of the society – among political leaders, administrators, farmers and the corporate sector

The time has come for a broad-based initiative to seize the opportunity!

ACTION PLAN

• Establish commercial farming schools to demonstrate cultivation of highly profitable crops
• Establish integrated horticulture estates covering one million hectares of irrigated land, for private farmers to cultivate high profit vegetable and fruit crops
• Establish integrated sericulture projects in which all the operations from mulberry cultivation to silk spinning and weaving are carried out scientifically
• Establish intensive aquaculture estates, each of 50 acres, consisting of quarter acre intensive production ponds leased out to small farmers and landless workers
• Establish scientifically run soil labs in every district to test
• Encourage the private sector to acquire or lease degraded, uncultivable waste lands and to utilize advanced technologies to reclaim acres for intensive horticulture & farm forestry.
• Widely publicize achievements in the agri-business sector to generate awareness of the enormous potential for the country.

Credits :

Excerpts from ICPD : A CALL TO THE NATION - Commercial Agriculture as an Engine for Rural Development, Industrialization and Full Employment