The agriculture sector is one of the most important sectors of the Indian economy. The agriculture sector is contributing around 50% in the total workforce in India and its contribution to the GDP is around 15%.87 in 2018-19. India is becoming an emerging economic power and, in this transition, the agriculture sector has to contribute a lot. Despite having huge potential, India’s share in world export market is not considerable. It demands strategic efforts to increase agriculture export as that will boost the agriculture economy. According to the Agriculture Census, the average landholding in India is 1.15 hectares per farmer. In India, 85 per cent of farmers are in marginal and small farm categories of less than 2 hectares. The major share of agricultural land is with the small and marginal farmers and this major portion itself is left out from the circle of agribusiness and exports. Narendra Modi-led NDA Government approved independent India’s first comprehensive ‘Agriculture Export Policy’ intending to double farmers’ income as well as the share of agriculture exports from the current USD 30 billion to USD 60 billion by 2022.
Productivity of Indian agricultural exports: Productivity levels in Indian agriculture is very low as compared to the productivity levels of other countries in the world (fig 1). Productivity levels of India in major agricultural export crops are very disappointing. India is one the largest producers of most of the crops (both food grains and no- food grain) but ranks are very low in terms of productivity.
The following are the productivity profitability analysis of important agricultural export commodities of India.
Table 1 Productivity Profitability Statement
Sr. No | Products | Productivity in India (ha/ton) | Highest Productivity in the world (ha/ton) | Difference | Area
(a) |
Existing Production (tones) (b)
(a *21) |
Potential Production with the increase in productivity (tones) (c)
(a*30) |
Increase in production (tonnes) (d)
(b-c) |
Present Export value per unit (e)
(US$1000) |
Increase in value ($1000) (f)
(d*e) |
1 | Grapes | 21 | 30 | 9 | 137000 | 2922000 | 4082000 | 1160000 | 1.49 | 113177 |
2 | Mangos | 6.50 | 15.83 | 9.33 | 2312000 | 15026000 | 21570960 | 6544960 | 1.04 | 6855720 |
3 | Onion | 17 | 48 | 31 | 1306000 | 22202000 | 62688000 | 40486000 | 0.20 | 8427549 |
4 | Groundnut | 17 | 60 | 42 | 5300000 | 90100000 | 318000000 | 227900000 | 1.14 | 261602233 |
5 | Banana | 35 | 70 | 35 | 860000 | 30100000 | 60200000 | 30100000 | 0.53 | 16245217 |
6 | Potatoes | 22 | 62 | 40v | 2179000 | 47938000 | 135098000 | 87160000 | 0.27 | 23856073 |
7 | Okara | 11 | 97 | 85 | 507000 | 5577000 | 49179000 | 43602000 | NA | NA |
8 | Chillies Dry | 2 | 17 | 15 | 840000 | 1680000 | 28560000 | 26880000 | 2.15 | 57974447 |
9 | Cucumber & Gherkins | 6 | 689 | 683 | 25676 | 154056 | 17690764 | 17536708 | 0.55 | 9668416 |
10 | Green Chillies | 8 | 280 | 272 | 8041 | 16082 | 2251480 | 2235398 | 0.86 | 1930718 |
Source: Based on FAO data calculated by Researcher.
Table 1 illustrate the productivity profitability comparison statement of major crops of India. The overall data indicate that overall productivity of main Indian agriculture crops is low with comparison to the world. If the new agriculture policy implemented by Indian government work as per direction, then there can be an enhancement in production. Figure 2 compares the existing production and potential production with an increase in productivity due to the new agriculture policy. It indicates the overall production of major agriculture products can be enhanced and the overall increment is explained below:
- Grapes: If India increases the productivity of grapes up to 30 tones/ha which is highest in the world then there will be an increase in production of 1160000 tons which can be exported with competitive prices in the international market.
- Mangos: If India increases the productivity of Mangos up to 15.83 tones/ha which is highest in the world then there will be an increase in production of 6544960 tons which can be exported with competitive prices in the international market.
- Onion: If India increases the productivity of Onions up to 48 tones/ha which is highest in the world then there will be an increase in production of 40486000 tons which can be exported with competitive prices in the international market.
- Groundnut: If India increases the productivity of Groundnut up to 60 tonnes/ha which is highest in the world then there will be an increase in production of 227900000 tons which can be exported with competitive prices in the international market.
- Banana: If India increases the productivity of Banana up to 70 tonnes/ha which is highest in the world then there will be an increase in production 30100000 of tons which can be exported with competitive prices in the international market.
- Potatoes: If India increases the productivity of Potatoes up to 62 tonnes/ha which is highest in the world then there will be an increase in production of 87160000 tons which can be exported with competitive prices in the international market.
- Okra: If India increases the productivity of Okra up to 97 tonnes/ha which is highest in the world then there will be an increase in production by 43602000 of tons which can be exported with competitive prices in the international market.
- Chillies: If India increases the productivity of Chillies up to 17 tonnes/ha which is highest in the world then there will be an increase in production of 26880000 tons which can be exported with competitive prices in the international market.
- Cucumber and Gherkins: If India increases the productivity of Cucumber and Gherkins up to 689 tonnes/ha which is highest in the world then there will be an increase in production of 17536708 tons which can be exported with competitive prices in the international market.
- Chillies Green: If India increases the productivity of Chillies Green up to 280 tonnes/ha which is highest in the world then there will be an increase in production by 2235398 tones which can be exported with competitive prices in the international market.
Conclusions: Without agribusiness development, the Indian agricultural economy will not reach its potential. Hence, more focus on export is the paradigm shift in the Indian agriculture economy. It’s heading towards a production-based economy to market-based agriculture. Paramsivan C, ,Pasupathi R, 2017, states that the India has tremendous potential for agriculture exports, especially in Rice and Spices and Fisheries, processed foods. New agriculture export policy has set the foundation to make Indian agriculture globally competitive. Ease of doing agricultural business index, encourage healthy competition between the States to create a healthy environment for agribusinesses that will encourage more investment, innovation skills, intellectual property safeguards, etc. India has suitable agro-climatic conditions and diversified agriculture produce for agriculture exports. However, India’s export share in the world market is very less, one of the major reason for being less involvement of farmers in the export chain. Thus, Agriculture export clusters can bridge the gap between the farmers and the industries for exporting agricultural produce. Hence, the formation of export clusters at the district level is a much needed and a welcoming step. There are various potential factors responsible for low productivity which are responsible for low productivity and that ultimately adversely impact on export competitiveness, these factors are land-man ratio, degradation of land, inadequate credit and marketing facilities, modern technologies, traditional methods of cultivation, insufficient irrigation facilities, lack of high yielding variety seeds, the small size of farms, lack of good agriculture practices, low investment, basic infrastructure, availability of water. However, possible remedies to increase productivity are land reforms, awareness, land-water resources, micro-credit and marketing facilities, better irrigation, a supply of quality seeds, intercrop farming, scientific cultivation, good agriculture practices, investment flow, strengthening basic infrastructure and involvement of professional experts in the supply chain. According to productivity and profitability statement, there is huge potential for India to increase the production of Indian Agriculture sector. (Anwarul Hoda and Ashok Gulati, 2013) recommends sustainable agriculture depends on utilization of irrigation, regenerating groundwater, water harvesting, and drip irrigations, nutrient-based fertilizer subsidy, agri credit through institutional sources, only keeping strategic reserves of food grain stock, and levying an export duty rather than imposing quantitative restrictions etc.