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Agriculture In India

Role Of Agriculture In India

Agriculture is a very important sector of the Indian economy. It plays a major role in the overall development of the country as it contributes nearly one-fourth of GDP and engages around 60 per cent of the population of the country.


Providing Employment:
At the time of independence around 72 per cent of the population was engaged in agriculture and allied activities. As economy developed, its other sectors (industry and services) also developed and the percentage of people working in agriculture sector came down to around 56 per cent in 2007–08.


Share In National Income:

Its share in total GDP in 1950–51 was around 55 per cent come down to 17 per cent in 2009 – 10. This reduced share indicates that the economy and its non-agricultural sectors are growing.


Supporting Industries:
Agriculture has a big role in the development of industries specially the agro-based industries such as textiles, sugar, tea, paper. The prosperity of these agro-based industries is directly dependent upon the availability of inputs from the agricultural sector. The prosperity of industries depends on agricultural prosperity from another angle also. The demand for industrial products depends upon the income of the farmers which in turn depends upon agricultural production.


Shares In Foreign Trade:
At the time of independence and a number of years thereafter our export basket mainly consisted of three ago-production-cotton textiles, jute and tea. These three accounted for more than 50 per cent of our export earnings. As economy developed, the share of agricultural exports in total exports fell down. In 2009–10 earnings from their exports formed about 10 per cent of total export earnings. As far as the agro-imports are concerned they constituted just 3.7 per cent of our total imports in 2009–10.


Supplier Of Food And Fodder:
Agriculture meets almost the entire food-needs of the people. In India, people spend a very large proportion of their incomes on food and food products. Thus, the cost of living of people also gets affected by agricultural prosperity. If food is costly; the cost of living of the people also gets affected to a great deal. Agriculture also provides fodder to sustain livestock comprising of cattle, buffaloes and poultry etc.


Savings of capital:

Agriculture has low capital output ratio; in other words it requires lesser capital per unit of output produced compared with the industries. A capital poor economy like India can make efforts to develop this sector which along with increase in production could increase employment opportunity in the rural areas and could help in solving problems of urban congestion and pollution in the cities.


Contributions To Government’s Revenue:
he government revenues also depend a great deal on agricultural prosperity. The direct contribution of agricultural taxes to the revenues of thee centre and the states is not significant but indirectly agriculture has a considerable influence on the revenues of the central and state governments.


Solving Problems Of Urban Congestion And Brain Drain:
Migration from rural areas to urban areas and metropolitan cities has created a dual problem: on the one hand, it has deprived rural areas of skilled and educated persons and, on the other hand, it has created the problem of urban congestion. It agriculture is on the road to prosperity and is in a position to absorb fruitfully the growing talent in rural areas, the dual problem of urban congestion and rural brain drain will be solved.

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