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Agricultural diversification in India and role of urbanization

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  • Rao, P. Parthasarathy
  • Birthal, P. S.
  • Joshi, P. K.
  • Kar, D.

Abstract

Indian agriculture is diversifying during the last two decades towards High-Value Commodities (HVCs) i.e., fruits, vegetables, milk, meat, and fish products. The pace has been accelerated during the decade of 1990s. HVCs account for a large share in the total value of agricultural production. Supply and demand side factors coupled with infrastructural development and innovative institutions drive these changes. In this paper, the focus is on diversification towards HVCs in the context of urbanization. Group of urban districts (districts with >1.5 million urban population) have a higher share of HVCs compared to the urban-surrounded (near urban districts) and other districts (districts in the hinterland). Among the HVCs, vegetables and meat products have a higher share in urban districts compared to the other two groups. Milk production is more widespread due to excellent network of co-operatives and infrastructure facilities. Using GIS (geographic Information System) approach it was found that urban-surrounded districts with better road network connection to urban centers have been able to diversify towards HVC's to meet the demand in the urban centers. Model results further confirm these findings. Thus, urbanization is a strong demand side driver promoting HVCs. Since urban population is growing at more than 3% per annum, demand for HVCs will drive their production. The analysis has also brought out regional variations in HVCs across different districts in the country that has implications on regional development and planning, and consequently on public and private sector investment strategies.

Suggested Citation

  • Rao, P. Parthasarathy & Birthal, P. S. & Joshi, P. K. & Kar, D., 2004. "Agricultural diversification in India and role of urbanization," MTID discussion papers 77, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:fpr:mtiddp:77
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    Cited by:

    1. Kakarlapudi, Kiran Kumar, 2010. "Agricultural Growth Deceleration in India: A Review of Explanations," MPRA Paper 35865, University Library of Munich, Germany, revised 10 Jan 2012.
    2. Mwangi, Edina Metili & Yu, Bingxin, 2015. "Agricultural diversification and Land use patterns in Southeast Asia," 2015 Conference, August 9-14, 2015, Milan, Italy 211864, International Association of Agricultural Economists.
    3. World Bank, 2007. "India's Emergent Horticultural Exports : Addressing Sanitary and Phytosanitary Standards and Other Challenges," World Bank Publications - Reports 19232, The World Bank Group.
    4. Mukherjee, Sanchita, 2010. "Crop diversification and risk: an empirical analysis of Indian states," MPRA Paper 35947, University Library of Munich, Germany.
    5. Massimiliano Calì & Carlo Menon, 2013. "Does Urbanization Affect Rural Poverty? Evidence from Indian Districts," The World Bank Economic Review, World Bank, vol. 27(2), pages 171-201.

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