Agriculture
has been the backbone of the Indian economy for centuries. Even today, despite
rapid industrialization and expansion of the service sector, agriculture
continues to play a pivotal role in ensuring food security, providing
employment, sustaining rural livelihoods, and contributing significantly to
national income. In a country where nearly two-thirds of the population lives
in rural areas, agriculture is not just an economic activity but also a way of
life, deeply embedded in India’s culture, traditions, and socio-political
fabric.
For UPSC
Prelims and GS Mains, understanding the role of agriculture in India’s economic
development is crucial. This essay explores the historical background,
importance, contribution, government policies, challenges, and future prospects
of agriculture in India, highlighting its indispensable role in shaping the
nation’s economy.
Role of Agriculture in the Indian Economy
1. Historical Background of Agriculture in
India
- Ancient & Medieval
Period
- Agriculture has been
the mainstay of Indian civilization since the Indus Valley period.
- Techniques like
irrigation, crop rotation, and domestication of animals were
well-developed.
- During medieval times,
land revenue formed the primary source of income for kingdoms.
- Colonial Period
- Agriculture was
exploited under the British through systems like Zamindari and Ryotwari.
- Focus shifted from
subsistence farming to cash crops such as indigo, cotton, and opium,
mainly for exports.
- This led to frequent
famines, low productivity, and rural distress.
- Post-Independence
- After 1947,
agriculture faced challenges like food shortages and low productivity.
- The Green Revolution
in the 1960s introduced high-yield variety seeds, fertilizers, and
irrigation, transforming India from a food-deficit to a self-sufficient
nation.
2. Importance of Agriculture in the Indian
Economy
a) Contribution to GDP
- At independence,
agriculture contributed over 50% of GDP.
- Today, its share has
reduced to around 16-18% due to industrial and service sector
growth, but it still remains significant.
b) Employment Generation
- Agriculture is the largest
employer, engaging nearly 40-45% of India’s workforce.
- Provides seasonal and
permanent employment, especially in rural areas.
c) Food Security
- Agriculture ensures self-sufficiency
in food grains.
- India is now the
world’s largest producer of milk, pulses, and spices and the second-largest
producer of rice, wheat, fruits, and vegetables.
d) Contribution to Exports
- Agricultural
commodities like basmati rice, spices, cotton, and tea contribute
significantly to India’s export earnings.
- Agricultural exports
account for nearly 11-12% of total exports.
e) Supply of Raw Materials
- Provides raw materials
for industries such as textiles, sugar, jute, and food processing.
f) Rural Development & Poverty Alleviation
- Agriculture sustains 70%
of rural households, directly linking it to rural development and
poverty reduction.
3. Role of Agriculture in Different Sectors
3.1 Agriculture and Industry
- Agro-based industries
(textiles, sugar, paper, jute, food processing) depend heavily on
agricultural raw materials.
- Industrial demand for
machinery, fertilizers, pesticides, and irrigation equipment also boosts
manufacturing.
3.2 Agriculture and Trade
- Agricultural exports
enhance foreign exchange reserves.
- Helps India strengthen
its balance of payments and trade relations.
3.3 Agriculture and Environment
- Sustainable agriculture
ensures soil fertility, water conservation, and biodiversity.
- Unsustainable
practices, however, cause deforestation, soil erosion, and groundwater
depletion.
4. Government Policies for Agriculture
a) Five-Year Plans & Agricultural
Development
- 1st Five-Year Plan
(1951-56) prioritized agriculture.
- Subsequent plans
focused on irrigation, Green Revolution, and rural development.
b) Agricultural Reforms
- Land reforms: abolition of Zamindari, land ceiling,
tenancy reforms.
- Green Revolution: high-yield seeds, irrigation,
fertilizers.
- White Revolution: dairy sector development.
- Blue Revolution: fishery sector growth.
c) Modern Policies & Schemes
- PM-KISAN: Direct income support to farmers.
- PMFBY: Crop insurance scheme.
- Soil Health Card Scheme: Promotes soil testing.
- E-NAM: National Agricultural Market for better
price realization.
- PM Krishi Sinchayee
Yojana: Focus on irrigation
and water use efficiency.
5. Challenges in Indian Agriculture
- Low Productivity
- Despite large area
under cultivation, yield per hectare remains low compared to global
standards.
- Fragmentation of
Landholdings
- Over 85% of farmers
are small and marginal, leading to inefficiency.
- Dependence on Monsoons
- Only about 50% of
cultivated area is irrigated; the rest depends on rainfall.
- Post-Harvest Losses
- Lack of storage, cold
chains, and processing leads to 20-30% losses.
- Credit and Indebtedness
- Farmers face
difficulties in accessing institutional credit, leading to reliance on
moneylenders.
- Market Inefficiencies
- Middlemen dominate
agricultural markets, reducing farmers’ share in consumer price.
- Climate Change
- Erratic monsoons,
floods, and droughts affect crop productivity.
- Farmer Distress
- Low income, high input
costs, and debt burden have led to widespread farmer suicides.
6. Future Prospects of Agriculture in India
- Sustainable Agriculture
- Organic farming,
natural farming, zero-budget farming to ensure soil health and
eco-balance.
- Technology &
Digitization
- Use of AI, drones,
satellite imaging, and precision farming to boost productivity.
- Agri-Entrepreneurship
& Startups
- Growing ecosystem of
agri-tech startups providing solutions for storage, logistics, and
markets.
- Diversification
- Moving beyond cereals
to high-value crops like horticulture, dairy, fisheries, and
floriculture.
- Export Potential
- India can emerge as a
global agricultural export hub.
- Doubling Farmers’
Income
- Government’s vision to
double farmers’ income through diversification, value-addition, and
technology.
7. Role of Agriculture in Achieving SDGs
- Zero Hunger (SDG 2): Agriculture ensures food security.
- Decent Work &
Economic Growth (SDG 8):
Provides employment.
- Climate Action (SDG 13): Promotes sustainable practices.
- Life on Land (SDG 15): Conserves ecosystems and biodiversity.
Conclusion
Agriculture
remains the foundation of India’s economy. While its share in GDP has
declined with the rise of industry and services, it still sustains the majority
of India’s population and serves as a crucial driver of rural development,
employment, and national food security. To make Indian agriculture resilient
and future-ready, there is a need to focus on sustainability, technological
innovation, better market access, and farmer welfare policies.
For UPSC
aspirants, the role of agriculture in the Indian economy is not only a topic of
academic importance but also a vital area to understand India’s socio-economic
fabric and policy-making framework.
📌 Top 10 FAQs Role of Agriculture in Indian
Economy
1. Why is agriculture important in the Indian
economy?
Agriculture
is vital because it ensures food security, provides employment to nearly half
of India’s workforce, supports rural livelihoods, contributes around 16-18% of
GDP, and supplies raw materials to industries.
2. What is the contribution of agriculture to
India’s GDP?
Currently,
agriculture contributes about 16-18% of GDP, though at independence it
was more than 50%. Its indirect role through industries and services is much
larger.
3. How many people depend on agriculture in
India?
Nearly 40-45%
of India’s workforce is employed in agriculture and allied activities,
making it the largest employment sector.
4. What are the major problems of Indian
agriculture?
The key
problems include small landholdings, low productivity, dependence on monsoons,
post-harvest losses, market inefficiencies, climate change, and farmer
indebtedness.
5. How did the Green Revolution impact Indian
agriculture?
The Green
Revolution (1960s) increased food grain production, especially wheat and rice,
making India self-sufficient in food and reducing dependence on imports.
6. What government schemes support Indian
agriculture?
Important
schemes include PM-KISAN, PMFBY, Soil Health Card, E-NAM, PM Krishi
Sinchayee Yojana, and MSP support to farmers.
7. What is the role of agriculture in exports?
Agriculture
contributes nearly 11-12% of total exports, with commodities like rice,
spices, cotton, tea, and marine products being major export items.
8. How can technology improve Indian
agriculture?
Technologies
like AI, drones, satellite monitoring, precision farming, and agri-startups
can increase productivity, reduce losses, and improve farmers’ income.
9. What is the future of Indian agriculture?
The future
lies in sustainable farming, diversification, agri-tech adoption, better
market linkages, and increased global competitiveness.
10. How is agriculture linked to rural
development?
Agriculture
sustains nearly 70% of rural households, creates employment, reduces
poverty, and forms the base of rural industries, making it central to rural
development.
📘 Top 20
MCQs on Role of Agriculture in Indian Economy
1. What is
the current contribution of agriculture to India’s GDP?
A) 25-30%
B) 16-18%
C) 10-12%
D) 40-45%
Answer: B
Agriculture contributes around 16-18% of GDP, down from 50% at independence,
but still vital for employment, food security, and rural livelihoods.
2. Which
sector provides the highest employment in India?
A) Industry
B) Services
C) Agriculture
D) Mining
Answer: C
Agriculture is the largest employer, engaging about 40-45% of the workforce,
especially in rural areas, making it central to India’s socio-economic fabric.
3. Which
revolution made India self-sufficient in food grains?
A) White Revolution
B) Blue Revolution
C) Green Revolution
D) Pink Revolution
Answer: C
The Green Revolution of the 1960s introduced HYV seeds, irrigation, and
fertilizers, making India self-sufficient in wheat and rice production.
4. Which is
the largest produced agricultural commodity in India?
A) Wheat
B) Milk
C) Rice
D) Sugarcane
Answer: B
India is the world’s largest producer of milk, pulses, and spices, contributing
heavily to rural income and nutrition security.
5. What
percentage of rural households depend on agriculture?
A) 50%
B) 60%
C) 70%
D) 80%
Answer: C
Around 70% of rural households depend on agriculture, directly linking it to
poverty reduction, rural development, and livelihood generation.
6. Which
scheme provides income support directly to farmers?
A) PMFBY
B) E-NAM
C) PM-KISAN
D) MSP
Answer: C
PM-KISAN provides direct income support of ₹6,000 annually to small and
marginal farmers through Direct Benefit Transfer (DBT).
7. What
percentage of India’s agricultural land is irrigated?
A) 25%
B) 40%
C) 50%
D) 70%
Answer: C
Only about 50% of cultivated land is irrigated, while the rest depends on
monsoons, making farming vulnerable to climate variations.
8. Which
crop dominated colonial Indian agriculture for export?
A) Wheat
B) Cotton
C) Rice
D) Maize
Answer: B
During British rule, cotton, indigo, and opium were promoted for exports,
causing food shortages and famines in India.
9. Which
policy ensures fair prices for farmers’ produce?
A) Crop Insurance
B) MSP
C) E-NAM
D) Land Reforms
Answer: B
Minimum Support Price (MSP) is a government-guaranteed rate to protect farmers
from distress sales and price fluctuations.
10. Which
revolution is linked with fisheries development?
A) Green Revolution
B) White Revolution
C) Blue Revolution
D) Yellow Revolution
Answer: C
The Blue Revolution boosted fish production, making India one of the leading
producers in aquaculture and fisheries.
11. Which
state was the pioneer of the Green Revolution?
A) Bihar
B) Punjab
C) Maharashtra
D) Odisha
Answer: B
Punjab and Haryana were the Green Revolution’s centers, where HYV wheat and
rice increased productivity dramatically.
12. What
percentage of exports does agriculture contribute?
A) 5%
B) 8%
C) 11-12%
D) 20%
Answer: C
Agricultural exports account for nearly 11-12% of India’s total exports,
including rice, spices, cotton, and tea.
13. Which
agricultural scheme focuses on irrigation efficiency?
A) PMFBY
B) PM-KISAN
C) PM Krishi Sinchayee Yojana
D) Soil Health Card
Answer: C
PM Krishi Sinchayee Yojana focuses on “Har Khet Ko Pani” and efficient water
use under the motto “Per Drop, More Crop.”
14. What is
the main problem of Indian agriculture?
A) Fertile soil
B) Small landholdings
C) High mechanization
D) Surplus irrigation
Answer: B
Over 85% of Indian farmers are small and marginal, leading to fragmentation and
low productivity of agricultural land.
15. Which
revolution is associated with dairy development?
A) Green Revolution
B) White Revolution
C) Blue Revolution
D) Yellow Revolution
Answer: B
The White Revolution, led by Operation Flood, made India the world’s largest
milk producer, improving rural income and nutrition.
16. Which
is a major cause of farmer distress?
A) Low productivity
B) Indebtedness
C) High input costs
D) All of the above
Answer: D
Farmer distress arises from low income, debts, high input costs, poor markets,
and climate challenges.
17. Which
practice ensures eco-friendly farming?
A) Excess fertilizer use
B) Organic farming
C) Monocropping
D) Chemical farming
Answer: B
Organic farming ensures soil fertility, biodiversity conservation, and
sustainable food production without harmful chemicals.
18. What is
E-NAM?
A) Crop insurance
B) Direct subsidy scheme
C) Online trading platform for agriculture
D) Irrigation scheme
Answer: C
E-NAM (Electronic National Agriculture Market) integrates markets across India,
enabling farmers to sell produce online for better price realization.
19. Which
SDG is directly linked with agriculture?
A) SDG 1 – No Poverty
B) SDG 2 – Zero Hunger
C) SDG 8 – Decent Work
D) All of the above
Answer: D
Agriculture impacts multiple SDGs like Zero Hunger, No Poverty, Decent Work,
Climate Action, and Life on Land.
20. Which
factor makes agriculture vulnerable in India?
A) Mechanization
B) Rain-fed farming
C) Strong MSP
D) Soil fertility
Answer: B
Dependence on monsoons makes agriculture highly vulnerable, as only half the
cultivated land is irrigated.
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