Agriculture & Food Management 2021-22 | RBI Grade B Phase 1 Preparation - Bank Exams PDF Download

 Page 1


CHAPTER
07
The agriculture sector has experienced buoyant growth in the past two years. The sector, 
which is the largest employer of workforce, accounted for a sizeable 18.8 per cent (2021-
22) in Gross Value Added (GVA) of the country registering a growth of 3.6 per cent in 
2020-21 and 3.9 per cent in 2021-22. Growth in allied sectors including livestock, dairying 
and fisheries has been the major drivers of overall growth in the sector. 
The measures taken by the Government to augment production and domestic supply 
of oilseeds and edible oils, interventions made in the sugar sector and promotion 
of crop diversification are examined. The need for sustainable agriculture through 
water conservation in irrigation and natural farming and need to promote research 
and development to improve crop productivity, mechanization, etc. is highlighted. 
It also discusses how Minimum Support Price (MSP) policy is being used to promote 
crop diversification. In addition to this, some important findings of the latest Situation 
Assessment Survey (SAS) have also been discussed. The net receipts from crop production 
alone have increased by 22.6 per cent as compared to the previous SAS Report of 2014 
although there is a visible diversification in the sources of income of the farmers.
Allied sectors including animal husbandry, dairying and fishing are steadily emerging to 
be high growth sectors. The livestock sector has grown at a CAGR of 8.15 per cent over 
the last five years ending 2019-20. As revealed by the latest SAS, the sector has been a 
stable source of income across groups of agricultural households accounting for about 15 
per cent of their average monthly income. This improvement in the contribution of allied 
sectors is in line with the recommendations of the Committee on Doubling Farmers’ 
Income which has suggested a greater focus on allied sectors to improve farmers’ income. 
A review of the allied sectors along with the recent programmes and initiatives to harness 
its potential has also been presented.
The Government has placed focus on the food processing sector , which is not only a major 
market of agriculture produce but is also a significant employer of the surplus workforce 
engaged in agriculture. Government therefore facilitates food processing through various 
measures of infrastructure development, subsidised transportation and support for 
formalization of micro food enterprises.
India runs one of the largest food management programmes in the world. The Government 
has further extended the coverage of food security network through additional provisions 
Agriculture & Food Management
Page 2


CHAPTER
07
The agriculture sector has experienced buoyant growth in the past two years. The sector, 
which is the largest employer of workforce, accounted for a sizeable 18.8 per cent (2021-
22) in Gross Value Added (GVA) of the country registering a growth of 3.6 per cent in 
2020-21 and 3.9 per cent in 2021-22. Growth in allied sectors including livestock, dairying 
and fisheries has been the major drivers of overall growth in the sector. 
The measures taken by the Government to augment production and domestic supply 
of oilseeds and edible oils, interventions made in the sugar sector and promotion 
of crop diversification are examined. The need for sustainable agriculture through 
water conservation in irrigation and natural farming and need to promote research 
and development to improve crop productivity, mechanization, etc. is highlighted. 
It also discusses how Minimum Support Price (MSP) policy is being used to promote 
crop diversification. In addition to this, some important findings of the latest Situation 
Assessment Survey (SAS) have also been discussed. The net receipts from crop production 
alone have increased by 22.6 per cent as compared to the previous SAS Report of 2014 
although there is a visible diversification in the sources of income of the farmers.
Allied sectors including animal husbandry, dairying and fishing are steadily emerging to 
be high growth sectors. The livestock sector has grown at a CAGR of 8.15 per cent over 
the last five years ending 2019-20. As revealed by the latest SAS, the sector has been a 
stable source of income across groups of agricultural households accounting for about 15 
per cent of their average monthly income. This improvement in the contribution of allied 
sectors is in line with the recommendations of the Committee on Doubling Farmers’ 
Income which has suggested a greater focus on allied sectors to improve farmers’ income. 
A review of the allied sectors along with the recent programmes and initiatives to harness 
its potential has also been presented.
The Government has placed focus on the food processing sector , which is not only a major 
market of agriculture produce but is also a significant employer of the surplus workforce 
engaged in agriculture. Government therefore facilitates food processing through various 
measures of infrastructure development, subsidised transportation and support for 
formalization of micro food enterprises.
India runs one of the largest food management programmes in the world. The Government 
has further extended the coverage of food security network through additional provisions 
Agriculture & Food Management
235 Agriculture & Food Management
INTRODUCTION
7.1 The agriculture and allied sectors grew at a positive growth rate of 3.6 per cent during 
2020-21. This became possible due to good monsoon and various government measures to 
enhance credit availability, improve investments, create market facilities, promote infrastructure 
development in the agriculture sector and increase provision of quality inputs to the sector. The 
timely intervention in the form of Atma Nirbhar Bharat (ANB) Abhiyan coupled with other 
growth promoting schemes (ANB and other schemes are discussed under respective sections) 
have further helped agriculture to achieve an improved growth of 3.9 per cent in 2021-22. 
Figure 1 presents the performance of the agriculture and allied sectors for the last five and half 
years.
Figure 1: Growth of Agriculture and Allied Sectors (per cent)
  Source: First Advance Estimates of National Income, 2021-22
7.2 The growth of agriculture & allied sectors as shown in the Figure 1 should be read with 
Figure 2 depicting the growth in the four constituents of agriculture & allied sectors namely 
crops, livestock, forestry & logging and fishing & aquaculture. It is observed that livestock and 
fisheries have been experiencing buoyant growth and has helped the sector perform well. For 
instance in 2018-19 the growth in the agriculture was buoyed by the performance of livestock 
and fisheries even though the growth of GV A for crops was -1.6 per cent. 
of foodgrains through the schemes like PM Gareeb Kalyan Yojana (PMGKY). A review 
of India’s food management programme including food procurement, allocation, storage 
and the issue of food subsidy along with various Government measures for effective food 
and nutritional security is also presented at length in the chapter. The chapter ends with 
a review of the performance of fertilizer sector.
Page 3


CHAPTER
07
The agriculture sector has experienced buoyant growth in the past two years. The sector, 
which is the largest employer of workforce, accounted for a sizeable 18.8 per cent (2021-
22) in Gross Value Added (GVA) of the country registering a growth of 3.6 per cent in 
2020-21 and 3.9 per cent in 2021-22. Growth in allied sectors including livestock, dairying 
and fisheries has been the major drivers of overall growth in the sector. 
The measures taken by the Government to augment production and domestic supply 
of oilseeds and edible oils, interventions made in the sugar sector and promotion 
of crop diversification are examined. The need for sustainable agriculture through 
water conservation in irrigation and natural farming and need to promote research 
and development to improve crop productivity, mechanization, etc. is highlighted. 
It also discusses how Minimum Support Price (MSP) policy is being used to promote 
crop diversification. In addition to this, some important findings of the latest Situation 
Assessment Survey (SAS) have also been discussed. The net receipts from crop production 
alone have increased by 22.6 per cent as compared to the previous SAS Report of 2014 
although there is a visible diversification in the sources of income of the farmers.
Allied sectors including animal husbandry, dairying and fishing are steadily emerging to 
be high growth sectors. The livestock sector has grown at a CAGR of 8.15 per cent over 
the last five years ending 2019-20. As revealed by the latest SAS, the sector has been a 
stable source of income across groups of agricultural households accounting for about 15 
per cent of their average monthly income. This improvement in the contribution of allied 
sectors is in line with the recommendations of the Committee on Doubling Farmers’ 
Income which has suggested a greater focus on allied sectors to improve farmers’ income. 
A review of the allied sectors along with the recent programmes and initiatives to harness 
its potential has also been presented.
The Government has placed focus on the food processing sector , which is not only a major 
market of agriculture produce but is also a significant employer of the surplus workforce 
engaged in agriculture. Government therefore facilitates food processing through various 
measures of infrastructure development, subsidised transportation and support for 
formalization of micro food enterprises.
India runs one of the largest food management programmes in the world. The Government 
has further extended the coverage of food security network through additional provisions 
Agriculture & Food Management
235 Agriculture & Food Management
INTRODUCTION
7.1 The agriculture and allied sectors grew at a positive growth rate of 3.6 per cent during 
2020-21. This became possible due to good monsoon and various government measures to 
enhance credit availability, improve investments, create market facilities, promote infrastructure 
development in the agriculture sector and increase provision of quality inputs to the sector. The 
timely intervention in the form of Atma Nirbhar Bharat (ANB) Abhiyan coupled with other 
growth promoting schemes (ANB and other schemes are discussed under respective sections) 
have further helped agriculture to achieve an improved growth of 3.9 per cent in 2021-22. 
Figure 1 presents the performance of the agriculture and allied sectors for the last five and half 
years.
Figure 1: Growth of Agriculture and Allied Sectors (per cent)
  Source: First Advance Estimates of National Income, 2021-22
7.2 The growth of agriculture & allied sectors as shown in the Figure 1 should be read with 
Figure 2 depicting the growth in the four constituents of agriculture & allied sectors namely 
crops, livestock, forestry & logging and fishing & aquaculture. It is observed that livestock and 
fisheries have been experiencing buoyant growth and has helped the sector perform well. For 
instance in 2018-19 the growth in the agriculture was buoyed by the performance of livestock 
and fisheries even though the growth of GV A for crops was -1.6 per cent. 
of foodgrains through the schemes like PM Gareeb Kalyan Yojana (PMGKY). A review 
of India’s food management programme including food procurement, allocation, storage 
and the issue of food subsidy along with various Government measures for effective food 
and nutritional security is also presented at length in the chapter. The chapter ends with 
a review of the performance of fertilizer sector.
236 Economic Survey 2021-22
Figure 2: Growth of GV A of Agriculture & Allied Sector (at 2011-12 prices)
Source: Based on data received from Department of Agriculture & Farmers Welfare (DAFW).
*Third revised estimate, #second revised estimate, @ First Revised Estimates released on 29th January, 2021.
GROSS VALUE ADDED (GVA) IN AGRICULTURE
7.3 A trend in the percentage share of agriculture and allied sectors to total GV A of the economy 
at current prices for the last ten years is presented in Figure 3. The share of the sector in total 
GVA of the economy has a long-term trend of around 18 per cent. The share of the agriculture 
& allied sector in total GVA, however, improved to 20.2 per cent in the year 2020-21 and 18.8 
per cent in 2021-22.
Figure 3: Percentage Share of GV A of Agriculture 
& Allied Sector to Total GV A (at current prices)
 
 Source: Based on data of DAFW.
 *As per 1st Advance Estimates of National Income, 2021-22.
7.4 A trend in the distribution of share of GV A of agriculture among its constituents is presented 
in Figure 4. Higher growth in allied sectors as compared to crop sector has obvious implications 
in terms of increasing importance of the former in total agricultural GVA vis-a-vis the later. It 
may be observed that the share of the livestock and fishing & aquaculture in total agricultural 
GVA has been improving during the period. Recognising the increasing importance of allied 
sectors, the Committee on Doubling Farmers’ Income (DFI, 2018) considers dairying, livestock, 
poultry, fisheries and horticulture as engines of high growth and has recommended a focussed 
policy with a concomitant support system.
Page 4


CHAPTER
07
The agriculture sector has experienced buoyant growth in the past two years. The sector, 
which is the largest employer of workforce, accounted for a sizeable 18.8 per cent (2021-
22) in Gross Value Added (GVA) of the country registering a growth of 3.6 per cent in 
2020-21 and 3.9 per cent in 2021-22. Growth in allied sectors including livestock, dairying 
and fisheries has been the major drivers of overall growth in the sector. 
The measures taken by the Government to augment production and domestic supply 
of oilseeds and edible oils, interventions made in the sugar sector and promotion 
of crop diversification are examined. The need for sustainable agriculture through 
water conservation in irrigation and natural farming and need to promote research 
and development to improve crop productivity, mechanization, etc. is highlighted. 
It also discusses how Minimum Support Price (MSP) policy is being used to promote 
crop diversification. In addition to this, some important findings of the latest Situation 
Assessment Survey (SAS) have also been discussed. The net receipts from crop production 
alone have increased by 22.6 per cent as compared to the previous SAS Report of 2014 
although there is a visible diversification in the sources of income of the farmers.
Allied sectors including animal husbandry, dairying and fishing are steadily emerging to 
be high growth sectors. The livestock sector has grown at a CAGR of 8.15 per cent over 
the last five years ending 2019-20. As revealed by the latest SAS, the sector has been a 
stable source of income across groups of agricultural households accounting for about 15 
per cent of their average monthly income. This improvement in the contribution of allied 
sectors is in line with the recommendations of the Committee on Doubling Farmers’ 
Income which has suggested a greater focus on allied sectors to improve farmers’ income. 
A review of the allied sectors along with the recent programmes and initiatives to harness 
its potential has also been presented.
The Government has placed focus on the food processing sector , which is not only a major 
market of agriculture produce but is also a significant employer of the surplus workforce 
engaged in agriculture. Government therefore facilitates food processing through various 
measures of infrastructure development, subsidised transportation and support for 
formalization of micro food enterprises.
India runs one of the largest food management programmes in the world. The Government 
has further extended the coverage of food security network through additional provisions 
Agriculture & Food Management
235 Agriculture & Food Management
INTRODUCTION
7.1 The agriculture and allied sectors grew at a positive growth rate of 3.6 per cent during 
2020-21. This became possible due to good monsoon and various government measures to 
enhance credit availability, improve investments, create market facilities, promote infrastructure 
development in the agriculture sector and increase provision of quality inputs to the sector. The 
timely intervention in the form of Atma Nirbhar Bharat (ANB) Abhiyan coupled with other 
growth promoting schemes (ANB and other schemes are discussed under respective sections) 
have further helped agriculture to achieve an improved growth of 3.9 per cent in 2021-22. 
Figure 1 presents the performance of the agriculture and allied sectors for the last five and half 
years.
Figure 1: Growth of Agriculture and Allied Sectors (per cent)
  Source: First Advance Estimates of National Income, 2021-22
7.2 The growth of agriculture & allied sectors as shown in the Figure 1 should be read with 
Figure 2 depicting the growth in the four constituents of agriculture & allied sectors namely 
crops, livestock, forestry & logging and fishing & aquaculture. It is observed that livestock and 
fisheries have been experiencing buoyant growth and has helped the sector perform well. For 
instance in 2018-19 the growth in the agriculture was buoyed by the performance of livestock 
and fisheries even though the growth of GV A for crops was -1.6 per cent. 
of foodgrains through the schemes like PM Gareeb Kalyan Yojana (PMGKY). A review 
of India’s food management programme including food procurement, allocation, storage 
and the issue of food subsidy along with various Government measures for effective food 
and nutritional security is also presented at length in the chapter. The chapter ends with 
a review of the performance of fertilizer sector.
236 Economic Survey 2021-22
Figure 2: Growth of GV A of Agriculture & Allied Sector (at 2011-12 prices)
Source: Based on data received from Department of Agriculture & Farmers Welfare (DAFW).
*Third revised estimate, #second revised estimate, @ First Revised Estimates released on 29th January, 2021.
GROSS VALUE ADDED (GVA) IN AGRICULTURE
7.3 A trend in the percentage share of agriculture and allied sectors to total GV A of the economy 
at current prices for the last ten years is presented in Figure 3. The share of the sector in total 
GVA of the economy has a long-term trend of around 18 per cent. The share of the agriculture 
& allied sector in total GVA, however, improved to 20.2 per cent in the year 2020-21 and 18.8 
per cent in 2021-22.
Figure 3: Percentage Share of GV A of Agriculture 
& Allied Sector to Total GV A (at current prices)
 
 Source: Based on data of DAFW.
 *As per 1st Advance Estimates of National Income, 2021-22.
7.4 A trend in the distribution of share of GV A of agriculture among its constituents is presented 
in Figure 4. Higher growth in allied sectors as compared to crop sector has obvious implications 
in terms of increasing importance of the former in total agricultural GVA vis-a-vis the later. It 
may be observed that the share of the livestock and fishing & aquaculture in total agricultural 
GVA has been improving during the period. Recognising the increasing importance of allied 
sectors, the Committee on Doubling Farmers’ Income (DFI, 2018) considers dairying, livestock, 
poultry, fisheries and horticulture as engines of high growth and has recommended a focussed 
policy with a concomitant support system.
237 Agriculture & Food Management
Figure 4: Percentage Share of GV A of Crop & Allied Sectors 
in Total Agriculture GV A (at current prices)
Source: Based on data of DAFW.
Investment in Agriculture and Allied Sectors
7.5 Investment is critical to the growth of a sector. The Gross Capital Formation (GCF) in 
agriculture and allied sectors relative to GVA in the sector has been showing a fluctuating 
trend as shown in Figure 5. Fluctuation in the GCF in the sector arises mainly because of wide 
fluctuations in private investment in agriculture and allied sectors. As may be observed in the 
Figure 5, while public investment has remained stable between 2-3 per cent over the years, 
the private investment has fluctuated and the total agricultural GCF has moved in sync with 
variation in private investment.
7.6 Recognising that there exists a direct correlation between capital investments in agriculture 
and its growth rate, there should be a focused and targeted approach to ensure higher public and 
private investment in the sector. Higher access to concessional institutional credit to farmers and 
greater participation of private corporate sector, whose investment rates are currently as low as 
2 to 3 per cent in agriculture
1
, may help in improving private investment in agriculture. Private 
corporate investments need to be crowded in by offering an appropriate policy framework and 
increase in public investment along the entire agricultural value system. 
1.  Report of the Doubling Farmers’ Income, 2018.
Page 5


CHAPTER
07
The agriculture sector has experienced buoyant growth in the past two years. The sector, 
which is the largest employer of workforce, accounted for a sizeable 18.8 per cent (2021-
22) in Gross Value Added (GVA) of the country registering a growth of 3.6 per cent in 
2020-21 and 3.9 per cent in 2021-22. Growth in allied sectors including livestock, dairying 
and fisheries has been the major drivers of overall growth in the sector. 
The measures taken by the Government to augment production and domestic supply 
of oilseeds and edible oils, interventions made in the sugar sector and promotion 
of crop diversification are examined. The need for sustainable agriculture through 
water conservation in irrigation and natural farming and need to promote research 
and development to improve crop productivity, mechanization, etc. is highlighted. 
It also discusses how Minimum Support Price (MSP) policy is being used to promote 
crop diversification. In addition to this, some important findings of the latest Situation 
Assessment Survey (SAS) have also been discussed. The net receipts from crop production 
alone have increased by 22.6 per cent as compared to the previous SAS Report of 2014 
although there is a visible diversification in the sources of income of the farmers.
Allied sectors including animal husbandry, dairying and fishing are steadily emerging to 
be high growth sectors. The livestock sector has grown at a CAGR of 8.15 per cent over 
the last five years ending 2019-20. As revealed by the latest SAS, the sector has been a 
stable source of income across groups of agricultural households accounting for about 15 
per cent of their average monthly income. This improvement in the contribution of allied 
sectors is in line with the recommendations of the Committee on Doubling Farmers’ 
Income which has suggested a greater focus on allied sectors to improve farmers’ income. 
A review of the allied sectors along with the recent programmes and initiatives to harness 
its potential has also been presented.
The Government has placed focus on the food processing sector , which is not only a major 
market of agriculture produce but is also a significant employer of the surplus workforce 
engaged in agriculture. Government therefore facilitates food processing through various 
measures of infrastructure development, subsidised transportation and support for 
formalization of micro food enterprises.
India runs one of the largest food management programmes in the world. The Government 
has further extended the coverage of food security network through additional provisions 
Agriculture & Food Management
235 Agriculture & Food Management
INTRODUCTION
7.1 The agriculture and allied sectors grew at a positive growth rate of 3.6 per cent during 
2020-21. This became possible due to good monsoon and various government measures to 
enhance credit availability, improve investments, create market facilities, promote infrastructure 
development in the agriculture sector and increase provision of quality inputs to the sector. The 
timely intervention in the form of Atma Nirbhar Bharat (ANB) Abhiyan coupled with other 
growth promoting schemes (ANB and other schemes are discussed under respective sections) 
have further helped agriculture to achieve an improved growth of 3.9 per cent in 2021-22. 
Figure 1 presents the performance of the agriculture and allied sectors for the last five and half 
years.
Figure 1: Growth of Agriculture and Allied Sectors (per cent)
  Source: First Advance Estimates of National Income, 2021-22
7.2 The growth of agriculture & allied sectors as shown in the Figure 1 should be read with 
Figure 2 depicting the growth in the four constituents of agriculture & allied sectors namely 
crops, livestock, forestry & logging and fishing & aquaculture. It is observed that livestock and 
fisheries have been experiencing buoyant growth and has helped the sector perform well. For 
instance in 2018-19 the growth in the agriculture was buoyed by the performance of livestock 
and fisheries even though the growth of GV A for crops was -1.6 per cent. 
of foodgrains through the schemes like PM Gareeb Kalyan Yojana (PMGKY). A review 
of India’s food management programme including food procurement, allocation, storage 
and the issue of food subsidy along with various Government measures for effective food 
and nutritional security is also presented at length in the chapter. The chapter ends with 
a review of the performance of fertilizer sector.
236 Economic Survey 2021-22
Figure 2: Growth of GV A of Agriculture & Allied Sector (at 2011-12 prices)
Source: Based on data received from Department of Agriculture & Farmers Welfare (DAFW).
*Third revised estimate, #second revised estimate, @ First Revised Estimates released on 29th January, 2021.
GROSS VALUE ADDED (GVA) IN AGRICULTURE
7.3 A trend in the percentage share of agriculture and allied sectors to total GV A of the economy 
at current prices for the last ten years is presented in Figure 3. The share of the sector in total 
GVA of the economy has a long-term trend of around 18 per cent. The share of the agriculture 
& allied sector in total GVA, however, improved to 20.2 per cent in the year 2020-21 and 18.8 
per cent in 2021-22.
Figure 3: Percentage Share of GV A of Agriculture 
& Allied Sector to Total GV A (at current prices)
 
 Source: Based on data of DAFW.
 *As per 1st Advance Estimates of National Income, 2021-22.
7.4 A trend in the distribution of share of GV A of agriculture among its constituents is presented 
in Figure 4. Higher growth in allied sectors as compared to crop sector has obvious implications 
in terms of increasing importance of the former in total agricultural GVA vis-a-vis the later. It 
may be observed that the share of the livestock and fishing & aquaculture in total agricultural 
GVA has been improving during the period. Recognising the increasing importance of allied 
sectors, the Committee on Doubling Farmers’ Income (DFI, 2018) considers dairying, livestock, 
poultry, fisheries and horticulture as engines of high growth and has recommended a focussed 
policy with a concomitant support system.
237 Agriculture & Food Management
Figure 4: Percentage Share of GV A of Crop & Allied Sectors 
in Total Agriculture GV A (at current prices)
Source: Based on data of DAFW.
Investment in Agriculture and Allied Sectors
7.5 Investment is critical to the growth of a sector. The Gross Capital Formation (GCF) in 
agriculture and allied sectors relative to GVA in the sector has been showing a fluctuating 
trend as shown in Figure 5. Fluctuation in the GCF in the sector arises mainly because of wide 
fluctuations in private investment in agriculture and allied sectors. As may be observed in the 
Figure 5, while public investment has remained stable between 2-3 per cent over the years, 
the private investment has fluctuated and the total agricultural GCF has moved in sync with 
variation in private investment.
7.6 Recognising that there exists a direct correlation between capital investments in agriculture 
and its growth rate, there should be a focused and targeted approach to ensure higher public and 
private investment in the sector. Higher access to concessional institutional credit to farmers and 
greater participation of private corporate sector, whose investment rates are currently as low as 
2 to 3 per cent in agriculture
1
, may help in improving private investment in agriculture. Private 
corporate investments need to be crowded in by offering an appropriate policy framework and 
increase in public investment along the entire agricultural value system. 
1.  Report of the Doubling Farmers’ Income, 2018.
238 Economic Survey 2021-22
Figure 5: Percentage Share of GCF in Agriculture and Allied 
Sectors Relative to Its GV A (at 2011-12 basic prices)
 Source: Based on data of DAFW and Agricultural Statistics at a Glance, 2020.
Agricultural Production 
7.7 As per Fourth Advance Estimates for 2020-21, total foodgrain production in the country 
is estimated at a record 308.65 million tonnes which is 11.15 million tonnes higher than that 
during 2019-20. The production of rice, wheat and coarse cereals has increased at compound 
annual growth rates (CAGR) of 2.7, 2.9 and 4.8 per cent respectively during last six years i.e. 
2015-16 to 2020-21. The CAGR for pulses, oilseeds and cotton has been 7.9, 6.1 and 2.8 per 
cent, respectively during the same period. Figure 6 depicts the trend in agricultural production 
over the past six years.
Figure 6: Trend in Agricultural Production (Million Tonnes)
Source: Based on data received from DAFW.
# Million bales of 170 kg each.