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1. Macro-economics ........................................................................................................ 3
1.1. Tenth plan ............................................................................................................. 4
1.2. Eleventh plan ........................................................................................................ 6
1.3. Vision 2020 .......................................................................................................... 7
2. Land............................................................................................................................. 9
2.1. Soil type................................................................................................................ 9
2.2. Waste land .......................................................................................................... 10
3. Agriculture ................................................................................................................ 11
3.1. Food grains ......................................................................................................... 13
3.2. Commercial crops............................................................................................... 14
3.3. Cropping season ................................................................................................. 15
3.4. Agriculture exports ............................................................................................. 15
3.5. Irrigation ............................................................................................................. 16
3.6. Revolutions......................................................................................................... 17
A brief description of the major revolutions: ................................................................ 18
3.7. Agriculture: At A Glance ................................................................................... 18
3.8. India and world: comparison in agriculture........................................................ 20
4. Agri Business ............................................................................................................ 21
4.1. Fertilizer and pesticides ...................................................................................... 21
4.2. Food processing.................................................................................................. 24
4.3. Agriculture machinery........................................................................................ 25
4.4. Agriculture markets ............................................................................................ 27
4.6. Agriculture finance ............................................................................................. 28
5. Forest......................................................................................................................... 30
6. Agriculture Allied Activities..................................................................................... 31
6.1. Horticulture......................................................................................................... 31
6.2. Poultry ................................................................................................................ 31
6.3. Dairy ................................................................................................................... 32
6.4. Sericulture........................................................................................................... 32
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6.5. Fish ..................................................................................................................... 33
6.6. Animal Husbandry.............................................................................................. 33
7. Land reforms ............................................................................................................. 35
8. NGOs......................................................................................................................... 37
9. Development schemes and indicators ....................................................................... 41
9.1. HDI index............................................................................................................... 42
9.2. IRDP....................................................................................................................... 43
9.3. Self Employment programs.................................................................................... 43
9.4. Wage Employment programs................................................................................. 44
9.5. Education................................................................................................................ 449.6. Health ..................................................................................................................... 46
10. Micro finance ......................................................................................................... 47
11. Cooperatives........................................................................................................... 48
12. Retail revolution and farmer .................................................................................. 50
13. ITC e-Choupal........................................................................................................ 52
14. WTO and Indian agriculture .................................................................................. 56
15. Important Institutions............................................................................................. 58
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1. Macro-economicsIndia is the second fastest growing major economy in the world, with a GDP growth rate
of 9.4% for the fiscal year 20062007. The average for last three years is close to 9%.
Beating Japan, the economy of India is expected to be the third largest in the world as
estimated by purchasing power parity by the end of this fiscal year. When measured in
Dollar terms, India is the twelfth largest in the world. Currently its GDP has more than
US $1.0 trillion. But per capita income of the country is low at $3,800 at PPP and $735
at nominal1 due to countrys huge population. In the World Bank classified India as a
low-income economy in 2006, but India will probably move into the lower middle-
income country classification of per capita income by 2008. Indian foreign exchange
reserves are increasing at rapid rate. During August, 2007, it was $230 billion. With therecent surge in inflows, no wonder by the time you will read this document it would be
more than $250 billion.
Following graph compares the growth rate of major economies2.
*
* '
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R ZZ W
W K
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D W
W H
H V
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& K
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8 .
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12006 estimates
2Source : International Monetary Fund, The Economist and the OECD
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The PPP picture is brighter. Following graph tells that its not far when we will catch up
china and America
3
.GDP on PPP bas is
0
2
4
6
8
10
12
14
16
USCh
ina
India Japan UK
Russi
a
Brazi
l
Kore
a
Australi
aHK
Sing
apore
U
S
$
trillion
1.1. Tenth planDuring tenth plan (2002-07) period India has seen the growth like never before. The table
below is showing the sectoral growth rates and ICOR under Different Sectors of the
economy
3*Estimates by IMF: World economic outlook , September 2006
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Tenth Five year Plan in a nutshell (2002-07)
Macro-economics parameters of the tenth plan are given below. The most noticeable is
the increase in the savings and investment rate. If an economy wants to grow with the
rate of 9% or more its investments rate must be more than 35%. Investment comes from
savings so higher savings rate is prerequisite of higher growth. Can you guess which
country has highest savings rate. Obviously China!
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Parameter 10th plan Post Plan
Domestic Savings Rate (%of GDPmp)
26.8% 33%
Current Account Deficit (%
of GDPmp)
1.6% 3.1%
Investment Rate(% of
GDPmp)
28% 36%
GDP Growth Rate (% per
annum)
7.9% 9.4%
Export Growth Rate(% per
annum)
12% NA
Gujarat, Karnataka and Delhi were grown fastest with the growth rate in state GDP was
more than 10%. Bihar and Kerala were among the slowest with growth rate in state GDP
was 6.5%. Insurgency hit north eastern (NE) states were worst performers with growth
rate hovering at the lower 5%.
1.2. Eleventh planEleventh plan (2007-11) is under the finalization process. Most of the policies and targets
are already finalize and reports on it are available on the planning commission website.
Targets growth rate for agriculture sector4 is 4 %.
Growth rate for agriculture sector achieved during 10th
plan: 1.8%
Parameter Target for 11th plan
GDP growth rate 9%
Domestic Savings Rate (%
of GDPmp)
33%
Current Account Deficit (%
of GDPmp)
2.8%
Investment Rate(% of
GDPmp)
35%
4Montek Singh Ahluwalia, planning commission,
http://planningcommission.nic.in/plans/planrel/53rdndc/dchndc53.pdf
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In the table below, the projections for sectoral growth and Import-Export growth rates are
given.
1.3. Vision 2020Inspired with president Kalam, country has prepared a vision for 2020. Committee
headed by K C Pant has prepared the vision document in 2002. Few high lights are given
below.
Vision 2020 at
glance
5
5
Report of the committee on vision 2020 planning commission,http://planningcommission.nic.in/plans/planrel/pl_vsn2020.pdf
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2.
Land
Following tables shows some facts about the Indian land. India which is 7th
largest
country has 2nd largest cultivable land and largest irrigated land in the world.
Parameter Indian value World Rank
Total Area 329 million hectares 7th
Land Area 297 million hectares 7th
Percentage of World Area 2.42 per cent 7th
Forest Area6 63 million hectares (19.4 %
of the total area)
Areable land 162 million hectare (43% of
Total)
2nd
(USA 1st)
Irrigated Area 55 million hectares (40% of
total Arable land)
1st
Rain irrigated Area 60%
Cereals production 231 in year 2001 3rd behind China, USA
2.1. Soil type
India- Land Soils
Soil States Useful in production of
Alluvial soils cover about
24% of the total land.
Found in Indo-Gangetic
Plains (Punjab, Haryana,
UP), in the valleys of
Narmada and Tapti in
Madhya Pradesh and the
Cauvery in Tamil Nadu.
These soils are considered
very good for the
production of wheat, rice
other cereals, pulses, oil
seeds, potato, sugarcane,
etc.Black soils Found in the States of
Maharashtra, Gujarat,
Madhya Pradesh,
Karnataka, Andhra Pradesh,
Tamil Nadu, Uttar Pradesh
and Rajasthan.
These are also considered
good for cultivation of
cotton, cereals, pulses, oil
seeds, citrus fruits,
vegetables, etc.
6Source: Data as of year 1999, planning commission website. The data on forest cover varies as different
agencies have different definition of what constitute a forest
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Red soils Found in Tamil Nadu,
Karnataka, Kerala,
Maharashtra, AndhraPradesh, Madhya Pradesh,
Bihar and West Bengal.
These are most suited for
rice, ragi (millet), tobacco
and vegetable cultivation.
2.2. Waste land
Wasteland is a degraded land which does not fulfill their life sustaining potential.Wasteland can result from inherent / imposed disabilities such as by location,environment, chemical and physical properties of the soil or financial or managementconstraints.
Wastelands statistics indicate that about 63.85 million hectares, which account for20.17% of the total geographical area (328.72 million hectares) exist as wastelands inIndia7.* X O O L H G D Q G R U 5 D Y L Q R X V O D Q G , / D Q G Z L W K R U Z L W K R X W V F U X E : D W H U O R J J H G D Q G 0 D U V K \ O D Q G / D Q G D I I H F W H G E \ V D O L Q L W \ D O N D O L Q L W \ F R D V W D O L Q O D Q G 8 Q G H U X W L O L ] H G G H J U D G H G Q R W L I L H G I R U H V W O D Q G ' H J U D G H G S D V W X U H V J U D ] L Q J O D Q G H W F F R P H V X Q G H U W K H F D W H J R U \ R I Z D V W H O D Q G
7Source: 1:50,000 scale wasteland maps prepared from Landsat Thematic Mapper/IRS LISS II/III Data
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Food Crops
Crop AreaRice West Bengal, U.P., Andhra Pradesh
and Haryana.
Wheat Punjab, Haryana and U.P and
Madhya Pradesh
Millets Tamil Nadu, Maharashtra, Gujarat,
Madhya Pradesh, U.P. and Haryana.
Barley U.P., Punjab and Haryana.
Maize Bihar, U.P., Punjab, Rajasthan,
Maharashtra and Gujarat.
Pulses Punjab, Rajasthan, Maharashtra,Bengal and Gujarat
Sugarcane U.P., Bihar, Maharashtra.
Non-Food crops or Cash crops
Tea Assam, West Bengal, Kerala.
Coffee Karnataka, Kerala and tamil nadu.
Oilseeds Orissa, U.P., Maharashtra, Gujarat, Andhra
Pradesh.Tobacco U.P., bihar, Tamil Nadu, Karnartaka and
Gujarat.
Cotton Maharashtra, Gujarat, Andhra Pradesh and
tamil Nadu
Jut West Bengal, Assam, Bihar and Orissa
Rubber Tamil Nadu, Karnataka and Kerala
Silk Karnataka, West Bengal, Assam and
Kashmir.
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3.1. Food grains8, Q G L D V 3 R V W L R Q L Q : R U O G L Q 3 U R G X F W L R Q R I ) R R G * U D L Q V
W R
3 U R G X F W L R Q
L Q 0 7 V
, Q G L D 3 R V W L R Q
, W H P
, Q G L D : R U O G
6 K D U H 5 D Q N 1 H [ W W R
7 R W D O & H U H D O V 7 K L U G & K L Q D 8 6 $
: K H D W 6 H F R Q G & K L Q D
5 L F H 3 D G G \ 6 H F R Q G & K L Q D
& R D U V H * U D L Q V ) R U W K 8 6 $ & K L Q D % U D ] L O
7 R W D O 3 X O V H V ) L U V W
2 L O V H H G V
* U R X Q G Q X W L Q
V K H O O 6 H F R Q G & K L Q D
5 D S H V H H G
0 X V W D U G 7 K L U G & K L Q D & D Q D G D
1 R W H 8 Q R I I L F L D O I L J X U H
Food grains Production in Millions tones
Following table shows the Crop-wise Production of Food Grains in Kharif/Rabi9
Crop-wise Production of Food Grains in Kharif/Rabi
Season in India
(2004-2005 and 2005-2006)
(Million Tonnes)
Crop 2004-05 2005
-06
Kharif Rab
i
Tot
al
Khar
if
Rabi Tot
al
Rice 79.04 14.46
93.5 75.45 12.35 87.8
Wheat - 79.5 79.5 - 75.53 75.53
Maize 12.66 2.42 15.08
12.54 2.85 15.39
8 6 R X U F H 0 L Q L V W U \ R I $ J U L F X O W X U H * R Y W R I , Q G L D 9
Source: Department of Agriculture and Cooperation, Ministry of Agriculture, Govt of India.
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Pulses 6.1 9.2 15.3 - - -
Total Coarse
Cereals 28.69 7.83 36.
52Total Pulses 5.78 9.37 15.
15
Total
foodgrains
113.8 111.
3
225.
1
109.9
2
105.0
8
215
Cotton* 15 - 150 165 - 165
Jute ** 106 - 106 101.2 - 101.2
Sugarcane(Cane)
Continued in Kharifand Rabi
- 2700
- - 237.5
Note : * : Cotton lakh bales of 170 kg each** : Jute and Mesta lakh bales of 180 kg. each.
3.2. Commercial crops& U R S 6 H D V R Q Z L V H $ G Y D Q F H ( V W L P D W H V R I
& R P P H U F L D O & U R S V 3 U R G X F W L R Q L Q , Q G L D
D Q G ) L U V W ( V W L P D W H
/ D N K 7 R Q Q H V
W K V W
$ G Y D Q F H $ G Y D Q F H
& U R S 6 H D V R Q 7 D U J H W V
( V W L P D W H V
7 D U J H W V
( V W L P D W H V
* U R X Q G Q X W
. K D U L I
5 D E L
7 R W D O
6 X Q I O R Z H U
. K D U L I
5 D E L
7 R W D O
6 R \ D E H D Q
. K D U L I
7 R W D O 1 L Q H
2 L O V H H G V
. K D U L I
5 D E L
7 R W D O
& R W W R Q
- X W H
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6 X J D U F D Q H & D Q H
1 R W H / D N K % D O H V R I N J V H D F K
3.3. Cropping seasonThe Indian crops can be divided into three groups in which two are major namely Kharif
& Rabi-
Kharif crop- The Kharif season is during the southwest monsoon (July-October). During
this season, agricultural activities take place both in rain-fed areas and irrigated areas.
Kharif crop includes Rice (Paddy), Jowar, Bajra, Maize, Cotton, Sugarcane, Seasamum,
Soyabean, and Groundnut.
Rabi crops- The Rabi season is during the winter months, when agricultural activities
take place only in the irrigated areas. This crop is sown in October last and harvested in
March/April every year. These crops include Wheat, Jowar, Barley, Gram, Tur,
Rapeseed, and Mustard.
Zayad Crop- In some parts of the country a crop is sown during March to June every
year. Zayad crops include Melon, watermelon, Vegetables, Cucumber, Moong, Urad etc.
Kharif and Rabi season comparison: Comparison of major food grains and total
production of rice and wheat. The comparison can also be seen in the table shown in thesections of food grains and commercial crops.
Grains 2004-05
in million tonnes
Rice 87.8
Wheat 73.03
Rabi (all food grains) 103.4
Kharif (all food grains) 102.9
Total (all food grains) 206.3
3.4. Agriculture exportsThe Agri-export and EXIM policy 2004-09 emphasized the importance of agricultural
exports and announced the following measures to boost the agri-ecports:
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A new scheme called the Vishesh Krishi Upaj Yojana ( Special AgriculturalProduce Scheme ) for promoting the export of fruits, vegetables, flowers minor
forest produce, and their value added products have been introduced. Funds shall be earmarked under ASIDE ( Assistance to states for Infrastructure
Development of Export) for the development nof Agri-Export zones.
Capital goods imported under EPCG shall be permitted to be installed anywherein the APZ.
Following tables shows the agriculture exports from india and its comparison with thetotal exports of the country. The figures of the year 1991 are given to highlight the factthat what is the impact of LPG (liberalization, privatization and globalization) on theagri-exports from the country.10
( [ S R U W V R I $ J U L F X O W X U H & R P P R G L W L H V Y L V D Y L V
7 R W D O 1 D W L R Q D O ( [ S R U W V I U R P , Q G L D
W R
5 V L Q & U R U H
$ J U L F X O W X U H < H D U
( [ S R U W V
7 R W D O 1 D W L R Q D O
( [ S R U W V
$ J U L F X O W X U H ( [ S R U W V W R 7 R W D O 1 D W L R Q D O
( [ S R U W V
3.5. IrrigationIndia is a monsoon dependent country for its water resources. Irrigation sector has been
fundamental to Indias economic development and poverty alleviation since 25% of
Indias Gross Domestic Product (GDP) and 65% of employment is based on agriculture.
During the post independence period, the country has invested a huge amount of capital
in the major and the medium irrigation projects. Among the states, three have alreadyachieved 70% or more of the ultimate irrigation potential with Tamilnadu recording
100% achievement, followed by Punjab and Rajasthan at 84% and 74% respectively. Six
states, i.e., Haryana, Karnataka, Jammu & Kashmir, and West Bengal are in the range of
63% to 71%, whereas in U.P. and Maharashtra, the achievement would be 56% each. The
states of Bihar, Gujarat, Orissa, M.P. and Assam have achieved less than 50% of the
ultimate potential. The ultimate potential under major & medium irrigation in the eastern
states (except West Bengal), i.e. Bihar, U.P., M.P. and Orissa put together works out to
10Source: Ministry of Agriculture, Govt. of India.
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bout 50% of the total ultimate potential of the country. Irrigation potential which stood at
22.6 mha in 1950-1951, has now reached about 100 mha, and as a result food production
has increased from 50 m tonnes (1951) to about 208 m tonnes (2005). The projections forfuture population and food requirement of the country indicate that the population of
India may stabilize around 1.6 to 1.7 billion by 2050 AD and that would require about
450 m tons of food grain annually at the required level of food consumption. Area wise it
is necessary to provide irrigation to at least 130 mha for food crops alone and in an area
of 160 mha for all crops to be able to meet the demands of the country in 2050 AD and
ensure food security.
Following table give the data about the shown and irrigated land in the country. It also
depicts the trend in the increase of net shown area and irrigated area.
Sown and Irrigated Area in India
(Million Hectare)
Year
Net
Sown
Area
Gross
Sown Area
Area Sown more
than once *
Net
Irrigated
Area
Gross
Irrigated
Area
Area Irrigated more
than once **
1950-
51 118.75 131.89 13.14 20.85 22.56 1.711991-
92 141.63 182.24 40.61 49.87 65.68 15.81
2003-
04* 140.88 190.64 49.76 55.1 76.82 21.71
3.6. Revolutions
Revolutions in Indian Economy
Revolutions Area Key Person
Green Agriculture Dr. Norman Borlaug and
Dr. M.S.Swaminathan.
Yellow Oil Seeds Sam Pitroda
White Milk Varghese Kurien
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Blue Fish -
Pink Shrimp -
Brown Masaaley -Grey Wool & Poultry -
Black Crude Oil -
A brief description of the major revolutions:
Operation Flood (white Revolution) has helped dairy farmers direct their owndevelopment, placing control of the resources they create in their own hands. A NationalMilk Grid links milk producers throughout India with consumers in over 700 towns andcities, reducing seasonal and regional price variations while ensuring that the producergets a major share of the price consumers pay.
The bedrock of Operation Flood has been village milk producers' cooperatives, whichprocure milk and provide inputs and services, making modern management andtechnology available to members. Operation Flood's objectives included :
* Increase milk production ("a flood of milk")* Augment rural incomes* Fair prices for consumers
The Green Revolution is a term used to describe the worldwide transformation of
agriculture that led to significant increases in agricultural production between the 1940sand 1960s. This transformation occurred as the result of programs of agriculturalresearch, extension, and infrastructural development, instigated and largely funded by theRockefeller Foundation, along with the Ford Foundation and other major agencies.[1]The Green Revolution in agriculture helped food production to keep pace with worldwidepopulation growth. It has had major social and ecological impacts.The Office of Special Studies in Mexico became an informal international researchinstitution in 1959, and in 1963 it formally became CIMMYT (The International Maizeand Wheat Improvement Center).
The second nation to which the Green Revolution spread was India. The Ford Foundation
had a presence in the nation, and their social scientists had decided that the technologicaldevelopment of agriculture was important to the future of India . At the same timeC.Subramaniam, the former Indian Minister. The Foundation and Indian governmentcollaborated to import a huge amount of wheat seed from CIMMYT
3.7. Agriculture: At A Glance Agriculture growth rate target for Tenth Plan (2002-2007) is 4%,but achived was
merely 1.8%. target for 11th plan is again 4%.
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Agriculture sector provides employment to 58.4% of countrys workforce and isthe single largest private sector occupation.
India holds first position in the world in the production of sugarcane and sugar,Brazil closely follow us and many times its production is more than ours. Brazil is
also largest producer of Ethanol.
Cashew nuts assume an important place in the Indian Economy. India produces45% of the global production of cashew. India is the largest producer, processor,
consumer & exporter of cashew in the world.
India contributes about 13% to the world vegetable production and occupies firstrank in the production of Cauliflower, second in onion and third in cabbage in the
world.
Indias share in the world production of mango is about 54%. India occupies the first rank in banana production of 1.16 Million tones. Animal husbandry output constitutes about 30% of the countrys agriculture
output.
U.P. is the highest wheat producing state, Punjab and Haryana hold 2nd & 3rdpositions respectively.
Rice is the main food crop in India. The highest rice producing State is WestBengal, U.P & Punjab are 2nd & 3rd respectively.
The highest pulses & Soyabean producing state is Madhya Pradesh. The highest cereals producing state is Maharashtra. India is the largest producer & consumer of tea in the world and accounts for
around 27% of world production and 13% of world trade.
Karnataka, which is the largest producer of coffee in the country, accounts for56.5% of total coffee production in India. India ranks sixth in the world coffee
production.
Kerela is the main rubber producing state, which produces 90% of the rubber inthe country and accounts for over 85% of the area under cultivation.
India is the largest Milk producing country in the world. India is the third highest tobacco producing country in the world. India ranked first in production of vegetable in the world. Besides India is the
second largest producer of fruits in the world. The Horticulture sector contributed 28% of GDP in agriculture.
Crop Rotation- The practice of growing more than one crop simultaneously in asingle field in a single season gives additional harvest. Thus, this practice
increases the over all yield and ensures maximum use of the soil and nutrients. If
there is danger of loss to any crop due to adverse weather conditions or diseases,
there are some better chances for the other crop in the field if the system of
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multiple cropping is adopted. The two and three years rotation is also adopted in
the country and is as follows:
First Year Second Year Third Year
Bajra & Pea Green manuring & Wheat -
Jowar & Arhar Cotton& Peas -
Kharif Sugar-cane Green manuring Cotton
Rabi Sugar-cane Wheat Preparation for Sugar-cane
Sugar cane is generally sown in three years rotation. The areas, near the help of organic
manures and fertilizer. In such areas three to four crops in a year are taken such as maize,early potato, late potato and pumpkin. In these areas the fertility of the fields is
maintained by adding manure with the soil.
3.8. India and world: comparison in agriculture
Leading production countries and Indias rank in the world11
Crop Leader Indias Rank
Paddy China 2nd
Wheat China 2nd
Maize USA 7th
Sugarcane Brazil 2nd
Tobacco China 2nd
Milk India 1st
Fruits and vegetable China 2nd
Live stock India 1st
India is leading producer of Banana and Mango also.
11FAO estimates
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4. Agri BusinessDefinition
12
:Agribusiness is sum total of all the opereations involved in a) manufacturingand distribution of farm supplies, b) production activities on the farm, c) and the storage
processing and distribution of the farm commodities and the items made from them.
Agribusiness Brief: As per recent studies the turnover of the total food market is
approximately Rs.250000 crores (US $ 69.4 billion) out of which value-added food
products comprise Rs.80000 crores (US $ 22.2 billion). The Government of India has
also approved proposals for joint ventures, foreign collaborations, industrial licenses and
100% export oriented units envisaging an investment of Rs.19100 crores (US $ 4.80
billion) out of which foreign investment is over Rs. 9100 crores (US $ 18.2 Billion). The
agricultural food industry also assumes significance owing to India's sizable agrarianeconomy, which accounts for over 35% of GDP13 and employs around 65 per cent of the
population. Both in terms of foreign investment and number of joint- ventures / foreign
collaborations, the consumer food segment has the top priority.
The other attractive features of the Indian agro industry that have the capacity to lure
foreigners with promising benefits are the deep sea fishing, aqua culture, milk and milk
products, meat and poultry segments14
.
4.1. Fertilizer and pesticidesA fertilizer is a Organic or inorganic plant foods, which may be either liquid or
granular, used to amend the soil in order to improve the quality or quantity of plant
growth
Our farm needs 18 different elements to survive but most of them are already provided to
the farm from the soil and natural surroundings. However, three primary elements-
Nitrogen (N), Phosphorus (P), and Potassium(K) need to be added to farm in the form of
fertilizer to increase productivity in total. The idea ratio of N: P: K fertilizer is 4:2:1.
India is the 3rd largest producer and consumer after China and States with 17.7million tonnes of installed capacity.
Annual consumption increased from 70,000 mt in 1951-52 to 203.4 lakh mt in 05-06. Per hectare consumption increased from less than 1 kg in 1951-52 to 106 kg in 05-06. Achieved self sufficiency in Nitrogenous fertilizers production, adequacy in
Phosphates but for Potash depended on imports.
12Davis and Goldberg, Harvard Business School
13Only agriculture and allied activities account for 18.3 % in 2006. But agriculture and related agro
industry which inculedes food processing, warehousing and export accounts for close to 35% of the GDP.14
Source: http://www.agriculture-industry-india.com/agro-industry-overview/
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Punjab tops with 184 kg per hectare and Orissa at bottom with 41.4 kg per hectareconsumption.
Still we are behind even from country like Pakistan and Bangladesh.Fertilizer Use: Large and medium farmers use fertilizer mostly, small farmers use less.
The landholding above 5 acres or 2-5 acres farmer use it more almost 70% of totalconsumption.
The use of fertilizer is varying from state to state. Punjab is highest user of fertilizer less then one percent farmers do not use it
regularly.
At National level 30 % farmers do not use it regularlyDistribution: Availability of fertilizer is the most important in its sell, Nutrients
determine the purchasing decision.
Brands have got lesser important in fertilizer market Fertilizers are distributed through three main channels institutional channel, company
outlets and private dealers.
Share of private dealers is 65 % of total fertilizer distribution
Types of Fertilizers & their composition
Nitrogenous Fertilizers
Urea 46%N
Ammoniam Sulphate (As) 21%N
Ammoniam Chloride (ACl) 26%N
Calcium Ammoniam Nitrate (CAN) 25%N
Phosphatic & Potassic Fertilisers
Single Super Phosphate (SSP) 16% P2O5
Muriate of Potash (MOP) 60%K2O
Sulphate of Potash (SOP) 48%K2O
Di-ammonium Phosphate (DAP) 18% N 46%P2O5
Rock Phosphate (RP) 16 - 20% P2O5
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4.2. Food processingIndia is the world's second largest producer of food next to China, and has the potential of
being the biggest with the food and agricultural sector. The total food production in India
is likely to double in the next ten years and there is an opportunity for large investments
in food and food processing.
India's food processing sector covers fruit and vegetables; meat and poultry; milk and
milk products, alcoholic beverages, fisheries, plantation, grain processing and other
consumer product groups like confectionery, chocolates and cocoa products, Soya-based
products, mineral water, high protein foods etc.
A strong and dynamic food processing sector plays a significant role in diversification of
agricultural activities, improving value addition opportunities and creating surplus for
export of agro-food products. This would, however, require policies and plans forimprovement of food processing infrastructure including up gradation of technology &
enforcement of quality standards, promoting investment in food processing, activating
domestic market with focus on exports.
The food processing was thought to be one of the most promosing sector to attract FDI.
It was one of the earliest sector to be privatized. The figures for FDI during the last few
years are given below.
Inflow of Foreign Direct Investment (FDI) in Food Processing
Industries (FPI) Sector in India15
(1999-2000 to 2006-2007)
(Rs. in Crore)
Year FDI Inflow Received in FPI Sector
1999-00 444.06
2000-01 198.13
2001-02 1036.12
2002-03 176.53
2003-04 510.85
2004-05 174.08
2005-06 182.94
2006-07 (Apr-Dec.) 222
15Source : Ministry of Food Processing Industries, Govt. of India
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The export of the processed food items are given in the next table.
2002-03Items 1996-97 2001-02 (Targets)
Processed Fruits and Vegetables 473.77 1100.6 1400
Animal Products 803.59 1500.9 1750
Other Processed Food (Guar Gum,
Ground nut, Alcohol, Beverages,
milled Products, etc.)
1835.92 1780.1 1600
Rice 3172.35 3173 3750
Walnuts 78.93 117.98 100
Marine Products 4121.36 5957.1 6000Total 10485.92 13630 14600
4.3. Agriculture machineryMechanization refers to injection of machinery between man and materials handled by
them. There is scope of mechanization in every aspect of production agriculture, post
harvest and agro processing.
It is not a surprise that Indian rural transport and tractor industry is one of the largest inthe world. In the year 2006, with the sale of 3.52 lakh tractors India is already the largestmarket by volume and second largest by value. Today industry comprises of 14 players,including 3 MNCs. The opportunities still are huge considering the low farmmechanization levels in the country, when compared to other developed economiesacross the world. After a downturn during last 3-4 years, the industry is back on a growthpath, which we believe would sustain in coming years as well. Key concern for theindustry is its dependence on agricultural income in hands of farmers and the state ofmonsoon. The overcapacity, increasingly good quality and lower price provides a goodexport opportunityUP, Punjab, MP, Bihar, AP, Rajasthan and Maharashtra are the biggest market for the
tractors. State wise sales figures are provided in the annexure. It clearly shows that northand central India has the highest number of tractor sales.
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4.4. Agriculture markets
Agricultural Marketing is a process which starts with a decision to produce a saleablefarm product and involves all aspects of market structure or system, both functional and
institutional, based on technical and economic consideration. Agricultural marketing is a
State subject.
One of the main problems that have been encountered by the Indian farmers is that of
marketing their agricultural produce at the right place and time and for the right
compensation. The middlemen, who buy their produce at low rates, exploit the poor and
uneducated farmers.
An efficient system of marketing needs to be evolved so that the agricultural productivity
can be improved. The following measures can be considered for improving the
agricultural marketing mechanism in India:
Establishment of regulated markets. Provision of storage and warehousing facilities. Introduction of Co-operative marketing structure.
Agricultural Price Policy- In an agrarian economy like India, the prices of agricultural
commodities have a major influence on the overall price structure. Sudden and unwarned
fluctuations in the prices of the agricultural products lead to a corresponding destabilizing
effect on the prices of other commodities as well. A decline in the agricultural prices will
result in a great fall in the income of the farmers.
After the Agricultural Price Commission was set up in 1965, the sector witnessed a more
stable and meaningful price and distribution policy. The main thrust areas of the
Agricultural Price Policy were:
Announcement of minimum support prices of major food grains. Fixation of procurement prices for purchasing a part of the marketable surplus at
below market prices.
Running a Public Distriburtion System(PDS) for the benefit of the low incomeconsumers. Building up of buffer stocks to meet the emergency situations and to safeguard
against the price fluctuations.
Price stability is of utmost importance for agriculture. In order to stabilize the agricultural
prices, the government adopts three measures:
1. Minimum Support Price2. Buffer stock3. Import of the commodity
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Agricultural markets: The agricultural markets in India can be broadly classified into
the following categories:
1. Wholesale markets.2. Retail markets.3. Daily and weekly mandis in the rural areas.4. Annual and occassional fairs andHaat.
Today India has 7000-plus APMC (agriculture produce and marketing committee) mandifor farm commodities. Mandi works through a series of middleman or commission agentswhich have a vice like grip on the trade of every farm commodity. From an example fromDelhi mandi, 60-75% of the paid by the customers is cornered by these middlemen. Itmeans that farmer gets only 25-40% of the retail price. Hundreds of crore collected in
mandi taxes rarely be reinvested in the distribution infrastructure back.
Agricultural taxation: Agricultural tax is being collected as a federal tax, but it is being
levied only on income from plantations. All other agricultural income is fully exempt
from tax. Agricultural property was subject to stamp duties and registration fees. All
property transactions have to be made on official, stamped forms, and registration fees
have to be paid to register transactions.
Countrys main terminal market is set up in Chandigarh and 6 other are in pipe line. Safal
market created by NDDB at the outskirts of the Bangalore is state of the art facility.
Terminal markets provide all facilities like grading and sorting, electronic accounting,quality testing labs, cold storage and important banking facilities.
4.6. Agriculture financeAgricultural production in this country depends upon millions of small farmers. It is the
intensity of their effort and the efficiency of their technique that will help in raising yields
per acre. Because of inadequate financial resources and absence of timely credit facilities
at reasonable rates, many of the farmers, even though otherwise willing, are unable to go
in for improved seeds and manures or to introduce better methods or techniques. Works
of minor irrigation like wells owned by the cultivators either get into disuse or are not
fully utilized for want of capital.
Types of Financing: Finance required for production can be divided broadly into : (a)
short-term (for periods up to 15 months) ; (&) medium-term (from 15 months up to 5
years) and (c) long-term (above 5 years). Short-term loans are required for purchasing
seeds, manures and fertilizers or for meeting labour charges, etc. These are expected to be
repaid after the harvest. Medium-term loans are granted for purposes such as sinking of
wells, purchase of bullocks, pumping plants and other improved implements, etc. Loans
repayable over a longer period (i.e. above 5 years) are classified as long-term loans.
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These are utilised for payment of old debts, purchase of the heavier machines, making
permanent improvements and increasing the size of the holding17.
Primary sources of agricultural credit are:
The following agencies provide finance to the cultivators :
1. Private agencies:
(a) Money lenders and landlords ;
(b) Commercial banks.
2. Public or semi-public agencies:
(a) The State
(b) Co-operative societies
(c) Regional Rural banks
Co-operatives: Commercial and regional rural banks are institutional lenders whereas
moneylenders which operate in the villages and talukas are non-institutional lenders.
Moneylenders have exploited the farmers and small landowners. With increased
institutional intervention in the rural finance sector, this exploitation has reduced
considerably and the farmers are no longer at the mercy of the whimsical moneylenders
for the satisfaction of their financial requirements.
NABARD: NABARD, which is considered to be the leading institution in the
agricultural sector, was set up on July1, 1982. Since its inception, NABARD has taken
over the functions of the Agricultural finance department of RBI and the Agricultural
Refinance and Development Corporation (ARDC). NABARD is responsible for the
development, planning, operational matters, coordination, monitoring, research, training
and consultancy in relation to rural credit.
NABARD maintains two funds, viz National Rural Credit (Long term operations) and the
National Rural Credit (Stabilization) Fund. Both the Central and the State governments
contribute to these funds. It operates throughout the country through its 16 regional
offices and 3 Sub-offices.
Crop Insurance Scheme: the United Front government on an experimental basis in
selected districts during the Rabi 1997-98 season introduced The Crop Insurance scheme.
The limit of insurance cover was fixed at Rs. 10000 irrespective of the losses incurred by
them. Under the new scheme, the farmers will themselves deal with the insurance
provider directly and the government will not provide any subsidiary directly to the
farmers. Both premium and claims were shared between the central and the state
governments in the ratio of 4:1.
17Planning commission of India: http://planningcommission.nic.in/plans/planrel/fiveyr/1st/1planch16.html
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National Agricultural Insurance Scheme (NAIS): The National Agricultural Insurance
Scheme (NAIS) was introduced in the country from the1999-2000 Rabi season, replacingthe Comprehensive Crop Insurance Scheme (CCIS), which was in operation in the
country since1985. The General Insurance Corporation (GIC) on behalf of the Ministry
of Agriculture implements this scheme.
The main objective of the scheme is to protect the farmers against losses suffered by
them due to crop failure on account of natural calamities, such as, drought, flood,
hailstorm, cyclone, fire, pest/diseases etc.
5. ForestThe overall forest cover in India is around 19.3% in the year 1999. The estimate is done
by the planning commission of India. One would find different figure from different
sources precisely because different agencies have different definition of what constitute a
forest. The latest assessment on forest cover (FSI 1999) indicates that 11.48 per cent of
the total geographical area is dense forest (over 40 per cent crown density) and 7.76 per
cent is the open forest (10-40per cent crown density).
Dense forest 37.73 m ha 11.48%
Open forest 25.51 m ha 7.76 %
Mangroves 0.49 m ha 0.15%
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6. Agriculture Allied ActivitiesFollowing are the major agriculture allied activities.6.1. HorticultureHorticulture refers to the practice of growing and cultivating garden plants. Horticulture
involves working in the field of plan, crop production, plant breeding and genetic
engineering, plant biochemistry, plant physiology, and the storage, processing, and
transportation of fruits, berries, nuts, vegetables, flowers, trees, shrubs, and turf. It helps
in the improvement of crop yield, quality, nutritional value, and resistance to insects,
diseases, and environmental stresses.
Horticulture has 5 primary areas of study. These are: Floriculture: production and marketing of floral crops Landscape Horticulture: production, marketing and maintenance of landscape
plants
Olericulture: production and marketing of vegetables Pomology: production and marketing of fruits Post harvest Physiology: maintenance of quality and preventing spoilage of
horticulture crops.
6.2. PoultryPoultry is one of the fastest growing segments of the agricultural sector in India today.
While the production of agricultural crops has been rising at a rate of 1.5 to 2 percent per
annum, that of eggs and broilers has been rising at a rate of 8 to 10 percent per annum. As
a result, India is now the world's fifth largest egg producer and the eighteenth largest
producer of broilers. Country produced 46 billion eggs in 2005-06.
Production of Egg, Broiler & Poultry, Meat in India18
(2002)
Egg Broiler Poultry, Meat
Year (Million) (Million) (Thousand Tons)
2002 35000 800 975
18Source : Annual Report 2002-03, Ministry of Food Processing Industries
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6.3. Dairy
Milk and Dairy Products in India
Production/Per Capita Availability of Milk in India
Year Milk Production
(Million Tonne)
Per Capita Availability
(gm./day)
1950-51 17 124
1991-92 55.7 178
2001-02 84.4 225
2006-07** 100 245
Procurement of Milk by Co-operative Sector in India during the year 2005-06 was
214 lakh Kg. which is close to 20% of total mil produced in the country.
To know more about the operation flood please refer to the information given in the
section of revolutions in India. The details about the cattle are given in animal husbandry
section.
Recent important news about the ban in the export of SMP and other milk product to cool
the domestic prices must be kept in mind. Negotiations are on and ban may be lift by theend of Oct, 2007.
6.4. SericultureIt is the rearing of silkworms for the production of raw silk. Although there are several
commercial species olf silkworms,Bombyx mori is the most widely used and intensively
studied. According to Chinese records, the discovery of silk production from B. mori
occurred about 2,700 B.C. Today, China and Japan are the two main producers, together
manufacturing more than 50% of the world production each year. The high cost of
production in Japan presents bug opportunity for Indian silk. Indian silk is yet to achieve
the reputation of high quality silk.
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3 U R G X F W L R Q R I 5 D Z 6 L O N L Q , Q G L D
W R
, Q 7 R Q Q H
< H D U 0 X O E H U U \ 7 D V D U ( U L 0 X J D 7 R W D O
1 R W H , Q F O X G L Q J 1 R Q 0 X O E H U U \
1 R W H 3 U R Y L V L R Q D O
6.5. FishFish Production of Marine and Inland in India: Country produced 28 lakh tonnes marine
and 37.5 lakh tonnes inland fishes (total 65.7 lakh tonnes) in 2005-06
Pisciculture: It involves raising fish commercially in tanks or enclosures, usually for
food. A facility that releases juvenile fish into the wild for recreational fishing or to
supplement a species' natural numbers is generally referred to as a fish hatchery. Fish
species raised by fish farms include salmon, catfish, tilapia, cod and others.
Fish Production of Marine and Inland in
India20
(1991-1992 to 2005-2006)
(in lakh Tones)Year Marine Inland Total
1991-92 24.47 17.1 41.57
2005-06 28.16 37.55 65.71
6.6. Animal HusbandryAnimal Husbandry: Animal husbandry is the agricultural practice of breeding and raisinglivestock. Animal husbandry constitutes about 30% of the total agricultural output of the
country.
India has the largest livestock population of the world. It accounts for 60% of the worlds
buffalo population and 15% of the cattle population. India has 27 indigenous breeds of
cattle and 7 breeds of buffaloes. As a result of these efforts, India has become the largest
196 R X U F H 0 L Q L V W U \ R I 7 H [ W L O H * R Y W R I , Q G L D
20Source : Ministry of Agriculture, Govt. of India.
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producer of milk in the world. Following table gives the details of Indian livestock as per
the animal census conducted in 2003.
Results of Livestock Census in India21
-2003
(Number in ' 000)
Category Rural Urban Total
Total cattle 175651 9530 185181
Total buffaloes 91930 5993 97922
Total yaks 60 4 65
Total Bovine 267888 15557.4 283446
Total Sheep 57992 3478 61469
Total Goats 117479 6878 124358
Total horses & ponies 680 71 751
Total camels 618 14 632
Total Livestock1 456768 28233.5 485002
Total Poultry 449139 39873 489012
You know: Rural India buys--------------------
46% of soft drinks sold49% of motor cycles59% of cigarettes18 million TV sets are in rural IndiaOf 2 million BSNL mobile connections,50 % are in small towns/villages11% of rural women use lipstick
Source: MART
21Source : Ministry of Agriculture, Govt. of India.
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7. Land reformsHistorical perspective-
Under the British rule, there were three types of land tenure systems in India.
i. Zamindari- This system was introduced by Lord Cornwallis in Bengal in 1973.Under this system, there used to be number of intermediaries between the
Zamindars and the actual tillers of the soil. The system took were various forms
such as Zamindari, Jagirdari, Inamdari, etc. In many cases revenue collectors
were raised to the status of landowners. In this system, tillers of the soil wereexploited by way of exorbitant rents. There were no incentives for them to
improve the land or to use better cultivation practices. There were many other
social evils of the system. It is said that the British introduced Zamindari system
to achieve two objectives. First, it helped in regular collection of land revenue
from a few persons i.e. Zamindars. Secondly, it created a class of people who
would remain loyal to the British ruler in the country.
ii. Mahalwari: under this system, the village communities held the village lands jointly, the members of which were jointly and severally responsible for the
payment of land revenue. Land revenue was fixed for the whole village and the
village headman (Lumberdar) collected it for which he received Panchatra i.e. 5per cent as commission.
iii. Rayatwari: Sir Thomas Munro first in Madras state and then in Bombay Stateintroduced it. In this system, there was a direct relationship between Government
and the tenant or Rayat i.e. individual landholder. Every registered holder was
recognized as its proprietor and he could sell or transfer the land. He was assured
of permanent tenure as long as he paid the land revenue. The landholder was also
allowed to sublet his land. It was a better system as compared to Zamindari or
Mahalwari and similar other forms of tenure.
Of these three systems, the Zamindari system was the most widely prevalent and had
an influence on the other two systems also. There was no proper revenue record under
the British rule and the situation was like that even at the time of independence.
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Agricultural legislation:
During the post independence period, the agricultural legislation was of four types:
1. Abolition of intermediaries: The intermediary system included various types ofinterests between the owner and the cultivator. These intermediary interests
lacked enthusiasm in the development of agriculture through sustained
investment. This resulted in the stagnation of agriculture. Due to this reason, the
state formulated legislation for the abolition of such tenures by 1955. The
implementation of these measures has been completed all over India.
2. Tenancy reforms: The major part of the tenurial system in India was Rayatwari,with no intermediary between the state and the actual holder. However, in this
system also some tenancy prevailed and the lands were leased out to the actualcultivators. This situation also called for legislation for the protection of the
interests of the tenants. These measures were:
Security of tenure. Eviction of the tenant cannot take place Fixation of rent, which was one fifth to one sixth of the gross produce. Right to purchase land3. Ceiling on land holdings: The redistribution of agricultural land in rural areas was
accepted as a measure for securing social justice. To enable surplus land to be
distributed, legislative measures were passed in almost all the states to restrict thesize of agricultural holdings. It was decided that on the completion of
implementation of this legislation, the surplus land would be distributed among
the landless farmers.
4. Bhoodan and Gramdan Act: The Bhoodan movement started in early 1950s andspread all over the country. The purpose of the act was to collect donations of
land for the distribution among the landless. In all 18 lakh hectares of land were
collected under this act in various states.
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8. NGOs22India has Long tradition of voluntarism and people with some beliefs and notions havestarted their own initiative to contribute to the society and thus formed Non Government
Organizations. Presently we see the growing influence of NGOs in development. They
are recognized by the State and global agencies of the role of Civil Society.
Definition of an NGO is difficult due to diverse and changing forms and purposes not a
very well structured. It is an organization in civil society which is purposeful and role
bound. It works for public cause with altruism and voluntary basis. For example,
Philanthropic Organizations and Public Trusts and Societies.
Now there is a need to dwell further into the cause of these NGOs. The three Actors
(Sectors) of Development:
State: This is mandated by Social Contract (Constitution) and social welfare andbenevolency are the driving force. The state works through Govt. and bureaucracy for
development initiatives.
Market: The market consists of Corporates / Business entities who contribute financially
and with their influence. They work on demand driven basis for profit they are likely to
earn.
Civil Society:
The civil society consist of individuals, households, communities, organisations (formal
and informal), social movements who work on the principles of altruism, reciprocation
& voluntarism. Civil Society is called Third /Voluntary sector for the same reason. The
role of Civil Society for development emerges in the context of failure of State and
market for development.
Goals / Objectives of an NGO
Their objective is to take care of poor and destitute and attain sustainable and equitable
development. The NGOs mobilize people and create awareness. The poor feel
empowered when they get choices and an NGO helps in the same strengthen the civil
society. The NGOs like MYRADA, Bangalore influence developmental agenda and
approach (locally and globally).
To achieve the desired goals an NGO does the following activities:
Relief/ Rehabilitation Provide Services (Education, health etc) Livelihood development(IGP,Training, etc) Mobilise and organise poor Build peoples institutions
22Source: NGO expert Shikha Thaman, IRMAN
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Create Awareness/ Public advocacy Build models of development for replication Support other NGOs thru training/networkin
What exactly makes an NGO or sail through opposition and fund scarcity? The answer
lies in the strength of an NGO which is dedicated to the cause of development. The
people of this organization exhibit high levels of commitment / motivation towards their
mission. Moreover an NGO has flexible /informal methods which give the members full
freedom to work in the way they are comfortable and also the way they are convinced to
achieve the goal. The organization encourages Innovative ideas and is also cost efficient.
They have the ability to reachout to poor & needy and hence are very effective. They
promote participatory approach which makes the beneficiaries experience ownership forthe programme being carried out. They also address the problem of state and market
failure for the poor due to which they are always in demand.
NGOs in World
Name of
NGO
Establishment
year
Important
Persons
Area of Operations
CRY Child
Rights andYou
America
(formerly
Child Relief
and You)
Established in
the US in2002.
Shefali
Sunderlal(President)
Srivatsan
Rajan
(Honorary
Director &
Treasurer)
& 5 < Z R U N V
W R Z D U G V
U H V W R U L Q J E D V L F
U L J K W V W R
X Q G H U S U L Y L O H J H G
F K L O G U H Q
H V S H F L D O O \
, Q G L D Q
The
International
Red Cross
and Red
Crescent
Movement
Founded in
1863 in
Geneva,
Switzerland.
Key
persons
Henry
Dunant
and Henry
Davison
Its mission is to protect human life and health
Action aid Established in
1972
To alleviate poverty and improve quality of life.
Amnesty
International
Established in
1961,
headquarter-
Protection of human rights.
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london.
CARE
International
Established in
1946,headqurter
Brussel,
Belgium.
Aiming to relieve human suffering, to provide
economic opportunity, and and to build sustainedcapacity for self-help.
NGOs In India
Name of NGO Establishment year Important Persons Area of Operations
Cancer Patients
Aid Association
(CPAA)
1969, Founder Chairman,
Mr. Y.K. Sapru,
Siloo Jasdanwalla
Cancer
Self Employed
women association
(SEWA)
SEWA is a trade
union registered in
1972
Founders- Ela
Bhatt, Arvind Buch
Poor womens growth.
Child AidFoundation (CAF)
July 1st, 1993. The founder anddirector Dr. A.
Goswami (adopted
Indian name)
Children's aid and care.
VARHAD Founded in the
year 2001 in
Amravati,
Maharashtra
(India).
Founder-Mr.
Ravindra Bhaurao
Vaidya.
Development of Women
& Child Prisoners
Prayas Founded in
September 1999.
Founders-Tarun
Talwar and
Sandeep Tandon
A non-profit organization
in USA to promote and
support educational and
developmental efforts in
India.
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HelpAge India Formed in 1978 Founder- Mr. Cecil
Jackson Cole,
founder member ofHelp the Aged in
United Kingdom
Organization working for
Elder Care in India
Centre for
Health Education,
Training and
Nutrition
Awareness
(CHETNA)
Formed in 1980 Chairpersons-Dr.
Sharada Jain,
Director Dr.Dileep
Mavlankar
Nutrition, health,
education and
development of society.
Deepalaya Started in July 16,
1979.
- This orgn is for
Economically and sociallydeprived, the physically
and mentally challenged
children.
Navjyoti Established in 1987 Founder- Kiran
Bedi
This orgn deals with drug
addicts.
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9. Development schemes and indicatorsSome Important Indicators of Social Development
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Table 8: India and Comparator Countries
Poverty projections for 2006-07
Urban: 5 crore (15% of urban population)
Rural: 17 crore (21% of rural population)
Total: 22 crore (19% of rural population)
9.1. HDI index
Population (m) 1,071
Per-capita GDP (PPP US$) 2,892
HDI ranking (/177) 127
Life expectancy (years) 63.3
Combined gross enrolment (%) 60
% Population under $2 per day 79.9Internet users (per 1000) 17
Cellular subscribers (per 1000) 25
Source: UNDP Human Development Report 2005
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9.2. IRDP
O Launched in 1980O A Credit-linked-self employment programO Assists the identified Rural poor households to augment their income & help them
cross poverty lineO For Income generating activities in primary, secondary and tertiary sectors of
rural economy.O Assistance through
O Subsidy by governmentO Term credit advanced by financial institutions commercial banks, RRBs,
Cooperative banksO Implemented through DRDA (A Broad based representative body for guidance &
directions for program implementation)
9.3. Self Employment programs
Providing and Generating Employment is a Major Approach to Poverty Alleviation Lack of sustained employment is a major cause of Poverty, both Chronic as well as
Transient
Chronic Poverty: Household suffering poverty on a long-term basis due to continueddeprivation (asset/skill/income/ employment) and failure of policies especially based
on trickle down approach
Transitory Poverty: Household momentarily falling into poverty or povertyworsening due to sudden fall in income and employment for reasons like natural
calamities, sickness, etc.
It is essential that both types of poverty are taken care of, as they can be mutuallyreinforcing.
Provision of Employment can be useful in tackling poverty for certain categories ofpoor (those capable of taking up employment)
Employment Programmes are designed under the Direct Attack strategy to provideemployment to the poor Two categories of Employment Programmes meant broadly to take care of two typesof poverty:
- Self-employment programmes for Chronic Poverty
- Wage-employment programmes for Transient Poverty
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9.4. Wage Employment programs
Large number of wage-employment program implemented, FWP, RLGEP, NREP, JRY,JGSY, SGRY, EGS, NFWP, NREGA.Rationale behind using wage employment for poverty elevation is that
Need for direct employment generation for tackling poverty chronic andtransient
Inability of self-employment program to tackle transient poverty Very poor cannot take advantage of self employment program Limited impact of self-employment program Need for multi-pronged strategy for poverty alleviation.
9.5. Education
Our country has compulsory and free education for all children up to the age of 14 (Art.
45, Directive Principle). The Compulsory Education Acts has been passed by many states
to make primary education compulsory. The policy has also been enforcing education is
the National Policy on Education (1986/92) and now the Universal Elementary
Education (6-14 years)has been made compulsory. The government has targeted to spend
6% of GDP on education.
Advantages of Self-Employment Helpful to overcome failure of
trickle-down
Occupational mobility for poor Make poor entrepreneurs Help poor to be self-reliant Promote Diversification in rural
areas
Disadvantages of Self-Employment
Poor may lack skill and entrepreneurialabilities
Not suited for tackling transient poverty Risk to be borne by poor Problems in selecting poor / target group Requires organized/sustained efforts to
develop micro-entrepreneurial activities
on a large scale
Failure to provide integrated servicesmay lead to failure of activities
Requires sustained growth in demand fornon-farm activities of the Self-employed
people
Competition from organised sector forthe poor
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After the constitutional amendment Education has become a Fundamental Right
(2002). The state will endeavor to provide education. The Right to Education Bill 2005 in
Parliament will give effect to the Constitutional Amendment.
There have been many interventions like Operation Black Board (1987): To provide
infrastructure , additional teachers and teaching materials, District Primary Education
Program (DPEP): (1994): Universalization of Education in low female literacy districts,
National Literacy Mission (1988):To attain literacy level of 75% , Adult literacy (15-35
group),Mahila Samakya ( Focus on Women through group approach).Sarva Shiksha
Abhiyan (2001) is currently running all over the country where the target to put all
Children in schools by 2005. The Mid Day Meal Scheme (2004) is universalised in all
public schools in the country which has drawn a lot of children to schools.
Following table shows the census data about the literacy in India. Recent data is based on
the sample survey conducted by the nation. They are estimates not the exact values. The
last sample survey reports that literacy rate in india during 2007 was close to 75%.
Expenditure: (Centre and States)
Year Male Female Total
Rural 19.02 4.87 12.10
Urban 45.60 22.33 34.59
1951
Total 27.16 8.86 18.33
Rural 71.40 46.70 59.40
Urban 86.70 73.20 80.30
2001
Total 75.85 54.16 65.38
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% to GDP (Norm 6%)
1950-51 1.2%
1989-90 3.8%
1997-98 3.8%
2004-05 3.5%
The target was to raise expenditure in education to 6% of total budgetary expenditure, but
it was still to be achieved. When comparing the literacy rate with other countries we find
that, states, 19.8% of men and 41.1% of women were not literate as of 2006.
As per the 2001 India census, India's national literacy is only 65.2 percent. Literacy drive
is spreading slowly to other states. India's youth (age 15 to 24) literacy rate was 76.4%
between 2000 and 2004. At current rates India will take no less than 20 years for a
literacy of 95%. Literacy in India is not homogeneous; some states in India have more
impressive literacy rates than others. Kerala, a south-Indian state widely recognized as
the well-educated state in India, recorded an impressive 90.92% literacy rate in 2001. On
the other hand the north-Indian state of Bihar lags behind with 47.53%. India's adult
literacy rates (61.3% in 2002), is just a little better compared to other nations in South
Asia except Sri Lanka's 92%, with Nepal next at 44%, Pakistan at 50-54% and
Bangladesh the lowest at 43.1% Many Indians have argued that illiteracy, especially in
the rural areas, gives undue advantage to contemporary politicians, who can keep on
neglecting real issues of socio-economic development, and continue with corruption.
9.6. Health
As defined by WHO Health is a state of not mere absence of diseases but a state of
complete physical mental and social well-being.Indias Health Policy asks for Health for all by 2000 AD which is made possible by
making primary health care universally accessible and affordable. The expected value of
IMR (Infant mortality rate) is less than 60 & Life expectancy is 64 Years. The National
Health Policy- 2002 has the objectives to eradicate/Control Major Diseases by 2015
and make IMR to
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Health Status / Progress
1951 2003/04
Life expectancy 32.1 65
Death rate(per 1000) 27 8.0
IMR (1000 Births) 146 60
Doctors (Modern)
(Lakh)
0.62 6.25
Beds (lakh) 1.18 9.14
Dispensaries/Hospitals 9209 38,031
Government has introduced National Rural Health Mission (NRHM)( 2005)to improve
the availability and access to health delivery and care by increased allocation in 18 less
developed states and increase Public Health Spending to 2-3 % of GDP. They aim to
strengthen Rural Hospitals; (one CHC with 30-50 beds / lakh for curative purpose) and
create accredited Social Health Activist in the villages (ASHA) along with formation of
Village health and sanitation committee. Despite the entire rosy picture there are
problems of Health Sector like the health Standards below norm and there has been a
rise of non-communicable and other diseases. This is due to poor state of PHC
System and low Public Health Expenditure which is (1.3 % of GDP) only.
10.Micro finance
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is a term for the practice of providing financial services, such as microcredit, micro-
savings or micro-insurance to poor people. By helping them to accumulate usably large
sums of money, this expands their choices and reduces the risks they face. As suggested
by the name, most transactions involve small amounts of money, frequently less than Rs
10000.
Microfinance is the latest buzzword in the world of banking and finance. Operating at the
bottom of pyramid, it has challenged and changed the way banking and financial services
have been delivered since the onset of capitalism. I would call it the banking of east. It
has spread fast during the last decade. The number of customer world wide reached to
100 million23
in 2006. In India this numbers reached to 20 million24
. The potential isimmense as the number of poor who wanted and needed the microfinance services are
estimated to be over 600 million. Microfinance came into international limelight when
last years Nobel Prize for Peace was awarded to Mohammad Younus of Grameen Bank
of Bangladesh. The Grameen model of micro credit is a proven model. It has been
successfully replicated in India and around the world. In India, Share Micro-Finance
limited, Spandana, Bandhan, Cashpor, SKS, SKRDP, BASIX are major microfinance
institutions operating mainly in rural areas. The un-served market is vast and a huge
opportunity for growth is present in both the rural & urban segments. The reach of
microfinance was marginal in the rural areas but virtually non-existent in the urban.
The microfinance in Asia was the brain child of Mohammad Younus the founder of
Grameen Bank. It started as small scale experiment in the villages adjacent to Chittagong
University where he was teaching economics. Continuous experiment and refinement
resulted into a model which in microfinance parlance called Grameen Model.
11.Cooperatives
23 http://www.unitus.com/sections/poverty/poverty_mf_main.asp24 (http://www.uncdf.org/english/microfinance/pubs/newsletter/pages/2005_06/news_india.php)One study shows that more than 80,000 customer can make a rural microfinance institution viable. How many neededto make an urban one?
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PACS are producers agriculture cooperative societies. These are lowest level
cooperative societies operating in almost all the states. There purpose is to distribute theagriculture input like fertilizers and seeds to the farmers. In many states they are largely
defunct and highly politicized.
e. National Cooperative Union of India (NCUI)Industries have apex body like CII or ASOCHAM; similarly NCUI is the Apex
Cooperative Organization in India which represents all the segments of Indian
Cooperatives. Its objectives are to promote and develop the cooperative movement in
India. It was established in 1929 as All India Cooperative Institutes and renamed to
National Cooperative Union of India in 1961
12.Retail revolution and farmer
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Industry Evolution
S Traditionally retailing in India can be traced to the emergence of the neighborhoodKirana stores catering to the convenience of the consumers. The era of government
support for rural retail: Indigenous franchise model of store chains run by Khadi &
Village Industries Commission
The decade of 1980s experienced slow change as India began to open up economy. Textiles sector with companies like Bombay Dyeing, Raymond's, S Kumar's and
Grasim first saw the emergence of retail chains
Later Titan successfully created an organized retailing concept and established aseries of showrooms for its premium watches
The latter half of the 1990s saw a fresh wave of entrants with a shift fromManufactures to Pure Retailers.
For e.g. Food World, Subhiksha and Nilgiris in food and FMCG; Planet M and MusicWorld in music; Crossword and Fountainhead in books.
o Post 1995 onwards saw an emergence of shopping centers, mainly in urban areas, withfacilities like car parking, it targeted to provide a complete destination experience for
all segments of society
Emergence of hyper and super markets trying to provide customer with 3 Vs - Value,Variety and Volume
Expanding target consumer segment: The Sachet revolution - example of reaching tothe bottom of the pyramid.
Retailing formats in India
a. Malls: The largest form of organized retailing today. Located mainly in metrocities, in proximity to urban outskirts. Ranges from 60,000 sq ft to 7,00,000 sq ft
and above. They lend an ideal shopping experience with an amalgamation of
product, service and entertainment; all under a common roof. Examples include
Shoppers Stop, Piramyd, Pantaloon.
b. Department Stores: Departmental Stores are expected to take over the apparelbusiness from exclusive brand showrooms. Among these, the biggest success is K
Raheja's Shoppers Stop, which started in Mumbai and now has more than sevenlarge stores (over 30,000 sq. ft) across India and even has its own in store brand
for clothes called Stop!.
c. Specialty Stores: Chains such as the Bangalore based Kids Kemp, the Mumbaibooks retailer Crossword, RPG's Music World and the Times Group's music chain
Planet M, are focusing on specific market segments and have established
themselves strongly in their sectors.
d. Hypermarts/Supermarkets: Large self service outlets, catering to variedshopper needs are termed as Supermarkets. These are located in or near
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residential high streets. These stores today contribute to 30% of all food &
grocery organized retail sales. Super Markets can further be classified in to mini
supermarkets typically 1,000 sq ft to 2,000 sq ft and large supermarkets rangingfrom of 3,500 sq ft to 5,000 sq ft. having a strong focus on food & grocery and
personal sales.
e. Discount Stores: As the name suggests, discount stores or factory outlets, offerdiscounts on the MRP through selling in bulk reaching economies of scale or
excess stock left over at the season. The product category can range from a
variety of perishable/ non perishable goods
In this rapidly evolving industry, every day new formats are coming like Dollar store,
Convenient store etc. Major retailers with their market share are given below.
13.ITC e-Choupal
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With over US$ 2 billion sales, ITC Limited is one of India's leading companies.
Traditionally a tobacco and cigarette producer, it has grown into a conglomerate dealing
in hotels, packaging, agribusiness, information technology, and fast moving consumergoods (FMCGs). Its diversification into consumer goods includes recent entry into the
garment, prepared food, greeting card, gift and matchbox industries.
The US$ 155 million International Business Division (IBD) of ITC's Agri Business
segment was created to market India's agricultural produce internationally. This division
also sources agricultural raw material for its domestic FMCG business (e.g. branded
wheat flour, rice etc). Aiming to integrate more closely with its rural suppliers, while also
developing new markets for its own and third-party goods, ITC began deploying its e-
Choupal network in early 2000 through its International Business Division.
Business model
Its business model centers around the deployment of a network of Internet-connected
kiosks, known as e-Choupals, throughout agricultural areas in India. An e-Choupal is a
high-tech version of the traditional "choupal," or "village gathering place" in Hindi,
where farmers are provided with the latest weather reports, local and international
produce prices, and farming best practices. Costing rupee 1-2.5 lakh each to set up, they
also serve as procurement and purchase points, allowing farmers not only to sell their
produce to ITC, but also to buy agricultural inputs and consumer goods for daily
household use.
Each e-Choupal is managed by an ITC-appointed "Sanchalak", a respected farmer of the
community who takes a public oath of office upon accepting the position. While ITC
covers equipment, the day-to-day operating costs, which consist primarily of electricity
and Internet connection charges, are covered by the e-Choupal Sanchalak.
.
Marketing channel prior to e-choupal
The figures in the bracket are the margins at different stages.
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Mandi operations pre- e-Choupal operations
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The mandi was inefficient and both for the farmers as well as the ITC. The middlemen
were the people who were cornering most of the profit.
Inefficiencies were in all the operations right from the inbound logistics to final payment
of the farmer and outbound supply to the ITC. To create the win-win solution for both the
following value chain was developed.
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WTO Fact File
Location: Geneva, SwitzerlandEstablished: 1 January 1995
Created by: Uruguay Round negotiations (1986-94)
Membership: 149 countries (on 11 December 2005) (Saudi Arabia is the last member)
Budget: 175 million Swiss francs for 2006
Secretariat staff: 635
Head: Pascal Lamy (Director-General)
Functions:
Administering WTO trade agreements
Forum for trade negotiations Handling trade disputes
Monitoring national trade policies
Technical assistance and training for developing countries
Cooperation with other international organizations
WTO & Agriculture: The WTO Agriculture Agreement was negotiated in the 198694
Uruguay Round and is a significant first step towards fairer competition and a less
distorted sector. It includes specific commitments by WTO member governments to
improve market access and reduce trade-distorting subsidies in agriculture. These
commitments are being implemented over a six-year period (10 years for developing
countries) that began in 1995. Participants have agreed to initiate negotiations for
continuing the reform process one year before the end of the implementation period, i.e.
by the end of 1999. These talks have now been incorporated into the broader negotiating
agenda set at the 2001 Ministerial Conference in Doha, Qatar.
The original GATT did apply to agricultural trade, but it contained loopholes. For
example, it allowed countries to use some non-tariff measures such as import quotas, and
to subsidize. Agricultural trade became highly distorted, especially with the use of export
subsidies, which would not normally have been allowed for industrial products. The
Uruguay Round produced the first multilateral agreement dedicated to the sector. It was a
significant first step towards order, fair competition and a less distorted sector. It was
implemented over a six-year period (and is still being implemented by developing
countries under their 10-year period) that began in 1995. The Uruguay Round agreement
included a commitment to continue the reform through new negotiations. These were
launched in 2000, as required by the Agriculture Agreement.
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15.Important InstitutionsImportant Institutions
NABARD National Bank for Agriculture and Rural
Development. NABARD is formed through
the Act 61 of 1981and came into existence
on 12 July 1982. Dr. Y S P Thorat is
presentChairman of NABARDNAFED National Agricultural Cooperative
Marketing Federation of India Ltd.
(NAFED) was established on the
auspicious day of Gandhi Jayanti on 2nd
October 1958. Ajit Kumar Singh is
chairman of NAFED
ICAR Indian Council of Agricultural Research
Dr. Mangala Rai-Director General.
GCMMF Gujarat Cooperative Milk Marketing
Federation. Chairman of GCMMF is
Mrs. Parthi Bhatol, MD is Mr. Vyas
TRIFED Tribal Co-operative Marketing
Development Federation of India Ltd.
For interested readers following documents are freely available on internet. This is most
authenticated data and updated as per the end of tenth plan, that is, year 2006-07.
1. http://planningcommission.nic.in/plans/planrel/fiveyr/10th/volume2/v2_ch5_1.pdf(for detailed agriculture data and analysis)
2. http://planningcommission.nic.in/plans/planrel/fiveyr/welcome.html (forevery parameter of Indian Economy)
3. http://planningcommission.nic.in/plans/planrel/fiveyr/10th/volume1/v1_ch2.pdf(for macro economic indicators of the economy
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