Urgent need to raise India's farm productivity: Assocham

There is an urgent need to enhance India's agricultural productivity and develop strong forward-backward linkages along the entire agri-value chain, considering the rising demand of food products, an industry association said Monday.

Despite record food grain production during the course of past few years, the share of agriculture and allied sectors in India's gross domestic product (GDP) declined by over 4.5 per cent between 2004-05 and 2010-11, Associated Chambers of Commerce and Industry of India (Assocham) said here in a release.

The share of agriculture and allied sectors in the gross state domestic product (GSDP) of top 19 states in India declined significantly during the aforesaid five-year period, thereby registering a fall ranging between about two to about 12 per cent in the GSDP, Assocham said citing the finding of a sector specific analysis it carried out recently.

Share of agri and allied sectors in the GSDP has fallen drastically in Bihar (12 per cent fall), Punjab (nine per cent fall), Uttar Pradesh (seven per cent), Haryana (six per cent), Madhya Pradesh (five per cent), West Bengal (six per cent) and Odisha (six per cent). These states, the major agriculture producing states in India, have registered a drop ranging between 5-12 per cent, it said.

"Jharkhand is the only state across top 20 states in India to have witnessed a surge of over three per cent and about 11 per cent in the share of agriculture-allied activities and services sector respectively in its GSDP," Assocham secretary general D.S. Rawat said in a release.

Expressing concern over decline in the share of agri-allied activities in the GSDP of almost all the states, Rawat said, "This calls for increased investments in research and development for speedy improvement in yield, besides, addressing infrastructure requirements in storage, communication, roads and market in the agriculture sector must also be prioritised."

"The government's decision to allow Foreign Direct Investment (FDI) in multi-brand retail would improve agriculture marketing, attracting significant investments in back-end supply chain and promote cluster farming in the long run considering that large number of farmers in India have small land holdings," added Rawat.

"There is an urgent need to enhance agricultural productivity and develop strong forward-backward linkages along the entire agri-value chain considering rising demand of food products" he said.