UNIT-I
AGRICULTURAL ECONOMICS
Q1) What is Agricultural economics? Explain Importance of Agriculture in Indian economy.
Ans) Agricultural economics is that branch of economics which deals with all aspects of problems related to Agriculture. According to Taylor, “Agriculture economics deals with the principles which underlines the farmer’s problems of what to produce, how to produce, whom to sell, how to sell, in order to secure the largest net profit for himself consistent with the best of interest of society as a whole.”
Importance of Agriculture in the Indian economy:
Indian economy hinges on Agriculture. About 58% population of India is dependent on Agriculture and contributes nearly about 14% of GDP. Most of the raw material for industries (cotton for textile industries, seeds for oil industries, sugar for sugar industries and so on) is supplied by Agriculture. Agriculture is important source for employment for illiterate and unskilled workers. Approx. 50% of population on India is engaged in Agricultural sector. It also highly contributes to Domestic as well International Trade. Large part of country's wealth belongs to Agriculture.
Briefly, Agriculture in India is central significant in terms of production and in terms of expenditure on non-farming products. It is the only sector considered as vulnerable as it is a sector where demand keep on increasing and supply will remain fluctuating due to factors like dependency on monsoon,
Shortage of labor force and cost etc. Underdeveloped country like India is struggling to become self-sufficient. Much, of the self-sufficiency in wheat has been attributed to Green revolution.
Q2) Explain various problems of Indian agriculture.
Ans: Agriculture in India faces host of problems, these problems work as hurdles in development and growth of agriculture and high productivity. Some of the principal problems of Indian Agriculture are:
Briefly, In India Agriculture faces so many problems due to scanty rainfall, Traditional outlook, lack of finance, scattered and small holding etc. Despite of many schemes and programme of government for farmers, farmers are still suffering from various problems in some areas. If we succeed in finding solutions and reforms for above problems, and start implementing them honestly then we can succeed to get high productivity.
Q3) Explain different types of farming.
Mainly there are three types of farming which are as follows:
1) Cooperative farming: It refers to farming practice where farming operation are done with cooperation of two or more farmers.
(Denmark: 100% of farmers belong to Cooperative farmer societies)
Features:
• Farmers can join voluntarily.
• Farmers Hold on their right to land.
• Farmers rent out their land, implements and livestock.
• It’s still in practice. (India, Denmark, Russia, Netherland)
2) Capitalist farming: Those farming activities which are controlled by individual farmer or entrepreneurs, mostly these activities of farming are indirectly controlled.
(This type of farming activity is predominant in South America, North America and Europe)
3) Collective farming: When a group of farmers rent out their land, Agricultural implements and Domestic animals retaining as private property which are enough only for the member's own requirement.
(Model of this farming system was given by erstwhile Soviet Union (1991), named as kolkhoz.
Features:
• Boost Agricultural production for self sufficiency.
• Promotes socialism
• Exception work is rewarded by state.
• Taxes are levied by states on hiering machinery.
• Yearly targets used to set up by govt. And production used to sell at fixed price to the govt.
• This system is not in practice. (It was dissolved in 1991)
Q4) What do you mean by land reforms? What are the objectives of land reforms? Do you think technical changes should give more importance than the institutional reforms?
Land reforms refers to change of rule, Regulations, laws or customs regarding land ownership as well as payment of land revenue. They are meant to improve the welfare of the rural population as a whole.
Objectives of land reforms:
Technical as well as Institutional reforms are to be taken as complementary to each other. One, cannot be taken as a substitute of the other. India has lacked in land reforms, particularly with regard to the size of holding. Bulk of farmers in India continues to be a small-holders. They are subsistence farmers, focuses on security of food for their own families. They are wary of shifting towards commercial farming.
They lack to adopt innovative techniques of production even when they are aware of techniques which would cause a multiple rise in their farm output. Thus, we can say that while a role of technology is not denied in raising farm incomes, it must be supported with institutional reforms.
Q5) What are various Agrarian reforms in Indian Agriculture. Explain land reforms adopted by Indian government.
To resolve the problems of Indian Agriculture and mitigating its backwardness, government took series of steps which are as follows:
1) Technical reforms:
2) General reforms:
3) Land reforms:
Q6) Describe nature and scope of Agricultural economics. Why there is need of separate study of Agricultural economics?
Agricultural economics is that branch of economics which deals with all aspects of problems related to agriculture. Agriculture is the principal component of primary sector, which focuses on production through exploitation of natural resources.
Scope of Agricultural economy:
• Includes Distribution, consumption, production and activities of govt. Related to Agriculture.
• Can analyzed on the basis of self-sufficiency, can reduce dependency on foreign goods and raw material.
• Wider concept than Economizing of resources.
• Various sectors of economy are interdependent on one another.
• Agriculture helps in providing raw material and labour force to industrial sector.
Nature of Agricultural economics:
According to Taylor, “Agriculture economics deals with the principles which underlines the farmer’s problems of what to produce, how to produce, whom to sell, how to sell, in order to secure the largest net profit for himself consistent with the best of interest of society as a whole.”
Need of separate study of Agricultural Economics:
• Agriculture is the main and primary sector of economy.
• Use of technology is lesser in agriculture because most of the farmers are illiterate and unskilled.
• Availability of fertile land is very important in Agriculture while in industrial sector it’s not.
• Most of the Agricultural products are necessities whose demand cannot change even when their price increases. Hence price elasticity is lesser than utility.
• Mostly Agricultural products are perishable and are not possible to be stored for long duration.
• Countries with changing climates needs to focus on variation for better production.
Q7) Explain various characteristics of Indian Agriculture.
The salient characteristics of Indian agriculture are delineated within the fallowing headings:
1. Diversity in Agricultural Systems:
India encompasses a nice range of agricultural systems as advocated by Whittlesey. Its massive angular distance sprawl and numerous climates have resulted into numerous agricultural systems. in several elements of the country, agriculture has prominently totally different traits appertaining to parcel of land, slope, temperature, rainfall, soil properties, and size of holdings, technology, and convenience of irrigation, labor, infrastructure and marketing facilities.
The Apatanis (a tribe of Arunachal Pradesh) have developed the paddy and fish culture whereas the Kashmiris devote their ‘karewa’ lands either to orchards (apple, almond, etc.) or to saffron. Cotton is that the dominant crop within the black earth region whereas the farmers of Andhra ground square measure concentrating on paddy and tobacco cultivation.
2. Doctrine in Character:
In Bharat agriculture continues to be a raffle on monsoon. Because of the failure of monsoon failure happens at AN interval of 3 to 5 years with monotonic regularity. The worst crop failures tend to cover 2 to a few consecutive years because it happened in 1962-64 and 1986-88 in geographical area, Madhya Pradesh, province, Haryana, geographic area and Rajasthan. In bound elements of the country like Marathwada (Aurangabad, Ahmednagar, Bihar, Osman Abad) and Rajasthan (Bikaner, Jaisalmer, Barmer, Jodhpur) agriculture is nearly annually at risk of drought.
Contrary to the current, the districts of Goal- para, Kamrup, Naogaon, Sibsagar, Barpeta (Assam), West Bengal, north Bihar, jap province, coastal Orissa and state square measure severely tormented by floods. Within the areas wherever adequate means that of irrigation and measures of control don't seem to be developed, the uncertainty issue has disadvantaged cultivators of confidence in their higher future.
3. Low Productivity:
The agricultural productivity in Bharat is low as compared thereto of the developed countries. In most of the agro-climatic regions as the per unit production is far below the national and international levels. The low levels of agricultural come is also attributed to obsolete technology, tiny size of holdings, scattered fields and difference in possession.
Most of the farmers square measure tradition certain, irrational, uneducated, and conservative and their risk-taking capability in terribly low. They’re typically back within the adoption of recent technology. And their poor status is an impediment within the purchase of recent seeds, fertilizers, sensible tools and technology and development of irrigation and alternative infrastructural facilities in their fields.
4. Diversity in Agricultural Technology:
As expressed, earlier Bharat has nice diversity in agricultural systems. Every agriculture kind and crop cultivation demand applicable tools and technology. Consequently, there's nice diversity within the technology utilized by the cultivators of the various elements of the country. For instance, the shifting cultivators of Northeast Bharat (Nagas, Lushais, Khasis, and Apatanis) have a straightforward and rudimentary technology supported fireplace, Dao and dibble-sticks, whereas the Bengali farmers plough their fields with picket plough drawn by bullocks and/or buffaloes.
In Mewar and Marwar (Rajasthan) artiodactyl mammal is that the draught animal whereas the progressive person farmers of geographic area use tractors and harvesters in their farms. The utilization of chemical fertilizers, pesticides, weedicides, herbicides, rodenticides and fungicides additionally varies from one a part of the country to a different. The selling, storage and process facilities square measure unevenly distributed within the country.
5. Traveler Landlords:
Although the zamindari and also the raiyatwari systems were abolished within the fifties within the country, there square measure still varied traveler landlords all told elements of the country. In step with one estimate regarding fifty per cent of the farmland of the country is below written or oral residence. The large farmers square measure invariably carrying on their agriculture with the assistance of agricultural laborers and sharecroppers.
There is an incredible increase within the range of agricultural staff and marginal cultivators United Nations agency assist the large farmers within the cultivation of crops. These staff, marginal farmers and sharecroppers square measure typically exploited by the landlords as usury continues to be stylish.
6. Unity in Diversity:
Indian agriculture displays unity during a range of respects, like deficiency of chemical element all told the overall cultivated space; low productivity per unit area and per unit of labour in most regions; prevalence of backward ancient and ex techniques of production giving low returns; the relative deficiency of cultivated land; predominance of tiny farmers, nice difference within the possession pattern of land, production by tenants and agricultural laborers below insecure conditions and therefore risk aversion; huge seasonal and disguised unemployment, no progressive agriculture, and also the dissatisfactory socioeconomic setting of the agricultural sector in most elements of the country.
7. Disappearance of ancient Social Institutions:
The traditional establishments of mutual cooperation and reciprocal aid system square measure progressively disappearing from the Indian rural society. The jajmani system prevailing in northern Bharat since time immemorial has broken. In fact, farming relations square measure below severe strain and tense in many elements (e.g., Bihar, province, and Tamil Nadu). The village panchayats square measure subjected to caste politics and sophistication antagonism.
The common atmosphere within the village is one in every of mutual distrust that impedes act required for a few reasonably technological modification, agricultural development and speedy transformation of the agricultural society.
8. Poor Linkage with Industrial Sector:
Indian agriculture in most elements of the country encompasses a terribly restricted forward linkage with alternative activities. The links between agriculture and trade in terms of labour and material inputs square measure still terribly weak. The present links square measure to produce raw materials for agro-based industries and a supplier of raw materials to the economic sector. The farmers don't seem to be during a position to dictate the terms within the fixation of worth of agricultural commodities. His poor economic standing comes within the manner of developing robust linkages with industries.
Q8) Explain various factors affecting Indian Agriculture.
Factors Affecting Indian Agriculture
1. Physical Factors
Physical factors touching agriculture are: (i) climate (ii) soil and (iii) topography.
(I) Climate.
Climate plays a dominating role in agriculture. Plants need comfortable heat and wet for his or her growth. Normally, regions having most temperature of but 10°C aren't appropriate for plant growth. Within the tropical regions, wherever temperature is high throughout the year, agriculture is with success done.
Plant life isn't doable in dry areas except that with the assistance of irrigation. The wet necessities vary from plant to plant and region to region. Within the lower latitudes, wherever temperature is high, plants would like a lot of wet for his or her growth (75cm to 100cm).
On the opposite hand, within the higher latitudes wherever summers area unit cool, winds aren't dry, precipitation of 50-62 cm is comfortable for plant growth.
(ii) Soils.
The richness of soil is another necessary physical issue touching agriculture. Soils dissent in respect of physical and chemical composition. Soils could also be fine or coarse, porous or non-porous. Normally fine soils like soil or silt area unit terribly fertile.
Generally, the soils that area unit found at the place of their origin, called residual soils, area unit poorer than those that are transported from the place of their origin. The transported soils area unit wealthy and have a spread of minerals in them. The transported soils are: (a) dirt, transported by wind (b) deposit, transported by watercourse water (c) glacial, transported by glaciers.
Soils become unfruitful if the fertility isn't revived. This will be achieved by effort the land fallow, by rotation of crop and by use of manures and fertilizers.
Soil erosion and water work became major issues with soils in and of itself these, ought to be checked by adopting contour farming, terrace farming, constructing dams and dykes.
(iii) Topography.
The nature of topography plays a major role within the development of agriculture. It determines extent of wearing, ways of cultivation and mode of transportation. Within the mountainous and rough regions, wearing is common; piece of land restricts use of machinery and development of suggests that of transportation.
However, within the flat regions, there's no such drawback. Plain regions have fertile soils. The flat topography facilitates use of machines. Suggests that of transportation is simply developed within the plain areas.
Moreover, dense population within the plain regions provides low-cost agricultural labour and a large marketplace for the product. The deposit plains, the watercourse valleys and therefore the deltas area unit terribly appropriate for agriculture.
2. Economic Factors
The most necessary economic factors touching agriculture are: (a) market (b) transport facilities (c) labour (d) capital (e) Government policies.
(a) Market.
Market is a crucial economic think about agriculture. the gap from the market determines the value of transportation. Agricultural crops like vegetables etc. area unit full-grown close to the market.
Sugarcane is full-grown near to the urban centers, wherever sugar mills have developed. Similarly, agriculture is developed round the cities that function markets for the dairy farm product.
(b) Transport Facilities.
The development of economical suggests that of transportation widen the marketplace for agricultural product.
(c) Capital.
Agriculture, within the contemporary world is changing into mechanized. This involves large capital investments. Purchase of machinery, fertilizers, pesticides and high yielding selection seeds need many cash. In India, the farmers area unit poor.
They cannot afford use of recent farm technology. Therefore, it affects agricultural production. The issue of availableness of capital plays a major role within the development of agriculture.
(d) Labour.
The supply of labour determines the character and sort of agriculture. Intensive cultivation needs an oversized offer of low-cost labour. Availableness of low-cost and economical labour is important for the cultivation of crops like rice, tea, cotton and rubber. Thus, the issue of availableness of labour conjointly plays an important role in agriculture.
(e) Government Policies.
The policies of the govt. conjointly influence agricultural land use. the govt. could prohibit the cultivation of a crop or could force the farmers to grow a specific crop, e.g., space beneath sugarcane and oil seeds cultivation has accrued in Asian nation on account of larger stress place by the govt. on these crops.
Government grant or liberal loan in respect of a specific crop helps in larger land area under it crop. After 1947, the govt. of Asian nation gave tax relief and concessions to the farmers for growing jute, with the result that in numerous components of the country, space beneath jute cultivation had accrued to an oversized extent.
3. Alternative Factors
The extent of scientific and technological development contains a nice pertaining to agriculture. Farmers, victimization primitive ways get poor yields. However, on the opposite hand, wherever farmer’s area unit victimization fashionable farm technology within the form of fertilizers, pesticides, machinery and high yielding selection seeds etc. the farm yields area unit high.
An Indian farmer is poorer as compared to Associate in Nursing yank farmer as a result of the later uses fashionable farm technology. The per area unit yield of rice in Asian nation is simply 2000 weight unit as compared to concerning 5600 weight unit in Japan. This distinction in yield is thanks to scientific and technological variations.
The system of tenure conjointly plays a major role within the patterns and productivity of agriculture crops.
Q9) Describe various types of Agriculture Market in India.
The study of agricultural selling includes all the operations, and therefore the agencies conducting them, concerned within the movement of farm created foods, raw materials and their derivatives, like textiles, from the farms to the ultimate customers, and therefore the effects of such operations on farmers, middlemen and customers.
Agricultural selling may be a method that starts with a choice to provide a vendible farm trade goods, and it involves all the aspects of market structure or system, each purposeful and institutional, supported technical and economic issues, and embrace pre- and post-harvest operations viz., assembling, grading, storage, transportation and distribution.
Marketing of agricultural merchandise in Republic of India is of no mean significance. Agricultural selling is one among the manifold issues that has direct bearing upon the prosperity of the cultivator. Agricultural selling, in its wide sense, includes all the operations concerned within the movement of products and raw materials from the sphere to the ultimate shopper.
The necessary kinds of agricultural markets in Republic of India square measure as follows:
Type # 1. Primary or native Markets:
Primary markets, referred to as Hatts or Shandies square measure control once or doubly every week within the neighborhood of a gaggle of villages. There square measure quite twenty-two, such markets in Republic of India. Most of the agriculturists sell their farm merchandise in these markets. Quite five hundredth of the entire marketed surplus is sold-out in these markets. These markets square measure organized by village Panchayats UN agency charge some rent from shopkeepers for the area occupied. Haggle and talks may be a common feature of those markets. The village bania acts as a middleman in these markets.
Type # 2. Secondary Markets:
These {are also square measure are} referred to as ‘wholesale’ or ‘assembling’ markets and are known as ‘mandis’ or ‘gungs’. There square measure regarding 4145 such markets. These markets square measure permanent in nature; business within the markets is transacted often throughout the year.
The manufacture is handled in giant quantities and specialized operators become necessary for the performance of various services. The markets offer facilities of storage, handling and banking services and square measure well-served by roads and railways. Variety of middlemen operate in these markets.
Type # 3. Terminal Markets:
These markets perform the carrying merchandise to customers, final consumers or to places of process. Such markets square measure to be found in massive cities or at ports. The world of their operation extends over a state.
Type # 4. Fairs:
Fairs endured non secular occasions at pilgrim centers square measure necessary sources of promoting of agricultural manufacture in Republic of India. Such fairs square measure control annually and square measure organized by district officers, native bodies or personal agencies. These fairs square measure very hip in Bihar, W. Bengal, UP, Orissa, geographic region, Gujarat and Rajasthan.
Type # 5. Regulated Markets:
These are created by the Govt. with the aim of checking deceitful practices that square measure typically practiced by traders within the primary and secondary markets. In these markets, the foundations and rules square measure prescribed by the Govt. selling practices.
Type # 6. Co-Operative Marketing:
These markets perform on the premise of principles of cooperation. A cooperative selling society carry the agricultural manufacture direct to the customers therefore eliminating an oversized army of middlemen and intermediaries.
Type # 7. State Trading:
State commercialism in agricultural manufacture has become a crucial component of agricultural selling in Republic of India. State agencies like, Food Corporation of Republic of India, created their exclusive centers in and around villages and mandis at season to acquire manufacture from peasants to Government at mounted costs.
Q10) What are the challenges faced by Indian farmers in Indian Agriculture?
India could be a developing country, the bulk of its population belong to the agricultural space, and their primary job is agriculture.
But it’s been decades these rural folks reside constant means they accustomed live thirty years agony. It is as a result of agriculture in Asian country isn't a profit-making job any longer. During this article, we have a tendency to reaching to list out the issues that are visage by the farmers currently.
Major issues visage by farmers in Asian country are as follows:
Unavailability of fine Quality of Seeds
Seeds are the fundamental input or staple for the farmers to grow crops. However, there's an absence of availableness of the nice quality of seeds within the market. And if the nice quality seeds are out there, they're thus expensive that the poor and marginal farmers don't seem to be able to afford.
Due to this, farmers are absolute to use the standard seeds that less productive and yields fewer crops. Most of the certified seeds makers in Asian country are personal firms.
The government ought to either tie-up with these firms or give direct subsidies to the farmers in order that they will afford the most effective quality of seeds for production.
Lack of contemporary instrumentation
Even in 2020, the bulk of Indian farmers use ancient tools for agriculture like plough, sickle, etc. This results in the wastage of energy and workforce and fewer yield per capita labour force.
Only very little use of the machine is seen in irrigation, harvest home and transportation. There are 2 reasons why farmers don't seem to be mistreatment trendy instrumentation. First, they're not aware, and second, they can’t afford such instrumentation.
The second drawback is, albeit a farmer will afford the instrumentation however there's the inconvenience of electricity 24*7 within the village areas.
Poor Irrigation facilities
Irrigation is one in all the essential steps for a crop to grow absolutely. However, does one understand that solely simple fraction space of the full land in Asian country has correct irrigation facility available?
India has the second-largest irrigated land within the world, but still, Asian country faces this drawback.
Punjab has the very best share space of irrigated land within the country of regarding ninety-eight irrigated land availableness, followed by Haryana. The rationale permanently irrigation facilities is that the availableness of water throughout the year from the rivers and dam. This helps the farmers to conduct agricultural operations on time.
But state of affairs everywhere the country isn't constant. In central Asian country, rivers don’t carry water throughout the year. Because of this, farmers got to depend upon the monsoon water for irrigation that is incredibly unsure.
Small and Fragmented Holdings of land
This is one in all the key reason why Indian farmers don't seem to be competent. Because, most of the poor farmers have an awfully bit of land which too in an exceedingly fragmented manner.
And consistent with information, the typical size of holding of land per farmers is decreasing per annum. It suggests that things is group action worse.
This drawback becomes a lot of serious in densely inhabited states with less farming land. Only 1.6% of total land holdings belong to the class of huge holding that too by the made farmers.
It becomes troublesome for a farmer to irrigate and harvest in fragmented lands as a result of plenty of your time is wasted in moving the resources from one field to a different.
Dealing with native traders and middleman
It is a drag a farmer faces at the top of all agricultural activity. This can be why we've got conjointly mentioned it within the finish. However, don’t decide the importance of this drawback by its position.
We often see within the news that farmers thrown their crops on roads simply because nobody purchased it.
Due to the absence of mandi homes and correct market places, farmers don't seem to be able to sell their crops and find an inexpensive worth. During this scenario, they need to appear for a middleman and native traders for business.
Lack of Storage facilities
In the absence of market place, the native traders dominate the market and exploitation of farmers takes place. These middlemen don't seem to be solely making a drag for farmers however conjointly for customers as a result of they ultimately sell the crops at a awfully high worth when getting it from farmers.
The situation of poor farmers is even worse. They’re forced to sell their crops at no matter worth is obtainable to them.
Going through these entire issues, however will we have a tendency to expect from our farmers to supply smart crops? Instead, we must always raise our government to supply the facilities that they be.
