Contribution of the Agricultural Sector to the Indian Economy

Contribution of the Agricultural Sector to the Indian Economy

Agriculture plays an important role in increasing Indian economic growth. 70 percent of the population of our country is dependent on Agriculture. Agriculture is a very important part of the Indian economy as it contributes about 17% to the total GDP and provides use to around 58% of the population.?

Indian agriculture has observed noticeable growth over the last few years. The production of grains and pulses has increased from 51 million tonnes (MT) in 1950-51 to 250 MT during 2011-12 highest ever seen.

The percentage of the agriculture sector in GDP increased by 19.9 percent in 2020-21 from 17.8 percent in 2019-20. The GDP increased to 19.9 percent in 2020-21 due to the large share of the agriculture sector from 17.8 percent in 2019-20.

Some important Basic Facts about agriculture are:

• India is the largest exporter as well as producer of cotton in the world.
• India is the biggest producer of ginger, okra, potatoes, onions, brinjal, etc., among all vegetables.
• In the world, Sikkim is the first state that claims 100% organic farming.
• In agricultural production, India has 2nd rank in the whole world
• India has world rank in the services and industry sector is 9th and 5th respectively.
• Agricultural production in India has increased from 87 USD bn to 459 USD bn in the last 15 years, By 12% annually
• Globally India has 9th rank for agricultural exports

As the economic recovery continued, India was able to step in successfully to meet the increased global demand after the second half of 2020, due to the covid pandemic situation. This was observed during the unprecedented global pandemic time. India’s agriculture sector was among the few segments that remained on the top during this pandemic period also.

As per the expert's opinion, our agricultural growth rate is likely to be 3.6 percent in the current financial year ending March 2022. On the other hand, India’s agricultural sector is estimated to grow by 3.9% in the year 2022-2023.?

Agricultural and Processed Food Products Export Development Authority (APEDA) products total exports increased from $6,485 million in April-August 2020 to $7,902 million in April-August 2021. By the Directorate General of Commercial Intelligence and Statistics (DGCI&S) this is all understood from the estimates released.

An amazing jump has been noted in exports of agricultural products and processed food products during the first five months of the current financial year. This is in continuation of the growth in exports in the financial year 2020-21.

Agriculture has played a critical part in this pandemic period and is one of the most important sectors of the economy.

Agriculture plays a lead role in Indian economic growth and development.

Agricultural contribution to National Income:

From ancient times, agriculture has contributed a large portion to increasing the national income.

Agriculture is the source of livelihood:

India’s two-thirds of the population are dependent or are engaged directly in agriculture for their livelihood.

Role of Agriculture for Industrial Development:

The 50 percent of generated income is in the manufacturing sector. The income comes from all the agro-based Industries in India.

The agricultural sector supplies a large number of raw materials to various important industries of the country. Agriculture is known as a major source of raw materials in our country.

Commercial Importance:

In both the internal and external trade of the country, Indian Agriculture is playing a lead role in Agricultural products like tea, coffee, tobacco, spices, sugar, cashew nuts, etc. are the main products of our country and constitute about 50 percent of total exports.

Manufactured jute, cotton textiles, and sugar also contribute 20 percent of the total exports of our country. The total exports from the agricultural sector is 70 percent.

Role of Agriculture in economic planning:

India and the prosperity of the Indian economy still largely depend on the agriculture sector.?

The increasing marketable surplus of agricultural output is very important in India for:

By increasing the supply of food and raw materials at non-inflationary prices

Increasing foreign exchange earnings through the increasing the volume of agricultural exports.

Increasing the domestic market for industrial products through higher purchasing capacities in the rural sector.