AGRICULTURE AND RURAL ECONOMY

RURAL PRODUCTION SYSTEMS AND RESOURCES

CROPPING PATTERN IN INDIA

MEANING:- Proportion of area under different Crops at a point of time and changes in this distribution over a period of time is known as CROPPING PATTERN. FACTORS DETERMINING THE CROPPING PATTERN:- (a) Soil Conditions, (b) Rainfall,

 (c) Climate (Hot/Cold/Moderate) (d) Technological Factors (Green Revolution 1965 to 1976 :-(i)High-yielding variety of Seed and use of Chemical Fertiliser. (ii)Wheat and Oil-seeds were sown more resulting good production.

 1. IMPORTANT FACTS ABOUT THE CROPPING PATTERN IN INDIA: Food-Crops: Food-Crops cover 3/4th area of total cropped area (including Cereals, Millets, Pulses, Vegetables and Fruits).
1950-51 97.3 Million Hectare land was used for food grains. 2006-07 123.5 Million Hectare land was used for food-grains.

 2. RICE :
1950-51 30.8 Million Hectare Land. 2006-07 43.6 Million Hectare Land. Area increased to 1.5 times. Thus, Rice is grown on more-than 1/3rd of the total area under Food-grains (123.5 : 43.6) Millian Hec. Land. All States grow Rice with change of Technology of High Yielding Variety (HYV).

 3. WHEAT :- 1950-51 9.8 Million Hectare Land. 2006-07 28.0 Million Hectare Land.(22.7% of Area under Food-grains). Thus, Wheat is grown on more than 1/5th of the total area under food-grain. (123.5 : 28.00 MH Land).

MAJOR STATES PRODUCING WHEAT ARE: 1.Punjab, 2.Haryana, 3. U.P.&, 4. Bihar.

These Four States are producing more Wheat because :

Adoption of Technology. Price Support by Govt. (increase in MSP) Market Infrastructure is available. 4. COARSE CEREALS: Maize, Bajra, Jowar etc. 1950-51 28.6 M.H. Land in use. 2006-07 21.0 M.H. Land in use. Pattern is changing (Land coverage declined).

 5. OIL-SEEDS :
Groundnut Mustard, Soyabean, Seasamum, Caster etc. 1950-51 10.7 M.H. Land was in use. 1985-86 19.0 M.H. Land was in use. 2006-07 35.0 M.H. Land was in use.

 TECHNOLOGY MISSION ON OILSEED Area increased for growing oilseed under these programme : N.O.D.P. (1985-86) Oilseed Dev. Prog. O.P.T.P. (1987-88) Oilseed Production Thrust Programme. Progress due to Technology Mission was made as under :-

 1998-99 2003004 2006-07

26.2 M.H. Land in use. 23.7 M.H. Land in use. 26.1 M.H. Land in use.

Thus, Oilseeds were produced more to reduce imports.

6. COMMERCIAL CROPS: (i) Sugarcane, (ii) Cotton & (iii) Jute.

Use of Land in Commercial Crops: 1950-51 1.7 MH 5.9 MH 0.6 MH 1985-86 2.8 MH 8.0 MH 0.7 MH 2006-07 4.9 MH 9.1 MH 0.8 MH (Sugarcane) (Cotton) (Jute) Land use increased regularly. Thus, cropping pattern have undergone significant changes during various PlanPeriod.

 7. EXPORT MARKET OF HORTICULTURAL CROPS: (I) Fruits Horticulture covers (ii) Vegetables 18.9 Million Hect. (iii)Floriculture of land in use. (iv) Coconut (v) Cashewnut etc.

 Life of these items is 1 Week to 3 MonthsFood-Processing was felt necessary. Ministry of Food-Processing is setting up FOOD-PARKS in different parts of the country.
FOOD PARKS will promote : (a) SME (Processing Units) (b) Cold-storage (c) Ware-houses (d) Quality Control Labs.

OTHER FACTORS DETERMINIG CROPPING PATTERN :

1. NATURAL FACTORS:
(a) Soil (b) Climate (c) Rainfall More Water :Rice crop is taken (Example WB) Low Rainfall:- Bajra,Jowar, Maize etc. crops are taken (Example : Rajasthan, U.P.)

2. ECONOMIC FACTORS: (a) Farmers opt Cash Crops for better price (such as Cotton, Sugarcane, Mustard etc.)

 (b) Cash Crop needs Proper Seed, Fertilizer and Irrigation. (c) Income Depends on Land holding size, inputs and Nature of Land (quality). 3. Historical Factors:
(a) Small-landholding tend to grow foodgrains (Wheat, Maize, Bajra etc.) (b) Big-landholding- tend to grow Cash-crops

 4.Social Factors:
Tradition.(Farmers do not want change) Customs affects cropping pattern.

5. Govt. Policy: Govt. Policy affects cropping pattern of different crops from :-a) Export point of view b) Taxes. c) Subsidies d) Availability of Credit. e) Supply of Inputs (Seed, Fertilizer

- 6. GOVT. POLICY REGARDING EXPANSION OF : (i) Irrigation Facilities. (ii) Determination of Agril. Prices (MSP), (iii) H.Y.V. of Seeds in selected area of the country with other inputs encourages farmers for change of crop (especially in wheat and rice crops).
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 1. Role of Agril. in Indian Economy: (a) Share in National Income (18%), (b) Large Employment providing sector(50% population), (c) Provision of Food surplus to the expanding population. (d) Contribution to Capital Formation. (e) Providing Raw Materials to Industries.

ROLE OF AGRICULTURE AND ALLIED ACTIVITIES IN INDIAN ECONOMY.

 (f) Market for Industrial Products. (g) Importance in International Trade i.e. Exports. SHARE IN NATIONAL INCOME: 1950-51 :Share of Agril. in NI 55.1%
(It includes Agril.Forestry,Fishing,Mining & Quarrying) 1981-82 2006-07 37.6% 18.5%

 DEVELOPED ECONOMIES ARE LESS DEPENDENT ON AGRICULTURE AS COMPARED TO UNDERDEVELOPED/DEVELOPING COUNTRIES. U.S.A. & U.K. : 2% of GDP is derived from Agriculture. As the country progresses, the dependence on Agril. declines.

 AGRICULTURE IS LARGEST EMPLOYMENT PROVIDER SECTOR: 1951 69.5% WORKING POPULATION WAS ENGAGED IN AGRI. 1991 66.9% -DO 2001 56.7% -DO 2007 52.0% -DO 2008 50.0% -DO-

RURAL ENTREPRENEURSHIP
Definition of Entrepreneur:( Rural Enterprise) An Entrepreneur is one who organizes, Manages, and assumes the risks of a business or an Enterprise. (As per Webster Dictionary) Entrepreneurship means The process leading to the creation and running of any new business regardless of its size, product, service, potential or form of ownership.

A business person who plans, owns, organizes and manages a concern and bears risks in expectation of good earnings is termed as an Entrepreneur. The word entrepreneur as per BBC English Dictionary (1993), refers to a person who sets up business.

 RURAL ENTREPRENEUR: A Rural Entrepreneur is one who lives in Rural Area and starts an economic activity in Rural Area which will generate income for him and his family. Traditionally, the person in village who were doing Carpentry, Blacksmithy, Cobbler, shoe-maker, Weavers, Floor mill,Tailoring, Basket and Rassi maker,

Bricks manufacturer, Earthen Pottery (Kumhar), Cloth merchants, Grocery Shop-keeper, General Stores ,Tea stall ,Restaurent, were all Rural Entrepreneurs. Rural Area means where the majority of the population is engaged in Agricultural activities and some others are engaged in Allied to Agriculture and Non-Agricultural activities. The persons who were engaged

 in Non-Agricultural Activities were known as Business people to whom today we may call as Rural Entrepreneurs. The population in Rural area- for a village it was below 5,000 and for a big village or town/semi-rural area it was below 50,000. These Entrepreneurs are utilizing local available human resources & skills, Rawmaterial with appropriate Technology.

 Rural Business Entrepreneur is doing business with the help of his family members. Very few persons are engaged from outside as labour or helper/Salesmen Cottage industry is another name of Rural Entrepreneurship. Most of the activities are Agro-based in Rural Area. Hence availability of raw material is never a problem for Rural Entrepreneur.

 Majority of the population lives in villages, hence, there is never a problem for labour/semiskilled workers. Capital or Finance is usually raised by himself from friends & relatives in Rural Area or from Financing Agencies (Banks or Money-lenders). Rural Industry: It includes the Cottage, village or household industries as well as SSI which is now known as MSME.

 Rural Industry as small scale Industry, today is defined as an industry with a Capital Investment in Plant & Machinery up to Rs.1 Crore. MICRO, SMALL AND MEDIUM ENTERPRISES:(MSME): MSMED Act, 2006 have been enacted by the Government. In this Act investment

Limit for Micro Enterprise is Rs. 10 lakh, For Small Enterprise it is Rs. 5 Crore and for Medium Enterprise it is Rs.10 Crore. In MSME, the concept of Enterprise has been used which means it comprises both Manufacturing and Services.

 (i) Manufacturing Enterprises : (a) Investment in Plant & Machinery in Micro Enterprises upto Rs. 25 lakh, (b) In Small Enterprises Investment above Rs.25 lakh and upto Rs.5 Crore, and (c) In Medium Enterprises investment above Rs.5 Crore has been permitted.

(ii) Service Enterprises: Investment up to: (a) Micro Enterprises Upto Rs.10 lakh (b) Small EnterprisesAbove Rs.10 lakh and up to Rs.2 Crore (c) Medium Enterprises Above Rs.2 Crore and upto Rs. 5 Crore.

SCHEMES FOR RURAL ENTREPRENEURSHIP

1. Training of Rural Youth for SelfEmployment ( TRYSEM): (a) TRYSEM was started on 15th Aug.1979 (b) Main objective was to impart Technical Training and Business expertise to those Rural Youth who belong to the families living Below Poverty Line (BPL). (c) Self employment to Rural Youth of age group of 18-35 years according to their

 Physical and mental abilities. (d) This Training was given as per requirements of the Youth of Local Area. (e) Training to Rural Women was also given under this Programme. (f) 30% of Trainees will be from SC/ST. (g) 1/3rd trainees would be Women. (h) Ex-servicemen were also included.

 2. Under 6th Plan (1985-90) the target was to impart training to Minimum 2 lakh Rural Youth. (40 Youth per Block per year). 3.Training was imparted at District level by Institutions like ITI, Polytechnic, Master Craftsman, Mater Trainers and skilled Artisans. (Tailoring, Carpentry, Blacksmithy, Masonary work, Pottery making

 Mechanics, Electricians, Plumber, cyclerepair/motor-cycle repair and Pump-set repair etc. were the activities). 5. Stipend during Training period was also given to Youths. 6. After training, Loan and subsidy was provided to start self-employment and selfdependent. (Investment Capital for Tools & Machines plus WC for Raw material was

 Made available to Trained youth. 7. The Central Govt. and State Govt. shared the expenses under the Scheme on a 50 : 50 basis. 8. Scheme was administered by DRDA. BDO was given this task to identify trade and institutions and select the trainees. 9. Target during 6th Plan period was to train 10.05 lakh Youth. Against this target

9.39 lakh youths were trained. In 7th Plan again 10 lakh youths were trained. 10. Banks CB, RRBs, & DCCBs were to finance under the scheme on small project basis. (Investment Capital + WC). 11. Training in 60 trades was imparted as against 100 trades identified in the country to 37 lakh youth up to April, 1999.

 Present Position of the Scheme: This scheme is not in existence at present. Since April 1, 1999, TRYSEM has been merged with newly introduced programme named as SGSY (SwarnaJayanti Gram Swarojgar Yojna).

DWCRA
Development of Women and Child in Rural Areas: (DWCRA): 1. This programme was started in Sept. 1982 as Sub-plan of IRDP. 2. Objective of the scheme was to concentrate upon women members of target families for increasing their income and provide such facilities through which they could start their income.

 3. 10-15 women formed a group, each for taking up economic activities suited to their aptitudes and local conditions. To start economic activity, Govt. imparted Training and Financial assistance with loan facility from Banks. 4. Now from April 1, 1999, this Scheme has been merged with SGSY and financing to women through SHG and

 in other manner is being given for doing Economic Activities. Activities includes : (i) Dairy Activity (ii) Embroidery work (iii) Massala Making (Grah Udyog) (iv) Carpet/Galicha making (v) Achar,& Murrabba making.

(vi) Basket making (vii) Handicrafts, bags, wall hanging etc. (viii) Tailoring & Embroidery work on Machine (ix) Vermicompost preparation in village Area for farmers. (x) STD booth & Photo-copier Shop. (xi) Selling Ready-made garments. (xii) Soap, Candles, Agarbatti manufacturing. (xiii) Grocery Shop in Village Area.

 More than 6 lakh Women Groups under SHG has been formed and financed to the tune of Rs.1411 Crores (2007-08) has been given through SHG in India. More than 85% SHGs consist of Women in India and their repayment of loan is also more than 80% in time. Majority of SHGs are located in Rural Area

Characteristics of an Entrepreneur:An Entrepreneur must be : 1. Energetic. 2. Hard-working 3. Ambitious 4. Self-confident 5. Keen to assume responsibilities. 6. Foresighted

 7. Single minded 8. Good Tempered 9. Eager to posses wealth. ENTREPRENEURIAL QUALITIES AND SKILLS : 1. Educated 2. Intelligent

3. Initiative 4. Preparedness to accept Risk 5. Good Judgment 6. Firm Determination 7. Emotional stability 8. Knowledge of Market Trends 9. Basic Technical knowledge. 10. Ability to mobilize Resources.

11. Good communication skills 12. Dynamic Leadership 13. Organizing Ability 14. Quick at Decision taking Success of Entrepreneurship will depend on Cooperation and support of the people who work for it, and they are as under: 1. Employees

2. 3. 4. 5. 6. 7. 8. 9.

Customers (good product/services) Dealers (distribution net work) Suppliers (raw materials suppliers) Investors Advertisements & Media (Publicity) Environment (Business conditions) Government policy (taxes etc.) Society (welfare of the consumers)

PROBLEMS OF RURAL INDUSTRIES

1. The Problem of Location 2. The problem of Raw Materials 3. The Problem of Skilled Labour 4. The Problem of Capital

 5. The Problem of Entrepreneurship 6. The Problem of Industrial Sickness 7. The Problem of Technology

8. The Problem of Marketing 9. The Problem of Competition 10. The Problem of Organization

An Rural Entrepreneur can start any Business or Service activity in Rural Area for which the financial assistance is available from Banks. Following are few examples: 1. Photocopying Center 2. Photography & Videography 3. Setting-up of Cyber cafes 4. Computer Training/Service Center

5. Auto repair, services and Garages 6. Servicing of Electric and Electronic Equipment or instruments 7. Laundry and Dry cleaning 8. Tailoring 9. Repair of Tractor, Pump sets etc. 10.STD/ISD Booths and Fax service

11. Installation and operation of Cable TV network 12. Beauty parlours 13. General Merchant Stores 14. Storage facility and Cold Storage 15. Pathological Laboratories 16. Educational Services (Coaching Centres)

17. 18. 19. 20. 21. 22. 23. 24.

Hotels & Restaurents Advertizing Agencies Marketing consultancy Cement and products of Cement shop Iron & Steel Fabrication work Bread , Bakery shop Plastic goods Stationery and Book shop

25. Courier Service 26. Vermiculture 27. Food, Fruits and Vegetables Process-ing, Refrigeration, and Transportation 28. Insurance Service 29. Telecommunication Service. 30. Other feasible activities.

 11. Thus, Rural Entrepreneur has great scope to start any activity for which the raw material is available in local or nearby area.

FOOD SECURITY IN INDIA

 Food Security of a Nation : Food Security of a Nation is ensured if (a) all of its citizens have enough nutritious food available, (b) all persons have the capacity to buy food of acceptable quality, and (c) there is no barrier in access to food.

 India is facing food-crisis as per the latest Global Hunger Index, released in 2010. Three leading indicators were used: (a) Prevalence of Child malnutrition (15 crore children) (b) Rate of child Mortality, (50%), and (c) the proportion of people who are Calorie deficient Under-nourished population in India is 23 crore.

 Food Security comprises of THREE dimensions : 1. Availability of Food Grains 2. Accessibility of Food-grains 3. Stability of Food articles. AVAILABILITY OF FOOD-GRAINS: Availability of food is a function of Production of Food-grains.

 The Accessibility to food relies on the States Food Policy coupled with the purchasing power of the Consumer. Stabilization is influenced by the sustainability of food-grains. India is one of the largest producers of the food in the world. 30 Crore people struggle for meeting requirement of two times food.

21% (i.e. 23 crore) of the population are malnourished, as per International Food Policy Research Institute, 2011. It means adequate and nutritive food to the poor is not available in India. Food-grain production in India: Year Prod. In MT Area in MHectare 1952-53 59.20 MT 102.09 MHect. 1972-73 97.03 MT 119.28 MHect.

1992-93 179.48 MT 123.15 MHect. 2002-03 174.77 MT 113.86 MHect. 2008-09 234.47 MT 117.50 MHect. 2009-10 218.20 MT 121.37 MHect. 2010-11 232.18 MT 123,00 MHect. ------------------------------------------------------Source :Ministry of Agril., GOI, Economic Survey, 2008, 2010,and 2010-11. -------------------------------------------------------

Due to the impact of Green Revolution and the use of modern Agro-services, the total production have increased from 59.20 Million Tonnes (in 1952-53) to 218.20 million Tonnes (in 2009-10), and the yield have also increased per hectare ( 2 to 3 times).

z
Annual GDP growth rate in Agriculture: 2007-08 ----it was 4.9% 2008-09 ----it reduced to 1.6% 2009-10 ----it was 1.4% 2010-11 ----it is estimated at 2.4% (Source : CSO, GOI, 2010)

 Availability of Food-grain (per capita): 1952-53 384.5 grams per day/person 1972-73 466.1 grams ,, ,, ,, 1992-93 468.8 grams ,, ,, ,, 2002-03 494.1 grams ,, ,, ,, 2008-09 436.0 grams ,, ,, ,, 2009-10 430.0 grams ,, ,, ,, (Economic Survey : 2008-09 & 2009-10)

Economic Planning in 60 years has not been successful in measuring sustainable food-grain availability to poor people of India. There is a upward price movement in food-grains which is a serious challenge to the food security of India. Poor people are unable to buy as per their per capita income which is Rs.44,000 p.a.

 Recent Initiatives by Govt. for Food Security: The GOI is implementing Four major programes: (i) PDS (ii) Integrated Child Dev. System (ICDP) (iii) 100 days Employment Guarantee system under MNREGA

 (iv) Antyodaya Anna Yojana (AAY) (v) Other programs are: (a) Mid-Day Meal Scheme for School Children (b) National Food Security Mission in 467 Districts of 17 States. Shortcoming of the PDS :Sub-standard quality of food-grains is sold.

 PDS SUPPLY : The Govt. is procuring food-grains from farmers at remunerative prices and distributing food-grains to consumers, particularly the poor section of the Society at affordable prices and maintaining Buffers for food security & price-stability.

Ration-Card in major 17 States of country is hold by following : (a) 81% of Rural House-hold (26.5% with BPL family in Rural Area) (b) 67% in Urban House-hold (10.5% with BPL in Urban Area). (Source: NSSO Report, 2007).

 Two Expert Committees were set by GOI: 1. Saxena Committee of the Ministry of Rural Development, and 2. Tendulkar Committee of Planning Commission These Committees have examined the existing poverty figures and have submitted their recommendations to GOI in 2010. Their recommendations includes:

 Passing of National Food Security Act. Under this Act, legal entitlement to subsidized food-grains to 75% of the countrys population would be guaranteed. PROPOSED FOOD SECURITY BILL: The National Advisory Council in its meeting in October,2010 has suggested that--

 - Legal entitlements to subsidized foodgrains be extended to at least 75% of the population. 45% population in Rural and 28% population in Urban should be entitled to 35 kg. (7 kg. per person) every month at a subsidized price:

For Rural Area the price may be : (1) Millets - Rs.1/- per kg. (2) Wheat - Rs.2/- per kg. (3) Rice - Rs.3/- per kg. National Advisory Council in its meeting have also suggested that the general households should be entitled to get 20kg food-grains 4kg. Per person every month. (44% in rural & 22% in urban).

 Food Corporation of India (FCI) carries out the Procurement, Distribution and Storage of Food-grains in India. Procurement of Food-grain is open-ended, its distribution is regulated by the scale of allocation and its off-take by the Consumers. The off-take (uses) of food-grains is as under:-

 1. To Targeted Public Distribution System 2. In Welfare Schemes of the GOI: (i) Antyodaya Anna Yojna (AAY) (ii) Mid-Day-Meal Scheme (MDMS) (iii) Wheat based Nutrition Programme (iv) Welfare programmes for SC/ST/OBC Institutions. (v) Annapurna Scheme

 (vi) Food for Work Programme (vii) Village grain bank scheme Off-take (supply from FCI) increased from 29.7 million tonnes in 2004-05 to 34.8 million tonnes in 2008-09. But, off-take from PDS has declined these days due to upward revision of the issue price, resulting increase in buffer-stock with FCI, which is un-economic and have

 Adverse impact on the FCIs working for food based safety nets in India. Thus, Govt. needs to improve the distribution of the food grain. Govt. should encourage increased investment in agriculture, expand safety nets and social assistance programs, and enhance income generating activities for the rural and urban poor.