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AGRICULTURE (intro (volatile growth, poor yields, wheat, rice account for…
AGRICULTURE
intro
volatile growth, poor yields
wheat, rice account for 78% food grain production in 2015. pulses and oilseeds have stagnated
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22 years to doble farmers income from 1994 to 2016 at 3.31% . b/w 15-16 to 22-23 needed 10.4% per annum1
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staple crops( cereals, pulses, oilseeds) occupy 77% of the total GCA but contri. only 41% to the output of the crop sector
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food processing
significance
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preservation, avoiding market gluts, post harvest losses, price stability
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improves quality of life for people with allergies, diabetes, etc. nutrition enhancement also done
for farmers- diversification, good price for produce.
food wastage, inflation, food security, nutrition
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opportunities
large base of food production, diverse agro climatic regions
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large consumer base. 50% indian household expenditure on food, changing lifestyle, increasing incomes.
strategic geographic location- proximity to europe, east asia, west asia
contract farming
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can provide inputs to farmers- seed, ferti., technical guidance
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challenges
126mil sm farmers- may not be able to produce the required size of crop. illiterate farmers ay not understand contract details
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constraints
demand side
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low customer awareness, deeply ingrained food habits
export markets- quality standards, brand building, SPS. export subsidies in developed countriies
supply side
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poor quality produce at farm level- fragmented holdings, low tech., inferior inputs. need information linkages at farm level
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supply chain
qualitative and quantitative post harvest losses- lack of infra for grading, packaging. lack of knowledge
high no. of intermediaries leading to demand supply mismatch, costly, hygiene, wastage
distribution and marketing- largely unorganised, organised retail contributes 1% of food consumption in india, compared to 72% across the world.organised retailing-reduces intermediaries, enables test marketing of food
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infra
post harvest infra-grading, packing, pre-cooling at farm site. cold storage capacity at 10%. 80% only for potatoes. less for meat, milk, fish
logistics-high transportation costs, warehousing, time. lack of tech. reefer trucks
70% processing in unorganised sector- access to credit, tech, network. lack of scale
process of value addition to agri., horti. produce by methods like grading, sorting and packaging. make food functionally more useful, increase shelf life
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Farm subsidies
rationale
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productivity enhancement- seed, fertilizer, water
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infra. development- storage, transport
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challenges
public investment in agriculture declined from 3.9% in1980-81 to 2.2% of agri GDP in 2014-15. input subsidies on fert, power, crop insurance, water and credit rose from 2.2% to 8%
groundwater depletion, nutrient imbalance in soil, environmental harm
trade distortion- increasing net exports of input intensive crops. decreasing net exports of comm. that require less inputs
reseasrch shows that expenditure incurred on roads, education and agri R&E are 10 times powerful in alleviating poverty and increasing agri GDP as compared to input subsidies.
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types
input
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irrigation- constructing dams, canals and chrging low from farmenrs
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seed- research in seed development, low prices at which seeds are offered
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govt. subsidies granted to farmers and agribusinesses to supplement their income, and manage the supply and cost of agri. commodities
way ahead
irrigation
intro
agri consumes 80% of total usable water available. inequitable- regions, crops
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challenges
regional imbalance- ganga-brahmaputra basincontributes 50% of annual water availability. southern and western basins 15% each
wide gap between irrigation potential created and usage- poor maintenance of canals, lack of participatory management, changing land use and cropping pattern
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agri, water use in concurrent list
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drip, better on farm management
trade and marketing
way ahead
diversification of production, exports
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eNAM
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infra required
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web connectivity, 3rd party certification for produce.
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marketing policies
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weak producer consumer linkages. farmer not connected to food processing, retail chains.
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APMC
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issues
segmentation, spatial price dispersion- ES1516. thrice of U.S.
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AD committee- 15 to 40% farmers share- credit linked sale, poor logistics
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no value addition or storage infra at mandi- cold storage units in 10% mandis. grading facilities in 1/3rd
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way ahead
market infra-railroad, waterways, eNAM
private market yards, contracts
transport and storage for perishables. cold storage capacity is 3.5 cr tonnes, short by 40lkh
FPOs, cooperatives- s&m bargaining
ECA restructure- stockholding limits for exporters, processing, retailers
price discovery- futures, AGMARKNET
model APMC act- single point levy, freedom of selling
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intro
OECD report- producer support estimate for india was -14% from 2000 to 2017 because of restrictive policies( ECA, APMC, min. export prices
msp
issues
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distorted cropping pattern- wheat rice at the expense of pulses, oilseeds
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distances to procurement centres, delays in payment
undermining food security- 1990-2000- no increase in cereal production but increased stocks of grains-->increased prices in open
way ahead
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any agri. policy should ensure efficiency, growth, regional equity, natural resource, balance and quality in production, nutrition
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deficiency price payment
PM AASHA
PSS- physical procurement of pulses, oilseeds and copra by central agencies, NAFED, FCI. by centre
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rationale
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improving productivity- incentive to invest in modern tech. and machinery. during GR, the mode of production changed to input intensive--> needed to incentivise
consumers- PDS, reasonable prices
intro
the price at which the govt. purchases crops from the farmers, whatever may be the price of the crops
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factors considered- cost of cultivation, supply and demand situation, price trends, parity with other crops
irrigation
intro
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65% of landholdings use groundwater sources. indus basin including punjab and haryana - one of the most stressed aquifers
way ahead
drip, better on farm management
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agri, water use in concurrent list
issues
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flood irrigation- 60% losses as surface run off, percolation and bare soil evaporation
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