Agriculture's answer lies beyond the sector, says EAC-PM chairman

Urges faster shift of workers into rural non-farm sectors to improve farm incomes

India needs to accelerate the movement of workers out of agriculture into rural non-farm activities as part of its long-term strategy to raise farm incomes, Chairman of the Economic Advisory Council to the Prime Minister (EAC-PM) S Mahendra Dev said on Wednesday.

 

Delivering his keynote address at an event to mark the Founder’s Day of the Institute of Economic Growth, Dev said India cannot sustain a situation where agriculture contributes only about 17 per cent to the country’s gross domestic product while employing around 43 per cent of the workforce. “Ultimately, we have to shift workers from agriculture to non-agriculture... the solution for agriculture lies in non-agriculture,” he said.

   

He said that while reforms in agriculture are needed, it is also important to take note of external factors such as the West Asia crisis and the government’s fiscal position before pushing ahead with them. Dev said that, when it comes to technology, areas such as gene editing are being taken up in a big way as India does not allow GM crops.

 

He said India also needs a predictable policy environment for exports and must ensure that Indian agriculture becomes a dependable supplier to the world. He added that trade policy reforms would raise farmers’ incomes further.

 

The EAC-PM chairman also said that diversification away from wheat and rice would not happen unless the rate of return on alternative crops is higher than that on wheat and rice.

 

While emphasising structural transformation, Dev argued that agriculture should move beyond a production-centric approach towards an income-centric strategy. Diversification into high-value crops, horticulture, livestock and fisheries, stronger post-harvest infrastructure, agroprocessing, and better marketing systems would be key to lifting farm incomes, he said.

 

Dev said Indian agriculture has recorded average annual growth of around 4.5 per cent over the past decade, among the highest for major economies, and rejected the perception that farmers’ incomes have remained stagnant. According to him, available evidence suggests farm incomes have grown faster than agricultural output, although small and marginal farmers continue to require greater policy support.

 

He said that nearly 86 per cent of India’s farmers are small and marginal landholders, making institutions such as farmer producer organisations, cooperatives, and aggregation platforms critical for improving access to inputs, markets, and better price realisation.

 

Calling for a fresh round of agricultural reforms, Dev said the policy framework established during the Green Revolution era must evolve to address challenges such as groundwater depletion, soil degradation, and climate change. Market reforms, predictable export policies, and incentives for crop diversification away from rice and wheat towards pulses, oilseeds, and millets would be necessary, he said, adding that farmers would shift only if alternative crops offered comparable or higher returns.

 

On technology, Dev said digital public infrastructure, AgriStack, artificial intelligence, drones, biotechnology, and satellite-based applications could improve productivity, optimise fertiliser use, and strengthen demand and supply forecasting. However, he stressed that the benefits of technology must reach all categories of farmers.

 

Dev also underlined the importance of agroprocessing and rural industrialisation in creating non-farm employment opportunities while enhancing value addition to farm produce. He called for stronger Centre-state coordination on agricultural reforms, climate resilience, and food systems, besides greater focus on women’s land rights, access to credit, and participation in agriculture.

 

He said India’s agricultural strategy under the Viksit Bharat vision should pursue three simultaneous objectives: higher growth and farm incomes, equitable development centred on small farmers and women, and environmentally sustainable agriculture.