Indian Economy Quiz: Agriculture |26 Feb, 2021

With a view to integrate farmers with bulk purchasers including exporters, agro- industries etc. for better price realization through mitigation of market and price risks to the farmers and ensuring smooth agro raw material supply to the agro industries, Union Finance Minister in the budget for 2017-18 announced preparation of a “Model Contract Farming Act” and circulation of the same to the States for its adoption. Salient features of the Model Contract Farming Act, 2018.

· “Registering and Agreement Recording Committee” or an “Officer” for the purpose at district/block/ taluka level for online registration of sponsor and recording of agreement provided.

· Contracted produce is to be covered under crop / livestock insurance in operation.

· Contract framing to be outside the ambit of APMC Act.

· No permanent structure can be developed on farmers’ land/premises

· No right, title of interest of the land shall vest in the sponsor. Promotion of Farmer Producer Organization (FPOs) / Farmer Producer Companies (FPCs) to mobilize small and marginal farmers has been provided

· FPO/FPC can be a contracting party if so, authorized by the farmers.

Source: Sriram’s IAS

constraint/constraints for development of integrated value chain system of Agriculture sector.

· Public and private investments in agriculture have remained low since the early 90s. Bottlenecks in implementation and a high degree of uncertainty have further reduced investor appetite for agricultural investments.

· Inability to acquire land for setting up of market yards, resulting from the restrictions on land leasing and land acquisition, is another major constraint.

· Even the existing marketing infrastructure suffers because of a lack of finances, manpower and proper facilities.

· Sub-market yards largely function as a location for government procurement and do not provide opportunities for open auction.

· Further, they are irregular in their operations and handle less than five per cent of the volume handled in principal yards.

· Poor maintenance of rural roads is a major constraint as well. Linkages with local and feeder roads remain sub-optimal.

· In the electricity sector, separate feeders for supply of power to agriculture and domestic electrification have not been carried out in many states.

Source: TMH Ramesh Singh

Effective use of agricultural machinery helps to increase productivity and production of farm output along with timely farm operations for quick rotation of crops on the same land.

· By rising a second crop or multi-crops from the same land, there is improvement in the cropping intensity and making agricultural land commercially more viable (NABARD, 2018).

· However, overall farm mechanization in India has rather been lower (40-45 per cent) compared to other countries such as USA (95 per cent), Brazil (75 per cent) and China (57 per cent).

· Indian tractor industry is the largest in the world, accounting for one-third of the total global production.

· During the past four decades, the tractor industry grew at a compounded annual growth rate (CAGR) of 10 per cent.

Source: Economic Survey

Area covered under micro-irrigation from 2010-11 to 2014-15 was declining and gradually increased from 2015-16 to 2018-19.

A dedicated Micro Irrigation Fund (MIF) created with NABARD has been approved with an initial corpus of Rs. 5000 crores facilitating the States in mobilizing the resources for expanding coverage of Micro Irrigation envisaged under PMKSY-PDMC and also in bringing additional coverage through special and innovative initiatives by State Governments.

Source: Economic Survey & The Hindu

New Digital Apps have been developed for making Indian agriculture in line with Digital India theme.

The DARE (Department of Agricultural Research & Education) launched the Agricultural Education Portal EKTA (Ekikrit Krishi Shiksha Takniki Ayaam) for integrated online management information system.

Source: The Hindu

Owing to the large rice production area of the country, preferential soil, and climate conditions, India is the largest rice producing country in the world after China. Rice contributes more than 40 per cent of the country’s total food grain production.

· West Bengal is the largest rice producing state in India. Almost half of its arable land is under rice cultivation. In the fiscal year 2016, the state produced about 15.75 million tonnes of rice over 5.46-million-hectare cultivable area.

· Uttar Pradesh is the second largest rice producing state with almost 5.86-million-hectare land under rice cultivation producing about 12.5 million tonnes of rice.

· The third largest rice producing state in the country is Punjab which produced about 11.82 million tonnes of rice during 2015-2016. The area on which rice was cultivated in the state amounted to 2.97 million hectares.

· Tamil Nadu produces 7.98 million tones.

· Andhra Pradesh produces 7.49 million tones.

Source: Indian Express

Government fixes agriculture credit disbursement targets for the banking sector every year.

· As per RBI directions, Domestic Scheduled Commercial Banks are required to lend 18% of the Adjusted Net Bank Credit (ANBC) or Credit Equivalent to Off-Balance Sheet Exposure (CEOBE), whichever is higher, towards agriculture.

· A sub-target of 8% is also prescribed for lending to small and marginal farmers including landless agricultural labourers, tenant farmers, oral lessees and share croppers.

· Similarly, in the case of Regional Rural Banks 18% of their total outstanding advances is required to be towards agriculture and a sub-target of 8% has been set for lending to small and marginal farmers.

Milk production in India.

· India continues to be the largest producer of milk in the world.

· Milk production in the country was 187.7 million tonnes in 2018-19 and registered a growth rate of 6.5 per cent over the previous year.

· The per capita availability of milk has reached a level of 394 grams per day during 2018-19.

Source: Economic Survey

The Economic Cost of food-grains consists of three components, namely, pooled cost of grains, procurement incidentals and the cost of distribution.

The pooled cost of food grains is the weighted MSP of the stock of food-grains available with FCI at the time of calculating the economic cost.

Source: Economic Survey

Essential Commodities Act (ECA), 1955 was enacted to control the production, supply and distribution of, and trade and commerce in, certain goods considered as essential commodities.

· The Act itself does not lay out Rules and Regulations but allows the States to issue Control Orders related to dealer licensing, regulate stock limits, and restrict movement of goods and requirements of compulsory purchases under the system of levy.

· The Act also provides for action to confiscate the stock seized; to suspend/ cancel licenses, if any and impose punishments like imprisonment.

· The Act also gives the power to fix price limits, and selling the particular commodities above the limit will attract penalties.

· Most of the powers under the Act have been delegated by the Central Government to the State Governments with the direction that they shall exercise these powers.

· Food and civil supply authorities in States execute the provisions of the Act.

Source: The Hindu