Introduction
Agriculture is the backbone of the Indian economy, employing more than 40% of the workforce and contributing around 18% to the country’s GDP. Despite its importance, the sector continues to face several structural and systemic challenges. In this response, we will examine four major issues affecting Indian agriculture and analyze how diversification towards high-value agriculture can help address these concerns.
Major Issues in Indian Agriculture
1. Low Productivity
India’s agricultural productivity remains lower compared to global standards. The use of outdated technology, lack of mechanization, and poor farming practices contribute to low yields. For example, average wheat and rice yields in India are significantly lower than those in countries like China and the USA.
2. Dependence on Monsoon
A large portion of Indian agriculture is rain-fed, making it vulnerable to the vagaries of the monsoon. Droughts or floods severely impact crop output, leading to financial losses for farmers. Irrigation infrastructure remains inadequate in many regions.
3. Price Volatility and Market Access
Farmers in India often face unstable prices for their produce. Poor storage facilities, lack of cold chains, and limited access to regulated markets force farmers to sell at low prices, especially during harvest seasons. Minimum Support Price (MSP) mechanisms do not cover all crops or reach all farmers effectively.
4. Fragmented Land Holdings
Due to generations of land division, average landholdings have become very small (less than 1.08 hectares on average). Small and marginal farmers (who form more than 85% of the total) lack economies of scale and struggle to adopt modern farming techniques or invest in productivity enhancements.
Diversification Towards High-Value Agriculture (HVA)
High-value agriculture includes the production of fruits, vegetables, dairy, poultry, fishery, and floriculture. Unlike traditional crops like rice and wheat, these sectors offer higher returns per unit of land and labor.
How HVA Can Address Agricultural Challenges
1. Boosting Farmer Incomes
HVA crops and activities generally have better market prices and greater profit margins. Shifting to fruits, vegetables, dairy, and poultry can help farmers increase their incomes, especially in small landholdings.
2. Reducing Monsoon Dependency
Many high-value activities such as poultry farming, dairy, or greenhouse cultivation are less reliant on rainfall. This reduces the risk posed by monsoon variability and helps stabilize income across seasons.
3. Employment Generation
HVA is more labor-intensive than traditional cereal farming. It can create more rural employment opportunities, especially for women and youth, and reduce the pressure on cities caused by rural-to-urban migration.
4. Better Resource Efficiency
HVA promotes the efficient use of resources like water and fertilizers. For instance, horticulture requires less water compared to paddy cultivation. Integrated farming systems also improve resource use efficiency.
Challenges in Promoting HVA
- Lack of cold storage and supply chains for perishable items
- Market access and pricing uncertainties
- Credit and insurance coverage for HVA sectors
- Need for farmer awareness and training
Government Support
Several government schemes such as the National Horticulture Mission, Operation Greens, and PM Formalisation of Micro Food Processing Enterprises (PM-FME) aim to support HVA. Infrastructure development under PM-KISAN and e-NAM can also assist in marketing high-value produce.
Conclusion
Indian agriculture faces persistent issues like low productivity, price instability, small land holdings, and dependency on monsoon. Diversification into high-value agriculture offers a promising solution to many of these problems by improving income levels, reducing risk, and generating employment. However, for this transition to be successful, it must be supported by strong infrastructure, policy reforms, and capacity-building measures. With the right support, HVA can make Indian agriculture more resilient, profitable, and sustainable.