State of Indian Agriculture 2011-12

Agriculture is a critical sector of the Indian economy. Though its contribution to the overall Gross Domestic Product (GDP) of the country has fallen from about 30 percent in 1990-91 to less than 15 percent in 2011-12, a trend that is expected in the development process of any economy, agriculture yet forms the backbone of development. An average Indian still spends almost half of his/her total expenditure on food, while roughly half of India’s work force is still engaged in agriculture for its livelihood. Being both a source of livelihood and food security for a vast majority of low income, poor and vulnerable sections of society, its performance assumes greater significance in view of the proposed National Food Security Bill and the ongoing Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme.

The agriculture sector in India has undergone significant structural changes in the form of decrease in share of GDP from 30 percent in 1990-91 to 14.5 percent in 2010-11 indicating a shift from the traditional agrarian economy towards a service dominated one. This decrease in agriculture’s contribution to GDP has not been accompanied by a matching reduction in the share of agriculture in  employment. About 52% of the total workforce is still employed by the farm sector which makes more than half of the Indian population dependant on agriculture for sustenance (NSS 66th Round). However,within the rural economy, the share of income from non-farm activities has also increased.

Growth Performance of Agriculture

Overall Growth

 The growth performance of the agriculture sector has been fluctuating across the plan periods (Fig 1.3). It witnessed a growth rate of 4.8 per cent during the Eighth plan period (1992–97). However, the agrarian situation saw a downturn towards the beginning of the Ninth plan period (1997–2002) and the Tenth plan period (2002–07), when the agricultural growth rate came down to 2.5 percent and 2.4 percent respectively. This crippling growth rate of 2.4 percent in agriculture as against a robust annual average overall growth rate of 7.6 per cent for the economy during the tenth plan period was clearly a cause for concern. The trend rate of growth during the period 1992-93 to 2010-11 is 2.8 percent while the average annual rate of growth in agriculture & allied sectors-GDP during the same period is 3.2 percent.

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State of Indian Agriculture




Land use in India


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Investment Tracking System

In order to address the issue of major investment projects being delayed for a variety of reasons, the Prime Minister has approved the setting up of an Investment Tracking System to ensure speedy implementation of such projects.

 Major projects will be specially tracked to take them forward on a fast track in order to provide a fresh impetus to the economy. This was in the context of delays faced by projects on multiple fronts – security clearances, environmental clearances, other clearances, land related matters, etc. While existing rules and laws have to be followed, it was widely felt that a lot of the delay is avoidable if only there is a will to resolve matters.

2. In pursuance of this, an Investment Tracking System has been put in place whereby –

(a) National Manufacturing Competitiveness Council shall track all Public Sector projects with an investment of ` 1000 crore and above. The National Manufacturing Competitiveness Council shall submit a quarterly statement of all projects monitored and any issues identified that need resolution, either systemically or individually.

(b) The Department of Financial Services shall monitor projects with an investment of  Rs 1000 crore and above in the private sector. The Department would use data available with the banking sector for this purpose. The Department shall submit a quarterly statement of all projects monitored and issues identified that need resolution, either systemically or individually.

3. Through this mechanism, projects will be periodically reviewed for any delays and specific or systemic issues will be identified for resolution. The Department of Financial Services and the National Manufacturing Competitiveness Council will submit quarterly reports on the tracking being done by them and on identified issues to the Prime Minister’s Office. Corrective action will be taken wherever found necessary.