Ushering Second Green Revolution

The frequent spike in food inflation and the growing public concern of it has again brought the agricultural sector to the fore-front of Indian economic policy making agenda. It is being increasingly felt that agricultural sector is trailing behind in providing an adequate food safety-net to a fast growing billion plus population and meeting the diverse food-requirements of the rapidly growing economy. Besides, an enhanced production and productivity in agriculture has become important for sustaining a high level of economic growth through increasing domestic demand and greater investment. The first green revolution ushered in the country in the 1960s more than quadrupled the food-production in the country (though with lopsided production and distribution), saving the people from the tragic famines characteristic of the British rule. But it is being increasingly felt that the gains in production and productivity made during the first green revolution have largely plateaud and agriculture in India has fatigued due to increasing production cost, dwindling resource base and adverse climate change. In fact, as succinctly remarked by the recent Economic Survey (2011), Indian agriculture has not witnessed any significant technological breakthrough post the first green revolution phase. There is thus an urgent need to trigger an environmentally sustainable, inclusive high growth rate in agriculture through right strategies, policies and interventions.

Agriculture in Indian Economy:

Despite declining contribution to the national income, growth in the agriculture sector still continues to be a critical factor in the overall performance of the economy. The contribution of agriculture in the Gross Domestic Product (GDP) of the country has progressively declined from 55.1 percent in 1950-51 to 37.6 percent in 1981-82 and further to 14.2 percent of GDP in 2010-11. However, far-less spectacular has been the decline of labour force engaged in agriculture and allied occupations-it accounted for 69.5 percent of the working population in1951 declining marginally to 66.9 percent and even in 2001 it accounted for 56.7 percent of the total employment in the country. While the declining contribution of agriculture to the national income has been observed all across the world as a hallmark of industrialisation the worrisome fact in Indian context has been the meagre decline in the workforce engaged in agriculture. Growth of employment in the Industrial and services sector have constantly lagged behind the growth of work-force in the country resulting in an overburdened agricultural sector. More-over the decline in the contribution of agricultural sector to the overall GDP has been obtained by the sector continuously clocking a lower growth rate compared to the other sectors. The overall GDP has grown by an average of 8.62 percent during the period 2004-05 to 2010-11 but agricultural sector GDP has increased by only 3.46 percent during the same period.

Agriculture in India continues to be a gamble with the monsoon increasing the economic vulnerability of two-third of Indian population that are directly or indirectly dependent on it. During the current five-year plan (2007-12), for the first three years agriculture averaged 2.03 percent against the plan target of 4 percent and even this dismal performance contained wide erratic fluctuations-after achieving an impressive growth rate of 5.8 percent in the first year of the plan it ventured into the negative territory of -0.1 percent in 2008-09 recovering marginally to 0.4 percent next year. As per the advance estimates for 2010-11 agriculture sector is expected to grow at 5.4 percent but to achieve the plan target of average 4 percent the sector needs to grow 8.5 percent for the rest of the plan period.

Besides feeding to the rapidly increasing urban population, agriculture provides raw-material to various agro-based industries. With diversification of production base in the economy the contribution of agriculture to foreign exports from India has declined but it still manages to contribute more than 10 percent of the total foreign exchange earnings. Most importantly a balanced growth of the agricultural sector is an absolute necessity for realising the goal of inclusive development and increasing prosperity in the rural sector can be a potential source of domestic demand and investment surplus.

The First Green Revolution

Facing the increased demand for food and other agricultural commodities, government of India started making sincere efforts to increase agricultural production and productivity from the latter half of the Second Five Year plan. Following the adoption of new high yielding varieties of wheat developed by Mexican Agricultural scientist Norman E Borlaug in different parts of the world, a new agricultural strategy was unveiled in India as well, depending on the extensive use of high yielding seeds, fertilizers, pesticides, insecticides, farm mechanisation and irrigation. The new programme resulted in massive increase in agricultural production and productivity in the regions selected for the endeavour. The food output in the country increased from 72 million tonnes in 1965-66 to 108 million tonnes in1985-86 and yield per-unit of the farmland in the green revolution region increased by at least 30 percent. This agricultural success termed as the Green revolution succeeded in eliminating the 'farm to mouth' nature of Indian farming and firmly established India as one of the largest agricultural producers in the world. No less important were the secondary contributions to the industrial growth in the country through the setting up of fertiliser, pesticides, farm-machinery and hydro-electric plants. The latter created on huge water reservoirs needed for irrigation purposes in different parts of the country.

However the first green revolution didn't prove to be an unmitigated blessing for the nation. For, a long time increase in production remained restricted to wheat and to some extent rice. Production of wheat often termed as the main stay of the green revolution increased from just over 11 million tonnes in 1960-61 to 36.3 million tonnes in 1980-81. Production of pulses, oil-seeds and other horticultural products effectively remained outside the ambit of green revolution. Pulse-production in the country Infact declined from 12.7 million tonnes to 10.6 million tonnes over the same period. The revolution remained restricted to the selected regions of the country particularly Punjab, Haryana and Western Uttar Pradesh, largely benefiting the large farmers there who had the financial capacity to undertake the required investment for high cost farm resources leaving aside other regions and small and marginal farmers. The most obnoxious of the results of the first green revolution as it is being debated among agricultural scientists, environmentalists and economic policymakers is its lavish dependence on expensive agricultural inputs which in the long run have proved to be environmentally hazardous, ecologically unsustainable and economically unviable for small and marginal farmers which constitute the majority of Indian farm-holdings.

Issues in Indian Agriculture

Given its politically sensitive nature and dependence of more than two-third of the population for livelihood, agricultural sector in the country was largely kept aloof of the wide swapping economic reforms carried in the country after the post 1991 crisis (why do we call it a crisis?. Agriculture was indirectly expected to be benefited from the reforms in other sectors through the increased and diversified demand for agricultural products and lower costs for agricultural inputs made possible by increased income and productivity. However, growth rate in agriculture secularly (??) declined from those achieved during the 70s and 80s throughout the post reform period. Compared to a compound annual growth rate of 3.4 percent during the period 1980-81 to 1990-91, the growth rate in agriculture remained restricted to less than 2 percent for the period 1990-91 to 2002-03. The sector has witnessed some revival in growth after 2004 but it continues to be widely fluctuating and remains well below the plan targets of 4 percent.

The slow growth in agriculture post reforms has partially undone the gains made during the green revolution. The per capita food grain availability in the country has declined from 177 kg per head in 1990-91 to 154 kg per head in 2004-05. Famine like situations often emerge in different parts of the country and the government has to often resort to imports to ensure availability and contain prices of the food grain. India continues to be poorly placed at the rank 67 among the 84 countries in the Global Hunger Index calculated on the basis of child malnutrition, infant mortality and calorific deficiency of the population. More than 42 percent of Indian population fall below the international poverty line of $1.25 per day, child mortality rate in the country is at alarmingly high level of 72 per thousand and over 80 million Indian children are mal-nourished.

Causes of Agricultural Crisis

One of the most important causes of the decline in the growth rate of agriculture has been the progressive decline in the overall investment in the sector including that from the public. Gross capital formation in agriculture which was around 10 percent of total capital formation in the economy in 1990-91 declined drastically to 3.5 percent in 1999-00, though capital formation in the sector has revived of late to 9 percent it is still not sufficient to trigger a high growth rate.

Equally important has been the lack of any significant technological break-through in the sector since the first green revolution period, a phenomenon further compounded by increasing social resistance to genetically modified varieties developed outside India and dismal expenditure on agricultural research and development. The levels of adoption of high yielding production technologies and improved farm practices have remained un-even in different parts of the country.

One of the adverse consequences of government policy of providing input subsidies for agriculture has been the unbalanced use of fertilisers, pesticides and water, taking its toll on soil-health reducing the yield. Farming in India has been further handicapped by low credit delivery to the sector reducing the farmer's capacity to undertake investments in productivity enhancing tools/techniques and making inadequate investment in storage, ware-housing and marketing facilities. Even after huge investments taken in the country to improve irrigation facilities, more than 60 percent of Indian agricultural land is still rain-fed reducing the intensity of cropping and adding to the fluctuations of output.

Needed a second green revolution

Population of India is projected to cross 1.6 billion by 2050, placing a requirement of around 450 million tonnes, almost a double from the current level of around 230 million tonnes of food grain onus on the agricultural sector. The current growth performance of the agricultural sector can hardly be expected to meet the necessitated requirement. Opening of agriculture to international trade also cannot achieve a reliable food security for the country as the world output of food grains have been showing wide fluctuations and a constant tendency of hardening of the prices. There emerges thus an urgent need to break the low growth path obtained in the agricultural sector through ushering a cost-effective, environmentally sustainable second green revolution in the country. Growing economic prosperity in the country also calls for a new direction in the agricultural growth for meeting the diverse nutritional requirements related to dairy, poultry and horticultural products. Growth in agriculture has become an absolute necessity to obtain inclusive growth as continued disparity may result in social unrest jeopardising our development efforts. Indeed an enhanced productivity in the farm sector can be an important source of increased domestic demand and a well-nourished work force raising the growth potentials of the economy.

The way forward

The course charted by the agricultural sector for the much needed spurt in growth rate needs to be effectively different from those in the first phase of the green revolution. Practically, the chances of expanding arable farmland in the country have dried up, and average farm land size in the country have shrunken further due to partition and requirement of land for housing, industrial and other purposes. Land qualities as well as climatic conditions in the country have become further averse to increasing agricultural productivity.

Thus, the fore-most requirement in the country is to unveil an agricultural growth strategy that is environmentally sustainable and that climatically satisfies the requirements of diverse agro-climatic zones in the country. Food output basket in the country needs to be diversified to include pulses, oil-seeds, fruit, vegetables, dairy products and coarse grains. A major technological breakthrough in the form of drought resistant seed varieties and farming technique is needed to increase crop-productivity in dry land and rain-fed areas hitherto untouched by the green revolution. The eastern region of the country with an equally productive land and adequate irrigation facilities has largely remained unaffected by the green revolution. These regions have immense potential to contribute to agricultural growth if supported by right mixture of credit, research and marketing policies.

The declining trend of the public investment in the agricultural sector needs to be arrested. The public investment works as a valuable add on to the private investment in the sector. The research, extension, infrastructure, credit and marketing facilities extended to agriculture continues to be meagre in the country producing adverse effects on farmers incentive and agricultural productivity. Given the economic vulnerability of a large section of Indian farming community there is an urgent need to develop economically viable low cost production techniques affordable to them.

A significant breakthrough in agriculture also necessitates an active involvement of the private sector. They can effectively contribute through their active research and extension facilities, establishing efficient supply chain management and setting up of agro-processing industries leading to value addition of the agricultural products and remunerative return for the farmers. They are also important repositories of new technological breakthrough in agriculture like genetically modified seeds and nano-technologies holding promise for the future. Though, the country definitely cannot compromise on the livelihood interests of millions of small and marginal farmers; a change in people's mindset is needed to develop a receptive climate for the adoption of new agricultural innovations in the country.

Conclusion

A further neglect of the agricultural sector can be self defeating to India’s developmental efforts. There is an urgent need to develop enabling programme and policies for the agricultural sector to usher an environmentally sustainable, climate friendly change in agricultural production and productivity. A prosperous agricultural sector holds the key to the national agenda of inclusive development.