India: Re-Energizing the Agricultural Sector to Sustain Growth and Reduce Poverty

Agriculture contributes only about a quarter of India's total GDP, but its importance in the economic, social, and political fabric of India goes beyond what mere numbers indicate. Central to policy making in India is the enduring concern with the large number of poor agricultural households and their income vulnerablity. These concerns, in turn, drive both policy and public expenditure in agriculture. While significant progress has been made towards rapid agricultural growth, eradication of poverty, and ensuring food security, since the 1990s agricultural growth has slowed down. A concern with the slowdown is evident in the priority given to raising agricultural productivity in the Indian government's National Agricultural Policy and the 10th Five Year Plan. In comprehensively addressing these issues, the report recommends: BL Moving away from traditional subsidy-based regimes BL Building a highly productive, internationally competitive agricultural sector BL Making t he sector more diversified Such a programme, the report argues, will have a direct impact on reducing poverty by: BL Enhancing producer incomes BL Maximizing consumer welfare through changes in food prices BL Increasing employment and wage effects leading to growth-induced effects throughout the economy. Providing important data on the state and future directions of India's agricultural sector, that is compatible and sustainable with the changed environment of the twenty-first century, the report suggests concrete policy options for increased productivity. These include reorienting government expenditures toward more productive investments in rural infrastructure and services, as also removing restrictions on domestic trade--changes that will improve the investment climate for farmers and the private sector to meet market opportunites. Conceptualized and written by noted agricultural experts and development economists in India and abroad, its statistical quality a nd analytical richness will make this report invaluable for government, academic, activist, business, and financial circles. Students, teachers, and researchers will also find it an indispensable resource.