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Agricultural R&D neglected in the Budget |
Why in News- The Department of Agricultural Research and Education (DARE) received Rs 99.4 billion for FY25, a marginal increase of only 0.7 percent from Rs 98.8 billion in FY24. This makes it seem that agricultural R&D has been neglected in the Budget.
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UPSC Syllabus: Prelims: Current Events of National and International Importance Mains: GS-II, III: Government Policies and Interventions, Economy |
Agricultural growth declines despite economic growth
Current Investment Levels: The Department of Agricultural Research and Education (DARE) received Rs 99.4 billion for FY25, a marginal increase of only 0.7 percent from Rs 98.8 billion in FY24.
Agricultural R&D expenditure reached Rs 160 billion in 2020-21, with 89 percent coming from the public sector and 11 percent from the private sector.
Challenges in Research and Development (R&D) Investment
Inadequate Funding: Despite high returns on investment in agricultural research and development (R&D), funding remains inadequate, limiting advances in technology and innovation.
Impact on Productivity: Lack of research and development (R&D) investment hinders the development of high-yielding and climate-resilient crop varieties, thereby affecting overall agricultural productivity.
Agricultural Research Intensity (ARI)
Agricultural Research Intensity (ARI) is the ratio of research and development (R&D) expenditure to the agricultural sector’s GDP.
It reflects the level of investment in agricultural research relative to the sector’s economic output.
Significance: A higher ARI indicates a greater emphasis on research and development, which is critical for enhancing productivity, sustainability, and resilience in agriculture.
Current ARI Level: ARI peaked at 0.75 per cent in 2008-09
ARI in 2022-23 is 0.43 percent and is expected to decline further in FY25 due to lower allocations in real terms.
Impact: A decline in ARI poses risks to food security and efforts to curb food inflation.
Marginal Returns of Agriculture- Research & Development (R&D)
High Returns: Investing in agriculture- R&D (R&D) yields a marginal return of more than 10 times.
An additional investment of Rs 1,000 crore can yield Rs 10,000 crore in agriculture-GDP.
Current Investment Level: Despite high potential returns, the current budget allocation for research & development (R&D) does not assure significant improvement in agricultural growth.
Agriculture in India
Agriculture is the backbone of the Indian economy, providing employment, food security, and raw materials for various industries. It plays a vital role in the socio-economic fabric of the country.
Economic Contribution
Contribution to GDP
• Agriculture contributes around 16-17% to India’s Gross Domestic Product (GDP). This significant share underlines the role of this sector in the overall economic scenario of the country.
• According to the Economic Survey 2023-24, the contribution of the agriculture sector to GDP in FY 2023 was around 16.5%.
Employment Generation
• Agriculture is the primary source of livelihood for about 58% of India’s population, covering the largest portion of the working population.
• According to the National Sample Survey Office (NSSO), about 45.8% of the workforce was employed in agriculture in 2022-23.
Food Security
Self-Reliance
• Agriculture ensures food security by providing a steady supply of food grains and other essential commodities, thereby meeting the dietary needs of the population.
• India is one of the world’s largest producers of rice, wheat, pulses and dairy products.
Public Distribution System (PDS)
• The PDS ensures that food grains are distributed to the poor at subsidized rates, thereby increasing food access and reducing hunger.
• The PM-Garib Kalyan Yojana provided free rations to over 800 million people during the COVID-19 pandemic.
Rural Development
Infrastructure Development
• Agricultural development leads to a boost in rural infrastructure, including roads, storage facilities, and irrigation systems, which are critical for overall rural development.
• Significant investments have been made under schemes such as the Pradhan Mantri Gram Sadak Yojana (PMGSY) to improve rural connectivity.
Poverty Alleviation
• Programmes such as PM-KISAN provide direct income support to farmers, helping to reduce rural poverty and improve living standards.
• PM-KISAN provides Rs 6,000 per year to small and marginal farmers, benefiting about 11 crore farmers.
Industrial development
• Agriculture supplies raw materials to various agro-based industries, including textile, sugar, jute, and food processing industries.
• The textile industry, which is heavily dependent on cotton, employs millions of people and contributes significantly to exports.
Employment in allied sectors
• The growth of the agro-processing sector provides additional employment opportunities and adds value to agricultural produce.
• The food processing sector has attracted significant foreign direct investment (FDI), increasing its capacity and efficiency.
Environmental sustainability
Sustainable practices
• Promoting natural and organic farming practices contributes to environmental sustainability by reducing the use of chemical inputs.
• The government plans to provide 1 crore farmers with sustainable farming in the next two years The government is planning to introduce natural farming practices to the farmers.
Climate Resilience
• Development of climate-resilient crop varieties through agricultural research helps mitigate the adverse effects of climate change.
• The Indian Council of Agricultural Research (ICAR) has been at the forefront of developing such resilient varieties.
Challenges and Opportunities in Indian Agriculture
Declining Growth Rate
• Growth in the agriculture sector declined from 4.7 percent in FY23 to 1.4 percent in FY24, indicating a slowdown in the sector’s contribution to the overall economy.
Resource Depletion
• Intensive agriculture practices have led to considerable soil degradation, leading to reduced fertility and crop yields.
• Overexploitation of groundwater for irrigation has led to a decline in groundwater levels, posing a serious threat to sustainable agriculture.
Climate Change
• Climate change has led to unpredictable weather patterns, including droughts and floods, which have adversely affected crop production.
• Climate change has also led to an increase in pest and disease outbreaks, further impacting agricultural productivity.
Economic Issues
• Many farmers face low income levels due to poor market linkages and inadequate pricing mechanisms.
• High levels of indebtedness and dependence on informal credit sources have led to financial instability among farmers.
Lack of Infrastructure
• Lack of proper storage facilities leads to significant post-harvest losses.
• Poor rural infrastructure and transport networks hinder the efficient movement of agricultural produce to markets.
Importance of Research and Development in Agriculture
High Marginal Returns
• Investing in agricultural research and development yields high marginal returns.
• For example, an additional investment of Rs 1,000 crore can generate Rs 10,000 crore in terms of agriculture-GDP.
• R&D efforts lead to the development of high-yielding and climate-resilient crop varieties, thereby increasing overall productivity.
Innovation and Technology Adoption
• R&D helps in the adoption of modern agricultural techniques such as precision agriculture, which optimizes input use and enhances efficiency.
• The development of sustainable agricultural practices through R&D can mitigate the adverse effects of climate change and resource scarcity.
Food Security
• Enhanced R&D investment ensures a stable supply of food, helping to control food inflation and ensure food security for the population.
• Research can lead to the development of nutrition-rich crop varieties, address dietary deficiencies, and improve public health.
Importance of Digital Public Infrastructure (DPI) in Agriculture
Data-Driven Decision Making
Increased Productivity: DPI enables farmers to access real-time data on weather, soil health, and market prices, helping them make informed decisions that increase productivity.
Precision Agriculture: Facilitates the adoption of precision agriculture techniques, optimizes input use, and reduces environmental impact.
Market Access and Transparency
Improved Market Linkages: DPI provides farmers with better access to markets and transparent pricing, ensuring fair returns for their produce.
Supply Chain Efficiency: Improves supply chain management, reducing post-harvest losses and ensuring timely delivery of agricultural products.
Financial Inclusion
Access to Credit: DPI can facilitate easy access to credit and insurance products for farmers, helping them manage financial risks and invest in better agricultural practices.
Direct Benefit Transfer: Ensures efficient and transparent delivery of subsidies and welfare payments directly into farmers’ bank accounts, thereby reducing leakages.
Knowledge Dissemination
Extension Services: DPI can enhance agricultural extension services by providing farmers access to expert advice, training programs, and best practices through digital platforms.
Community Engagement: Encourages community engagement and knowledge sharing among farmers, promoting collaborative problem-solving and innovation.
Government Initiatives to Boost Agriculture
Digital Public Infrastructure (DPI)
Comprehensive Coverage: The implementation of DPI in agriculture aims to cover farmers and their lands across the country within three years, thereby increasing access to information and resources.
Namo Drone Didi Yojana
Empowering Women: The allocation of Rs 500 crore for providing drones to 15,000 selected women self-help groups aims to empower women and improve agricultural practices.
Natural Farming Initiative
Sustainable Practices: The government plans to engage 1 crore farmers in natural farming, supported by certification and branding, thereby promoting sustainable agriculture.
High-Yielding Crop Varieties
Crop Development: 109 high-yielding and climate-resilient varieties of 32 field and horticultural crops will be released to enhance agricultural productivity.
PM-Garib Kalyan Yojana
PM-Garib Kalyan Yojana is a comprehensive welfare scheme launched by the Government of India to provide financial and food security to the poor and vulnerable sections of society.
Free ration distribution: The scheme provides free ration to over 800 million people, helping to reduce food insecurity.
Financial support: Adequate financial support has been extended to farmers through initiatives such as PM-KISAN, which provides direct income support.
Budget allocation: In FY25, the food subsidy budget under the scheme is Rs 2.05 trillion, down from Rs 2.12 trillion in FY24, with the main benefit going to consumers rather than farmers.