Share of high-value
commodities on the rise in country's total agri output
value.
The share of high-value agricultural commodities is
rising in the country's total agricultural output value
and these are emerging as the prominent growth drivers
for the farm sector.
The value of non-foodgrain output in the total agriculture
production has increased from 37.1 per cent in 1982-83
to 46.7 per cent in 2005-06. Categories such as fruits
and vegetables, fisheries and livestock are witnessing
a significant growth compared with wheat or rice. Between
2000-01 and 2005-06, the value of cereals output, including
wheat and rice, grew by 21.63 per cent (at current prices)
while fishing grew by over 61 per cent and fruits and
vegetables grew by 33.74 per cent. Oilseeds, another
non-foodgrain, has jumped by almost 82 per cent between
2000-01 and 2005-06 in terms of value. Overall, the
grain segment grew at about 2 per cent during the period
while the non-grain category grew at more than 4 per
cent.
"The non-foodgrain category will largely drive
the agricultural sector in the years to come,"
said Ashok Gulati and Kavery Ganguly of the International
Food Policy Research Institute. The trend is in line
with the changing consumption patterns in the country.
"The demand for foodgrain is growing at 1-2 per
cent while the demand for non-foodgrain is witnessing
a growth of 5-6 per cent," Gulati added. A recent
World Bank report on agriculture pointed to the rising
demand for high-value crops and animal products. "Growers
are bound to move to high-value commodities and it is
a positive trend for them as it means higher incomes.
But the consequent shortage in foodgrain is a matter
of serious concern and policy intervention is required
to ensure better productivity for rising demand.
The overall consumption basket will continue to show
a decline in the foodgrain demand but the quantum of
foodgrain requirement will rise due to rising population",
said D K Joshi, principal economist at Crisil. Even
the agriculture export basket is witnessing a shift
to high-value produce. The value of floriculture exports,
for instance, grew from Rs 221 crore in 2004-05 to Rs
650 crore in 2006-07, clocking a growth of 194 per cent.
Fruits and vegetables exports grew from Rs 1,363 crore
to Rs 2,411 crore (an increase of almost 77 per cent)
and animal product exports increased from Rs 2,592 crore
to Rs 4,063 crore (almost 57 per cent). By contrast,
cereals export dipped by 15.33 per cent from Rs 9,173
crore to Rs 7,766 crore in the same period.
The increasing share of high-value food commodities
in the agricultural sector output is a clear indication
of the out-of-staple diversification of Indian agriculture.
The fast growth in the high-value segment has provided
a cushion to agricultural growth, which otherwise would
have decelerated at a faster rate. It is often argued
that because of their commercial orientation high-value
crops may endanger household food security, says the
2006-07 annual report of the Indian Council for Agricultural
Research.
