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OnlyIAS - PRAHAAR - Agriculture

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PRAHAAR ReDEFINED 3.

0: ECONOMY

CHAPTER 10 AGRICULTURE SECTOR IN INDIA


● Agriculture is the art and science of cultivating the soil, growing crops and raising livestock.
● Share of net irrigated area accounts for about 49% of the total net sown area in the country and about 40% is
irrigated through canal systems and 60% through groundwater. (Economic Survey 2021-2022).
● The Indian agriculture sector has been growing at an average annual growth rate of 4.6 per cent during the last six
years (Economic Survey 2022-23)
● Crop burning contributed nearly 50% of the near-surface PM2.5 in Delhi in 2022.
● According to the agricultural census, 73.2% of rural women are engaged in farming activities but only 12.8%
own landholdings.
● An RBI study in 2019 said that 28% of agricultural credit is still provided by the moneylenders, traders and
relatives. When it comes to small farmers, nearly 60% have no access to bank loans.

Matters Related to Agriculture


● UN SDG-1: End Poverty in All Forms.
● UN SDG-2: Eliminate Global Hunger, protect indigenous seed and crop varieties, doubling agriculture productivity
and small farmer incomes by 2030.
Indian Constitution
● Agriculture is a state subject.
● Entry 14 of the State List: It mentions the item relating to agriculture: “agriculture, including agricultural
education and research, protection against pests and prevention of plant disease.”
● Entry 33 in the Concurrent List: It limits the power of states in agriculture and empowers the centre by stating
that both the state and the union government can legislate regarding production, trade, supply and distribution of a
range of foodstuffs and agricultural raw materials.

FACTS AND DATA

● Share in GVA in the year 2022-23: 18.3 %.


● Growth Rate: 3.3 per cent in 2022-23.
Sector
● Share in Total Employment: 38% (2019-20).
Overview
● The agriculture sector’s contribution to GDP has decreased from 54% in 1950-51 to less
than 17% in 2016-17.

Land Use ● Net Sown Area – 43% ● Cultivable Waste – 4%


Pattern ● Pastures & Groves – 4% ● Fallow Land – 9.6%

Food Grain ● Wheat and Rice accounted for around 78% of the food grains production.
Production ● Total food grains production in the country is 149.9 million tonnes 2021-22 (Kharif only).

SIGNIFICANCE OF AGRICULTURE SECTOR FOR INDIA


● Major Source of Employment: About 60% of our labour force is directly involved in the agriculture sector. In
terms of employment, only the fishery sector supports the livelihood of over 28 million people in India, especially
the marginalised and vulnerable communities.
● Source of Forex Earning: In 2020-21, exports of agriculture and allied products from India grew by 18 per cent over
the previous year. The marine products export from India is targeted to reach USD 14 billion by 2025.
● Agriculture is significant in reducing Poverty and improving the Living Standard.
● Agriculture helps in the Supply of the Raw Material and Food and Development of the Industrial Sector.

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PRAHAAR ReDEFINED 3.0: ECONOMY

● Various Employment Opportunities & thus Economic Development is catered with the help of the Agriculture
sector.
● It helps in Controlling Inflation and Reduction in Regional Disparities.

ISSUES IN AGRICULTURE SECTOR IN INDIA


● Uneconomical, Fragmented Land Holdings: The small and marginal land holdings (2 ha) account for 72% of
landholdings (Economic Survey 2019-20) which is a major limitation to reap the benefits of economies of scale.
● Credit Availability: Lack of access to formal credit.
● Falling yields: Due to inadequate inputs and information.
● The Declining Area under Cultivation: Diversion of agricultural land for non-agricultural uses.
● High Inputs Cost: deregulation of fertiliser prices, reduction in farm subsidies, etc.
● Low Farm Revenues: due to low production along with low prices received in the market.
● Climate Change: Out of the total net sown area s, 60% of land under cultivation is dependent on Monsoons. This
condition is worsening due to climate change.
● Faulty Implementation of Government Policies/Schemes: for e.g., Oppressive APMC Acts, MSP-related policies,
Stock limits under ECA, liberalised Agri-import policy (leading to declining in domestic prices & farmers’ incomes),
ineffective Insurance & credit-related schemes, lack of awareness about schemes.
● Investment Issues: Inadequate Public investment & private investment.
● Inefficient MSP Structure: Only 6% farmers get the benefit of MSP and the remaining 94% are dependent on the
markets.
● Lack of Enabling Infrastructure (Value Chain): Including cold storage, warehouses, and agro- processing, etc.
● Research & Development: Less than 1% of the Agricultural GDP in India is spent on research.
● Rural Distress & Farmer Suicides: According to National Crime Records Bureau (NCRB) report (2015), over 8000
farmers and 4500 agricultural labourers have committed suicide.
● Agricultural NPA’s: According to Reserve Bank of India data, NPAs in the agricultural sector rose over 23% from
Rs 48,800 crore in 2016 to Rs 60,200 crore in 2017.
● Excessive use of Manures, Fertilisers and Biocides
● Using Loan Amount for Non-Farming Purposes
● Unscientific Farming Practices: E.g., Farming without following agro economic conditions of an area, no soil tests
etc.

CONSEQUENCES OF AGRARIAN CRISIS


● Reducing Farmers’ Income: Per day income of farm households is only about ₹277, which is not much different
from the minimum wage rate paid under the national employment guarantee scheme (NSO, 2021).
● Unsustainable Livelihoods: NSSO 70th round indicates a farm household needs to have at least 1 hectare of land to
cover their consumption expenditure. But over 65% of households have less than one hectare of land.
● Rising Indebtedness: Nearly 52% of agricultural households are under debt, esp. concentrated among small and
marginal farmers (landholding < 2 ha).
● Rural-Urban Migration: In the last 10 years (2001-2011) India witnessed one of the largest migrations from rural to
urban India due to the failure of agriculture and the dearth of employment in the agriculture sector.
● Exit from the Agriculture sector for better income opportunities elsewhere. According to a Centre for Study of
Developing Societies (CSDS), Delhi, 76% of farmers gave up farming.
● Rising Inequalities: Disparity of about 3 times between a farmer and non-farmer’s income
● Food Insecurity and Protests by Farmers due to deteriorating agricultural conditions.

DOUBLING FARMERS INCOME

NITI AYOG- INDIA @ 75: RECOMMENDATIONS ON DOUBLING FARMERS INCOME


● A coherent and stable agricultural export policy, ideally with a five to ten-year time horizon.
● Price Realisation: The government should consider replacing the Commission on Agricultural Costs & Prices
(CACP) by an agriculture tribunal in line with the provisions of Article 323 B of the Constitution.

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● NITI Aayog should set up a group to examine the following:


o Replacing the MSP by a Minimum Reserve Price (MRP), which could be the starting point for auctions at
mandis.
o Examine options for including private traders operating in markets to complement the MSP regime.
● An effective and technology driven Agriculture Advisory Service may be considered on the lines of those of the
United States Department of Agriculture (USDA) and the European Union (EU).
● Futures Trade should be encouraged.
● Crop Insurance: PMFBY needs to be modified to Promote weather-based insurance, Increase non-loanee farmers’
insurance coverage and allow for mixed cropping and increase the number of crops notified.
● Adopting Acts: Encourage states to adopt the Model Contract Farming Act, 2018 and Model Agriculture Land
Leasing Act, 2016 which aims to improve land access to small and marginal farmers through land leasing.
● Digitise Land Records: Geo-tagging, along with location agnostic online registration of land records to generate
updated land records, must be carried out. Digital India Land Record Modernisation Programme
for modernization of land records system in the country.
● Promote Farmer Producer Organizations (FPOs): There are now 741 FPOs in the country, managed under the
aegis of Small Farmers Agribusiness Consortium (SFAC).
● Focus on Precision Agriculture: Support research on energy friendly irrigation pumps, micro irrigation, climate
smart technologies, IoT, AI and use of technology in animal husbandry to monitor animal behaviour, health and
production to prepare for future challenges.
● Create a Knowledge Hub to Disseminate Best Practices: The performance of Krishi Vigyan Kendras (KVKs)
should be regularly reviewed by external agencies and well performing KVKs must be strengthened to disseminate
best practices at the field level.
● The ICAR and State Agriculture Universities (SAUs) should focus on providing recommendations across the
farming value chain, covering production, post-production, processing and other value- addition activities.
● Shifting cultivators to non-farm and subsidiary activities, Increasing livestock productivity and Price incentives for
producers are some other recommendations.
Recent Initiatives on Doubling Farmers Income
● Pradhan Mantri Fasal Bima Yojana 2016: To provide insurance at the lowest premium rate to farmers with added
benefits. Overall 832.24 lakh farmers enrolled under the PMFBY during 2021-22 fiscal.
● Pradhan Mantri Krishi Sinchayee Yojana (PMKSY): Boost to micro-irrigation under ‘Per Drop More Crop’
● Soil Health Cards 2015: Scheme launched to reduce fertilisers usage and expenses
● National Agriculture Market (e-Nam): To ensure expanded market access and better price realisation for Farmers.
● Fertiliser Sector Reform (Urea): 100% of Neem Coating of indigenous and imported urea achieved. Diversion of
highly subsidised urea towards non-agricultural purposes reduced to negligible.
● Stabilisation of prices of Pulses: For the first time, a buffer stock of up to 20 lakh MT of pulses is being created to
manage the price volatility of pulses
● Agro-Meteorological Services (AAS) for Farmers: About 21 million farmers are currently receiving AAS
in vernacular languages through SMS and other modes.
● Paramparagat Krishi Vikas Yojana: Promoting organic farming and establishing an Organic value chain for the
North Eastern States.
● National Gokul Mission: Aiming at improving the genetic stock and breeds of indigenous cattle population and at
Milk Production and Dairy development.
● SAMPADA Scheme: to provide effective and seamless backward and forward integration for the processed food
industry, better prices to farmers, huge rural employment opportunities, reduced wastage, and increased export
competitiveness in processed food.
● Mission for Integrated Development of Horticulture (MIDH): Several expert groups have identified horticulture
as a high-growth area and a source of buoyant income and improved resilience for farmers.
Current Status: According to the Situation Assessment Survey by NSO, the monthly agricultural household income
of the country has increased from Rs 8059 to Rs 10218.

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PRAHAAR ReDEFINED 3.0: ECONOMY

HORTICULTURE SECTOR
● The horticultural sector covers six categories, namely pomology (fruits), olericulture (vegetables), floriculture
(flowers), plantation crops, spices, aromatics, and herbal medicines.
Present Status of Horticulture
● India is the second-largest producer of fruits and vegetables globally; the Second largest producer and exporter of
Spices.
● Occupying only about 14 percent of agricultural land, horticulture contributes more than 33 percent to the
agricultural GVA.

Importance of Horticulture Challenges in Horticulture

• High-value crops and Higher returns per unit of • Longer sowing to harvest cycle for some of the fruits
land as compared to cereal crops. such as Apple, Guava, etc.
• Ensures Nutritional security by overcoming • High cost of inputs that burdens the farmers and the
vitamin and micronutrient deficiencies. initial cost constraints.
• Being labour-intensive generates more • Large-scale prevalence of old and senile orchards
employment opportunities. impacts productivity.
• Availability of quality seed and planting material
• Boosts secondary agriculture by developing
impacts the quality of produce.
cottage-based Industries.
• Poor tree canopy management.
• Source of variability in farm produce and diets.
• Rainfed cultivation.
• Serves as raw material for various industries, such • Facilities for post-harvest management have not
as processing, pharmaceutical, perfumery and kept pace with production growth.
cosmetics, chemical, confectionery, oils and paints, • Lack of appropriately trained extension services for
etc. horticulture.
• Source of Employment • Limited availability of market intelligence.

STRATEGY TO BOOST HORTICULTURAL PRODUCTION


● Increasing the output through higher productivity.
● Hybrid technology for high productivity and quality.
● Modernization, and accreditation of nurseries.
● High-density planting system: higher yield and net economic returns per unit area, more efficient use of inputs.
● Increasing the output through area expansion such as Integrated Farming system approach, Urban & Peri-Urban
Horticulture.
● Resources use efficiency or savings in the cost of production through micro-irrigation, fertigation, adoption of
mechanisation to reduce labour costs.
● Increase in cropping intensity by enhancing Irrigation, Crop Rotation, Mixed Cropping, etc.
● Diversification towards high-value crops within horticulture such as floriculture, cashew, Cocoa, mushrooms, spice,
and medicinal plant cultivation.
● Improvement in the market access and marketing system. KISAN RATH Mobile App launched to search transport
vehicles for Primary and Secondary transportation for movement of Agriculture & Horticulture produce.
● Creation of near-farm occupations in post-harvest handling facilities.
● Postharvest and value addition in horticulture crops.

GOVERNMENT INITIATIVES
● National Horticulture Mission: launched under the 10th five year plan in 2005-06.
● It provides holistic growth of the horticulture sector through an area based regionally differentiated strategies
● Integrated Development of Horticulture (MIDH): High-density plantations, protected cultivation, micro-irrigation,
quality planting material, rejuvenation of senile orchards, and post-harvest management and marketing.

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● National Horticulture Board (NHB): It was set up in 1984 on the basis of recommendations of the "Group on
Perishable Agricultural Commodities", headed by Dr M. S. Swaminathan. Objective is to improve the integrated
development of the Horticulture industry and to help in coordinating, sustaining the production and processing of
fruits and vegetables.

PRECISION FARMING
● Precision Farming (also called Satellite Farming) refers to the application of a precise and proper quantity of
inputs like water, fertiliser, pesticides, etc. at the correct time to the crop for increasing its productivity and
maximising its yields, by creating use of digital farming technologies.
● It desires implementation through ICTs, Wireless detector Networks, robotics, drones, Variable Rate Technology,
Geospatial strategies, and automatic positioning systems.
Benefits of Precision Farming
● Decrease use of fertiliser
● Reduces input price: It reduces input prices by 18-20% and enhances yield between 30% (rice and wheat) and 100%
(sugarcane, fruits, and vegetables).
● Farm management code like Agrivi makes all activities on the farm easier and improves farm productivity.
● GPS soil sampling: Testing a field’s soil reveals the market nutrients, pH level, and a spread of other knowledge that
is very important for creating aware and profitable selections.
● Saves labour prices: by exploitation technology to assist maximise the advantages of crop cultivation, crop
protection, and irrigation by exploitation of automatic sensors.
● Monitor Soil & Plant Parameters: Growers will verify peak conditions for plant growth by placing sensors
throughout the fields.
● Correct quantity at correct time: Applying the correct quantity of chemicals within the right place and at the correct
time edges crops, soils, and groundwater, and so the complete crop cycle.
● Reduces pollution through lowest use of chemicals
● Prevents soil degradation: Since over-use of chemicals is avoided, it prevents the leaching of undesired chemicals
into soil.
● Resource Efficiency: It provides opportunities for higher resource management and afterward reduces wastage of
resources.
● Increase agriculture productivity: Through automatic applications of nutrients and input it will help in better crop
yield.
● Efficient use of water resources: Targeted delivery of water through techniques like fertigation reduces water usage.
Fertigation is the process of directly applying fertiliser to a crop through the irrigation system.
● Precision farming has the potential to create a lot of employment opportunities.
● Changing the socio-economic status of farmers

CROP INSURANCE- PM FASAL BIMA YOJANA (PMFBY)


Major Objectives of PMFBY
● To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified
crops as a result of natural calamities, pests & diseases.
● To stabilise the income of farmers to ensure their continuance in farming.
● To encourage farmers to adopt innovative and modern agricultural practices.
● To ensure flow of credit to the agriculture sector.
● The new Crop Insurance Scheme is in line with the One Nation – One Scheme theme.
● The PMFBY will replace the existing two schemes National Agricultural Insurance Scheme as well as the Modified
NAIS.

PMFBY TO PMFBY 2.0:


● Completely Voluntary: Enrolment made 100% voluntary for all farmers from 2020.
● Limit to Central Subsidy: The Cabinet has decided to cap the Centre’s premium subsidy under these schemes for
premium rates up to 30% for unirrigated areas/crops and 25% for irrigated areas/crops.
● More Flexibility to States for the implementation of the Scheme.

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PRAHAAR ReDEFINED 3.0: ECONOMY

● Penalising the Pendency: If states don’t release their share before March 31 for the Kharif season and September 30
for rabi, they would not be allowed to participate in the scheme in subsequent seasons.
● Insurance companies have to now spend 0.5% of the total premium collected on information, education and
communication (IEC) activities.
Performance of the Scheme
● The Scheme covers over 5.5 crore farmer applications on average per year.
● During the last six years of its implementation, farmers paid a premium of ₹25,186 crore and received claims
amounting to ₹1.2 lakh crore (as of 31 October 2022).
● One notable example is mid-season adversity claims of nearly Rs. 30 crore in Rajasthan during Rabi 2019-
20 Locust attack.

ZERO BUDGET NATURAL FARMING (ZBNF)


● Natural farming is a system where the laws of nature are applied to agricultural practices.
● The term Zero Budget Natural Farming (ZNBF) was coined by Subhash Palekar, it means raising crops without
using any fertilisers and pesticides or any other external materials.
● The word Zero Budget refers to the zero cost of production of all crops.
Features of ZBNF
● It is based on Four Pillars:
o Bijamrit is the microbial coating of seeds with formulations of cow urine and cow dung.
o Jivamrit is the enhancement of soil microbes using an inoculum of cow dung, cow urine, and jaggery.
o Mulching is the covering of soil with crops or crop residues which creates humus and encourages the growth of
friendly microorganisms.
o Waaphasa is the building up of soil humus to increase soil aeration.
● The system requires cow dung and cow urine obtained from Indian breed cows only. Desi cow is apparently the
purest as far as the microbial content of cow dung, and urine goes.
● In ZBNF, multi-cropping is encouraged over single crop methods.

ORGANIC FARMING AND ZBNF


Similarities
● Both discourage farmers from using any chemical fertilisers, pesticides on plants and in all agricultural
practices.
● Both encourage farmers to use local breeds of seeds, and native varieties of vegetables, grains, pulses and other
crops.
● Both farming methods promote non-chemical and homemade pest control methods.
Differences
Organic Farming ZBNF
Organic fertilisers and manures like compost, vermi- In natural farming decomposition of organic matter by
composting, cow dung manure, etc. are used and added to microbes and earthworms is encouraged right on the soil
farmlands from external sources. surface itself.
It requires basic agro practices like ploughing, tilling, In natural farming, there is no ploughing, tilting, no
mixing of manures, weeding, etc. to be performed. fertilisers, and no weeding is done.
It is still expensive due to the requirement of bulk Natural agriculture is an extremely low-cost farming
manures, and it has an ecological impact on surrounding method, completely moulded with local biodiversity.
environments.

INTEGRATED FARMING SYSTEMS


● This approach has multiple objectives of sustainability, food security, farmer’s security and poverty reduction by
involving livestock, vermicomposting, organic farming etc. with farming. It ensures:
o Productivity: Provides an opportunity to increase economic yield per unit area by virtue of intensification of crop
and allied enterprises especially for small and marginal farmers.

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o Profitability: It has the capability to make the sector profitable by reducing the use of chemical fertiliser and
recycling nutrients.
o Sustainability: In IFS, by-product of one subsystem works as an input for the other subsystem, making it
environmentally sustainable.
o Recycling: Effective recycling of products, by-products and waste material in IFS is the cornerstone behind the
sustainability of farming system under resource poor condition in rural areas.
o Income Round the Year: Due to interaction of enterprises with crops, eggs, meat and milk.
o Best Utilisation of Small Landholdings: Indian farmers in many regions such as in north-eastern part, practice
subsistence agriculture. They also have a rich traditional base in water harvesting, soil management etc. which
could be efficiently utilised under IFS.
o Meeting Fodder Crisis: By-product and waste material of crop are effectively utilised as fodder for livestock.
o Employment Generation: Combining crop with livestock enterprises would increase the labour requirement.

RECENT DEVELOPMENTS IN AGRICULTURE

A. ANIMAL HUSBANDRY INFRASTRUCTURE DEVELOPMENT FUND (AHIDF)


● In pursuance of the Atma Nirbhar Bharat Abhiyan stimulus package, Cabinet approved setting up of Animal
Husbandry Infrastructure Development Fund (AHIDF) amounting to Rs. 15000 crores.
● Eligibility: Farmer Producer Organizations (FPOs), MSMEs, Section 8 Companies, Private Companies and individual
entrepreneur with only 10% margin money contribution by them.
Objective
● For incentivizing investment by the cooperative sector for the development of dairy infrastructure.
● The MSMEs and private companies are also being promoted and incentivized for their participation in processing and
value addition infrastructure in the animal husbandry sector.
Benefits
● Export Promotion ● More investments by farmers in agriculture.
● Impact on Increasing Farmers income. ● Employment Generation.

B. WOMEN IN AGRICULTURE
● Agriculture has the highest percentage distribution of female workers at around 63% (PLFS 2021-22). The Food and
Agriculture Organization has estimated that if women farmers have the same access to productive resources as men,
they would increase the yields on their farms by 20-30%, which would increase at least 2.5-4% to the total agricultural
output in developing countries. Problems associated with Women Farmers:
o Land-ownership issues o Less support from family and society
o Difficulties in access to credit o Lack of equipment
o Male dominance o Lack of political participation
Government Initiatives for Women Farmers
● National Mission on Agricultural Extension & Technology (NMAET) – Sub-Mission on Agricultural Extension
(SAME):
o Agriculture Technology Management Agency (ATMA): It provides for one ‘Gender Coordinator’ per State to
ensure that funds and benefits are provided to them in proportion to their numbers, with minimum 30% of
allocation for women farmers.
o Mass Media Support to Agricultural Extension: One day specially allocated to cover areas of core competence
of women farmers in programs of All India Radio & Doordarshan.
● Mission for Integrated Development of Horticulture: Specific coverage of women beneficiaries for programmatic
interventions with higher subsidy on tractor, power tiller etc. as compared to men.
● National Mission on Oilseeds & Oil Palm: Promotion of women groups with involvement by states in distribution
of certified seeds etc.
● Integrated Scheme for Agricultural Marketing: Provides financial assistance in Storage Infrastructure Projects
under Agriculture Marketing infrastructure (AMI) for Registered FPOs, Panchayats, Women, SC/ST beneficiaries or
their cooperatives/Self-help groups.
● National Food Security Mission: At least 30% allocation of the funds is for women farmers.

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● National Mission for Sustainable Agriculture: At least 50% of the allocation is to be utilised for small, marginal
farmers of which at least 30% are women beneficiaries/farmers.

C. GENETICALLY MODIFIED CROPS


● According to WHO, genetically modified crops are crops derived from organisms whose genetic material (DNA) has
been modified in a way that does not occur naturally, i.e. through the introduction of a gene from a different organism.
Status of GM Crops in India
For commercial production, all GM crops in India require approval from the Genetic Engineering Appraisal
Committee (GEAC). Bt cotton is the only genetically modified crop that is allowed for commercial production in India.

Benefits of GM Crops Threats from GM Crops


• Tackling food security • Doubtful yield increase: The increase in yield by GM crops is still not proven.
challenges • Terminator seeds, which produce infertile seeds at harvest thereby increasing the
• Higher yield dependence of farmers on seed companies.
• Climate change • Resistance to GM crops developed in pests
resilience • Threat to environment
• Pest resistance • Health risk
• Tackle nutrition • International trade
challenges
• Illegal cultivation
• Permanent changes
Way Forward
● Recommendations of the Parliamentary Standing Committee on Science and Technology, 2017
o Closed field trials: The central government should ensure that the field trials are done in a closed environment
and in consultation with agricultural universities.
o Reforming GEAC: GEAC should be headed by an expert from the field of Biotechnology.
o Long-term effect: The committee noted that no GM crop should be introduced in the country without scientific
assessment of its long-term effect on the environment and human health.
● Parliamentary Standing Committee on Agriculture, 2012
o It recommended labelling GM products including food crops and processed food so that consumers are able to
make informed choices.
o GEAC should be given statutory status to provide it power and autonomy to function as statutory regulator.
o Recommended legislation relating to liability and redress for damage due to Living Modified Organisms in
order to comply with Nagoya-Kuala Lumpur Supplementary protocol on Biosafety.
o Recommended strengthening of National Biodiversity Authority with scientific, technical and legal human
resources to prevent threats to biodiversity from GM crops.

BIOTECHNOLOGY IN THE AID OF AGRIC ULTURE


● Can improve the productivity of farms of small and marginal farmers.
● Can be utilised to develop heat-tolerant, drought-resistant and early maturing varieties.
● Increasing water-stress requires water-use efficiency of agriculture.
● Develop less harmful pesticides such as biopesticide or herbicide-tolerant, pest-resistant varieties, e.g. Bt Cotton.
● Can be effectively used to improve productivity of agriculture. E.g. high-yielding varieties of wheat such as DBW
187, DBW 303 etc.
● Biotechnologies such as artificial insemination, Embryo transfer, in-vitro fertilisation etc. can improve milk
production and drought-resistance of the breeds. Biotechnology can protect livestock from diseases.
● Fertilisers: Biotechnology can reduce the usage of fertilisers in Indian farms and consequently ill-effect due to
eutrophication. E.g. recently developed nano urea has higher uptake.
● Bioremediation: Biotechnology can be used to clean up contaminated soils and water bodies.

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● Post-Harvest Management: Biotechnology can be used to develop technologies that can improve the storage and
preservation of crops thereby reducing post-harvest losses, especially in horticulture crops.

AGRICULTURAL CREDIT AND INDEBTEDNESS IN INDIA


● The Government of India has initiated several policy measures to improve the accessibility of farmers to the
institutional sources of credit.
Various Institutional and Policy arrangements:
● Agricultural credit is disbursed through a multi-agency network consisting of Commercial Banks (CBs), Regional
Rural Banks (RRBs) and Cooperatives.
● NABARD is a Development Bank tasked with providing and regulating credit and other facilities for the promotion
and development of agriculture, small-scale industries, cottage and village industries, and other allied economic
activities in rural areas, with the goal of promoting integrated rural development and securing rural prosperity.
● Interest subvention to farmers
● Extension of interest subvention scheme to post harvest loans
● Collateral free loans: The limit of collateral free farm loan has been increased from Rs.50,000 to Rs.1,00,000.
● The Government introduced the Kisan Credit Card (KCC) Scheme, for the issue of KCC to farmers for uniform
adoption by the banks, so that farmers may use them to readily purchase agriculture inputs such as seeds, fertilisers,
pesticides etc.
● Agriculture Market Infrastructure Fund (AMIF) – NABARD: It was announced in the 2018 Budget for
developing and upgrading agricultural marketing infrastructure in the 22,000 Gramin Agricultural Markets (GrAMs)
and 585 APMCs.
Indebtedness of Farm Households: Data
● Over 50% of agricultural households in the country were in debt with an average outstanding loan per
household at Rs 74,121 in 2018 compared with Rs 47,000 in 2013.
● Economic Survey (2022-23): The average monthly income per agricultural household during the agricultural year
2018-19 was at Rs 10,218 – a 59% increase compared with Rs 6,426 in 2012-13.

Causes of High Indebtedness Measures to Improve the Situation


● Using Credit for Domestic Purpose ● Access to affordable credit
● Inadequate access to low-cost ● Agricultural Loans with Gold as Collateral
financing is at the root of rural misery. ● Restricting Farm Loan Waivers
● The ability of rural poor households to ● Credit Guarantee Plan for Agriculture, example Kisan Credit
provide assets as collateral is a major Card Scheme and PM Kisan Yojana.
determinant of their access to ● Increasing Credit to Allied Activities, for example, PM
institutional lending. SAMPADA yojana to promote food processing industry is a
● Factor of Social Identities welcome step and it provides credit to associated allied sectors as
● High input costs well.
● Fluctuating commodity prices ● Land Consolidation
● Disparities on credit access across states.

MAHESH KUMAR JAIN COMMITTEE ON AGRICULTURE CREDIT


The recommendations of the RBI Internal Working Group include:
● The group noted that the central and state governments need to increase their capital expenditure which will
stimulate the demand for investment credit in agriculture.
● Banks should provide crop loans only through Kisan Credit Cards in order to curb the misuse of interest subsidy.
● The group recommended that loan waivers should be avoided.
● Separate lending targets should be set for allied activities and banks should not insist on land records up to Rs. 2
lakh for such credit.
● Digitisation of land records

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● The group recommended that the lending target for small and marginal farmers should be revised from the existing
8% to 10% with a roadmap of two years.
● Revising PSL
● Indian Banks’ Association should introduce a portal on the lines of PSBLoansin59minutes to allow quicker credit
access for the agriculture sector.
● Central government should set up a credit guarantee fund for the agriculture sector on lines of the credit guarantee
fund for the MSME sector to cover the default risk of borrowers.

IRRIGATION SYSTEM
● Irrigation is the artificial supply of water to crops for agricultural production. There can be several artificial ways
for providing water such as canals, wells, tube-wells, tanks, etc. which transport water from different sources such as
rivers, ponds, or underground water to targeted fields. “Water” is the State subject (as per Seventh Schedule of the
constitution).
Micro-Irrigation System
● Micro-irrigation (MI) techniques such as drip irrigation, sprinkler, rain-gun, porous pipe system, etc. where water
is supplied directly to the crops are considered as innovative water-saving technology. Micro irrigation (or Localised
irrigation) is a type of decentralised irrigation system.
● Micro irrigation leads to better results, but small and marginal farmers often find it unaffordable. Of the total 151.33
lakh hectares under kharif crop, only 25.72 lakh hectares is covered by micro irrigation.
Micro Irrigation Fund
• Micro Irrigation Fund (MIF) with a corpus of Rs.5000 crore was operationalized in NABARD.
• The objective of the fund is to facilitate State Governments efforts in mobilising additional resources for
expanding coverage under micro irrigation and incentivizing its adoption.
• Under MIF, the State Governments are provided loans at 3% below the cost of funds; the 3% being compensated
by the Govt. of India as interest subvention.

Benefits of Micro-Irrigation Challenges of Micro-Irrigation


● Water use efficiency and Irrigation Water ● Underutilisation of Potential
Productivity and prevents water logging. ● Huge primary cost
● Energy efficiency ● Energy crisis
● Fertigation technique: Precise mixing of ● Delays in subsidy payment
fertilisers and water, control of best dosage, and ● Lack of Technical Support
direct dosing of fertilisers to the root region
● Knowledge gap
resulting in the increase in fertiliser consumption
by the crops. ● Declining landholdings and farm income
● Increase in crop productivity ● Greater Maintenance requirement
● The Mihir Shah Committee report has ● Reducing per capita Water availability
recommended the development of institutions for ● Financial Returns from the Irrigation Sector
capacity building of water professionals. ● Problem of Drainage
● Inter-cropping ● High Usage of water
● Infrastructure development ● Inter Water Disputes such as Mahadayi Water dispute
● Higher yields tribunal, Godavari water state tribunals
● Less water loss ● Skewed Irrigation Distribution
● Lower consumption of fertilisers ● Inefficient usage of water: rice and sugarcane alone
● Weed and disease reduction consume almost 60 % of India’s irrigation water.
● Precision farming

POLICY RECOMMENDATIONS
● A comprehensive watershed management plan needs to be formulated and effectively implemented.

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● Implementing Vaidyanathan Committee’ s Recommendations:


o Committee suggested the norms for fixing water rates, cost escalation on the Operation and Maintenance (O&M)
component of economic water rates.
o It suggested conversion of volumetric supply of water rates from crop-wise and area-wise water rates for different
agro-climatic zones.
● Adopting Best Practices from local level to national Level:
o Jalyukta Shivar yojana in Maharashtra has played a prominent role in providing farm ponds to every farmer
in her/his agriculture field.
o In Gujarat, ‘Bhungroo’ is a water management system that injects and stores excess rainfall water underground.
This water is then used for irrigation during summers.
o Mission Kakatiya is a flagship program under the Telangana government aimed at restoring minor irrigation
sources of water like ponds and tanks.
● Participating with civil society: Pani foundation hosts the Satyamev Jayate Water Cup, a competition for excellence
in soil and water conservation.
● International Cooperation: Netafim, an Israel based company, has shown the potential of a family drip irrigation
system at Ramthal, Karnataka.

GOVERNMENT INITIATIVES
● Jal Shakti Ministry: created to provide access to safe drinking water by reorganising the earlier ministries.
● National Mission on Micro Irrigation (NMMI): The Centrally sponsored mission was launched in June 2010 in
addition to the earlier Micro Irrigation Scheme launched in January 2006.
● Micro Irrigation Fund: The Government has created a dedicated Micro Irrigation Fund with NABARD.
● Rainfed Area Development Programme (RADP): an initiative which aims to increase agricultural productivity of
rainfed areas in a sustainable manner.
● Pradhan Mantri Krishi Sinchayee Yojana: the scheme aims to provide end-to-end solutions in the irrigation supply
chain (water sources, distribution network and farm-level applications).
● Kaleshwaram Lift Irrigation Project: This Scheme of Telangana is a multi-purpose irrigation project on
the Godavari River in Kaleshwaram, Bhupalpally, Telangana. It is at the confluence point of Pranahita River and
Godavari River. It is the world’s largest Irrigation and Drinking Water System.
● Neeranchal National Watershed Project: Improved equity, livelihoods, and incomes through forwarding linkages,
on a platform of inclusiveness and local participation.
● National Mission for Sustainable Agriculture: Key targets for FY 2021- 2025 include covering 20 lakh hectare of
area under organic farming, 87 lakh hectare under precision irrigation.
Irrigation and Water Productivity
● The Economic Survey has proposed policy changes which include increasing Irrigation Water Productivity (IWP)
by adopting improved methods of irrigation and irrigation technologies,
● Focus should shift from 'land productivity' to 'irrigation water productivity'
● Reasonable and Due Access to irrigation water to the marginal and small farmers.

PRADHAN MANTRI KRISHI SINCHAYEE YOJANA (PMKSY)


● Launched in 2015, PMKSY has been formulated amalgamating ongoing schemes viz. Accelerated Irrigation Benefit
Programme (AIBP); Integrated Watershed Management Programme (IWMP); and On-Farm Water Management
(OFWM) component of National Mission on Sustainable Agriculture (NMSA).
● Recently, Government of India has approved continuation of PMKSY during 2021-22 to 2025-26, with extension of
Ground Water component.
Objectives: “More Crop Per Drop”
● Achieve convergence of investments
● Enhance the physical access of water on the farm and expand cultivable area under assured irrigation (Har Khet ko
pani).
● Integration of water source, distribution and its efficient use.
● Improve on-farm water use efficiency to reduce wastage

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● Enhance the adoption of precision- irrigation and other water saving technologies
● Enhance recharge of aquifers and introduce sustainable water conservation practices.
● To promote extension activities relating to water harvesting, water management, and crop alignment for farmers
and grass root level field functionaries
● To attract greater private investments in irrigation.
● It is a Centrally Sponsored Schemes.
● Water budgeting is done for all sectors namely, household, agriculture and industries.
Other Developments: Sustainable Agriculture demands Optimum Water Management
● On March 22 (World Water Day), Prime Minister launched the ‘Catch the rain Campaign’ under Jal Shakti
Abhiyan.
● Campaigns are desired as water demand is going to rise in future – 843 billion cubic metres (BCM) by 2025 and
1180 BCM by 2050.

STORAGE OF AGRICULTURAL PRODUCE


● A study by National Academy of Agricultural Sciences (NAAS) said storage is the major cause of post-harvest
losses for all kinds of food in India, fruits and vegetables, where India faces a critical deficiency of cold storage
capacity—this belies the enormous potential of its processed food industry.
● Around 70% of the total food grains production is retained and consumed at the farm level.
● The balance amount is supplied to the central pool and delivered at the nominated warehouse or at the local mandi
earmarked for procurement.
● As of 2019, India has a total Agri warehousing capacity of around 91 million metric tonnes (MMT) with the
majority of the capacity being owned by state agencies.
● State agencies own around 40% of the capacity and the balance distributed among private entrepreneurs, cooperative
societies, farmers, etc.
Need for Storage and Warehousing
● Hunger and malnutrition: India ranks 107 in the Global Hunger Index, 2022.
● Low Contribution of Agriculture to GDP approx, 18%
● Poor income of farmers
● Due to high yield seeds, irrigation facilities, etc. there is an increase in the quantity of production.
● Storage ensures food security (SDG goal – 2)
● India wastes food worth approximately $14 billion each year.
● Paradox of Plenty - The contrasting scenarios of record agricultural production and grinding poverty in the agriculture
sector.
● According to the Ministry of Consumer Affairs - 62,000 tonnes of food grain was damaged in Food Corporation of
India warehouses because of pests between 2011 and 2017.
● Open Storage in mandis - It is estimated that around 30 million tonnes of food grains are stored using open method
making grains vulnerable to fungus and moisture.
● Administrative inefficiencies – Lack of Computerisation and poor record maintenance.
● Hoarding: leading to inflation and market volatility.

Warehousing in India
● Central Warehousing Corporation (CWC): Statutory Body since 1957, provides safe and reliable storage
facilities for about 120 agricultural and industrial commodities.
● State Warehousing Corporations (SWCs): Separate Warehousing Corporations were also set up in different
States.
● Food Corporation of India (FCI): They perform the important functions of ensuring scientific storage,
Warehousing receipts can be used by the farmers as collateral for the access of loans, Ensures Price stabilisation
e.g. Operation Greens, Market Intelligence.

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FOOD CORPORATION OF INDIA (FCI)


It was established under the Food Corporations Act of 1964, to fulfil following objectives:
● Effective price support operations for safeguarding the interests of the farmers.
● Distribution of food grains throughout the country for Public Distribution System; and
● Maintaining a satisfactory level of operational buffer stocks of food grains to ensure National Food Security.
Issues related to Procurement and Storage by FCI
● Open-ended Procurement: FCI buys as many grains as the farmers can sell. It not only stretches the already
overburdened godowns but also collapses the food grains market.
● Market Distortion – Through its policy of open ended procurement.
● Imbalances in storage facilities: According to the CAG report, out of the total storage space, 64% was located in the
large procurement states like Punjab, Haryana, Andhra Pradesh, Uttar Pradesh, and Chhattisgarh.
● Inadequate storage facility: the existing storage facility is poorly maintained causing grain damages due to pest
attacks.
● Lack of scientific storage mechanism: FCI still uses gunny bags for storing food grains instead of canisters or metal
containers.
● Poor pest management – Modern Sanitary and Phytosanitary Measures for exports require sophistication in pest
management which is absent.
● Non-adherence to First in First out principle (FIFO): CAG report has mentioned that food grains harvested in later
dates are despatched for PDS consumption but still grains procured in earlier dates are stored in warehouses
● Transit losses: Around 411,810 tonnes of wheat and rice were wasted as transit and pilferage losses in the past four
years.
● The poor condition of storage facilities: Food grains are getting rotten at storage facilities and have negligible pest
control mechanisms.
● Not using scientific storage methods: Modern methods like automata, silos and automatic pest control mechanisms
are not being employed.
● High subsidies: While the distribution price of foodgrains under the National Food Security Act (NFSA), 2013 has
remained the same at Rs 2-3/kg, the assured minimum support price (MSP) at which FCI procures wheat and rice
from farmers for distribution has skyrocketed.
● Shanta Kumar committee on FCI reform pointed out following issues:
o Lack of Proactive Liquidation Policy: The current system of liquidation of excess stocks through the Open
Market Sale Scheme (Domestic) or through export markets is extremely ad-hoc and slow.
o Insufficient sale price: FCI doesn’t get a good price most of the time, as predetermined price (reserve price) is
often less than the acquisition cost/economic cost of grains for FCI and it ends up making a loss in the sale.

REFORMS TAKEN TO IMPROVE STORAGE FACILITIES


● Decentralised Procurement Scheme: to procure and store at the state level to avoid transit losses.
● Negotiable Warehouse Receipt system: Under this system, farmers can deposit their produce to the registered
warehouses, and get a certain amount as advance from banks against their produce valued at MSP.
● The essential commodities act: ECA has been amended to relax stocking limits and thus encourage private and
foreign investments in storage.
● Agriculture Infrastructure Fund: setup for investment in viable projects for post-harvest management
Infrastructure.
● Storage and cold chain facilities: created under Pradhan Mantri Kisan Sampada Yojana (PMKSY)
● 'Village Storage Scheme' announced in Budget 2020: Run by women's SHGs with the aim to provide holding
capacity for farmers.
● Implementing recommendations of Shanta Kumar committee:
o Hand over Procurement to state: The FCI should hand over procurement operations of wheat, paddy, and rice
to states that have gained sufficient experience and infrastructure.
o Outsourcing: FCI should outsource its stocking operations to various agencies such as Central Warehousing
Corporation, State Warehousing Corporation, Private Sector under the Private Entrepreneur Guarantee (PEG)
scheme.
o FCI should act as an ‘agency for innovations in the Food Management System’

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● Promoting open Market sale: FCI conducts a weekly auction to conduct this scheme in the open market using the
platform of commodity exchange NCDEX (National Commodity and Derivatives Exchange Limited).
Way Forward
● Modernization and up-gradation of Bulk Grain Handling Infrastructure. Government is inviting tenders under
Design, Build, Fund, Own & Operate (DBFOT) to attract private investment into food storage and handling
● The private sector should be encouraged to build storage capacities in which they will store and maintain food grains
procured by the Government agencies. Private Entrepreneurs Guarantee (PEG) Scheme formulated in 2008 in which
storage capacity is created by private parties.
● Adequate manpower and supervision are required for scientific and safe storage.
● Timely and systematic evacuation planning can lead to the utilisation of vacant storage space.
● The intervention of state governments in identifying and handing over land for the construction of covered storage
spaces.
● FCI reforms should be an urgent measure to address the issue of funding and scientific storage. Need to Implement
Shanta Kumar committee recommendations.
● Increase accreditation of cold storage for the perishable commodities.

TRANSPORT OF AGRICULTURAL PRODUCE


Issues with the Transport of Agricultural Produce
● Lack of modern road and rail infrastructure.
● Lack of full regional connectivity especially with Northeast India.
● Seasonally blocked routes in Himalayan and North-eastern states.
● Over reliance on road transport instead of rail transport.
● Lack of all-weather and metalled roads in rural and tribal pockets of india.
● Usually transport trucks overloading leads to leakage and wastage during transit.
Steps to Improve Transportation
● Kisan rails as the first-ever multi-commodity trains to move perishable agricultural commodities.
● Krishi Udan scheme to transport agricultural goods by air Example India Airlifted fruits from Afghanistan
(Dedicated air corridor for carrying cargo).
● Transport and Marketing Assistance (TMA)
● Pradhan Mantri Gram Sadak Yojana: It is a nationwide plan in India to provide good all-weather road connectivity
to unconnected villages. In 2022 it was extended to connect all Gramin Agricultural Markets.
● Dedicated freight corridor: dedicated for agro-products. Andhra Pradesh flagged off India’s first fruit train carrying
locally grown bananas to JNPT.
● Shift from road to rail network: About 1.9% of the perishable fruits and vegetables are transported through rail,
while 97.4% of the produce is transported through roads.

MARKETING OF AGRICULTURAL PRODUCE


Problems with Agricultural Marketing in India
● Licensing Barriers
● High Incidence of Market Charges: APMCs collect market fees ranging between 0.5% to 2.0% of the sale value of
the product.
● Absence of standardised grading mechanism of agricultural produce before it is sold.
● Poor Infrastructure in Agricultural Markets
● The poor economic viability of projects
● Information dissemination systems provide limited information like prices of major commodities and generally not
available in local languages.
● Absence of a National Integrated Market: APMC performs the dual role of regulator and player.
● Limited public investment on the agricultural marketing sub-sector ranging from 4-5 % of the total public expenses
on agriculture.

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Initiatives to Improve Marketing


● Electronic national agriculture market (e-NAM) to connect all regulated wholesale produce markets through a
pan-India trading portal.
● E-governance portal AGMARKNET
● Kisan Credit Card scheme: to provide term loans for agricultural needs.
● Formation and Promotion of FPOs under the “One District One Product” cluster to promote specialisation and
better processing, marketing, branding & export.
● Market Intelligence and Early Warning System (MIEWS) Portal
● Seamless connectivity through Kisan Rail and Dedicated freight corridors.
● E-NAM, an online trading platform for agricultural produce aiming to help farmers, traders, and buyers with online
trading and getting a better price by smooth marketing.

AGRICULTURAL PRODUCE MARKETING COMMITTEES (APMC)


● The Ministry of Agriculture and Farmers' Welfare made attempts to overhaul the regulatory system by proposing the
Model APMC Act and Model State/UT Agricultural Produce and Livestock Marketing (Promotion &
Facilitation) Act, 2017.
● APMC is a statutory market committee constituted by a State Government in respect of trade in certain notified
agricultural or horticultural or livestock products, under the APMC Act issued by that state government.
● In most APMCs, buyers have to route all purchases through licensed aadhatiyas(middlemen). These middlemen charge
a commission for their “services” — many times, both from the buyer and seller.
Functions of APMC
● Ensuring Transparency in pricing system and market area.
● Providing market-led extension services to farmers.
● Ensuring payment for agricultural produce sold by farmers on the same day.
● Promoting agricultural processing including activities for value addition
● Promoting public-private partnership (PPP) in the management of agricultural markets.
Issues and Criticism of APMC
● Agricultural markets are fragmented since they are under various state governments.
● Lack of unrestricted movement
● Less farmers’ price realisation: Middlemen earn huge profit leaving farmers in loss.
● No direct selling to contract farming sponsors, retailers, food processing units etc. As a result, farmers are unable to
command higher profits.
● Exploitation by intermediaries
● Multiplicity of market levies, taxes, commissions, and fees at the first level of trading has a cascading effect on retail
prices, thus, causing inflation.
● Non transparency in utilisation of levies collected
● Political interference & corruption
● Distress sale due to lack of storage infrastructure.
● High Wastages in Supply Chain
● Lack of Infrastructure in Agricultural Markets
● Monopoly of APMC
● Cartelization by the agents in an APMC
● Licence fee in these markets is highly prohibitive.
● APMC plays the dual role of regulator and Market. Consequently, its role as regulator is undermined by vested
interest in lucrative trade.
● Mandi fees on inter-state trade amount to double taxation, besides violating the idea of a single national market.
Model Agricultural Produce and Livestock Marketing (Promotion & Facilitation) (APLM) Act, 2017

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● It aims to replace the APMC Act, 2003 and create a single Agri-market where with a single licence one can trade
Agri-produce as well as livestock. It causes better price realisation by Farmers thus helps in doubling the farmer’s
income by 2022.
Other Government Initiatives to improve Agricultural Marketing in India
● AGMARKETNET: It is a G2C e-governance portal that caters to the needs of various stakeholders such as farmers,
industry, policymakers, and academic institutions by providing agricultural marketing-related information from a
single window.
● Gramin Agricultural Markets (GrAMs): Efforts are being made to develop and upgrade the existing 22,000 rural
haats (Rural Primary Markets) into GrAMs. It will be linked to e-NAM and will remain outside the APMC Act
regulation.
● Scheme for Formation and Promotion of FPOs: The scheme aims to create 10,000 FPOs in a five year period from
2019-20 to 2023-24.
● Several states have started to give farmers direct access to consumers and eliminate the middlemen. Ex: Apni Mandi
in Punjab, Haryana and Rajasthan, Hadapsar Mandi in Pune.

AGRICULTURE EXPORTS
● Starting with a mere USD 0.6 billion export in 1987-88, now the export of agricultural products has reached a new
height of USD 19.69 billion till April-December 2022-23, and expanded the export basket to over 200 countries.
● In 2021-22, the exported agricultural products were worth USD 24.77 billion
● According to the WTO Trade Data, India was ranked at 25th in 1986, which slipped further to 28th in 1987 and
29th position in 1988. However, the ranking of India improved significantly as the county's position moved to 10th
rank in 2019 which improved further to 9th position in 2020 and 8th rank in 2021.
● Major commodities in export basket - rice (both Basmati and non-basmati), marine products, sugar, spices, cotton,
wheat and buffalo meat.
● India has emerged as the net exporter of agricultural products, with exports in 2021-22 touching a record USD
50.2 billion (Economic Survey 2022-23).
● Keeping in mind Prime Minister Narendra Modi's call for 'vocal for local' and 'Atmanirbhar Bharat',
Agricultural and Processed Food Products Export Development Authority (APEDA) has been focusing on the
promotion of exports of locally sourced GI (Geographical Indications) tagged as well as indigenous, ethnic
agricultural products.
o New products and new export destinations have been identified and accordingly, various trial shipments have
been facilitated.
Significance of Agriculture Exports
● High Growth Sector and has been showing sustained positive trends.
● Contribution to India’s agricultural GDP and Foreign Exchange.
● Has helped in development of “Brand India” and promotion of Organic Farming.
Challenges Faced by Indian Agricultural Exports
● Low share of high value and value-added Agri produce in its Agri export basket is less than 15% compared to 25% in
the US and 49% in China.
● Agriculture exports face challenges like, poor export competitiveness, low productivity, lack of uniformity in quality,
high logistics costs, lack of adequate post-harvest & transport infrastructure, absence of market information, and global
market linkages, Tariff/Non-Tariff barriers, etc.
● Global macroeconomic volatility and stringent sanitary & phyto-sanitary standards, use of primitive agriculture
technology, non-implementation of land & marketing (APMC) reforms, lack of formal credit or insurance further
discourage exports.
Government Initiatives to Boost Agri-Exports
● Safe Food Export Traceability Portal
● "One Lab One Assessment" Portal
● Monitoring Export Alerts Portal
● Agriculture Export Promotion Plan Scheme of APEDA
● National Programme for Organic Production (NPOP)
● National Monetisation Pipeline

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● Agri Udaan Programme for mentoring Agri start-ups


● APEDA has suggested augmenting cargo handling facilities at airports, ports, etc. This will reduce the waiting
time.
● Other Initiatives: Model Contract Farming act, Model APMC Act, digitization of land records, operation Greens,
Market Access Initiative (MAI) Scheme, Market Development Assistance (MDA) Scheme, and Merchandise Exports
from India Scheme (MEIS).
● International Negotiation: India’s proactive role in the WTO negotiations on trade facilitation and public
stockholding.
● Remission of Duties and Taxes on Exported Products (RoDTEP) scheme has been operationalized for exports
with effect from 01.01.2021.

FARMER PRODUCER ORGANIZATIONS (FPO)


● A Producer Organisation (PO) is a legal entity formed by primary producers such as farmers, milk producers,
fishermen, weavers, rural artisans, craftsmen, etc.
Benefits of FPOs to Small and Marginal Farmers:
● Reduced Cost of Input Procurement
● Provide Finances at Reasonable Cost
● Minimise post-harvest losses, for e.g., Jammu, Oriental FPO has developed cold chain infrastructure and created the
brand name ‘Safe N Fresh’.
● Collective Bargaining.
● FPOs can address Land Fragmentation Issue.
● Social Impact – Improved gender relations and decision making of women farmers. Ex: Tribal women in the Pali
district of Rajasthan formed a producer company and they are getting higher prices for custard apples.
Challenges and Issues in Building Robust FPO:
o Unorganised range of activity.
o High cost of institutional credit, large dependence on informal sources for funding.
o Lack of access to modern technology and lack of forwarding linkages
o Inadequate infrastructure and delays in getting clearances.

E-TECHNOLOGY IN THE AID OF FARMERS


Introduction
● The aim of e-Agriculture is to promote the adoption and use of ICTs and digital innovations in agriculture, forestry,
fisheries, natural resource management, and rural developments.
● The e-Technology can be utilised through three basic pillars, i.e. Agri-extension & Information + Services +
Research which results in digitally empowered farmers.
Scope and Significance of Adopting E-Technology in Agriculture
● Remedial Measures for water crisis, desertification, crop pests, diseases and a persistent lack of infrastructure can
be taken with the use of Information Technology.
● Development of Efficient Methods with use of Survey Drones, Fleet of Agribots, Sensor with animals, Smart tractor
etc.
● Effective planning and execution such as keeping track of crops, predicting yields, sowing season, need of the crop
and others. For Example - Water use efficiency of Israel for drip irrigation.
● Adopting innovative technology to gain control of the changing dynamics and leverage market insight without
relying on traders.
● IoT smart farming solutions
● Providing Logistic support: Kisan Sabha App intends to implement the most efficient and convenient logistics
assistance to the farmers.
● Preventing crop failure and providing insurance (e.g. Crop Insurance Mobile App)
● Providing quality seed Information (e.g Seednet Portal)
● Kisan Suvidha and Pusa Krishi Mobile App and Kisan SMS Portal for information related to market prices,
seeds, pesticides, fertilisers, weather and agricultural machinery, etc.

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● E-procurement of Crops: The Haryana government has launched the Meri Fasal-Mera Byora e-procurement
portal. Due to this portal.
● Reduce Farmer Effort and improve decision-making by collecting and analysing granular data and Weather
prediction.
● Improving productivity and Environmental sustainability.

NANOTECHNOLOGY IN AGRICULTURE
The centre has published ‘Guidelines for Evaluation of Nano-based Agri-input and Food Products.'
● Nano-biotechnology has long been a priority for the Indian government, which established a National Nano Mission
in 2007.
● The project looks into how nanotechnology may be used to provide clean drinking water, materials, sensors, and drug
delivery, among other things.
● The Department of Science and Technology (DST) is in charge of carrying out the Nano Mission.
Scope and Significance of Nanotechnology in Agriculture
Nanotechnology can take an important part in the productivity through control of nutrients as well as it can also participate
in the monitoring of water quality and pesticides for sustainable development of agriculture.
● Increased productivity with Nanofertilizers
● Nanoparticles act as fungicide carriers and are used to improve low water solubility, decrease volatilization, and
improve stability.
● Nanobiosensor for pathogen detection and diagnosis.
● Soil and Water Remediation
● Increased Product Shelf-life

ARTIFICIAL INTELLIGENCE (AI) IN AGRICULTURE


● In 2018, the International Crop Research Institute for Semi-Arid Tropics (ICRISAT) received a Microsoft
Artificial Intelligence (AI) for Earth grant to support the continued development of Artificial Intelligence solutions,
focusing on sustainable agriculture in developing parts across the globe.
● In India, this pilot project is implemented in the state of Andhra Pradesh where farmers have always relied on their
guesswork to decide when to plant and a combination of ancient traditions.
● AI in farming can help in increasing crop yield by providing:
o real-time advisory,
o prediction of crop prices, and
o early detection of pest attacks, precision farming, and others.
o For example- CROPTIX to diagnose crop diseases in the field and alert rural farmers in Kenya and PEAT, a
machine vision for diagnosing pests/soil defects.
● Providing Logistic support (e.g. Kisan Sabha App)

ICT INITIATIVES FOR AGRICULTURE SECTOR


● mKisan SMS Portal
● Kisan Call Centres (KCC)
● eSagu for personalised expert advice to small and marginal farmers.
● Earik, the single window to improve the access to agricultural information and technology in north-eastern India.
● aAQUA is a multilingual online problem-solving system that helps farmers get expert answers to their questions.
● Direct benefit transfer (DBT) Central Agri Portal.
● Agmarknet for daily market price and real time information about prices, location of commodities and varieties in
local languages.
● Digital Mandi is an electronic trading platform for agri-commodities.
● e- Choupal is a village kiosk with a computer and internet access that is managed by an expert.
● Akashganga for timely milk collection, proper payment, and higher income for dairy farmers. The system includes
electronic milk weighing, fat testing, software capture of unique ID, and printing of payslips and payment settlement.
● The National Agriculture Market (NAM)

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● The Digital Agriculture Mission (2021-2025)


Case Studies
Microsoft Started a pilot project with Hyderabad-based International Crop Research Institute for Semi-Arid
Tropics (a UN agency) in 2016 to build a sowing app to conveniently provide sowing information
to farmers.
Karnataka SAMRAKSHANE, an e-governance solution to handle crop insurance under Pradhan Mantri Fasal
Bima Yojana (PMFBY) and the Modified Weather Based Crop Insurance Scheme (MWBCIS).
Karnataka The Karnataka state government and the National Commodity and Derivatives Exchange
Government and (NCDEX) started Rashtriya e-Market Services to encourage competition in agricultural markets
NCDEX Spot and help farmers receive better prices for their crops.
Exchange
Plantix Karnataka government launched “Plantix”, an app to detect pests, plant diseases, and nutrient
deficiencies.
Meghdoot App launched by the Government to help farmers by providing forecasts relating to temperature,
humidity, rainfall, wind speed and direction, etc.
Challenges in adopting E-Technology
● Duplication of efforts and yet lack of proper infrastructure.
● Absence of right inputs and advisory along with adoption inertia due to traditional attitude.
● Financial constraints.
● Lack of awareness and education.
● Electricity, Connectivity and Cellular Bandwidth.
● Cyber Security and Government’s map restriction policies.
● Linguistic diversity as a barrier.
Way Forward
● Raising digital literacy and developing more Farmer-centric Mobile Apps and promoting research and innovations
in this regard.
● Outreach and awareness activities with informative content and proper monitoring.
● Developing the concept of smart villages with development of intelligence infrastructure, adoption of sustainable
practices and linkage of rural communities to institutional mechanisms.
● Technology adoption can help the farm product to reach from “local to global” market in an efficient way.
● Would help convert the image of the Indian “Peasant farmer” into an “Entrepreneur farmer”.

DIRECT AND INDIRECT FARM SUBSIDIES

SUBSIDIES: DATA AND FACTS


● Total Subsidy: In 2023-24, the total expenditure on subsidies is estimated to be Rs 4,03,084 crore, a decrease of
28.3% from the revised estimate of 2022-23.
● Food Subsidy: Allocation to food subsidy is estimated at Rs 1,97,350 crore in 2023-24, a 31.3% decrease over the
revised estimate of 2022-23. Food Subsidy includes - Subsidy to FCI, Subsidy to States and Sugar Subsidy.
● Fertiliser Subsidy: In 2023-24, Rs 1,75,103 crore was budgeted for fertiliser subsidies 22% less than the revised
estimates of 2022-23. Fertiliser subsidies for 2022-23 have been significantly increased in response to a sharp
increase in international prices of raw materials because of the Russia- Ukraine war.
● Power Subsidy and Agriculture: The Standing Committee on Water Resources (2022) noted that subsidised
electricity encouraged farmers to grow water-intensive crops in water-scarce areas.

DIRECT FARM SUBSIDIES


● Direct farm subsidies are those subsidies that are directly provided to farmers and are generally paid in the form of
a direct cash subsidy. Examples of direct farm subsidies: PM Kisan Scheme, PAHAL in LPG, Farm Loan
Waivers.

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Challenges of Direct Farm Advantages of Direct Farm Subsidies


Subsidies
● Lack of Financial Inclusion ● Boosting the purchasing power of farmers and giving them a choice to spend.
● Moral hazard o PM Kisan Scheme, the Rythu Bandhu Scheme provides financial
● Identification of assistance to farmers by allowing them the choice to spend as per their
beneficiaries requirements in cultivation.
● Inflation ● Prevents the misuse of public funds.
● Market Access ● Direct subsidies also curb the inefficient use of resources. Ex: Farmers will
purchase fertiliser at full rate and will purchase what is needed.
● The cash farmers receive can be used as capital in agriculture.
● Reduces government burden freeing transportation and storage costs.
● Transparency: It will also curb the corruption and issue of ghost beneficiaries
and will bring in transparency.

INDIRECT FARM SUBSIDIES


● Indirect subsidies are those subsidies in which the cost of the product is set at a lower price than the market price.
● Indirect subsidies are provided in terms of tax breaks, insurance, low-interest loans, depreciation write-offs, rent
rebates.
● India spends roughly 2% of GDP on indirect subsidies.
● Examples: Irrigation subsidy, Power subsidy, Fertilizer subsidy, Credit subsidy, MSP (Minimum Support Price), etc.
Challenges of Indirect Farm Advantages of Indirect Subsidies
Subsidies
● Cereal Centric supports distorted ● Key role in promoting technological and infrastructural advancements,
cropping patterns. ensuring farmers get quality inputs like Seed and Fertilizer.
● Overuse of natural resources ● Change in behaviour and promotion of sustainable practices like crop
and corruption due to diversification.
intermediaries. ● Farmers training and use of technology.
● International pressure to minimise ● Ensures food security in the country.
subsidies and vote bank politics ● Helps to contain the migration from the agriculture sector.
create a peculiar situation.

Subsidies Led Distortions in India


● Most state governments have failed to ensure rational and sustainable use of subsidised water and electricity.
● Subsidised Fertilisers: Use of NPK (nitrogen, phosphorus, and potassium,) is in a ratio of around 8:3:1 while
recommended use is 4:2:1.
● Cultivation of wheat, Rice and sugarcane at cost of pulses, horticulture crops and coarse but nutritious grains.
● Agricultural Finance: Farmers are entitled to pre- harvest loan at 7% interest rate. They are allowed further 3%
subvention in case of timely payment. Farmers can also take loan for post-harvest time against Negotiable Warehouse
Receipt.
● Price Subsidies can distort markets in ways that ultimately hurt the poor: For Instance: Farm loan waiver not
only increases the states' fiscal deficit and interest burden, but also limits their ability to invest in productive capital
in agriculture.
● Food inflation, leakage and Corruption.
Measures to tackle Farm Subsidies Challenges/Way Forward
● Kelkar Committee:
o The committee recommended the phased elimination of subsidies on Diesel, Petrol, Cylinder gas and converting
them to capital investments.
o It also recommended the rationalisation of subsidy on Fertiliser.
● Long term policies on export trade to ensure continuity and keep farmers aligned to exports.
● Financial inclusion and holistic development of Agri-sectors and use of technology should be aimed.
● Subsidies should come with a sunset clause and initiatives like contract farming and cooperative farming should be
promoted to make agriculture remunerative.

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● The farm bills are a right move to empower the farmers and reduce the monopoly of APMC.
● The government should equally focus on both food and nutritional security.
● Subsidies could be linked to the size of the farm-holding.
● NITI Aayog Suggested:
o Efficient fertiliser usage and reorienting fertiliser subsidy policy.
o Subsidies on liquid fertilisers and investment subsidies for micro-irrigation.

MINIMUM SUPPORT PRICE (MSP)


● Introduced in the 1960s to overcome India’s food deficit, MSP is the minimum price that the government
considers remunerative for agricultural production and is hence deserving of support. In event of fall of prices in
notified agricultural commodities, the government provides price support by procuring the farm produce at MSP.
● MSP is considered as one of the most important measures to ensure Food security and alleviate rural poverty,
procure food grains for Public distribution, etc.
Current Status of MSP
● At present, MSP is declared for 23 agricultural commodities by the government on the recommendation of
Commission for Agricultural Costs and Prices (CACP) before cropping season, apart from this Fair and
Remunerative Price for sugarcane is also declared.
● Currently, MSP is declared for 23 agricultural commodities
o 7 cereals (paddy, wheat, maize, bajra, jowar, ragi and barley)
o 5 pulses (chana, arhar/tur, urad, moong and masoor)
o 7 oilseeds (rapeseed-mustard, groundnut, soyabean, sunflower, sesamum, safflower and niger seed)
o 4 commercial crops (cotton, sugarcane, Copra (Milling and Ball) and raw jute).
● Government is not legally bound to pay MSP even if the market rates are below the threshold prices. MSP is run
entirely on executive directions and isn’t guaranteed by law.
M S Swaminathan Committee’s Recommendation on MSP
● Recommended MSP should be at least 50% more than the weighted average cost of production.
● Arrangements for MSP need to be put in place for crops other than paddy and wheat. Also, millets and other
nutritious cereals should be permanently included in the PDS.

IMPORTANCE AND BENEFITS OF MSP REGIME


● Safety net or insurance and higher investments in agriculture and adoption of technology.
● Protection from fluctuation in global markets and food security is achieved.
● Alleviation of Rural poverty prevents rural to urban migration for jobs.
● Ensures remunerative income and helps to make informed decisions.
● Acts as a benchmark for private buyers and counters price volatility of agricultural commodities.
● Improve economic access of food to people (through procurement and distribution).
● Crop Diversification: There are slightly higher increases in the MSP for pulses, oilseeds and coarse cereals which
helps in achieving the motive of diversifying crops.
● Forward Chain: The MSP leads to higher farm profits which encourage farmers to spend more on inputs, technology
etc.
● Atma-nirbhar Bharat: The government has focussed on increase in production per acre to fulfil the objective
of Atma-Nirbhar Bharat. For instance -MSP for lentils (Masur) and mustard increased by 9% (Rs 500 per quintal)
and 8% (Rs 400 per quintal) to encourage farmers to go for more production of pulses.

IMPACT OF MSP ON CROPPING PATTERN


● MSP backed procurement of Wheat and Rice, especially from Punjab and Haryana has promoted rice/wheat
monoculture despite lack of favourable conditions.
● Traditionally, the mainstay of Indian agriculture, millets (especially Jowar and Bajra) saw a decline.
● Heavy FRP (Fair and Remunerative Price) and SAP (State Administered Price) regime is one of the prime reasons for
sugarcane cultivation in UP, Maharashtra and Bihar.

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● Inadequate MSP protection and low procurement has led to shrinkage of area of cultivation in pulses and oilseeds and
resorting to imports in times of scarcity.

Fair and Remunerative Price (FRP)


● It is the minimum price at which sugarcane is to be purchased by sugar mills from farmers. It is fixed by the Cabinet
Committee on Economic Affairs (CCEA)) on the basis of recommendations from the Commission for Agricultural
Costs and Prices (CACP) every year before cropping seasons.
● Average annual production of sugarcane is around 35.5 crore tonnes (As per Economic Survey 2021-22),
which is used to produce around 3 crore tonnes of sugar.
● India has emerged as the world’s largest producer and consumer of sugar as well as the world’s 2nd largest
exporter of sugar.

CHALLENGES ASSOCIATED WITH MSP REGIME


● Distortion of cropping pattern and impacts on Environment
● Still yield per hectare is the lowest among economies with a large agriculture sector.
● Can cause inflation and Detrimental to competition
● Sugar industry: Arbitrary fixation of cane prices by state governments over and above the MSP fixed by the centre
has been adversely affecting the sugar mills and they are not able to pay the dues of farmers.
● Degradation of agricultural ecosystem: Crops which are not aligned with the agro-climatic region lead to depletion
of water table, soil degradation and deterioration in water quality.
o Rice, despite being unsuitable for growth in Punjab and Haryana (semi-arid regions), is widely grown there. This
has led to deterioration of the groundwater table.
o Stubble burning is also a consequence of Rice monoculture.
● Low awareness, accessibility and regional imbalance
● Delay in Payments, debt obligations and market distortion
● Agriculture Exports remain curbed as MSP prices are higher than international markets.
● The Shanta Kumar committee’s report on agriculture estimates that just around 6% of the country’s farmers benefit
from the MSP system.
● Excess Storage: The stock has now become double the requirements under the schemes of PDS, Buffer stock etc.
● Challenges in WTO: India’s MSP scheme for many crops has been challenged by many countries in the WTO. They
have been claimed to be highly trade-distorting by its method of calculation.
o If the current process continues, the country will face international criticism for breaching the 10 per cent norm
for subsidy on farm production set by the WTO.
● Economically Unsustainable: The economic cost of procured rice and wheat is much higher for the FCI than the
market price of the same.
Way Forward
● Recommendations of NITI Aayog:
o Improved facilities at procurement centres, such as drying yards, weighing bridges, toilets, etc.
o More godowns should be set up and maintained properly for better storage and reduction of wastage.
o The Procurement Centres should be in the village itself to avoid transportation costs.
o The MSP scheme requires a complete overhaul in those States where the impact of the scheme is ‘nil’.
● Recommendation of National Farmers Commission
o Improvement in implementation of Minimum Support Price (MSP): MSP arrangements must be made for
crops other than paddy and wheat. Millets and other nutritious cereals should also be included in the PDS
permanently.
o Minimum capping on MSP: MSP should be at least 50% more than the weighted average cost of production.

PRICE DEFICIENCY PAYMENT (PDP) SCHEME BY NITI AAYOG


● The NITI Aayog in its Three-Year Action Agenda suggested a Price Deficiency Payment System.
● Under PDPS, Farmers are compensated for the difference between MSPs (for select crops) and prevailing market
prices via subsidy.
● The subsidy will be paid via Direct Benefit Transfer (DBT) into the farmer’s Aadhar seeded Bank Account.

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● To avail the benefit, the farmer would need to register with the nearest APMC and report the total area sown.
● The extent of the subsidy may be capped by the Centre. NITI Aayog suggests that differences up to 10% may be
compensated.
● As the MSP regime is working well in Rice and Wheat, the PDPS system would apply to crops other than these.

SIMILAR SCHEMES EMPLOYING PRICE DEFICIENCY PAYMENTS:


1. PM AASHA (Pradhan Mantri Annadata Aay Sanrakshan Abhiyan) by Government of India has PDPS as one of
its sub-schemes for MSP-notified oilseeds.
2. Mukhya Mantri Bhavantar Bhugtan Yojana in Madhya Pradesh for pulses and oilseeds. (Now discontinued)
3. Bhavantar Bharpai in Haryana for TOP crops (Tomato, Onion and Potato) and Cauliflower.
Benefits of PDPS
● Significant cost saving and unburdening of the storage infrastructure.
● Ease of payments as the DBT payments can be fast and eliminates intermediaries.
● WTO compliant as the Price Deficiency Schemes are seen as less trade distorting.
● Altering cropping patterns and ensuring regional balance.
Concerns with PDPS
● Dampening of prices by trader cartels to avail benefit of low purchase price. This imposes a heavy cost burden on
the Government as they have to cover the difference.
● Mukhyamantri Bhavantar Bhugtan Yojana In Madhya Pradesh had to be discontinued due to the above reason.
● Fiscal Burden would be immense as it seeks to cover crops for which government procurement is currently low.
ICRIER estimates the cost of this scheme to be close to Rs 2 Lakh Crore annually.
● DBT Payment issues due to non-linking of bank accounts with Aadhar or financial exclusion (not having a bank
account).
Way Forward
● Price Difference covered by the Government must be capped (10% recommended by NITI Aayog) to discourage
cartelisation.
● Reasonable due diligence to ensure Aadhar- Bank account linkage.
● Direct Income Support schemes (e.g. PM KISAN) and Price Insurance Scheme must be considered as a non-trade
distorting alternative to PDPS.
Alternatives to MSP
● Madhya Pradesh had previously experimented with the system by implementing “Bhavantar Bhugtan Yojana”,
and Haryana is currently in the process of implementing it for certain commodities.
● While recent steps in the agriculture sector such as PM KISAN and quasi-rural basic income schemes like
Telengana’s Rythu Bandhu scheme are a good step, MSP reforms are a sine-qua-non for our goal to double
farmer’s income.

COMMITTEE RECOMMENDATIONS

NATIONAL COMMISSION ON FARMERS - SWAMINATHAN COMMITTEE (2004):


● MSP is insurance not remuneration
● Distinguishing between support prices and procurement prices.
● Distribute ceiling-surplus and waste land.
● Prevent diversion of prime agricultural land and forests.
● MSPs must be at least 50% more than the cost of production.
● Insertion of Agriculture in the concurrent list of the constitution.
● Increasing the investments in agriculture-related infrastructure.
● Establishment of soil testing laboratories for detection of micronutrient deficiency.
● Forming a single Indian market which promotes grading, branding and packaging.
● FCI to only deal with food grains from surplus states to be moved to deficient states.
● Negotiable Warehouse Receipt Scheme must be started and scaled where farmers can get 80% advance from banks
against their produce valued at MSP to avoid distress sale at times of low prevailing prices.

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● Shifting focus of MSP on Pulses and Oilseeds and realign trade policy for better synergy.
● Outsource stocking operations to agencies such as Central Warehousing Corporation, State Warehousing
corporations and Private Sector.
● Buffer Stocking Operations and Automatic Liquidation Policy.
● End to End Computerisation of the entire food management system.

RAMESH CHANDRA COMMITTEE ON FOOD AND AGRICULTURE POLICY (2013):


● It was constituted to examine the methodological issues in fixing MSP, it recommended:
o Calculating production cost, the family labour head should be considered as a skilled worker.
o The interest on working capital should be given for the whole season.
o Post-harvest costs, including cleaning, grading, drying, marketing and transportation should be included.
o The cost should be raised to 10% to account for risk premium and managerial charges.

PUBLIC DISTRIBUTION SYSTEM (PDS)


Public distribution system is a government-sponsored chain of fair price shops entrusted with the work of distributing
basic food and non-food commodities to the targeted section of people. The PDS system is managed by the Ministry of
Consumer Affairs, Food and Public Distribution.
Objective of PDS
● Implementation of NFSA.
● To have a moderating influence on the market.
● To attempt socialisation in the matter of
distribution of essential commodities
● Correct the current supply and demand
imbalances for consumer products
● Ensure social justice
● Support poverty-relief programmes
● Meeting demand and supply
● Improvement in the Public Service System
● Nutritional security: PDS has an objective to provide a regular supply of nutritious food to beneficiaries.
PDS Operations
● PDS is operated under the joint responsibility of the Central and the State/UT Governments.
● FCI role : The Central Government, through Food Corporation of India (FCI), has assumed the responsibility for
procurement, storage, transportation and bulk allocation of food grains to the State Governments.
● The operational responsibility : It includes allocation within State, identification of eligible families, issue of Ration
Cards and supervision of the functioning of Fair Price Shops (FPSs) etc., rest with the State Governments.
● Commodities under PDS: Under the PDS, presently the commodities namely wheat, rice, sugar and kerosene are
being allocated to the States/UTs for distribution.
● Exception to commodities of PDS : Some States/UTs also distribute additional items of mass consumption through
the PDS outlets such as pulses, edible oils, iodized salt, spices, etc.
Issues Associated with PDS in India
● Identification of beneficiaries and issues with Aadhar Validation
● Shortfall in storage capacity with FCI against the central pool stock
● Inconsistent quality and Environmental issues
● Dual pricing , Corruption and leakages
● Rising Subsidy and financial burden and concerns regarding the financial feasibility of such a system
Ways to Revamp PDS
● End to End computerisation
● Recognising model state
● Implementing Universal PDS
● Digitalisation, Use of GPS in trucks and Direct Cash Transfers

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● Improving storage capacities


● Vigilance Committee at the State, District, Block and Fair Price Shop (FPS) level.
Public Distribution System (PDS) Vs Targeted Public Distribution System (TPDS)
PDS and TPDS
Difference between PDS and PDS was relaunched as TPDS; both PDS and TPDS have same role, TPDS focuses
TPDS more on people below poverty line (BPL)
TPDS- Operated By TPDS is jointly operated by the Central and State Government.
Role of Central Govt in TPDS Procurement, Allocation, Transportation of food grains to FCI.

Role of State Govt in TPDS Allocation, Distribution of Food grains, Identify beneficiaries, issue ration cards.

TPDS – Beneficiaries Divided into 2 categories – Households Below Poverty Line and Households Above
Poverty Line.

FOOD SECURITY
Introduction
● The Food and Agricultural Organization (FAO) states that food security emerges when all people at all times have
physical and economic access to sufficient, safe and nutritious food to meet their dietary needs and food
preferences for an active and healthy life. Food security has three important and closely related components, which
are :
o Availability of food,
o Access to food,
o Absorption of food.

Need of Food Security in India


● Chronic undernutrition: As per the report of ‘State of Food Security and Nutrition in the World 2022’, the number
of undernourished people in India declined to 224.3 million in 2019–21 from 247.8 million in 2004-06.
● Low Agriculture productivity and Cereal yield.
● The composition of the food basket is shifting away from cereals to high value agricultural commodities like fish,
eggs, milk and meat.
Issues Related to Food Security
● Corruption and replacement food grains
● Bogus ration cards and identification issue
● Nutritional security and Rural-urban bias
● Uneven distribution of food grains production, procurement and distribution
● Skewed production of food grains
● Declining food grains production
Government Measures
National Measures
● Entitlement Feeding Programmes:
o ICDS (All Children under six, Pregnant and lactating mother)
o MDMS (All Primary School children).
● Food Subsidy Programmes:
o Targeted Public Distribution System: 35 kgs/ month of subsidised food grains.
o Annapurna scheme: 10 kgs. of free food grain for the destitute poor.

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o E-marketplace: An electronic national agriculture market (e-NAM) to connect all regulated wholesale produce
markets through a pan-India trading portal.
o National Nutrition Mission: National Nutrition Mission or Poshan Abhiyaan aims to improve the nutritional
health of children, adolescents, lactating mothers and pregnant women.
● Legal entitlement to food: The government passed the Food Security Act in 2013. It entitles 67% of the Indian
population to 5 Kg/month food grains per beneficiary at highly subsidised rates. State Governments have to identify
the households in such a manner that 75% rural + 50% urban population is covered. States can use data from socio-
economic and caste census (SECC).
● SDG Goal 2: End hunger, achieve food security and improved nutrition and promote sustainable agriculture.
● Employment Programmes:
○ National Rural Employment Scheme: 100 days of employment at minimum wages.
○ National Old Age Pension Scheme: Monthly pension to Below Poverty Line (BPL).
○ National Family Benefit Scheme: Compensation in case of death of breadwinner to BPL families.
International Measures
● Zero Hunger Challenge: The United Nations Secretary-General launched the Zero Hunger Challenge in 2012
during the Rio+20 World Conference on Sustainable Development. The Zero Hunger Challenge was launched to
inspire a global movement towards a world free from hunger within a generation.
● Nutrition for Every Child (UNICEF Nutrition Strategy 2020-2030) It aims to support national governments and
partners in upholding children's right to nutrition, and ending malnutrition in all its forms over the next decade.

FOOD SECURITY: NATIONAL FOOD SECURITY ACT (NFSA), 2013


● The basic concept of food security globally is to ensure that all people, at all times, should get access to the basic food
for their active and healthy life and is characterised by availability, access, utilisation and stability of food.
● Objective: The Act provides for food and nutritional security in the human life cycle approach, by ensuring access to
an adequate quantity of quality food at affordable prices for people to live a life with dignity and for matters connected
therewith or incidental thereto.
● Eligibility:
o Priority Households to be covered under TPDS, according to guidelines by the State government.
o Households covered under existing Antodaya Anna Yojana.
Present Status of NFSA, 2013
● The government recently announced that all 81 million beneficiaries covered by the National Food Security Act
(NFSA) will receive free food grains until December 2023.
● Beneficiaries of the Antyoday Anna Yojana (AAY) will receive 35kg of foodgrains for free each month until
December 2023, while others will receive 5kg.
● The government has now discontinued the Pradhan Mantri Garib Kalyan Anna Yojana, which was launched in 2020
during Covid-19 and provided 5 kg of free food grains to every person in addition to the NFSA entitlement of 5 kg of
foodgrains at subsidised rates.
Revising National Food Security Act, 2013: NITI Aayog
● Through a discussion paper in March 2021, NITI Aayog has recommended reducing the rural and urban coverage
under the National Food Security Act (NFSA), 2013, to 60% and 40%, respectively.
● It has also proposed a revision of beneficiaries as per the latest population which is currently being done through
Census 2011.
● If the rural-urban coverage ratio remains the same (67% of all population), then the total number of people covered
will increase from the existing 81.35 crore to 89.52 crore - an increase of 8.17 crore (based on the projected 2020
population). This will result in an additional subsidy requirement of Rs. 14,800 crore.
● If the national coverage ratio is revised downward, the Centre can save up to Rs. 47,229 crore.
● This amount of savings can be utilised by the Government in other important areas of concern such as health and
education.

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Other Recommendations
● High Level Committee under Shanta Kumar had recommended reducing the coverage ratio from 67% of the
population to 40%.
● Economic Survey- 2020-21: had recommended a revision of the Central Issue Prices (CIP) of foodgrains released
from the central pool, which have remained unchanged for the past several years.
● The Central Issue Prices (CIP) is the price at which the government makes available food grains from the central
pool to beneficiaries of the National Food Security Act of 2013 and for beneficiaries of other welfare schemes in
the states from the central pool quota.

BUFFER STOCK
● Definition : Buffer stocks refer to a pool of certain commodities like Rice,
Wheat, etc which are maintained to provide food security and tackle unforeseen
emergencies like drought, famine, wars, etc. In India, the buffer stocks are
maintained by the public sector.
● Stocking of Food Grains : It was first introduced in India in 1969 during the
4th Five year plan period.
● FCI setup : The Food Corporation of India was set up in 1964 under the
Food Corporation Act 1964 to achieve the aims of the Food Policy.
● Objective: Better returns for Farmers and Food Security, Price stability and source of food grains for welfare programs

ECONOMICS OF ANIMAL REARING


● The livestock plays an important role in the economy of farmers.
● The farmers in India maintain a mixed farming system i.e., a combination of crop and livestock where the output of
one enterprise becomes the input of another enterprise thereby realising resource efficiency.
Potential of Animal Rearing Economy in India: 20th Livestock Census
● Livestock contributed 16% of small farm households' income, as well as an average of 14% for all rural households.
● It provides a living for two-thirds of the rural population and employs approximately 8.8% of India's population.
● The livestock sector accounts for 4.11% of GDP and 25.6% of total Agriculture GDP.
● Animal Husbandry is a state subject and as per the 20th Livestock Census, India has World’s highest livestock
owner:
o First in the total buffalo population in the world - 109.85 million buffaloes
o Second largest poultry market in the world
o Second in the population of goats - 148.88 million goats
o Second largest producer of fish and also second largest aquaculture nation in the world
o Third in the population of sheep (74.26 million)
Recently, Basic Animal Husbandry Statistics 2022’ has been released by the Ministry of Fisheries, Animal Husbandry and
Dairy. Major highlights of the reports are as under:
Domain Specific Data
Contribution of Livestock ● Share of Livestock at constant prices in Agriculture Sector - 30.13%
● Share of Livestock at Total GVA - 4.9%
● Total milk production (During 2021-22) - 221.06 million tonnes
● Annual growth rate of Milk Production – 5.29%
● Per Capita Availability of Milk - 444 gram/day (2021-22)
● Major milk producing States - Rajasthan (First Rank -15.05%), Uttar Pradesh
Milk Production (14.93%) and Madhya Pradesh (8.06)
● Today, India is the largest producer of milk in the world, contributing 23% of global
milk production.

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● Total Egg production (During 2021-22) - 129.60 billion nos


● Annual growth rate – 6.19%
Egg Production
● Major Egg producing States - Andhra Pradesh (20.41%), Tamil Nadu (16.08%),
Telangana (12.86%) and West Bengal (8.84%)
● Total meat production (During 2021-22) - 9.29 million tonnes
Meat Production ● Major meat producing States are Maharashtra (12.25%), Uttar Pradesh (12.14%),
West Bengal (11.63%)
Importance of Animal Rearing
● Alternative Income to farmers
● Employment generation: It provides employment to around 8.8% of the Indian population. It also contributes to
India’s GDP. The livestock sector contributes 4.11% to Indian GDP and also 25.6% to agricultural GDP.
● Food and Nutrition: Combats malnutrition and hidden hunger
● Animal waste used as fertiliser.
● Resilience to climate change and Weed control.
● Foreign Earning from production and export of wool, leather, saddlery & harness, etc.
● Biogas production and sustainable agricultural development.
● Women Empowerment at the household level.
● Risk mitigation by providing a sense of security and confidence to landless, small, and marginal farmers.
● Associated with Culture and Tradition: Use of Livestock for Sports and Recreation
Challenges in the Livestock Development
● Yield and productivity challenge.
● Outbreak of Diseases.
● Feed availability and quality.
● Funding Issue and lack of access and use technology
● Market Access and presence of a large informal sector.
● Lack of quality checking and standardisation of animal products.
● Inadequate and poor quality of veterinary infrastructure: Testing and treatment facilities for veterinary diseases
was woefully lacking in India.
● Climate change impacts.
Measures to Promote Livestock Sector
● Ensuring feed and fodder security by enhanced fodder seed production
● Efficient Marketing for promotion of various livestock products like egg, fish, milk etc.
o National Programme for Dairy Development
● Promoting indigenous Breeds
o Rashtriya Gokul Mission
o Gopal Ratna Awards and Kamdhenu Awards
o National Cattle and Buffalo Breeding Project
● Veterinary Services:
o Pashu Sanjivani: An Animal Wellness Programme encompassing provision of Animal Health cards (‘Nakul
Swasthya Patra’) along with UID identification
● Research and development to increase per livestock productivity.
o National Artificial Insemination Programme to prevent the spread of diseases.
● Concessional financing and subsidies.
● India should strictly follow the sanitary and phytosanitary standards as laid down by Codex Alimentarius
Commission which is formed by FAO and WHO.
● A consortium with National Bank for Agriculture and Rural Development (NABARD) and National Centre of
Disease Control (NCDC) to fund the dairy cooperatives.

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o Establishment of Dairy Processing and Infrastructural Development Fund to provide loan assistance to
Eligible End Borrowers (EEBs) such as the State Dairy Federations, District Milk Unions, etc. to modernise the
milk processing plants and machinery and to create additional infrastructure for processing more milk.
● Promoting Cattle Health: The Government of India aimed to achieve 100 per cent vaccination for Foot-and-mouth
disease under the National Animal Disease Control Programme by 2025.
● Encouraging Public - Private Partnership (PPP) for sustainable livestock rearing.
● NITI AAYOG has suggested that:
o Breeding indigenous cattle with exotic breeds to enhance productivity.
o Capacity building for farmers and fish breeders with new technology penetration.
o Promoting and developing Bull mother farms with an objective to produce good quality genetically superior
bulls and also to promote cross-breeding.
● Connecting market of livestock: E-Pashu Haat Portal: aims to connect breeders and farmers regarding availability
of bovine germplasm. The portal has been launched under the scheme "National Mission on Bovine Productivity."
● Leverage Private investment: Animal Husbandry Infrastructure Development Fund (AHIDF) is proposed with
15,000 crores to leverage private investment and ensure availability of capital to the farmers.
● Innovating new and alternative uses of livestock: Gobar-Dhan (Galvanizing Organic Bio-Agro Resource Dhan)
will manage and convert cattle dung and solid waste in farms to compost, biogas, and bio-CNG.

FISHERIES- BLUE REVOLUTION

● India has become the 3rd largest fish producer and the 4th largest exporter of fish and
fisheries products taking Brand India from ‘Local to Global’.
● Around 28 million people are employed in the fisheries sector in India.
● The fish production reached an all-time high of 16.25 MMT during FY 2021-22 with marine
Potential exports touching Rs. 57,586 Crores.
● By 2024–2025, the government has set a target to boost fish production nationwide to 22 million
metric tonnes.
Important ● Meena Kumari Committee: for review of deep-sea fishing policy.
Committee ● Ashok Dalwai Committee: to chart out policy for doubling farmer’s income.
Objectives ● Modernisation, employment generation and promotion of exports.
● Promotion of Inclusive growth and sustainably increasing food production.
● Under usage of both fresh and brackish water resources for aquaculture.
● Shortage of quality and healthy fish seeds.
● Lack of mapping of zones of fishes and poor fishing vehicles.
● Absence of standardisation and branding of fishes.
Challenges ● Non-availability of skilled and trained man force.
● Usage of obsolete technology, depletion of inland natural waters.
● Usage of unsustainable practices like blast fishing.
● Lack of strong value chain which hampers India’s exports.
● Bottom trawling: The Sri Lankan government has passed a legislation for banning trawling.
Trawlers also damage the ecosystem. This has impacted badly to fishers of Tamil Nādu who are
caught frequently by the Sri Lankan navy.
● Promoting community participation by establishing FPO's.
Measures to ● Development of post-harvest infrastructure.
boost the Blue ● Restoration of productivity and conservation of indigenous fishery resources.
revolution ● Promotion of integrated farming system- rice cum fish agriculture on the lines of Kuttanad
below sea level farming.
● Upgradation of fishing vessels and using satellite technology of GAGAN and Gemini to map
fishes rich zones.
● Integrated development and management of the fisheries sector

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● Pradhan Mantri Matsya Sampada Yojana


● National Policy on Marine Fisheries (2020) to develop an ecologically healthy, economically
viable and socially inclusive fisheries sector.
● The National Fisheries Development Board (NFDB) was established in 2006.
Policy ● Establishment of Fisheries and Aquaculture Infrastructure Development Fund
Interventions (FIDF) during 2018-19.
● Extension of Kisan Credit Card (KCC) facilities to fishers and fish farmers to help them in
meeting their working capital needs.
● MGNREGA: For developing the farm ponds, where pisciculture is taking place.

DAIRY SECTOR- WHITE REVOLUTION

● India has the largest bovine population in the world and is the largest producer of
milk in the world, contributing 23% of global milk production.
● Dairy industry employs more than 80 million rural households, with the majority being
small and marginal farmers as well as the landless.
Potential ● As per the National Sample Survey Office’s (NSSO) 70th round survey, 23% of
agricultural households with very small parcels of land (less than 0.01 hectare) reported
livestock as their principal source of income.
● Egalitarian and inclusive.

Case Study/Model ● Operation Flood promoted the AMUL model.


Objectives of white ● To promote cooperative societies to enhance procurement, storage, transportation of
revolution (Operation milk.
Flood) ● Production of a wide variety of milk products and their marketing management.
● Provide superior breeds of cattle, health services, veterinary treatment, and artificial
insemination facilities.
● To connect milk producers with the consumers of more than 700 cities and towns and
throughout the country, a ‘National Milk Grid’ was formed.
The achievements of ● Alternative occupation to rural masses.
operation flood/white ● Became leading producer in milk.
revolution: ● Quality of livestock improved and promoted indigenous livestock.
● Small and Marginal farmers along with landless labourers benefitted.
● Inadequate market facilities and informal nature of the sector.
Challenges ● Unhygienic conditions and incidence of diseases.
● Climate change led to an increase in temperature affecting productivity.
● Poor coverage of livestock insurance.
● Infrastructural deficiencies such as cold chain facilities leading to milk losses.
Measures towards ● Geotagging of animals helps us to keep track of health-related issues of a particular
New White animal.
Revolution/ ● Strengthening the Dairy Development Extension Program and creating a network of
Operation Flood 2.0 strong value chains.
● Using technology like Artificial Intelligence and Machine learning to run simulations on
how to increase the productivity of the animals.
● Value-added products.
● National Livestock Mission for development of livestock and adequate availability of
Policy quality feed and fodder.
Interventions ● Gobar-Dhan (Galvanizing Organic Bio-Agro Resource Dhan)
● Rashtriya Gokul Mission to develop indigenous breeds in a scientific manner.
● Dairy Entrepreneurship Development Scheme under NABARD for generating self-
employment opportunities in the dairy sector.

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PRAHAAR ReDEFINED 3.0: ECONOMY

● Doubling of milk processing capacity to 108 million MT from the present 53.5 million
MT by 2025.
Initiatives taken in the Budget 2023-24 for the Dairy Sector
o Increase in Credit target: Credit target for agriculture and allied sector has been
increased to 20 lakh crore with focus on animal husbandry, dairy and fisheries.
o Allocation of funds for Cooperatives: Rs 900 crore has been allocated for the
Ministry of cooperatives for the development of cooperatives and to enhance limits
for loans.
Role of Cooperatives ● The small dairy farmers were able to avoid middlemen.
in Operation Flood ● Guaranteed minimum procurement price for milk.
● Enhanced knowledge and bargaining power of small and marginal farmers.
Achievement of ● There are more than 1,90,000 dairy cooperative societies across the country.
Women dairy Approximately 6 million of their members are women members.
farmers ● The National Dairy Development Board (NDDB) has been proactive in establishing
women-led producer enterprises such as Shreeja Mahila Milk Producer Company.

MODEL AGRICULTURE PRODUCE AND LIVESTOCK MARKETING (PROMOTION AND


FACILITATION) ACT, 2017
Centre unveiled the Model Agricultural Produce and Livestock Marketing (Promotion and Facilitating) Act (APLM), 2017
to replace the Agriculture Produce Markets Committee Act, 2003. It has following provisions:
● Unified Market Area: Whole state/UT can be declared as a single unified market area by the State/UT government.
● Market Committee: Market Committee to manage market yards in a specified area, and will be responsible for
regulating the auction of agri-produce and livestock and provide facilities for marketing of agri-produce and livestock.
o The Committee may also link consumers with farmers through digital technology and manage these market yards
through PPPs.
● Market yard of National Importance (MNI): A state may declare any market yard as a MNI based on parameters
such as its total throughput, number of consumers served, and infrastructure with a separate Market Committee to
manage the MNI.
● E-Trading: A state may set up an electronic trading platform, which shall provide infrastructure and services for
trading in agricultural produce. A person may obtain a license to establish and run an e-trading platform.
● Integration: e-trading platforms can be integrated with private market yards and sub yards with interoperability under
a unified National Agricultural Market.
● Cap on market fees: The act proposes a cap on levy of market fees at 2% (of sale price) for fruits and vegetables and
1% for food grains.
● Single point levy of market fee: The Market Committee shall levy market fee on agricultural produce from a buyer
only once, whether brought from outside or within the state/UT.

GREEN REVOLUTION
● It refers to the development of HYV seeds during the decade of 1960's which led to the phenomenal rise in the
output of food crops in India, particularly of rice and wheat in order to alleviate hunger and poverty.
Components of Green Revolution (GR)
● The HYV Seeds
● Irrigation and need of Chemical Fertilisers
● Use of Insecticide and Pesticide
● Consolidation of Holding and Land Reforms
● Agriculture Credit
● Rural Electrification and Farm Mechanisation
● Agriculture Universities

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PRAHAAR ReDEFINED 3.0: ECONOMY

Positive Impact of GR Negative Impact of GR


● Rural Employment and Increase in Agricultural ● Non-Food Grains (commercial crops like cotton, jute,
Production tea and sugarcane) left out.
● Capitalistic Farming and Affluence of Farmers ● Excessive usage of chemicals
● Reduction in import of food-grains ● Extinction of Indigenous Varieties of Crops
● Ploughing back of profit and Industrial Growth ● Impacts on Soil and Crop Production
● Mechanisation of Agriculture ● Mechanisation under the Green Revolution created
● Change in the Attitude of Farmers widespread unemployment.
● Green Revolution India from ‘begging bowl’ to ● Water Consumption
leading producer of food-grains. ● Regional inequalities
● Inequalities between large- and small-scale farmers.

Second Green Revolution for Sustainable Livelihoods


It is needed on account of the following reasons:
● Growing population: According to the United Nations Population Fund's "State of the World Population Report
2023," India's population with 1,428.6 million people, is predicted to surpass China by the middle of 2023.
● Dependency on agriculture: As per Annual Reports of Department of Agriculture, released in 2021, 65% of the
country's population lived in the rural areas and 47% of the population was dependent on agriculture for livelihood.
● Ecological cost: The Green Revolution has made us self-sufficient in food grains, but the environmental consequences
and ecological costs are offsetting the progress made.
● Depletion and pollution of groundwater: The lakes and ponds are becoming life less due to eutrophication – a
direct consequence of the Green Revolution.
● Stagnant growth: Growth in the agricultural sector has been almost stagnant.
● Global warming: It is said to engulf productive coastal lands due to rise in sea levels. This creates an urgent need to
raise agricultural productivity.
Bringing Green Revolution in Eastern India (BGREI)
● Objective: BGREI is about bringing similar benefits to eastern India that largely remained untouched by the wonder
that converted the north-west into a ‘grain bowl’.
● BGREI is the flagship programme under Rashtriya Krishi Vikas Yojana (RKVY).
● Focus: Bringing the second Green Revolution in the eastern region, which has rich water resources. Assam, Bihar,
Chhattisgarh, Jharkhand, Odisha, West Bengal and eastern Uttar Pradesh (Purvanchal) are the seven states.
Evergreen Revolution
● It was invented by Dr. M. S. Swaminathan to address the shortcomings and gaps in the Green Revolution. It
focuses on producing more with less, such as less land, less pesticide, and less water, and to achieve sustainable
agriculture.

Key Terms
Fragmented Land Holdings, Rural Distress, Doubling Farmers Income, Minimum Support Price to Minimum Reserve
Price, Digital Land Record Modernisation, Farmer Producer Organization, Precision Agriculture, Integrated Farming,
Resource Efficiency, Fertigation, Zero Budget Natural Farming, Water Budgeting, Paradox of Plenty, Vocal for Local,
Geographical Indication, e-Agriculture, Bottom trawling, Local to Global, Food Security, Buffer Stock.

PYQs Year
1. What are the major challenges of the Public Distribution System (PDS) in India? How can it be made 2022
effective and transparent?
2. What are the main bottlenecks in the upstream and downstream process of marketing of agricultural 2022
products in India?
3. What is an Integrated Farming System? How is it helpful to small and marginal farmers in India? 2022
4. How and to what extent would micro-irrigation help in solving India's water crisis? 2021

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PRAHAAR ReDEFINED 3.0: ECONOMY

5. What are the salient features of the National Food Security Act, 2013? How has the Food Security Bill 2021
helped in eliminating hunger and malnutrition in India?
6. What are the present challenges before crop diversification? How do emerging technologies provide an 2021
opportunity for crop diversification?
7. What are the main constraints in transport and marketing of agricultural produce in India? 2020
8. What are the salient features of the Jal Shakti Abhiyan launched by the Government of India for water 2020
conservation and water security?
9. What are the major factors responsible for making the rice-wheat system a success? In spite of this 2020
success, how has this system become bane in India?
10. What are the reformative steps taken by the Government to make the food grain distribution system more 2019
effective?
11. What are the reasons for poor acceptance of cost-effective small processing units? How will the food 2017
processing unit be helpful to uplift the socio-economic status of poor farmers?
12. How can the ‘Digital India’ programme help farmers to improve farm productivity and income? What 2015
steps has the Government taken in this regard?
13. In what way could replacement of price subsidy with Direct Benefit Transfer (DBT) change the scenario 2015
of subsidies in India? Discuss
14. The Food Security Bill is expected to eliminate hunger and malnutrition in India. Critically discuss 2013
various apprehensions in its effective implementation along with the concerns it has generated in WTO

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