Statsguru: India's agri output may outpace global growth over 10-yr period

India’s agricultural production is expected to outpace global growth over a 10-year period. India is expected to increase production of cereals such as rice and wheat by a fifth in 10 years, shows data from a joint study by the Paris-based Organization for Economic Co-operation and Development (OECD) and the United Nations Food and Agriculture Organization (FAO). The production of pulses in India is likely to rise by 45 per cent by 2032, compared to a 30 per cent global rise, suggested the OECD-FAO Agricultural Outlook 2023-2032 (chart 1). 

There will be a similar growth in consumption, though rice consumption at 14 per cent is expected to grow slower than rice production at 19 per cent. The consumption of pulses is expected to grow by 47 per cent as Indians increase protein intake (chart 2). 



Other sources of proteins, such as poultry, eggs, and fish, will also show faster production in India than in the world at large. Average consumption for these items is expected to grow more than cereals and pulses (charts 3, 4). 

Growth in per capita income and India’s increasing population, which has already overtaken China’s by some estimates, remains a key factor behind the increase in food grain consumption over the next decade. Consequently, the rise in consumption of staple food items, driven by the increasing population, is also likely to witness increased availability of daily per capita calories in India, which will rise faster than the world average.
 

The rising demand for better quality food comes amid fears of a rise in production costs. Input costs, such as those of fertiliser and energy, are expected to correct in 2023 but inch up afterward. They are expected to remain higher than pre-pandemic levels (chart 5) in the years to come. The report noted that a 1 per cent increase in the fertiliser cost is likely to result in a 0.2 per cent increase in the price of agricultural commodities. Fertiliser prices are closely linked to energy prices, and tightening environmental regulations could also act as a tailwind.

This may have implications for affordability. Even before the economic devastation of the pandemic, a far larger share of India’s population was unable to afford a healthy diet than in other countries (chart 6).