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Impact of economic reforms on Indian agricultural sector: Application of geomatics technology to reduce marginalisation and vulnerability of small farmers in India


Impact of Economic Reforms Process on Indian Agricultural Sector
Agricultural sector is the mainstay of the rural Indian economy around which socio-economic privileges and deprivations revolve, and any change in its structure is likely to have a corresponding impact on the existing pattern of social equality. No strategy of economic reform can succeed without sustained and broad based agricultural development, which is critical for
  • raising living standards,
  • alleviating poverty,
  • assuring food security,
  • generating buoyant market for expansion of industry and services, and
  • making substantial contribution to the national economic growth.
Studies also show that the economic liberalization and reforms process have impacted on agricultural and rural sectors very much.

According to [Bhalla97], of the three sectors of economy in India, the tertiary sector has diversified the fastest, the secondary sector the second fastest, while the primary sector, taken as whole, has scarcely diversified at all. Since agriculture continues to be a tradable sector, this economic liberalization and reform policy has far reaching effects on (I) agricultural exports and imports, (ii) investment in new technologies and on rural infrastructure (iii) patterns of agricultural growth, (iv) agriculture income and employment, (v) agricultural prices and (vi) food security [Bhalla93].

Reduction in Commercial Bank credit to agriculture, in lieu of this reforms process and recommendations of Khusrao Committee and Narasingham Committee, might lead to a fall in farm investment and impaired agricultural growth [Panda96]. Infrastructure development requires public expenditure which is getting affected due to the new policies of fiscal compression. Liberalization of agriculture and open market operations will enhance competition in "resource use" and "marketing of agricultural production", which will force the small and marginal farmers (who constitute 76.3% of total farmers) to resort to "distress sale" and seek for off-farm employment for supplementing income.

Marginalisation of Small farmers
A central issue in Agricultural Development is the necessity to increase productivity, employment, and income of poor segments of the agricultural population. Among the rural poor, the small farmers constitute a sizeable portion in the developing countries. Studies by FAO have shown that small farms constitute between 60-70% of total farms in developing countries and contribute around 30-35% to total agricultural output [Randhawa & Sundaram90].

Liberalisation era (1990-91) began in India when over 40% of rural households were landless or near landless, and over 96% of the owned holdings and 68.53% (over 2/3rd ) of owned land belonged to the size groups (marginal, small and semi-medium). The decade of 1981-82 to 1991-92 seems to have witnessed a marked intensification of the marginalisation process - the percentage of small owners increased from 14.70% to 21.75%.

Small farmers emerged as the size group with the largest share of 33.97% in the total land, which is just doubled during this decade. As regards the Large Farmers, they were 1 % of the total owners in 1990-91 but owned nearly 13.83% of the total land. An interesting, but speculative, inference is that the changing position of the large owners represents the other side of the marginalisation process, i.e., the presence, and possibly growing strength, of a small but dominant and influential group in agriculture. Analytical reports reveal that marginalisation process could gather further momentum in the years ahead to become an explosive source of economic and political turbulence, due to the features of prevailing policy-cum-market environment in the country.

Trend towards a greater casualisation (erratic and low-paid work) of the workforce that was witnessed in the 1980s appears to have continued in the1990s. Low productivity and inability to absorb the growing labour force make the agricultural sector in India witness to a pervasive process of marginalisation of rural people. This process is likely to get intensified in the coming years, raising formidable problems in achieving sustained development of rural areas and rural people[VMRao&Hanumappa99].

Both Information Technology, Genetic Engineering and Bio-Technology, which are the "drivers" of globalisation with their complementarities of liberalisation, privatisation and tighter Intellectual Properties Rights, are bound to create new risks of marginalisation and vulnerability. Information Technology is able to produce a penetrating and clinical mapping of the land, encompassing the physical, chemical and biological features, and groundwater resources, and forecast of climatic conditions in a focussed manner, that even small geographical segments - the small farms - can be benefited through the guidance provided by the ways in which natural and human resources can be optimally combined with appropriate technologies, inputs and options to enhance and diversify agricultural production [KVS2K]. Information Technology will facilitate dissemination of information on development, education, extension, husbandry, marketing, production, and research, to agricultural farmers.

Indian Agricultural Sector
The Indian Agricultural sector provides employment to about 65% of the labour force, accounts for 27% of GDP, contributes 21% of total exports, and raw materials to several industries. The Livestock sector contributes an estimated 8.4 % to the country GDP and 35.85 % of the agricultural output. India is the seventh largest producer of fish in the world and ranks second in the production of inland fish. Fish production has increased from 0.75 million tons in 1950-51 to 5.14 million tons in 1996-97, a cumulative growth rate of 4.2% per annum, which has been the fastest of any item in the food sector, except potatoes, eggs and poultry meat. The future growth in agriculture must come from [GBSingh2K] viz.,
  • new technologies which are not only "cost effective" but also "in conformity" with natural climatic regime of the country;
  • technologies relevant to rain-fed areas specifically;
  • continued genetic improvements for better seeds and yields;
  • data improvements for better research, better results, and sustainable planning;
  • bridging the gap between knowledge and practice; and
  • judicious land use resource surveys, efficient management practices and sustainable use of natural resources.
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