The Hindu : Poor funding for farm sector decried

Online edition of India's National Newspaper
Wednesday, Mar 12, 2003

Southern States

Southern States - Karnataka

Poor funding for farm sector decried

By Our Staff Reporter

HYDERABAD March. 11. In a sharp and pointed critique of the Central Government's policy towards agriculture, Som Pal, Member, Agriculture, Planning Commission and Member, 12th Finance Commission, has said that investment in agriculture as a percentage of the GDP has been only 1.3 per cent for the last three five-year plans. This, despite agriculture's contribution of 26 per cent to the GDP and 69 per cent of India's population being dependent on it.

He was delivering the convocation address at the 35th Annual convocation of the Acharya N. G. Ranga Agricultural University here on Tuesday.

While Rs. 50,000 crores had been invested in telecommunications over the past five years, not "one paise of asset creation'' had taken place in irrigation though it was urgently needed. Providing further evidence of the neglect of agriculture, Mr. Som Pal said the gross capital formation in agriculture had come down from 21 per cent to 7.1 since 1971.

``Terms of trade'' between agriculture and other sectors of the Indian economy had hovering around 82 to 95 per cent, indicating large-scale transfer of funds from agriculture through the "subtlety'' of price mechanism.

Bank records showed that almost 70 per cent of the savings in rural areas were invested in non-agricultural sectors. This trend was more "intriguing'' since the return on investment was among the fastest in agriculture.

Mr. Som Pal warned that "the present pattern of economic growth is highly unsuitable for India'' and said the benefits of a liberalised economy had not touched the agriculture sector.

He praised the farmers and scientists for contributing to the massive strides made by Indian agriculture despite these heavy odds and said proper nurturing can unleash the full potential of Indian agriculture. India had the intrinsic advantage of being a treasure house of genetic resources and this needs to be leveraged by Government policy.

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