Agriculture Policies & Reforms in India

7/28/2019 Agriculture Policies & Reforms in India

1/17

REFORMs & policies inINDIAN AGRICULTURE

Presented by

Pricila Sunkari

Prachi Angwalkar


2/17

REFORMS IN AGRICULTURE

A common criticism of Indias economic reforms is that they have been

excessively focused on industrial and trade policy, neglectingagriculture which provides the livelihood of 60 percent of the

population.

The reduction of protection to industry, and the accompanying

depreciation in the exchange rate, has tilted relative prices in favor of

agriculture and helped agricultural exports.

The index of agricultural prices relative to manufactured products has

increased by almost 30 percent in the past ten years.

Public investment declined, this was more than offset by a rise in

private investment in agriculture which accelerated after the reforms.

However, there is no doubt that investment in agriculture-related

infrastructure is critical for achieving higher productivity and this

investment is only likely to come from the public sector.


3/17

EC

O

N

O

M

IC

P

R

O

CE

S

S

Since July, 1991 the country has taken..

The New Economic Policy (NEP-1991) introduced..

Salient features of NEP-1991.

The GATT Agreement signed in.

IMPACT OF ECONOMIC REFORMS


4/17

IX

P

L

A

N

ST

R

A

T

E

GY

The agricultural development strategy for the Ninth Five Year

Plan..

The Strategy to ensure food security

The Ninth Plan Target is..

In the coming millennium.


5/17

P

L

A

N

N

I

N

G

&

D

E

V

E

L

OP

M

E

N

T

India is endowed with

India has a total geographical area .

Development of irrigation potential .

Management of Soil Resources is essential ..

Development of livestock has been


6/17

IMPACT OF

GLOBALISATION

The liberalization of Indias economy was adopted by India in 1991

The reforms sought to gradually phase out liberalization,

privatization ,globalization.

Reforms in the agricultural sector in particular came under severe

criticism in the late 1990s, when 221 farmers in the south Indianstate of Andhra Pradesh committed suicide.

Andhra Pradeshs experience particularly critical in this debate

because it was headed by Chief Minister Chandrababu Naidu,

who pursued liberalization with enthusiasm.


7/17

7 STEPS TAKEN BY THE GOVERNMENT

To begin with government took lead in providing various facilities on its own.

In course of time different types of activities were entrusted to specificpublic agencies.

The government abolished the zamindari system. It was followed with the

consolidation of small holdings to make them economically viable.

Another important input was the widespread use of radio and television

for acquainting farmers in new and improved techniques of cultivation.

The crop insurance was another step to protect the farmers against losses

caused by crop failure on account of natural calamities like drought, flood,

hailstorm, cyclone, fire, diseases etc.


8/17

Easy availability of capital or investment input through a well-knit network

of rural banking and small scale cooperative societies with low interest

rates were other facilities provided to the farmers for modernization of

agriculture.

Special weather bulletins for farmers were introduced on radio and

television.

The government announced minimum support price for various crops

removing the elements of uncertainty. It ensures minimum price for the crop

grown by the farmers.


9/17

INTRODUCTION TO POLICY

REFORMS

India was a

latecomer

Economic

reforms

Earnest only in

1991

Indias

economicPost-reforms

period

Positive

features

The average

growth rate

Ten year

period from

1992-02

6.0

percent


10/17

POLICY

CHALLENGES

PRICE POLICY India has done well in protecting the consumers from global food prices

In the post-reform period, terms of trade increased initially, declinedduring 1999 to 2004. It was 106 in 1997-98. In 2006-07 it was only 102.

Prices play important role in cropping pattern shifts and alsoincrease in private investments in agriculture.

INVESTMENTS AND SUBSIDIES

Investment in irrigation and rural infrastructure is importantfor agricultural growth.

public investment in agriculture is lower than the requirementsneeded for achieving 4% growth. subsidies continue to mount, atcost of investment.

Subsidies led to highly wasteful use of canal water, ecological

degradation from water logging, salinity, pollution, over drawl of groundwater


11/17

POLICY & REGULATORY

FRAMEWORKF D I

100 % of FDI is allowed under the automaticroute in floriculture, horticulture,development of seeds, cultivation ofvegetables and mushrooms under

uncontrolled conditions and services relatedto the agriculture and allied sectors.

100 % is allowed in the tea sector, includingtea plantations under the government routesubject to the following conditions:

Compulsory divestment of 26% equity of thecompany in favour of an Indian partner/thepublic within a period of five years.

Prior approval of the State Government, in theevent of any land future use change.

05

1015

202530

plans layout


12/17

POLICY RECOMMENDATIONS

WTO is

receiving the

deepest

Affecting themajor sectors

of Indian

economy

Intensively in

the coming

years

A major

concern

growing

Impact of

WTO

Dominate

the Indian

agriculture

The challenge

to policy

makers

Protect

Indian

agriculture

Impendi

ng WTO

threat


13/17

INDIAN FARMERS NOT

BENEFITTING FROM W.T.O

AGREEMENT

Despite clear evidence that Indian farmers do not gain fromthe implementation of the trade liberalization process

under the World Trade Organization's Agreement onAgriculture, and are in fact badly hit by it

Five years after the World Trade Organization (WTO) cameinto existence, the anticipated gains for India from thetrade liberalization process in agriculture are practically

zero. The kind of export subsidies that need to be pruned is not

provided in India.

India was forced to either phase out or eliminate thequantitative restrictions (QRs) on agricultural commodities

and products.


14/17

MARKETOVERVIEW

POST INDEPENDENCE

GREEN

REVOLUTION

NATIONALAGRICULTURAL

POLICY

ECONOMIC

REFORMS


15/17

PERFORMANCE OF THE AGRICULTURE

SECTOR DURING THE CURRENT 5 YEAR

PLAN (2007- 2011)

During the first three years of the current Five Year Plan, the

griculture sector (including allied activities) recorded an average

growth of 2.03 per cent against the Plan target of 4 per cent per

annum. Things are looking bright in the current year with a relatively

good monsoon and the agriculture-sector is expected to grow at

5.4 per cent as per the 2010-11 advance estimates.

The agriculture sector growth in the first four years of the Plan isestimated at 2.87 per cent.

In order to achieve the Plan target of average 4 per cent per

year, the agriculture sector needs to grow at 8.5 per cent during

2011-12.


16/17

ConclusionAgriculture is expected to be a point of focus for the private sector in

India, as a number of private players are expected to venture into

organic farming, contract farming, and setting up hubs for theprocurement of farm produce.

Increased corporate investment in this sector is expected to offer a

new frontier of growth across many areas such as economies of scale

through advanced models of farming, effective distribution systems

and food security.


17/17

Agriculture Policies & Reforms in India

Documents

Transcript of Agriculture Policies & Reforms in India