Three cheers for Indian agriculture!

Jan 01 2014, 21:39 IST
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SummaryThe year 2013 is something to cheer about the performance of Indian agriculture

The year 2013 is something to cheer about the performance of Indian agriculture. Given the good rainfall, agricultural GDP in the 2013-14 agri-year (July-June) is likely to grow between 5.1% and 5.7%, almost three times higher than last year. New records in production and trade are being achieved. Take these: Horticultural production is likely to touch 269 million tonnes (mt) and perhaps for the first time going to surpass the foodgrain production (of 260 mt or so) in 2013-14. Milk production is likely to scale a new peak of 139 mt, and this commodity will be the biggest agri-commodity in terms of value, even bigger than rice or wheat. Cotton is likely to touch 37 million bales, and so on.

On the agri-trade front, our exports in 2012-13 were $41 billion against agri-imports of $20 billion, giving a net trade surplus of $21 billion. This feat is going to be repeated this year too. India is the largest exporter of rice, guar gum meal, beef (buffalo meat) and the second-largest exporter of cotton. India exported 22 mt of cereals, never done before in its history of more than 3,000 years! India’s ‘revealed comparative advantage’, as measured by the Balassa Index, is 1.6 against that of manufacturing at 0.98, indicating clearly that Indian agriculture is much more competitive globally than our manufacturing sector.

Behind the success of each of these commodities, in production and/or trade, is a fascinating story, the story of well-designed policies, or processes, or investments, or technology, but above all, the entrepreneurial spirit of our farmers. Let me narrate just three stories here, which have had a large impact on our agriculture and benefiting millions of farmers, consumers and the country at large. The idea is to distil lessons for future policy direction so that we can scale these up, with much larger gains.

First, let us talk about milk. In 1951, when the US was producing 53 mt of milk, India’s milk production was just 17 mt. In 2013-14, US milk production is likely to be around 91 mt and India at 139 mt! Project this for the next 10 years and see its implications. And so far, most of this is done by small farmers with an average herd size of about four cows and/or buffaloes. This is an outstanding example of inclusive growth, which the developing world with smallholders needs to emulate.

Verghese Kurien and

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