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Published on: April 1, 2022, 5:25 p.m.
Agriculture and its potential
  • Given its huge contribution to the Indian economy and the number of people associated with it, agriculture and its allied sectors are critical for achieving the SDG-8

By Siraj Chaudhry. The author is Managing Director & CEO, National Commodities Management Services Limited

The pandemic has come as an eye-opener for the entire world and has changed the lives of many forever. Socioeconomic turmoil and hardships caused by the pandemic are hard to define. From a global health crisis to deep economic turmoil, the impact of the pandemic on jobs and incomes has been unprecedented. 

In India, the economic consequences of the pandemic have been staggering for different sections of society. Many of those with limited means and protection, such as workers in informal employment, have severely suffered the consequences of this crisis. Nationwide lockdown and sealing of inter-state and international borders to control the pandemic triggered reverse migration of informal migrant workers back to the countryside.

According to a report by the Centre for Monitoring Indian Economy (CMIE), employment shrunk by a massive 30 per cent in April 2020. Even when Covid-19 cases declined and mobility restrictions eased in June 2021, the recovery in labour markets remains uncovered. The recovery in June notwithstanding, job losses compared to January 2021 was of the order of 17 million, states the report. 

The impact of the pandemic on society is a long-lasting one and something which is not easy to measure. The new challenges arising from the pandemic have affected the progress on SDGs. The overarching aim “leave no one behind” announced during the adoption of 17 SDGs by United Nations Member States in September 2015 seems to be under threat by the current growing inequalities. It will require renewed enthusiasm and approach to enact in principle the 17 SDGs.

SDG-8 and Indian agriculture: Agriculture and allied activities account for about 20 per cent of India’s GDP as per the Economic Survey 2020-2021. Around 41.49 per cent of Indian population found employment in agricultural activities as per the World Bank collection of development indicators. It is for the first time in the last 17 years that the share of agriculture in GDP has reached almost 20 per cent, making it a redeeming feature in GDP performance during 2020-21. Given its huge contribution to the Indian economy and the number of people associated with it, agriculture and its allied sectors are critical for achieving the SDG-8 of Decent Work & Economic Growth.

 Primary food processing as an avenue for growth Every farm produce requires some form of basic processing such as drying, shelling, milling, grinding, etc. This form of processing is known as primary processing. Rice mills, flour mills, and pulse mills, fall under this category.

Primary Food Processing (PFP) is the first value addition to a crop and a substantial share of food grains undergo primary level processing such as hulling, milling, grinding, etc. before getting consumed. In India, where the consumption of processed food is still at a nascent stage, primary food is the most common form of food processing, and a large chunk of food grains are consumed just after primary processing.

It is a significant first step in the food value chain and therefore every effort should be made for the promotion of the PFP industry. It is one industry that can generate employment directly at the farm gate and can help in raising farmers’ income. Through primary food processing, farmers can realise a higher value for their produce as the value of a finished product is always higher than a raw product.

In a fast-developing economy, the tendency of labourers to migrate to urban centres for better income is commonly seen. But this rampant migration has its peril. It not only chokes the limited infrastructure of urban centres through a rise in slums, but also leads to less labour participation in agriculture, which can threaten food security in some territories.

One major lesson of the pandemic is the urgency for revival and reconstruction of rural livelihoods. PFP being a labour-intensive industry has the potential to provide localised employment opportunities and curb migration. Strong financial, technical and business support should be provided to farmers for establishing PFP enterprises. Companies like Cargill have established food processing plants in Karnataka for converting corn to food starches and derivatives and have made additional investments in silos for storing the corn. This kind of facility provides increased market access to local farmers with more opportunities to sell their products and align with the market.

Agro-forestry is another area with immense potential but is largely untapped. India has significant imports of wood and wood-based products such as pulp, paper, packaging, etc. The applicable tariffs on these items are quite low, which often makes import of wood more attractive than growing trees in India. Due to the lop-sided tariff policy on woods and wood products, livelihood creation in the country in the agro-forestry sector is not satisfactory. To curb this, there is a need for crafting favourable policies which could give a fillip to employment generating wood-based industry in India.

 Skill development of agri workers: As per the Food and Agriculture Organization’s (FAO) estimates, nearly 40 per cent of food produced in India gets wasted before it reaches the consumer. In monetary terms, this amounts to a loss of Rs1lakh crore. These losses can be attributed to fragmented food systems and supply chains gaps. Further, the multiple layers of intermediaries create severe vulnerabilities in our food supply chain such as lower price realisation for farmers.

Availability of scientific storage facilities is a prerequisite for reducing post-harvest losses during the storage of grain. Reduction in post-harvest losses can help in increasing food availability and eliminating hunger. To address this challenge, warehousing companies such as National Commodities Management Limited (NCML) are setting up new storage and silos facilities and are seeking skilled workers for managing operations of these warehouses and silos which are coming up in rural areas.

In March 2021, NCML signed an MoU with the Agriculture Skill Council of India (ASCI), for upgrading the skills of workers in the agriculture sector. Through this partnership, a continuous learning framework leading to training and development of resources in the agriculture industry was created and some 920 people were trained in 8-9 different skills related to warehouse management across 19 locations. 

Adoption of technology by farmers: Most farmers in India now own mobile phones, but are often unable to use them for finding information on crop prices or best practices for their crops. Slow adoption of agricultural technologies and innovative practices has been a bane of Indian agriculture. This could all end soon with the help of digital transformation which India is undergoing. Through Bharatnet the government is already working on providing broadband connectivity to the 2,50,000 Gram Panchayats across the country.

Last mile digital connectivity can be leveraged to communicate innovations in agricultural practices to farmers in a user-friendly format. A huge number of start-ups have sprung up in the area of food crop transactions bringing together input suppliers, farmers, and buyers. These digital platforms link farmers with the market resulting in better prices for goods sold. With proper guidance and training, the farmers could be integrated with a digital marketplace. This would require coming together of the government and the corporate sector to provide required touch points and quality information to farmers to catapult the digital marketplace.

Rural penetration of technology can be capitalised further to realise better prices for the handicraft and artwork of rural artisans. India’s cultural, linguistic and handicraft diversity is well-known, and its art and craft products are recognised globally. With the advent of e-commerce platforms, rural artisans can sell their products online at better prices. This linkage between rural artisans and e-commerce platforms needs to be deepened further for increasing the income of rural artisans and putting more money into the rural economy.

Agritech and e-commerce have the potential to transform the rural Indian economy. Government support and improved digital infrastructure presents an exciting opportunity for innovation in agriculture value chain. It also presents massive employment opportunities for the rural population for managing the digital ecosystem of agriculture. This would require upskilling of the rural workforce at a massive scale for making them employable in the evolving digital ecosystem. Increased digital literacy within small and marginal farmers will also help in the adoption of agri-tech at a rapid pace, thereby transforming agriculture in the country.

For agriculture to find value in current times, it needs to be linked to the food industry. The future of jobs in agriculture sector depends on how we are able to convert the produce into food and get the food on the plate. In other words, jobs could be created anywhere in the value chain that connects the producers with final consumers. Hence, we need to focus on skilling the people so that they can be employed at any part of this value chain. If a large population resides in the rural parts of India generating employment in rural areas by leveraging technology, infrastructure and skill building, it would bring immense prosperity to the nation.

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