CL-irma GK

111
1. Macro-economics ........................................................................................................ 3
1.1. Tenth plan ............................................................................................................. 4
1.2. Eleventh plan ........................................................................................................ 6
1.3. Vision 2020 .......................................................................................................... 7
2. Land............................................................................................................................. 9
2.1. Soil type................................................................................................................ 9
2.2. Waste land .......................................................................................................... 10
3. Agriculture ................................................................................................................ 11
3.1. Food grains ......................................................................................................... 13
3.2. Commercial crops............................................................................................... 14
3.3. Cropping season ................................................................................................. 15
3.4. Agriculture exports ............................................................................................. 15
3.5. Irrigation ............................................................................................................. 16
3.6. Revolutions......................................................................................................... 17
A brief description of the major revolutions: ................................................................ 18
3.7. Agriculture: At A Glance ................................................................................... 18
3.8. India and world: comparison in agriculture........................................................ 20
4. Agri Business ............................................................................................................ 21
4.1. Fertilizer and pesticides ...................................................................................... 21
4.2. Food processing.................................................................................................. 24
4.3. Agriculture machinery........................................................................................ 25
4.4. Agriculture markets ............................................................................................ 27
4.6. Agriculture finance ............................................................................................. 28
5. Forest......................................................................................................................... 30
6. Agriculture Allied Activities..................................................................................... 31
6.1. Horticulture......................................................................................................... 31
6.2. Poultry ................................................................................................................ 31
6.3. Dairy ................................................................................................................... 32
6.4. Sericulture........................................................................................................... 32
6.5. Fish ..................................................................................................................... 33
6.6. Animal Husbandry.............................................................................................. 33
7. Land reforms ............................................................................................................. 35
8. NGOs......................................................................................................................... 37
9. Development schemes and indicators ....................................................................... 41
9.1. HDI index............................................................................................................... 42
9.2. IRDP....................................................................................................................... 43
9.3. Self Employment programs.................................................................................... 43
9.4. Wage Employment programs................................................................................. 44
9.5. Education................................................................................................................ 44
9.6. Health ..................................................................................................................... 46
10. Micro finance ......................................................................................................... 47
11. Cooperatives........................................................................................................... 48
12. Retail revolution and farmer .................................................................................. 50
13. ITC e-Choupal........................................................................................................ 52
14. WTO and Indian agriculture .................................................................................. 56
15. Important Institutions ............................................................................................. 58
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1. Macro-economics
India is the second fastest growing major economy in the world, with a GDP growth rate
of 9.4% for the fiscal year 2006–2007. The average for last three years is close to 9%.
Beating Japan, the economy of India is expected to be the third largest in the world as
estimated by purchasing power parity by the end of this fiscal year. When measured in
Dollar terms, India is the twelfth largest in the world. Currently its GDP has more than
US $1.0 trillion. But per capita income of the country is low at $3,800 at PPP and $735
at nominal1 due to country’s huge population. In the World Bank classified India as a
low-income economy in 2006, but India will probably move into the lower middle-
income country classification of per capita income by 2008. Indian foreign exchange
reserves are increasing at rapid rate. During August, 2007, it was $230 billion. With the
recent surge in inflows, no wonder by the time you will read this document it would be
more than $250 billion.
Following graph compares the growth rate of major economies2.
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Page | 3
The PPP picture is brighter. Following graph tells that it’s not far when we will catch up
china and America3.
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1.1. Tenth plan
During tenth plan (2002-07) period India has seen the growth like never before. The table
below is showing the sectoral growth rates and ICOR under Different Sectors of the
economy
3
*Estimates by IMF: World economic outlook , September 2006
Page | 4
Tenth Five year Plan in a nutshell (2002-07)
Macro-economics parameters of the tenth plan are given below. The most noticeable is
the increase in the savings and investment rate. If an economy wants to grow with the
rate of 9% or more its investments rate must be more than 35%. Investment comes from
savings so higher savings rate is prerequisite of higher growth. Can you guess which
country has highest savings rate. Obviously China!
Page | 5
Parameter 10th plan Post Plan
Domestic Savings Rate (% 26.8% 33%
of GDPmp)
Current Account Deficit (% 1.6% 3.1%
of GDPmp)
Investment Rate(% of 28% 36%
GDPmp)
GDP Growth Rate (% per 7.9% 9.4%
annum)
Export Growth Rate(% per 12% NA
annum)
Gujarat, Karnataka and Delhi were grown fastest with the growth rate in state GDP was
more than 10%. Bihar and Kerala were among the slowest with growth rate in state GDP
was 6.5%. Insurgency hit north eastern (NE) states were worst performers with growth
rate hovering at the lower 5%.
1.2. Eleventh plan
Eleventh plan (2007-11) is under the finalization process. Most of the policies and targets
are already finalize and reports on it are available on the planning commission website.
Targets growth rate for agriculture sector4 is 4 %.

Growth rate for agriculture sector achieved during 10th plan: 1.8%
Parameter Target for 11th plan

GDP growth rate 9%
Domestic Savings Rate (% 33%
of GDPmp)
Current Account Deficit (% 2.8%
of GDPmp)
Investment Rate(% of 35%
GDPmp)
4
Montek Singh Ahluwalia, planning commission,
http://planningcommission.nic.in/plans/planrel/53rdndc/dchndc53.pdf
Page | 6
In the table below, the projections for sectoral growth and Import-Export growth rates are
given.
1.3. Vision 2020

Inspired with president Kalam, country has prepared a vision for 2020. Committee
headed by K C Pant has prepared the vision document in 2002. Few high lights are given
below.
Vision 2020 at
glance5
5
Report of the committee on vision 2020 planning commission,
http://planningcommission.nic.in/plans/planrel/pl_vsn2020.pdf
Page | 7
Page | 8
2. Land
Following tables shows some facts about the Indian land. India which is 7th largest
country has 2nd largest cultivable land and largest irrigated land in the world.
Parameter Indian value World Rank

Total Area 329 million hectares 7th
Land Area 297 million hectares 7th
Percentage of World Area 2.42 per cent 7th
Forest Area6 63 million hectares (19.4 %
of the total area)
Areable land 162 million hectare (43% of 2nd (USA 1st)
Total)
Irrigated Area 55 million hectares (40% of 1st
total Arable land)
Rain irrigated Area 60%
Cereals production 231 in year 2001 3rd behind China, USA
2.1. Soil type
India- Land – Soils
Soil States Useful in production of

Alluvial soils cover about Found in Indo-Gangetic These soils are considered
24% of the total land. Plains (Punjab, Haryana, very good for the
UP), in the valleys of production of wheat, rice
Narmada and Tapti in other cereals, pulses, oil
Madhya Pradesh and the seeds, potato, sugarcane,
Cauvery in Tamil Nadu. etc.
Black soils Found in the States of These are also considered
Maharashtra, Gujarat, good for cultivation of
Madhya Pradesh, cotton, cereals, pulses, oil
Karnataka, Andhra Pradesh, seeds, citrus fruits,
Tamil Nadu, Uttar Pradesh vegetables, etc.
and Rajasthan.
6
Source: Data as of year 1999, planning commission website. The data on forest cover varies as different
agencies have different definition of what constitute a forest
Page | 9
Red soils Found in Tamil Nadu, These are most suited for
Karnataka, Kerala, rice, ragi (millet), tobacco
Maharashtra, Andhra and vegetable cultivation.
Pradesh, Madhya Pradesh,
Bihar and West Bengal.
2.2. Waste land
Wasteland is a degraded land which does not fulfill their life sustaining potential.
Wasteland can result from inherent / imposed disabilities such as by location,
environment, chemical and physical properties of the soil or financial or management
constraints.
Wastelands statistics indicate that about 63.85 million hectares, which account for
20.17% of the total geographical area (328.72 million hectares) exist as wastelands in
India7.
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Page | 10
3. Agriculture
The Indian Agricultural sector provides employment to about 65% of the labour force,
accounts for 18.5% of GDP in 2005, contributes 20-21% of total exports, 14.7% of the
total export earnings, and raw materials to several industries.
Area, Production and Yield of Food grains Along with Percentage Coverage under
Irrigation in India
Year Area Production Yield (Kg./Hectare) % Coverage

(Million (Million Tonne) under
Hectare) Irrigation
1950-51 97.32 50.82 522 18.1

1990-91 127.84 176.39 1380 35.1
2000-01 121.05 196.81 1626 43.4
2006-07* 124.07 211.78 1707 NA
Growth in Agriculture
Annual average Growth Rate (Percent)
Five Year Plan and Years Growth rate of agriculture Overall GDP Growth Rate
and allied sectors
Eight five year Plan 4.7 6.7
Ninth five year Plan 2.1 5.5
2003-04 10 8.5
2004-05 .07 6.9
2005-06 2.3 7.5-8
Growth Rates
Growth rates 2004-05 2005-06
GDP 7.5% 8.2%
Agriculture .7% 2.3%
Industrial Sector 8.6% 9.0%
Service sector 9.9% 9.8%
Page | 11
Food Crops
Crop Area
Rice West Bengal, U.P., Andhra Pradesh
and Haryana.
Wheat Punjab, Haryana and U.P and
Madhya Pradesh
Millets Tamil Nadu, Maharashtra, Gujarat,
Madhya Pradesh, U.P. and Haryana.
Barley U.P., Punjab and Haryana.
Maize Bihar, U.P., Punjab, Rajasthan,
Maharashtra and Gujarat.
Pulses Punjab, Rajasthan, Maharashtra,
Bengal and Gujarat
Sugarcane U.P., Bihar, Maharashtra.
Non-Food crops or Cash crops
Tea Assam, West Bengal, Kerala.

Coffee Karnataka, Kerala and tamil nadu.
Oilseeds Orissa, U.P., Maharashtra, Gujarat, Andhra
Pradesh.
Tobacco U.P., bihar, Tamil Nadu, Karnartaka and
Gujarat.
Cotton Maharashtra, Gujarat, Andhra Pradesh and
tamil Nadu
Jut West Bengal, Assam, Bihar and Orissa
Rubber Tamil Nadu, Karnataka and Kerala
Silk Karnataka, West Bengal, Assam and
Kashmir.
Page | 12
3.1. Food grains8
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Food grains Production in Millions tones
Following table shows the Crop-wise Production of Food Grains in Kharif/Rabi9
Crop-wise Production of Food Grains in Kharif/Rabi

Season in India
(2004-2005 and 2005-2006)
(Million Tonnes)
Crop 2004-05 2005
-06
Kharif Rab Tot Khar Rabi Tot
i al if al
Rice 79.04 14.4 93.5 75.45 12.35 87.
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Wheat - 79.5 79.5 - 75.53 75.
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Maize 12.66 2.42 15.0 12.54 2.85 15.
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Page | 13
Pulses 6.1 9.2 15.3 - - -
Total Coarse
Cereals 28.69 7.83 36.
52
Total Pulses 5.78 9.37 15.
15
Total 113.8 111. 225. 109.9 105.0 215
foodgrains 3 1 2 8
Cotton* 15 - 150 165 - 165
Jute ** 106 - 106 101.2 - 101
.2
Sugarcane Continued in Kharif - 270 - - 237
(Cane) and Rabi 0 .5
Note : * : Cotton lakh bales of 170 kg each

** : Jute and Mesta lakh bales of 180 kg. each.
3.2. Commercial crops
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3.3. Cropping season
The Indian crops can be divided into three groups in which two are major namely Kharif
& Rabi-
Kharif crop- The Kharif season is during the southwest monsoon (July-October). During
this season, agricultural activities take place both in rain-fed areas and irrigated areas.
Kharif crop includes Rice (Paddy), Jowar, Bajra, Maize, Cotton, Sugarcane, Seasamum,
Soyabean, and Groundnut.
Rabi crops- The Rabi season is during the winter months, when agricultural activities
take place only in the irrigated areas. This crop is sown in October last and harvested in
March/April every year. These crops include Wheat, Jowar, Barley, Gram, Tur,
Rapeseed, and Mustard.
Zayad Crop- In some parts of the country a crop is sown during March to June every
year. Zayad crops include Melon, watermelon, Vegetables, Cucumber, Moong, Urad etc.
Kharif and Rabi season comparison: Comparison of major food grains and total
production of rice and wheat. The comparison can also be seen in the table shown in the
sections of food grains and commercial crops.
Grains 2004-05
in million tonnes
Rice 87.8
Wheat 73.03
Rabi (all food grains) 103.4

Kharif (all food grains) 102.9
Total (all food grains) 206.3
3.4. Agriculture exports
The Agri-export and EXIM policy 2004-09 emphasized the importance of agricultural
exports and announced the following measures to boost the agri-ecports:
Page | 15
• A new scheme called the Vishesh Krishi Upaj Yojana ( Special Agricultural
Produce Scheme ) for promoting the export of fruits, vegetables, flowers minor
forest produce, and their value added products have been introduced.
• Funds shall be earmarked under ASIDE ( Assistance to states for Infrastructure
Development of Export) for the development nof Agri-Export zones.
• Capital goods imported under EPCG shall be permitted to be installed anywhere
in the APZ.
Following tables shows the agriculture exports from india and its comparison with the
total exports of the country. The figures of the year 1991 are given to highlight the fact
that what is the impact of LPG (liberalization, privatization and globalization) on the
agri-exports from the country.10
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3.5. Irrigation
India is a monsoon dependent country for its water resources. Irrigation sector has been
fundamental to India’s economic development and poverty alleviation since 25% of
India’s Gross Domestic Product (GDP) and 65% of employment is based on agriculture.
During the post independence period, the country has invested a huge amount of capital
in the major and the medium irrigation projects. Among the states, three have already
achieved 70% or more of the ultimate irrigation potential with Tamilnadu recording
100% achievement, followed by Punjab and Rajasthan at 84% and 74% respectively. Six
states, i.e., Haryana, Karnataka, Jammu & Kashmir, and West Bengal are in the range of
63% to 71%, whereas in U.P. and Maharashtra, the achievement would be 56% each. The
states of Bihar, Gujarat, Orissa, M.P. and Assam have achieved less than 50% of the
ultimate potential. The ultimate potential under major & medium irrigation in the eastern
states (except West Bengal), i.e. Bihar, U.P., M.P. and Orissa put together works out to
10
Source: Ministry of Agriculture, Govt. of India.
Page | 16
bout 50% of the total ultimate potential of the country. Irrigation potential which stood at
22.6 mha in 1950-1951, has now reached about 100 mha, and as a result food production
has increased from 50 m tonnes (1951) to about 208 m tonnes (2005). The projections for
future population and food requirement of the country indicate that the population of
India may stabilize around 1.6 to 1.7 billion by 2050 AD and that would require about
450 m tons of food grain annually at the required level of food consumption. Area wise it
is necessary to provide irrigation to at least 130 mha for food crops alone and in an area
of 160 mha for all crops to be able to meet the demands of the country in 2050 AD and
ensure food security.
Following table give the data about the shown and irrigated land in the country. It also
depicts the trend in the increase of net shown area and irrigated area.
Sown and Irrigated Area in India
(Million Hectare)
Net Net Gross

Sown Gross Area Sown more Irrigated Irrigated Area Irrigated more
Year Area Sown Area than once * Area Area than once **
1950-
51 118.75 131.89 13.14 20.85 22.56 1.71
1991-
92 141.63 182.24 40.61 49.87 65.68 15.81
2003-
04* 140.88 190.64 49.76 55.1 76.82 21.71
3.6. Revolutions
Revolutions in Indian Economy
Revolutions Area Key Person

Green Agriculture Dr. Norman Borlaug and
Dr. M.S.Swaminathan.
Yellow Oil Seeds Sam Pitroda
White Milk Varghese Kurien
Page | 17
Blue Fish -
Pink Shrimp -
Brown Masaaley -
Grey Wool & Poultry -
Black Crude Oil -
A brief description of the major revolutions:

Operation Flood (white Revolution) has helped dairy farmers direct their own
development, placing control of the resources they create in their own hands. A National
Milk Grid links milk producers throughout India with consumers in over 700 towns and
cities, reducing seasonal and regional price variations while ensuring that the producer
gets a major share of the price consumers pay.
The bedrock of Operation Flood has been village milk producers' cooperatives, which
procure milk and provide inputs and services, making modern management and
technology available to members. Operation Flood's objectives included :
* Increase milk production ("a flood of milk")

* Augment rural incomes
* Fair prices for consumers
The Green Revolution is a term used to describe the worldwide transformation of

agriculture that led to significant increases in agricultural production between the 1940s
and 1960s. This transformation occurred as the result of programs of agricultural
research, extension, and infrastructural development, instigated and largely funded by the
Rockefeller Foundation, along with the Ford Foundation and other major agencies.[1]
The Green Revolution in agriculture helped food production to keep pace with worldwide
population growth. It has had major social and ecological impacts.
The Office of Special Studies in Mexico became an informal international research
institution in 1959, and in 1963 it formally became CIMMYT (The International Maize
and Wheat Improvement Center).
The second nation to which the Green Revolution spread was India. The Ford Foundation
had a presence in the nation, and their social scientists had decided that the technological
development of agriculture was important to the future of India . At the same time
C.Subramaniam, the former Indian Minister. The Foundation and Indian government
collaborated to import a huge amount of wheat seed from CIMMYT
3.7. Agriculture: At A Glance
¾ Agriculture growth rate target for Tenth Plan (2002-2007) is 4%,but achived was
merely 1.8%. target for 11th plan is again 4%.
Page | 18
¾ Agriculture sector provides employment to 58.4% of country’s workforce and is
the single largest private sector occupation.
¾ India holds first position in the world in the production of sugarcane and sugar,
Brazil closely follow us and many times its production is more than ours. Brazil is
also largest producer of Ethanol.
¾ Cashew nuts assume an important place in the Indian Economy. India produces
45% of the global production of cashew. India is the largest producer, processor,
consumer & exporter of cashew in the world.
¾ India contributes about 13% to the world vegetable production and occupies first
rank in the production of Cauliflower, second in onion and third in cabbage in the
world.
¾ India’s share in the world production of mango is about 54%.
¾ India occupies the first rank in banana production of 1.16 Million tones.
¾ Animal husbandry output constitutes about 30% of the country’s agriculture
output.
¾ U.P. is the highest wheat producing state, Punjab and Haryana hold 2nd & 3rd
positions respectively.
¾ Rice is the main food crop in India. The highest rice producing State is West
Bengal, U.P & Punjab are 2nd & 3rd respectively.
¾ The highest pulses & Soyabean producing state is Madhya Pradesh.
¾ The highest cereals producing state is Maharashtra.
¾ India is the largest producer & consumer of tea in the world and accounts for
around 27% of world production and 13% of world trade.
¾ Karnataka, which is the largest producer of coffee in the country, accounts for
56.5% of total coffee production in India. India ranks sixth in the world coffee
production.
¾ Kerela is the main rubber producing state, which produces 90% of the rubber in
the country and accounts for over 85% of the area under cultivation.
¾ India is the largest Milk producing country in the world.
¾ India is the third highest tobacco producing country in the world.
¾ India ranked first in production of vegetable in the world. Besides India is the
second largest producer of fruits in the world.
¾ The Horticulture sector contributed 28% of GDP in agriculture.
¾ Crop Rotation- The practice of growing more than one crop simultaneously in a
single field in a single season gives additional harvest. Thus, this practice
increases the over all yield and ensures maximum use of the soil and nutrients. If
there is danger of loss to any crop due to adverse weather conditions or diseases,
there are some better chances for the other crop in the field if the system of
Page | 19
multiple cropping is adopted. The two and three years rotation is also adopted in
the country and is as follows:
First Year Second Year Third Year

Bajra & Pea Green manuring & Wheat -
Jowar & Arhar Cotton& Peas -
Kharif Sugar-cane Green manuring Cotton
Rabi Sugar-cane Wheat Preparation for Sugar-cane
Sugar cane is generally sown in three years rotation. The areas, near the help of organic
manures and fertilizer. In such areas three to four crops in a year are taken such as maize,
early potato, late potato and pumpkin. In these areas the fertility of the fields is
maintained by adding manure with the soil.
3.8. India and world: comparison in agriculture
Leading production countries and India’s rank in the world11
Crop Leader India’s Rank

Paddy China 2nd
Wheat China 2nd
Maize USA 7th
Sugarcane Brazil 2nd
Tobacco China 2nd
Milk India 1st
Fruits and vegetable China 2nd
Live stock India 1st
India is leading producer of Banana and Mango also.
11
FAO estimates
Page | 20
4. Agri Business
Definition12: Agribusiness is sum total of all the opereations involved in a) manufacturing

and distribution of farm supplies, b) production activities on the farm, c) and the storage
processing and distribution of the farm commodities and the items made from them.
Agribusiness Brief: As per recent studies the turnover of the total food market is
approximately Rs.250000 crores (US $ 69.4 billion) out of which value-added food
products comprise Rs.80000 crores (US $ 22.2 billion). The Government of India has
also approved proposals for joint ventures, foreign collaborations, industrial licenses and
100% export oriented units envisaging an investment of Rs.19100 crores (US $ 4.80
billion) out of which foreign investment is over Rs. 9100 crores (US $ 18.2 Billion). The
agricultural food industry also assumes significance owing to India's sizable agrarian
economy, which accounts for over 35% of GDP13 and employs around 65 per cent of the
population. Both in terms of foreign investment and number of joint- ventures / foreign
collaborations, the consumer food segment has the top priority.
The other attractive features of the Indian agro industry that have the capacity to lure
foreigners with promising benefits are the deep sea fishing, aqua culture, milk and milk
products, meat and poultry segments14.
4.1. Fertilizer and pesticides

A fertilizer is a Organic or inorganic plant foods, which may be either liquid or
granular, used to amend the soil in order to improve the quality or quantity of plant
growth
Our farm needs 18 different elements to survive but most of them are already provided to
the farm from the soil and natural surroundings. However, three primary elements-
Nitrogen (N), Phosphorus (P), and Potassium(K) need to be added to farm in the form of
fertilizer to increase productivity in total. The idea ratio of N: P: K fertilizer is 4:2:1.
• India is the 3rd largest producer and consumer after “China” and “States” with 17.7
million tonnes of installed capacity.
• Annual consumption increased from 70,000 mt in 1951-52 to 203.4 lakh mt in 05-06.
• Per hectare consumption increased from less than 1 kg in 1951-52 to 106 kg in 05-06.
• Achieved self sufficiency in “Nitrogenous” fertilizers production, adequacy in
“Phosphates” but for “Potash” depended on imports.
12
Davis and Goldberg, Harvard Business School
13
Only agriculture and allied activities account for 18.3 % in 2006. But agriculture and related agro
industry which inculedes food processing, warehousing and export accounts for close to 35% of the GDP.
14
Source: http://www.agriculture-industry-india.com/agro-industry-overview/
Page | 21
• Punjab tops with 184 kg per hectare and Orissa at bottom with 41.4 kg per hectare
consumption.
• Still we are behind even from country like “Pakistan” and “Bangladesh”.
Fertilizer Use: Large and medium farmers use fertilizer mostly, small farmers use less.
• The landholding above 5 acres or 2-5 acres farmer use it more almost 70% of total
consumption.
• The use of fertilizer is varying from state to state.
• Punjab is highest user of fertilizer less then one percent farmers do not use it
regularly.
• At National level 30 % farmers do not use it regularly
Distribution: Availability of fertilizer is the most important in its sell, Nutrients

determine the purchasing decision.
• Brands have got lesser important in fertilizer market
• Fertilizers are distributed through three main channels institutional channel, company
outlets and private dealers.
• Share of private dealers is 65 % of total fertilizer distribution
Types of Fertilizers & their composition
Nitrogenous Fertilizers
Urea 46%N
Ammoniam Sulphate (As) 21%N
Ammoniam Chloride (ACl) 26%N
Calcium Ammoniam Nitrate (CAN) 25%N
Phosphatic & Potassic Fertilisers
Single Super Phosphate (SSP) 16% P2O5

Muriate of Potash (MOP) 60%K2O
Sulphate of Potash (SOP) 48%K2O
Di-ammonium Phosphate (DAP) 18% N– 46%P2O5
Rock Phosphate (RP) 16 - 20% P2O5
Page | 22
Bio-fertilizers are environment friendly (free of inorganic chemicals) and cheaper source
of plant nutrients. Decision about setting up of National Bio-fertilizer Development Cost
(NBDC) and six regional bio-fertilizers centers is taken in ninth five year plan.
Government Policy: It has been highly Government regulated production and marketing
sector.
• It has been regulated under Essential Commodities Act.
• After August 1992, except Urea all P and K fertilizers were decontrolled.
• New Fertilizer Policy came in April 2003, now manufacturers of Urea can
market up to 50% of production.
Installed manufacturing capacity and share is given in the next table
Capacity Capacity Percent Present

share share
Sector N P N P
Public sector 34.98 4.33 29.0 7.65
Cooperatives 31.69 17.13 26.27 30.27

sector
Private sector 53.94 35.13 44.73 62.08
Total 120.61 56.59 100 100
Joint Ventures: due to the high cost of raw materials Indian fertilizer producers are eyes
the countries where natural gas, a main raw material and fuel, is cheap. It has created a
need for countries to create joint ventures outside India, especially in Middle East and
North Africa. Following is the list of such ventures.
Joint Ventures Abroad Under Implementation
1. IFFCO and Southern Petroche. 1. JV in UAE

Ind. Ltd. 2. JV in Egypt
2. JV in Jordan 3. JV in Tunisia
3. JV with Morocco
4. JV with Oman
Page | 23
4.2. Food processing
India is the world's second largest producer of food next to China, and has the potential of
being the biggest with the food and agricultural sector. The total food production in India
is likely to double in the next ten years and there is an opportunity for large investments
in food and food processing.
India's food processing sector covers fruit and vegetables; meat and poultry; milk and
milk products, alcoholic beverages, fisheries, plantation, grain processing and other
consumer product groups like confectionery, chocolates and cocoa products, Soya-based
products, mineral water, high protein foods etc.
A strong and dynamic food processing sector plays a significant role in diversification of
agricultural activities, improving value addition opportunities and creating surplus for
export of agro-food products. This would, however, require policies and plans for
improvement of food processing infrastructure including up gradation of technology &
enforcement of quality standards, promoting investment in food processing, activating
domestic market with focus on exports.
The food processing was thought to be one of the most promosing sector to attract FDI.
It was one of the earliest sector to be privatized. The figures for FDI during the last few
years are given below.
Inflow of Foreign Direct Investment (FDI) in Food Processing
Industries (FPI) Sector in India15
(1999-2000 to 2006-2007)
(Rs. in Crore)
Year FDI Inflow Received in FPI Sector
1999-00 444.06
2000-01 198.13
2001-02 1036.12
2002-03 176.53
2003-04 510.85
2004-05 174.08
2005-06 182.94
2006-07 (Apr-Dec.) 222
15
Source : Ministry of Food Processing Industries, Govt. of India
Page | 24
The export of the processed food items are given in the next table.
Items 1996-97 2001- 2002-03
02 (Targets)
Processed Fruits and Vegetables 473.77 1100.6 1400
Animal Products 803.59 1500.9 1750
Other Processed Food (Guar Gum, 1835.92 1780.1 1600
Ground nut, Alcohol, Beverages,
milled Products, etc.)
Rice 3172.35 3173 3750
Walnuts 78.93 117.98 100
Marine Products 4121.36 5957.1 6000
Total 10485.92 13630 14600
4.3. Agriculture machinery
Mechanization refers to injection of machinery between man and materials handled by

them. There is scope of mechanization in every aspect of production agriculture, post
harvest and agro processing.
It is not a surprise that Indian rural transport and tractor industry is one of the largest in
the world. In the year 2006, with the sale of 3.52 lakh tractors India is already the largest
market by volume and second largest by value. Today industry comprises of 14 players,
including 3 MNCs. The opportunities still are huge considering the low farm
mechanization levels in the country, when compared to other developed economies
across the world. After a downturn during last 3-4 years, the industry is back on a growth
path, which we believe would sustain in coming years as well. Key concern for the
industry is its dependence on agricultural income in hands of farmers and the state of
monsoon. The overcapacity, increasingly good quality and lower price provides a good
export opportunity
UP, Punjab, MP, Bihar, AP, Rajasthan and Maharashtra are the biggest market for the
tractors. State wise sales figures are provided in the annexure. It clearly shows that north
and central India has the highest number of tractor sales.
Page | 25
Various market segments for tractors and dominant players the respective segments
Segments Horse Market Suitability Dominant Player(s)

Power Share
(HP) (%)
Small 21-30 23-25 Tractors suited for soft soil Eicher, M&M
Tractors conditions and preferred in
well irrigated northern states.
Medium 31-40 53-56 Used in southern and western M&M, Farmtrac
Tractors region due to hard soil
conditions.
Large 41-50 17 Rich farmers with larger land M&M, Farmtrac
Tractors holdings, especially in Punjab
and Haryana.
Large >50 Hp 04-Jun Used in Turnkey project sites John Deere, HMT
Tractors such as building sites for
canals, dams and civil
construction projects.
Export potential on Indian farm equipment is immense. With overcapacity in country,

good quality, lower price India is poised to become a big exporter of farm equipment.
One prime example is Mahindra. Mahindra has already emerged as the fourth-largest
tractor brand in the US, with a 5% share of the 15-90 horse power (HP) segment, that is
also known as the hobby or consumer segment. Following tables shows the production
and sales of tractors and power tillers.
Production and Sale of Tractors and Power Tillers in

India16
(1990-91 to 2006-2007)
Year Production (No.) Sale (No.)
Tractors Power Tractors Power
Tillers Tillers
1990-91 139233 6228 139831 6316
2005-06 - - 292908 22303
2006-07 - - 263146* 13375*
(Upto 31
Dec., 06)
16
Source : Ministry of Agriculture, Govt. of India.
Page | 26
4.4. Agriculture markets
Agricultural Marketing is a process which starts with a decision to produce a saleable

farm product and involves all aspects of market structure or system, both functional and
institutional, based on technical and economic consideration. Agricultural marketing is a
State subject.
One of the main problems that have been encountered by the Indian farmers is that of
marketing their agricultural produce at the right place and time and for the right
compensation. The middlemen, who buy their produce at low rates, exploit the poor and
uneducated farmers.
An efficient system of marketing needs to be evolved so that the agricultural productivity
can be improved. The following measures can be considered for improving the
agricultural marketing mechanism in India:
• Establishment of regulated markets.

• Provision of storage and warehousing facilities.
• Introduction of Co-operative marketing structure.
Agricultural Price Policy- In an agrarian economy like India, the prices of agricultural
commodities have a major influence on the overall price structure. Sudden and unwarned
fluctuations in the prices of the agricultural products lead to a corresponding destabilizing
effect on the prices of other commodities as well. A decline in the agricultural prices will
result in a great fall in the income of the farmers.
After the Agricultural Price Commission was set up in 1965, the sector witnessed a more
stable and meaningful price and distribution policy. The main thrust areas of the
Agricultural Price Policy were:
• Announcement of minimum support prices of major food grains.

• Fixation of procurement prices for purchasing a part of the marketable surplus at
below market prices.
• Running a Public Distriburtion System(PDS) for the benefit of the low income
consumers.
• Building up of buffer stocks to meet the emergency situations and to safeguard
against the price fluctuations.
Price stability is of utmost importance for agriculture. In order to stabilize the agricultural
prices, the government adopts three measures:
1. Minimum Support Price
2. Buffer stock
3. Import of the commodity
Page | 27
Agricultural markets: The agricultural markets in India can be broadly classified into
the following categories:
1. Wholesale markets.
2. Retail markets.
3. Daily and weekly mandis in the rural areas.
4. Annual and occassional fairs and Haat.
Today India has 7000-plus APMC (agriculture produce and marketing committee) mandi
for farm commodities. Mandi works through a series of middleman or commission agents
which have a vice like grip on the trade of every farm commodity. From an example from
Delhi mandi, 60-75% of the paid by the customers is cornered by these middlemen. It
means that farmer gets only 25-40% of the retail price. Hundreds of crore collected in
mandi taxes rarely be reinvested in the distribution infrastructure back.
Agricultural taxation: Agricultural tax is being collected as a federal tax, but it is being
levied only on income from plantations. All other agricultural income is fully exempt
from tax. Agricultural property was subject to stamp duties and registration fees. All
property transactions have to be made on official, stamped forms, and registration fees
have to be paid to register transactions.
Country’s main terminal market is set up in Chandigarh and 6 other are in pipe line. Safal
market created by NDDB at the outskirts of the Bangalore is state of the art facility.
Terminal markets provide all facilities like grading and sorting, electronic accounting,
quality testing labs, cold storage and important banking facilities.
4.6. Agriculture finance

Agricultural production in this country depends upon millions of small farmers. It is the
intensity of their effort and the efficiency of their technique that will help in raising yields
per acre. Because of inadequate financial resources and absence of timely credit facilities
at reasonable rates, many of the farmers, even though otherwise willing, are unable to go
in for improved seeds and manures or to introduce better methods or techniques. Works
of minor irrigation like wells owned by the cultivators either get into disuse or are not
fully utilized for want of capital.
Types of Financing: Finance required for production can be divided broadly into : (a)
short-term (for periods up to 15 months) ; (&) medium-term (from 15 months up to 5
years) and (c) long-term (above 5 years). Short-term loans are required for purchasing
seeds, manures and fertilizers or for meeting labour charges, etc. These are expected to be
repaid after the harvest. Medium-term loans are granted for purposes such as sinking of
wells, purchase of bullocks, pumping plants and other improved implements, etc. Loans
repayable over a longer period (i.e. above 5 years) are classified as long-term loans.
Page | 28
These are utilised for payment of old debts, purchase of the heavier machines, making
permanent improvements and increasing the size of the holding17.
Primary sources of agricultural credit are:

The following agencies provide finance to the cultivators :—
1. Private agencies:
(a) Money lenders and landlords ;
(b) Commercial banks.
2. Public or semi-public agencies:
(a) The State
(b) Co-operative societies
(c) Regional Rural banks
Co-operatives: Commercial and regional rural banks are institutional lenders whereas
moneylenders which operate in the villages and talukas are non-institutional lenders.
Moneylenders have exploited the farmers and small landowners. With increased
institutional intervention in the rural finance sector, this exploitation has reduced
considerably and the farmers are no longer at the mercy of the whimsical moneylenders
for the satisfaction of their financial requirements.
NABARD: NABARD, which is considered to be the leading institution in the

agricultural sector, was set up on July1, 1982. Since its inception, NABARD has taken
over the functions of the Agricultural finance department of RBI and the Agricultural
Refinance and Development Corporation (ARDC). NABARD is responsible for the
development, planning, operational matters, coordination, monitoring, research, training
and consultancy in relation to rural credit.
NABARD maintains two funds, viz National Rural Credit (Long term operations) and the
National Rural Credit (Stabilization) Fund. Both the Central and the State governments
contribute to these funds. It operates throughout the country through its 16 regional
offices and 3 Sub-offices.
Crop Insurance Scheme: the United Front government on an experimental basis in

selected districts during the Rabi 1997-98 season introduced The Crop Insurance scheme.
The limit of insurance cover was fixed at Rs. 10000 irrespective of the losses incurred by
them. Under the new scheme, the farmers will themselves deal with the insurance
provider directly and the government will not provide any subsidiary directly to the
farmers. Both premium and claims were shared between the central and the state
governments in the ratio of 4:1.
17
Planning commission of India: http://planningcommission.nic.in/plans/planrel/fiveyr/1st/1planch16.html
Page | 29
National Agricultural Insurance Scheme (NAIS): The National Agricultural Insurance
Scheme (NAIS) was introduced in the country from the1999-2000 Rabi season, replacing
the Comprehensive Crop Insurance Scheme (CCIS), which was in operation in the
country since1985. The General Insurance Corporation (GIC) on behalf of the Ministry
of Agriculture implements this scheme.
The main objective of the scheme is to protect the farmers against losses suffered by
them due to crop failure on account of natural calamities, such as, drought, flood,
hailstorm, cyclone, fire, pest/diseases etc.
5. Forest
The overall forest cover in India is around 19.3% in the year 1999. The estimate is done
by the planning commission of India. One would find different figure from different
sources precisely because different agencies have different definition of what constitute a
forest. The latest assessment on forest cover (FSI 1999) indicates that 11.48 per cent of
the total geographical area is dense forest (over 40 per cent crown density) and 7.76 per
cent is the open forest (10-40per cent crown density).
Dense forest 37.73 m ha 11.48%
Open forest 25.51 m ha 7.76 %
Mangroves 0.49 m ha 0.15%
Page | 30
6. Agriculture Allied Activities
Following are the major agriculture allied activities.

6.1. Horticulture
Horticulture refers to the practice of growing and cultivating garden plants. Horticulture
involves working in the field of plan, crop production, plant breeding and genetic
engineering, plant biochemistry, plant physiology, and the storage, processing, and
transportation of fruits, berries, nuts, vegetables, flowers, trees, shrubs, and turf. It helps
in the improvement of crop yield, quality, nutritional value, and resistance to insects,
diseases, and environmental stresses.
Horticulture has 5 primary areas of study. These are:

• Floriculture: production and marketing of floral crops
• Landscape Horticulture: production, marketing and maintenance of landscape
plants
• Olericulture: production and marketing of vegetables
• Pomology: production and marketing of fruits
• Post harvest Physiology: maintenance of quality and preventing spoilage of
horticulture crops.
6.2. Poultry
Poultry is one of the fastest growing segments of the agricultural sector in India today.
While the production of agricultural crops has been rising at a rate of 1.5 to 2 percent per
annum, that of eggs and broilers has been rising at a rate of 8 to 10 percent per annum. As
a result, India is now the world's fifth largest egg producer and the eighteenth largest
producer of broilers. Country produced 46 billion eggs in 2005-06.
Production of Egg, Broiler & Poultry, Meat in India18

(2002)
Egg Broiler Poultry, Meat
Year (Million) (Million) (Thousand Tons)

2002 35000 800 975
18
Source : Annual Report 2002-03, Ministry of Food Processing Industries
Page | 31
6.3. Dairy
Milk and Dairy Products in India
Production/Per Capita Availability of Milk in India
Year Milk Production Per Capita Availability

(Million Tonne) (gm./day)
1950-51 17 124
1991-92 55.7 178
2001-02 84.4 225
2006-07** 100 245
Procurement of Milk by Co-operative Sector in India during the year 2005-06 was
214 lakh Kg. which is close to 20% of total mil produced in the country.
To know more about the operation flood please refer to the information given in the
section of revolutions in India. The details about the cattle are given in animal husbandry
section.
Recent important news about the ban in the export of SMP and other milk product to cool
the domestic prices must be kept in mind. Negotiations are on and ban may be lift by the
end of Oct, 2007.
6.4. Sericulture
It is the rearing of silkworms for the production of raw silk. Although there are several
commercial species olf silkworms, Bombyx mori is the most widely used and intensively
studied. According to Chinese records, the discovery of silk production from B. mori
occurred about 2,700 B.C. Today, China and Japan are the two main producers, together
manufacturing more than 50% of the world production each year. The high cost of
production in Japan presents bug opportunity for Indian silk. Indian silk is yet to achieve
the reputation of high quality silk.
Page | 32
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6.5. Fish
Fish Production of Marine and Inland in India: Country produced 28 lakh tonnes marine
and 37.5 lakh tonnes inland fishes (total 65.7 lakh tonnes) in 2005-06
Pisciculture: It involves raising fish commercially in tanks or enclosures, usually for

food. A facility that releases juvenile fish into the wild for recreational fishing or to
supplement a species' natural numbers is generally referred to as a fish hatchery. Fish
species raised by fish farms include salmon, catfish, tilapia, cod and others.
Fish Production of Marine and Inland in

India20
(1991-1992 to 2005-2006)
(in lakh Tones)
Year Marine Inland Total
1991-92 24.47 17.1 41.57
2005-06 28.16 37.55 65.71
6.6. Animal Husbandry
Animal Husbandry: Animal husbandry is the agricultural practice of breeding and raising
livestock. Animal husbandry constitutes about 30% of the total agricultural output of the
country.
India has the largest livestock population of the world. It accounts for 60% of the world’s
buffalo population and 15% of the cattle population. India has 27 indigenous breeds of
cattle and 7 breeds of buffaloes. As a result of these efforts, India has become the largest
19
6RXUFH0LQLVWU\RI7H[WLOH*RYWRI,QGLD
20
Page | 33
producer of milk in the world. Following table gives the details of Indian livestock as per
the animal census conducted in 2003.
Results of Livestock Census in India21
-2003
(Number in ' 000)
Category Rural Urban Total
Total cattle 175651 9530 185181
Total buffaloes 91930 5993 97922
Total yaks 60 4 65
Total Bovine 267888 15557.4 283446
Total Sheep 57992 3478 61469
Total Goats 117479 6878 124358
Total horses & ponies 680 71 751
Total camels 618 14 632
Total Livestock1 456768 28233.5 485002
Total Poultry 449139 39873 489012
You know: Rural India buys

--------------------
46% of soft drinks sold
49% of motor cycles
59% of cigarettes
18 million TV sets are in rural India
Of 2 million BSNL mobile connections,
50 % are in small towns/villages
11% of rural women use lipstick
Source: MART
21
Page | 34
7. Land reforms
Historical perspective-
Under the British rule, there were three types of land tenure systems in India.
i. Zamindari- This system was introduced by Lord Cornwallis in Bengal in 1973.

Under this system, there used to be number of intermediaries between the
Zamindars and the actual tillers of the soil. The system took were various forms
such as Zamindari, Jagirdari, Inamdari, etc. In many cases revenue collectors
were raised to the status of landowners. In this system, tillers of the soil were
exploited by way of exorbitant rents. There were no incentives for them to
improve the land or to use better cultivation practices. There were many other
social evils of the system. It is said that the British introduced Zamindari system
to achieve two objectives. First, it helped in regular collection of land revenue
from a few persons i.e. Zamindars. Secondly, it created a class of people who
would remain loyal to the British ruler in the country.
ii. Mahalwari: under this system, the village communities held the village lands
jointly, the members of which were jointly and severally responsible for the
payment of land revenue. Land revenue was fixed for the whole village and the
village headman (Lumberdar) collected it for which he received ‘Panchatra’ i.e. 5
per cent as commission.
iii. Rayatwari: Sir Thomas Munro first in Madras state and then in Bombay State
introduced it. In this system, there was a direct relationship between Government
and the tenant or Rayat i.e. individual landholder. Every registered holder was
recognized as its proprietor and he could sell or transfer the land. He was assured
of permanent tenure as long as he paid the land revenue. The landholder was also
allowed to sublet his land. It was a better system as compared to Zamindari or
Mahalwari and similar other forms of tenure.
Of these three systems, the Zamindari system was the most widely prevalent and had
an influence on the other two systems also. There was no proper revenue record under
the British rule and the situation was like that even at the time of independence.
Page | 35
Agricultural legislation:
During the post independence period, the agricultural legislation was of four types:
1. Abolition of intermediaries: The intermediary system included various types of

interests between the owner and the cultivator. These intermediary interests
lacked enthusiasm in the development of agriculture through sustained
investment. This resulted in the stagnation of agriculture. Due to this reason, the
state formulated legislation for the abolition of such tenures by 1955. The
implementation of these measures has been completed all over India.
2. Tenancy reforms: The major part of the tenurial system in India was Rayatwari,
with no intermediary between the state and the actual holder. However, in this
system also some tenancy prevailed and the lands were leased out to the actual
cultivators. This situation also called for legislation for the protection of the
interests of the tenants. These measures were:
• Security of tenure. Eviction of the tenant cannot take place

• Fixation of rent, which was one fifth to one sixth of the gross produce.
• Right to purchase land
3. Ceiling on land holdings: The redistribution of agricultural land in rural areas was
accepted as a measure for securing social justice. To enable surplus land to be
distributed, legislative measures were passed in almost all the states to restrict the
size of agricultural holdings. It was decided that on the completion of
implementation of this legislation, the surplus land would be distributed among
the landless farmers.
4. Bhoodan and Gramdan Act: The Bhoodan movement started in early 1950s and
spread all over the country. The purpose of the act was to collect donations of
land for the distribution among the landless. In all 18 lakh hectares of land were
collected under this act in various states.
Page | 36
8. NGOs22
India has Long tradition of voluntarism and people with some beliefs and notions have
started their own initiative to contribute to the society and thus formed Non –Government
Organizations. Presently we see the growing influence of NGOs in development. They
are recognized by the State and global agencies of the role of Civil Society.
Definition of an NGO is difficult due to diverse and changing forms and purposes not a
very well structured. It is an organization in civil society which is purposeful and role
bound. It works for public cause with altruism and voluntary basis. For example,
Philanthropic Organizations and Public Trusts and Societies.
Now there is a need to dwell further into the cause of these NGOs. The three Actors
(Sectors) of Development:
State: This is mandated by Social Contract (Constitution) and social welfare and
benevolency are the driving force. The state works through Govt. and bureaucracy for
development initiatives.
Market: The market consists of Corporates / Business entities who contribute financially
and with their influence. They work on demand driven basis for profit they are likely to
earn.
Civil Society:
The civil society consist of individuals, households, communities, organisations (formal
and informal), social movements who work on the principles of altruism, reciprocation
& voluntarism. Civil Society is called Third /Voluntary sector for the same reason. The
role of Civil Society for development emerges in the context of failure of State and
market for development.
Goals / Objectives of an NGO
Their objective is to take care of poor and destitute and attain sustainable and equitable
development. The NGOs mobilize people and create awareness. The poor feel
empowered when they get choices and an NGO helps in the same strengthen the civil
society. The NGOs like MYRADA, Bangalore influence developmental agenda and
approach (locally and globally).
To achieve the desired goals an NGO does the following activities:
• Relief/ Rehabilitation
• Provide Services (Education, health etc)
• Livelihood development(IGP,Training, etc)
• Mobilise and organise poor
• Build people’s institutions
22
Source: NGO expert Shikha Thaman, IRMAN
Page | 37
• Create Awareness/ Public advocacy
• Build models of development for replication
• Support other NGOs thru training/networkin
What exactly makes an NGO or sail through opposition and fund scarcity? The answer
lies in the strength of an NGO which is dedicated to the cause of development. The
people of this organization exhibit high levels of commitment / motivation towards their
mission. Moreover an NGO has flexible /informal methods which give the members full
freedom to work in the way they are comfortable and also the way they are convinced to
achieve the goal. The organization encourages Innovative ideas and is also cost efficient.
They have the ability to reachout to poor & needy and hence are very effective. They
promote participatory approach which makes the beneficiaries experience ownership for
the programme being carried out. They also address the problem of state and market
failure for the poor due to which they are always in demand.
NGO’s in World
Name of Establishment Important Area of Operations

NGO year Persons
CRY Child Established in Shefali & 5 < Z R U N V
W R Z D U G V
Rights and the US in Sunderlal U H V W R U L Q J E D V L F
You 2002. (President) U L J K W V W R
America Srivatsan X Q G H U S U L Y L O H J H G
F K L O G U H Q
(formerly Rajan H V S H F L D O O \
Child Relief (Honorary , Q G L D Q
and You) Director &
Treasurer)
The Founded in Key Its mission is to protect human life and health
International 1863 in persons
Red Cross Geneva, Henry
and Red Switzerland. Dunant
Crescent and Henry
Movement Davison
Action aid Established in To alleviate poverty and improve quality of life.
1972
Amnesty Established in Protection of human rights.
International 1961,
headquarter-
Page | 38
london.
CARE Established in Aiming to relieve human suffering, to provide
International 1946, economic opportunity, and and to build sustained
headqurter capacity for self-help.
Brussel,
Belgium.
NGO’s In India
Name of NGO Establishment year Important Persons Area of Operations

Cancer Patients 1969, Founder Chairman, Cancer
Aid Association Mr. Y.K. Sapru,
(CPAA) Siloo Jasdanwalla
Self Employed SEWA is a trade Founders- Ela Poor women’s growth.
women association union registered in Bhatt, Arvind Buch
(SEWA) 1972
Child Aid July 1st, 1993. The founder and Children's aid and care.
Foundation (CAF) director Dr. A.
Goswami (adopted
Indian name)
VARHAD Founded in the Founder-Mr. Development of Women
year 2001 in Ravindra Bhaurao & Child Prisoners
Amravati, Vaidya.
Maharashtra
(India).
Prayas Founded in Founders-Tarun A non-profit organization
September 1999. Talwar and in USA to promote and
Sandeep Tandon support educational and
developmental efforts in
India.
Page | 39
HelpAge India Formed in 1978 Founder- Mr. Cecil Organization working for
Jackson Cole, Elder Care in India
founder member of
Help the Aged in
United Kingdom
Centre for Formed in 1980 Chairpersons-Dr. Nutrition, health,
Health Education, Sharada Jain, education and
Training and Director Dr.Dileep development of society.
Nutrition Mavlankar
Awareness
(CHETNA)
Deepalaya Started in July 16, - This org’n is for
1979. Economically and socially
deprived, the physically
and mentally challenged
children.
Navjyoti Established in 1987 Founder- Kiran This org’n deals with drug
Bedi addicts.
Page | 40
9. Development schemes and indicators
Some Important Indicators of Social Development
Page | 41
Table 8: India and Comparator Countries
Poverty projections for 2006-07

Urban: 5 crore (15% of urban population)
Rural: 17 crore (21% of rural population)
Total: 22 crore (19% of rural population)
9.1. HDI index
Population (m) 1,071

Per-capita GDP (PPP US$) 2,892
HDI ranking (/177) 127
Life expectancy (years) 63.3
Combined gross enrolment (%) 60
% Population under $2 per day 79.9
Internet users (per 1000) 17
Cellular subscribers (per 1000) 25
Source: UNDP Human Development Report 2005
Page | 42
9.2. IRDP
y Launched in 1980
y A Credit-linked-self employment program
y Assists the identified Rural poor households to augment their income & help them
cross poverty line
y For Income generating activities in primary, secondary and tertiary sectors of
rural economy.
y Assistance through
y Subsidy by government
y Term credit advanced by financial institutions – commercial banks, RRBs,
Cooperative banks
y Implemented through DRDA (A Broad based representative body for guidance &
directions for program implementation)
9.3. Self Employment programs
• Providing and Generating Employment is a Major Approach to Poverty Alleviation

• Lack of sustained employment is a major cause of Poverty, both Chronic as well as
Transient
• Chronic Poverty: Household suffering poverty on a long-term basis due to continued
deprivation (asset/skill/income/ employment) and failure of policies especially based
on trickle down approach
• Transitory Poverty: Household momentarily falling into poverty or poverty
worsening due to sudden fall in income and employment for reasons like natural
calamities, sickness, etc.
• It is essential that both types of poverty are taken care of, as they can be mutually
reinforcing.
• Provision of Employment can be useful in tackling poverty for certain categories of
poor (those capable of taking up employment)
• Employment Programmes are designed under the Direct Attack strategy to provide
employment to the poor
• Two categories of Employment Programmes meant broadly to take care of two types
of poverty:
- Self-employment programmes for Chronic Poverty
- Wage-employment programmes for Transient Poverty
Page | 43
Disadvantages of Self-Employment
Advantages of Self-Employment • Poor may lack skill and entrepreneurial
• Helpful to overcome failure of abilities
trickle-down • Not suited for tackling transient poverty
• Occupational mobility for poor • Risk to be borne by poor
• Make poor entrepreneurs • Problems in selecting poor / target group
• Help poor to be self-reliant • Requires organized/sustained efforts to
• Promote Diversification in rural develop micro-entrepreneurial activities
areas on a large scale
• Failure to provide integrated services
may lead to failure of activities
• Requires sustained growth in demand for
non-farm activities of the Self-employed
people
• Competition from organised sector for
the poor
9.4. Wage Employment programs
Large number of wage-employment program implemented, FWP, RLGEP, NREP, JRY,

JGSY, SGRY, EGS, NFWP, NREGA.
Rationale behind using wage employment for poverty elevation is that
• Need for direct employment generation for tackling poverty – chronic and
transient
• Inability of self-employment program to tackle transient poverty
• Very poor cannot take advantage of self employment program
• Limited impact of self-employment program
• Need for multi-pronged strategy for poverty alleviation.
9.5. Education
Our country has compulsory and free education for all children up to the age of 14 (Art.
45, Directive Principle). The Compulsory Education Acts has been passed by many states
to make primary education compulsory. The policy has also been enforcing education is
the National Policy on Education (1986/92) and now the Universal Elementary
Education (6-14 years)has been made compulsory. The government has targeted to spend
6% of GDP on education.
Page | 44
After the constitutional amendment Education has become a Fundamental Right
(2002). The state will endeavor to provide education. The Right to Education Bill 2005 in
Parliament will give effect to the Constitutional Amendment.
There have been many interventions like Operation Black Board (1987): To provide
infrastructure , additional teachers and teaching materials, District Primary Education
Program (DPEP): (1994): Universalization of Education in low female literacy districts,
National Literacy Mission (1988):To attain literacy level of 75% , Adult literacy (15-35
group),Mahila Samakya ( Focus on Women through group approach).Sarva Shiksha
Abhiyan (2001) is currently running all over the country where the target to put all
Children in schools by 2005. The Mid Day Meal Scheme (2004) is universalised in all
public schools in the country which has drawn a lot of children to schools.
Following table shows the census data about the literacy in India. Recent data is based on
the sample survey conducted by the nation. They are estimates not the exact values. The
last sample survey reports that literacy rate in india during 2007 was close to 75%.
Year Male Female Total
1951 Rural 19.02 4.87 12.10
Urban 45.60 22.33 34.59
Total 27.16 8.86 18.33
2001 Rural 71.40 46.70 59.40
Urban 86.70 73.20 80.30
Total 75.85 54.16 65.38
Expenditure: (Centre and States)
Page | 45
% to GDP (Norm 6%)
1950-51 1.2%
1989-90 3.8%
1997-98 3.8%
2004-05 3.5%
The target was to raise expenditure in education to 6% of total budgetary expenditure, but
it was still to be achieved. When comparing the literacy rate with other countries we find
that, states, 19.8% of men and 41.1% of women were not literate as of 2006.
As per the 2001 India census, India's national literacy is only 65.2 percent. Literacy drive
is spreading slowly to other states. India's youth (age 15 to 24) literacy rate was 76.4%
between 2000 and 2004. At current rates India will take no less than 20 years for a
literacy of 95%. Literacy in India is not homogeneous; some states in India have more
impressive literacy rates than others. Kerala, a south-Indian state widely recognized as
the well-educated state in India, recorded an impressive 90.92% literacy rate in 2001. On
the other hand the north-Indian state of Bihar lags behind with 47.53%. India's adult
literacy rates (61.3% in 2002), is just a little better compared to other nations in South
Asia except Sri Lanka's 92%, with Nepal next at 44%, Pakistan at 50-54% and
Bangladesh the lowest at 43.1% Many Indians have argued that illiteracy, especially in
the rural areas, gives undue advantage to contemporary politicians, who can keep on
neglecting real issues of socio-economic development, and continue with corruption.
9.6. Health
As defined by WHO Health is a state of not mere absence of diseases but a state of
complete physical mental and social well-being.
India’s Health Policy asks for Health for all by 2000 AD which is made possible by
making primary health care universally accessible and affordable. The expected value of
IMR (Infant mortality rate) is less than 60 & Life expectancy is 64 Years. The National
Health Policy- 2002 has the objectives to eradicate/Control Major Diseases by 2015
and make IMR to <30 by 2010.
Rural Health Service mainly constitutes of PHCs which have been there since 1952.
One PHC / 27,364 & One SC / 4579 is the main idea behind the service of PHCs. The
Role of PHCs is to give primary medical care and control of communicable diseases
along with focusing on maternal & Child Care and family planning/ Health education.
Page | 46
Health Status / Progress
1951 2003/04
Life expectancy 32.1 65
Death rate(per 1000) 27 8.0
IMR (1000 Births) 146 60
Doctors (Modern) 0.62 6.25

(Lakh)
Beds (lakh) 1.18 9.14
Dispensaries/Hospitals 9209 38,031
Government has introduced National Rural Health Mission (NRHM)( 2005)to improve
the availability and access to health delivery and care by increased allocation in 18 less
developed states and increase Public Health Spending to 2-3 % of GDP. They aim to
strengthen Rural Hospitals; (one CHC with 30-50 beds / lakh for curative purpose) and
create accredited Social Health Activist in the villages (ASHA) along with formation of
Village health and sanitation committee. Despite the entire rosy picture there are
problems of Health Sector like the health Standards below norm and there has been a
rise of non-communicable and other diseases. This is due to poor state of PHC
System and low Public Health Expenditure which is (1.3 % of GDP) only.
10. Micro finance
Page | 47
is a term for the practice of providing financial services, such as microcredit, micro-
savings or micro-insurance to poor people. By helping them to accumulate usably large
sums of money, this expands their choices and reduces the risks they face. As suggested
by the name, most transactions involve small amounts of money, frequently less than Rs
10000.
Microfinance is the latest buzzword in the world of banking and finance. Operating at the
bottom of pyramid, it has challenged and changed the way banking and financial services
have been delivered since the onset of capitalism. I would call it the banking of east. It
has spread fast during the last decade. The number of customer world wide reached to
100 million23 in 2006. In India this numbers reached to 20 million24. The potential is
immense as the number of poor who wanted and needed the microfinance services are
estimated to be over 600 million. Microfinance came into international limelight when
last year’s Nobel Prize for Peace was awarded to Mohammad Younus of Grameen Bank
of Bangladesh. The Grameen model of micro credit is a proven model. It has been
successfully replicated in India and around the world. In India, Share Micro-Finance
limited, Spandana, Bandhan, Cashpor, SKS, SKRDP, BASIX are major microfinance
institutions operating mainly in rural areas. The un-served market is vast and a huge
opportunity for growth is present in both the rural & urban segments. The reach of
microfinance was marginal in the rural areas but virtually non-existent in the urban.
The microfinance in Asia was the brain child of Mohammad Younus the founder of
Grameen Bank. It started as small scale experiment in the villages adjacent to Chittagong
University where he was teaching economics. Continuous experiment and refinement
resulted into a model which in microfinance parlance called ‘Grameen Model’.
11. Cooperatives
23
http://www.unitus.com/sections/poverty/poverty_mf_main.asp
24
(http://www.uncdf.org/english/microfinance/pubs/newsletter/pages/2005_06/news_india.php)
One study shows that more than 80,000 customer can make a rural microfinance institution viable. How many needed
to make an urban one?
Page | 48
Cooperatives work on the basis of user owner principle. The user-owner principle means
the people who use the cooperative own and finance the business. Cooperatives are
financed by members purchasing stock, paying membership fees, or accepting self-
imposed assessment on products purchased and/or sold or fees for services. In some
cooperatives, members reinvest their earnings (profits) to capitalize the business.
Cooperative movement is very strong in India. Since independence the cooperative

movement has enable Indian farmers and other small producer to cooperate and achieve a
size that would help them to compete in the market place. Following are the list of major
cooperatives in India. AMUL the well know Indian company is a brand owned
cooperative only.
a. AMUL
Amul (Anand Milk-producers Union Limited), formed in 1946, is a dairy cooperative

movement in India. It is a brand name managed by an apex cooperative organization,
Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which today is jointly
owned by some 2.41 million milk producers in Gujarat, India. It is based in Anand town
of Gujarat and has been a sterling example of a co-operative organization's success in the
long term. The Amul Pattern has established itself as a uniquely appropriate model for
rural development. Amul has spurred the White Revolution of India, which has made
India the largest producer of milk and milk products in the world. It is also the world's
biggest vegetarian cheese brand.
b. IFFCO
It is India’s largest cooperative. It produces fertilizers.

To overcome this lacuna and to bridge the demand supply gap in the country, IFFCO was
formed as a unique venture in which the farmers of the country through their own Co-
operative Societies created this new institution to safeguard their interests. The numbers
of co-operative societies associated with IFFCO are 155 at present. The mission of the
organization is, "to enable Indian farmers to prosper through timely supply of reliable,
high quality agricultural inputs and services in an environmentally sustainable manner
and to undertake other activities to improve their welfare"
c. Sugar Cooperatives
Sugar cooperatives are another group of cooperatives which are very effective, especially
in the state of Maharashtra and Gujarat. Sugar cooperatives in North (like UP and Bihar)
are plagued with politics and are not performing as well as cooperatives of other states.
d. PACS
Page | 49
PACS are producers’ agriculture cooperative societies. These are lowest level
cooperative societies operating in almost all the states. There purpose is to distribute the
agriculture input like fertilizers and seeds to the farmers. In many states they are largely
defunct and highly politicized.
e. National Cooperative Union of India (NCUI)

Industries have apex body like CII or ASOCHAM; similarly NCUI is the Apex
Cooperative Organization in India which represents all the segments of Indian
Cooperatives. Its objectives are to promote and develop the cooperative movement in
India. It was established in 1929 as All India Cooperative Institutes and renamed to
National Cooperative Union of India in 1961
12. Retail revolution and farmer
Page | 50
Industry Evolution
Traditionally retailing in India can be traced to the emergence of the neighborhood

‘Kirana’ stores catering to the convenience of the consumers. The era of government
support for rural retail: Indigenous franchise model of store chains run by Khadi &
Village Industries Commission
• The decade of 1980s experienced slow change as India began to open up economy.
• Textiles sector with companies like Bombay Dyeing, Raymond's, S Kumar's and
Grasim first saw the emergence of retail chains
• Later Titan successfully created an organized retailing concept and established a
series of showrooms for its premium watches
• The latter half of the 1990s saw a fresh wave of entrants with a shift from
Manufactures to Pure Retailers.
• For e.g. Food World, Subhiksha and Nilgiris in food and FMCG; Planet M and Music
World in music; Crossword and Fountainhead in books.
o Post 1995 onwards saw an emergence of shopping centers, mainly in urban areas, with
facilities like car parking, it targeted to provide a complete destination experience for
all segments of society
• Emergence of hyper and super markets trying to provide customer with 3 V’s - Value,
Variety and Volume
• Expanding target consumer segment: The Sachet revolution - example of reaching to
the bottom of the pyramid.
Retailing formats in India

a. Malls: The largest form of organized retailing today. Located mainly in metro
cities, in proximity to urban outskirts. Ranges from 60,000 sq ft to 7,00,000 sq ft
and above. They lend an ideal shopping experience with an amalgamation of
product, service and entertainment; all under a common roof. Examples include
Shoppers Stop, Piramyd, Pantaloon.
b. Department Stores: Departmental Stores are expected to take over the apparel
business from exclusive brand showrooms. Among these, the biggest success is K
Raheja's Shoppers Stop, which started in Mumbai and now has more than seven
large stores (over 30,000 sq. ft) across India and even has its own in store brand
for clothes called Stop!.
c. Specialty Stores: Chains such as the Bangalore based Kids Kemp, the Mumbai
books retailer Crossword, RPG's Music World and the Times Group's music chain
Planet M, are focusing on specific market segments and have established
themselves strongly in their sectors.
d. Hypermarts/Supermarkets: Large self service outlets, catering to varied
shopper needs are termed as Supermarkets. These are located in or near
Page | 51
residential high streets. These stores today contribute to 30% of all food &
grocery organized retail sales. Super Markets can further be classified in to mini
supermarkets typically 1,000 sq ft to 2,000 sq ft and large supermarkets ranging
from of 3,500 sq ft to 5,000 sq ft. having a strong focus on food & grocery and
personal sales.
e. Discount Stores: As the name suggests, discount stores or factory outlets, offer
discounts on the MRP through selling in bulk reaching economies of scale or
excess stock left over at the season. The product category can range from a
variety of perishable/ non perishable goods
In this rapidly evolving industry, every day new formats are coming like Dollar store,
Convenient store etc. Major retailers with their market share are given below.
13. ITC e-Choupal
Page | 52
With over US$ 2 billion sales, ITC Limited is one of India's leading companies.
Traditionally a tobacco and cigarette producer, it has grown into a conglomerate dealing
in hotels, packaging, agribusiness, information technology, and fast moving consumer
goods (FMCGs). Its diversification into consumer goods includes recent entry into the
garment, prepared food, greeting card, gift and matchbox industries.
The US$ 155 million International Business Division (IBD) of ITC's Agri Business
segment was created to market India's agricultural produce internationally. This division
also sources agricultural raw material for its domestic FMCG business (e.g. branded
wheat flour, rice etc). Aiming to integrate more closely with its rural suppliers, while also
developing new markets for its own and third-party goods, ITC began deploying its e-
Choupal network in early 2000 through its International Business Division.
Business model
Its business model centers around the deployment of a network of Internet-connected
kiosks, known as e-Choupals, throughout agricultural areas in India. An e-Choupal is a
high-tech version of the traditional "choupal," or "village gathering place" in Hindi,
where farmers are provided with the latest weather reports, local and international
produce prices, and farming best practices. Costing rupee 1-2.5 lakh each to set up, they
also serve as procurement and purchase points, allowing farmers not only to sell their
produce to ITC, but also to buy agricultural inputs and consumer goods for daily
household use.
Each e-Choupal is managed by an ITC-appointed "Sanchalak", a respected farmer of the

community who takes a public oath of office upon accepting the position. While ITC
covers equipment, the day-to-day operating costs, which consist primarily of electricity
and Internet connection charges, are covered by the e-Choupal Sanchalak.
.
Marketing channel prior to e-choupal

The figures in the bracket are the margins at different stages.
Page | 53
Mandi operations pre- e-Choupal operations
Page | 54
The mandi was inefficient and both for the farmers as well as the ITC. The middlemen
were the people who were cornering most of the profit.
Inefficiencies were in all the operations right from the inbound logistics to final payment
of the farmer and outbound supply to the ITC. To create the win-win solution for both the
following value chain was developed.
Page | 55
Following were the benefits for both the parties:
Farmers ITC
• Better information center Long term suppliers
• Better information timing relationship with farmers
• better price of produce due to Decreased cost
• Decreased transaction time Quality control
• Weighing accuracy Disintermediation savings
• Transportation cost
• Professionalism and dignity
There are many positive social Impact of e-Choupals: it has provided an inaccessible
village with a window to the world .Socio impact can be categorized as under:
• Improved agriculture
• Better lifestyle
• Brighter future
It has Improved Agriculture by
Bridging the Information gap:
• Weather
• Better practices
• Customized solutions
Cheaper and smarter Inputs
• Low costs
• Aggregation
• Intelligent deployment of products
Farmers as a source of innovation
14. WTO and Indian agriculture
Page | 56
WTO Fact File
Location: Geneva, Switzerland

Established: 1 January 1995
Created by: Uruguay Round negotiations (1986-94)
Membership: 149 countries (on 11 December 2005) (Saudi Arabia is the last member)
Budget: 175 million Swiss francs for 2006
Secretariat staff: 635
Head: Pascal Lamy (Director-General)
Functions:
• Administering WTO trade agreements
• Forum for trade negotiations
• Handling trade disputes
• Monitoring national trade policies
• Technical assistance and training for developing countries
• Cooperation with other international organizations
WTO & Agriculture: The WTO Agriculture Agreement was negotiated in the 1986–94
Uruguay Round and is a significant first step towards fairer competition and a less
distorted sector. It includes specific commitments by WTO member governments to
improve market access and reduce trade-distorting subsidies in agriculture. These
commitments are being implemented over a six-year period (10 years for developing
countries) that began in 1995. Participants have agreed to initiate negotiations for
continuing the reform process one year before the end of the implementation period, i.e.
by the end of 1999. These talks have now been incorporated into the broader negotiating
agenda set at the 2001 Ministerial Conference in Doha, Qatar.
The original GATT did apply to agricultural trade, but it contained loopholes. For
example, it allowed countries to use some non-tariff measures such as import quotas, and
to subsidize. Agricultural trade became highly distorted, especially with the use of export
subsidies, which would not normally have been allowed for industrial products. The
Uruguay Round produced the first multilateral agreement dedicated to the sector. It was a
significant first step towards order, fair competition and a less distorted sector. It was
implemented over a six-year period (and is still being implemented by developing
countries under their 10-year period) that began in 1995. The Uruguay Round agreement
included a commitment to continue the reform through new negotiations. These were
launched in 2000, as required by the Agriculture Agreement.
Page | 57
15. Important Institutions
Important Institutions
NABARD National Bank for Agriculture and Rural

Development. NABARD is formed through
the Act 61 of 1981and came into existence
on 12 July 1982. Dr. Y S P Thorat is
present Chairman of NABARD
NAFED National Agricultural Cooperative
Marketing Federation of India Ltd.
(NAFED) was established on the
auspicious day of Gandhi Jayanti on 2nd
October 1958. Ajit Kumar Singh is
chairman of NAFED
ICAR Indian Council of Agricultural Research
Dr. Mangala Rai-Director General.
GCMMF Gujarat Cooperative Milk Marketing

Federation. Chairman of GCMMF is
Mrs. Parthi Bhatol, MD is Mr. Vyas
TRIFED Tribal Co-operative Marketing

Development Federation of India Ltd.
For interested readers following documents are freely available on internet. This is most
authenticated data and updated as per the end of tenth plan, that is, year 2006-07.
1. http://planningcommission.nic.in/plans/planrel/fiveyr/10th/volume2/v2_ch
5_1.pdf (for detailed agriculture data and analysis)
2. http://planningcommission.nic.in/plans/planrel/fiveyr/welcome.html (for
every parameter of Indian Economy)
3. http://planningcommission.nic.in/plans/planrel/fiveyr/10th/volume1/v1_ch
2.pdf (for macro economic indicators of the economy
Page | 58

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1.2. Eleventh plan

Targets growth rate for agriculture sector4 is 4 %.

Parameter Target for 11th plan

1.3. Vision 2020

Parameter Indian value World Rank

2.1. Soil type

India- Land – Soils

Soil States Useful in production of

2.2. Waste land

Year Area Production Yield (Kg./Hectare) % Coverage

1950-51 97.32 50.82 522 18.1

Non-Food crops or Cash crops

Tea Assam, West Bengal, Kerala.

Food grains Production in Millions tones

Following table shows the Crop-wise Production of Food Grains in Kharif/Rabi9

Crop-wise Production of Food Grains in Kharif/Rabi

Note : * : Cotton lakh bales of 170 kg each

3.2. Commercial crops

3.3. Cropping season

Rabi (all food grains) 103.4

3.4. Agriculture exports

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Sown and Irrigated Area in India

Net Net Gross

Revolutions in Indian Economy

Revolutions Area Key Person

A brief description of the major revolutions:

* Increase milk production ("a flood of milk")

The Green Revolution is a term used to describe the worldwide transformation of

3.7. Agriculture: At A Glance

First Year Second Year Third Year

3.8. India and world: comparison in agriculture

Leading production countries and India’s rank in the world11

Crop Leader India’s Rank

India is leading producer of Banana and Mango also.

Definition12: Agribusiness is sum total of all the opereations involved in a) manufacturing

4.1. Fertilizer and pesticides

Distribution: Availability of fertilizer is the most important in its sell, Nutrients

Types of Fertilizers & their composition

Phosphatic & Potassic Fertilisers

Single Super Phosphate (SSP) 16% P2O5

Installed manufacturing capacity and share is given in the next table

Capacity Capacity Percent Present

Public sector 34.98 4.33 29.0 7.65

Cooperatives 31.69 17.13 26.27 30.27

Private sector 53.94 35.13 44.73 62.08

Total 120.61 56.59 100 100

Joint Ventures Abroad Under Implementation

1. IFFCO and Southern Petroche. 1. JV in UAE

4.3. Agriculture machinery

Mechanization refers to injection of machinery between man and materials handled by

Segments Horse Market Suitability Dominant Player(s)

Export potential on Indian farm equipment is immense. With overcapacity in country,

Production and Sale of Tractors and Power Tillers in

Agricultural Marketing is a process which starts with a decision to produce a saleable

• Establishment of regulated markets.

• Announcement of minimum support prices of major food grains.

4.6. Agriculture finance

Primary sources of agricultural credit are:

NABARD: NABARD, which is considered to be the leading institution in the

Crop Insurance Scheme: the United Front government on an experimental basis in

111

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Traditionally retailing in India can be traced to the emergence of the neighborhood