Highlights on Agriculture:
India should also fully leverage new low cost technologies that have wider benefits for agriculture. Cellphones have been creatively used by countries like Ghana, Kenya, Nigeria and Thailand to provide information on prices and cultivation to farmers which has led to massive increases in farm incomes. Since the costs of drones have fallen sharply, they can be used by State Agricultural Universities to provide crucial information on crop health, irrigation problems, soil variation and even pest and fungal infestations that are not apparent at eye level to farmers. Small efforts can go a long way in mitigating farm losses and risks and maximizing income.
A host of studies has demonstrated significant net benefits of GM crops (Kathage and Qaim [2012]) with leading countries such as Brazil and now China opening up to new GM technologies and aggressively building their own research capacity. Nonetheless there are good reasons for some of the public apprehensions on GMOs. Therefore, the regulatory process in India needs to evolve so as to address the concerns in a way that does not come in the way adapting high yielding technologies and rapidly moving towards the world’s agro-technological frontier.
It has long been recognized that a key factor undermining the efficient use of water is subsidies on power for agriculture that, apart from its benefits towards farmers, incentivises wasteful use of water and hasten the decline of water tables.
Given the low yields in agriculture and limited scope for increasing acreage under cultivation, India has to enhance productivity in agriculture by investing in key inputs, so as to ensure food security for the growing population. Therefore, the pathway to improved productivity in agriculture in India needs to be guided by expansion in the share of irrigated areas, investments to improve efficiency in water use, suitable pricing of water, mechanization of operations of agriculture to lower costs and reduce wastage, and seed development for improved varieties to increase yields, debate and address the concerns about introduction of genetically modified seeds in a time frame of three to six months, efficient use of fertilizers and pesticides through improved practices, market driven pricing of fertilizers with no restriction on imports, shift to direct benefit transfer of fertilizer and other agriculture subsidy, distinguish and target subsidy to the farmer and that (subsidy) to inefficient operations of agriculture inputs, credit access to farmers for investments at rates that the financial institutions pay for their deposits, ring-fencing of agriculture related operations of banks from Non-Performing Assets (NPA) to non-agricultural operations, replacement of intermediation of agricultural finance with direct benefit transfers, and development of real time information system to back an improved timely agricultural advisory services.
Read Full Chapter on Agriculture – Economic Survey 2015-16 (PDF download)