Novel approach to rural retailing - intensifying the agricultural support for small farmers

Abstract

Agriculture as a sector is the largest employer in India. It employs about two-thirds of the population and is the backbone of economic development in India. About 25 percent of the country’s GDP is contributed by this sector which also accounts for about 18 percent share of the value of national export. The bulk of the wage goods required by the non-agriculture sector and raw materials for a large section of the industry are supplied by the agricultural sector. Green Revolution The central concern for food security during the post-independence era, was one of the largest driving factors of Indian agriculture. Progress under the Green Revolution was spectacular registering a fourfold increase in food grain production from about 50 million mt during 1950-51 to nearly 209 million mt during 1999-2000. India has been successful in graduating from an era of food deficits to one of food surpluses with a buffer stock of nearly 50 million mt. As a consequence of the astonishing growth in the agricultural sector, impressive gains were made in the other sectors as well. India became the highest producer of milk in the world with an increase from 0.75 million mt to nearly 5 million mt during the first five decades. India is also one of the largest producers of fruits and vegetables. Opening Economy The problems of food security and poverty along with the management of the natural resources have been constantly plaguing the minds of the policy makers of the country. After the economy opened up, the scenario changed with profitability, competitiveness and efficiency in domestic agricultural production gaining higher priority with the immense potential of export opportunities in world markets. With the removal of trade barriers consequent upon the coming into force of the Agreement on Agriculture (AOA) under the World Trade Organization (WTO), India is confronted with the twin challenges of domestic food security with natural source conservation on the one hand and coping effectively with the international trade regime, on the other.Small Farmers Small farmers are the ones most vulnerable to various risks involved in agriculture. About 70 percent of all farming households in India come under the small and marginal farmers segment. Due to a wide range of constraints these farmers are forced to undertake subsistence farming. The issues that act as constraints for these small farmers would be discussed in detail later. Rain-fed Areas Even though the Green Revolution brought in a package of high yielding practices including irrigation, fertilizers, pesticides as a part of the modern agricultural technology practices, a large segment of the farmers were dependent on the erratic supply of rain water. All the measures and benefits of the green revolution were mostly confined to the well irrigated regions of the country and the resource rich farmers. The advent of the tube-well technology sponsored by the government demonstrated the benefits of underground exploitation, and farmers were able to take advantage of high yielding varieties by the purchase of tube wells. However, a huge chunk of the cultivated area which was under the rain-fed regions of the country, remained outside the fold of the Green Revolution.