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Contribution of Agriculture to Economy

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Contribution of Agriculture to Economy - Lesson Summary

Agriculture provides employment to around 63% of our total population. However, the share of agriculture in our gross domestic product or GDP is declining. A decrease in the share of agriculture in our GDP does not mean that our agricultural output has decreased. It means that the growth in agriculture is slowing down and is much lower as compared to the growth in industries and services.

The slowing down of growth in agriculture is generating fewer employment opportunities in this sector. The government set up institutions like the Indian Council of Agricultural Research, I-C-A-R, and the Indian Agricultural Research Institute, I-A-R-I, and several agricultural, veterinary and horticulture universities.

The aim of these institutions is to provide education, and research and development facilities for the modernisation and growth of agriculture in India. The government has developed better meteorological facilities for more dependable weather forecasts, and improved infrastructure in villages.

Regardless of the above, farmers still face certain challenges in agriculture. One of the important steps in the green revolution in India was to make fertilisers available to farmers at subsidised or reduced rates. The subsidy on fertilisers has now been reduced and has increased the cost of production for the farmers.

A reduction in import duties on agricultural items is another challenge to the Indian farmers in terms of international competition. Inadequate irrigation and power facilities for the farmers is also an issue. Rural infrastructure facilities like roads and markets also need to be further developed.


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