Introduction and Role of Agriculture in India

1. AGRICULTURE
Dr. S. P. SUGAPRIYA
Assistant Professor of Economics,
E.M.G Yadava Women’s College,
Madurai.

2. Introduction
 Agriculture is a very important sector of the Indian economy. It plays a
major role in the overall development of the country.
 Today India ranks second worldwide in farm output.
 Agriculture and allied sectors like forestry and fisheries accounted for
13.9% of the GDP in 2011 -2012 about 50% of the total workforce.
 Rice, Cereals, Pulses, oilseeds, Sugarcane, Cotton contributes major
share in total agriculture production.
 The agricultural sector of India has occupied almost 43% of India’s
geographical area.

3.  Agriculture is the most important sector of Indian Economy.
According to the Economic Survey (2017-2018), Indian
agriculture sector accounts for 17-18 percent of India's gross
domestic product (GDP) and provides employment to around
50% of the country’s workforce.
 Agriculture sector in India is therefore rightly called as
backbone of Indian economy.
 Agriculture and allied sector has a critical role in ensuring
food security, reducing poverty and sustaining growth in
India.

4. AgricultureinIndia
 Total Geographical Area – 329 million hectare.
 Net area shown142 million hectare
 Gross cropped area190.8 million hectare
 Net Irrigated area 56.9 million hectare
 Provides food to more than 1 billion people
 Produces 51 major crops

5. ROLE OF
AGRICULTURE
Share in National
Income
Important place
in exports
Contributes to
Governments
Revenue
Providing
Employment
Provides raw materials
to industries
Support to trade
and transport
Capital Formation Provide market for
manufactured goods

6. Sharein NationalIncome
 Agriculture contributes a large share in the GDP. Although the
share of agriculture in the total national income has been
gradually decreasing account of the development of Secondary
and Service Sectors.
 Its share in total GDP in 1950 -51 was around 55% and it
sharply declined to 13.9% in 2010-2011.
 But agriculture still continues to be the main sector because it
provides livelihood to a majority of the people.

8. ProvidingEmployment
 In India over two-thirds of our working population are engaged
directly on agriculture and also similarly depend for their
livelihood.
 It is an important source of livelihood. Generally, landless
workers and marginal farmers are engaged in non-agricultural
jobs like handicrafts, furniture, textiles, leather, metal work,
processing industries, and in other service sectors.
 In India about 70.6% of total labour force depends upon
agriculture.

9. ProvidesrawmaterialstoIndustries
 Agriculture in India has been the major source of supply of
raw materials to various important industries of our country.
Cotton and jute textiles, sugar, vanaspati, edible oil plantation
industries (viz. tea, coffee, rubber) and agro-based cottage
industries are also regularly collecting their raw materials
directly from agriculture.
 As economy developed, the share of agricultural exports in
total exports fell down.

10.  In 2013-14 agricultural exports formed about 12 per cent of
the national exports. In recent years, special schemes (like
Special Agricultural Product Scheme) have been started to
promote exports of fruits, vegetables, flowers, dairy products
and forest products.
 About 50 per cent of income generated in the manufacturing
sector comes from all these agro-based industries in India.
 Moreover, agriculture can provide a market for industrial
products as increase in the level of agricultural income may
lead to expansion of market for industrial products.

11. Supporttotradeandtransport
 Agriculture is the main support for railways and roadways.
 For, Agriculture products have to be moved to industrial
centres.
 International trade is mostly in agricultural products.
 Operations in the agricultural sector supports services like
banking, storage etc.

12. ImportantPlaceinExports
 Indian agriculture has a pride of place in the sphere of
international trade also.
 We export mostly agricultural products like jute, cotton textiles,
tea, oilseeds, spices, tobacco, wood, timber and millets.
 Nearly 70% of India’s exports accounts for agricultural goods.
 In view of this predominance of agricultural sector, even a small
rise in agricultural production results in a favourable influence
on the total incomes and overall development.

13. ProvidesMarketforManufacturedGoods
 Most of the people in India derive income from agriculture. If
the income of the agriculturists increase, the demand for
manufactured goods like cloth, sugar and cycles will
increase.
 If the incomes of the farmer fall, the demand will also fall.
 So the prosperity of many industries in the country depends
on the prosperity of the farmers.

14. CapitalFormation
 Savings are important for investment in agriculture, there is
much saving. This can be seen from the fact that commercial
banks are able to mobilise more savings from agriculture.
 Such savings are spent for investment purposes in industries
in the towns.

15. ContributestoGovernmentRevenue
 State government get a major part of their revenue in terms of
land revenue, irrigation charges, agricultural income tax etc.
 Central government also earns revenue from export duties on
the agricultural production.
 Moreover our government can raise substantial revenue by
imposing agricultural income tax. However this has not been
possible due to some political reasons.

16.  The government revenues also depend a great deal on
agricultural prosperity.
 The direct contribution of agricultural taxes to the revenues
of the center and the states is not significant but indirectly
agriculture has a considerable influence on the revenues of
the central and state governments.
 Particularly, when due to agricultural droughts, the revenue
suffers a set-back, government expenditure on relief, etc.,
goes up a great deal leading to heavy deficit in government
budgets.

17. Conclusion
 India has always been benefited by Agriculture.
 Thus , the agricultural sector is playing a very important role
in the country like India and the prosperity of the Indian
Economy still largely depends on agricultural sector.
 Agricultural development is the basic pre condition of
sectoral diversification and development of the economy.