The Indian Agriculture sector: Since the COVID-19 pandemic
Posted on: 29 March, 2022
The Agrarian sector plays a significant role in the national economy. Despite an unprecedented crisis like the COVID-19 pandemic, the agriculture sector continued its supply chain of essential food items with moderate disruptions and was able to register a growth of 3.6% in 2020-2021. Nearly 55% of the total workforce of the nation is engaged in agriculture and allied sectors which contributed 20.2% to the nation’s gross value added (GVA) in 2020-2021.
Agronomy at a glance
COVID-19 an outbreak in china became a global pandemic in March 2020, hampered almost all sectors of the economy due to the nationwide lockdown imposed by the government. India’s efforts towards countering the COVID-19 pandemic was exceptional and was acknowledged by all the nations, but the series of lockdown made a serious impact on the socio-economic conditions of the country. The unemployment rate rose to 7.11% in 2020 from 5.27% in 2019. But employment in agriculture did not decline, instead, it showed a slight increase of 5.5% compared to the pre-COVID period. As pandemic also made many migrants return to their villages. India has come a long way from being a famine-affected and food scare nation to a proud food surplus nation. Now India is able to feed and manage nearly 18% of the total world population productively. As India is the largest producer of milk, pulses, and jute. It also ranks second-largest producer of rice, wheat, poultry, cotton, and groundnuts in the world. The export of rice recorded a huge growth of 10.5% increasing from $4777.3 Million to $5278.9 Million in Oct. 2020. India is also known for the production of fruits and vegetables which registered a growth of 11.6% in terms of USD, especially mango, banana, and papaya. With this large number of traits agriculture and allied sector is presently a glad substance with worldwide approval.
The begining & Impact of pandemic
The uncertainties caused by the lockdown, restrictions on interstate logistic activity disrupted the agriculture’s supply chain and it resulted in a subtle spike in food & product prices. As per the Ministry of consumer affairs data, during lockdown 2.0 almost 1479 tonnes of food grains were reported as damaged in FCI warehouses. Farmers from various parts of the rural areas faced huge losses as the government was helpless in the supplying wants of the consumers and maintaining a minimum support price (MSP) for farmers. Hampered supply chain and poor marketability of the crops or the products resulted in the wastage of the crop yield and forced the farmers to throw away the food grains, fresh vegetables, and fruits into garbage containers and spill milk into the river as they failed to get the right price. The pandemic affected not only food distribution to final consumers but also global trade disturbance, farmers were unable to get the required chemical fertilizers, pesticides, and seeds. Vehicles & farm equipment such as tractors, tillers, and rippers sales were low, as the availability of labor at low cost was more and returning of migrant workers. Still, the agricultural sector achieved better statistical value compared to other sectors in 2020-2021. The lockdown corresponded with the Rabi season harvests. The share of the agriculture & allied sector in total GVA, nonetheless, improved to 20.2 percent in 2020-21 and 18.8 percent in 2021-22 compared to 18.4 percent in a pre-pandemic era. Due to Restrictions on exports farmers were not able to earn a fair cost for their churn out despite the fact that food inflation was high. Secondly, by losing their positions in foreign markets, sellers would lose their hegemony and monetary edge.
Observations
Although being a top performer in the agriculture sector in the world, India’s performance in terms of productivity is low compared to the US, China & European countries. NITI aayog proposed recommendations to improve the productivity of the farmers, which can be segregated into six aspects.
Overall, the COVID-19 pandemic had a varied impact on different sectors of the economy. As challenges come with an opportunity, the pandemic has opened doors for many opportunities in Agri-infrastructure, logistics, and Technology. New concepts like the ‘farm to fork’ value chain coming into light which includes various components like production, Post-Harvest Infrastructure (PHI), distribution, marketing, and consumption has led farmers to connect directly with marketers leaving intermediaries / mandis behind. Well-known food-tech unicorn ‘Zomato’ has plans to become a food chain unit for restaurant partners based on this scheme.
The last decade has shown rapid advancement in technology, which the agriculture sector may benefit considerably. Artificial Intelligence (AI) has many direct applications in the agriculture field, with computer vision and machine learning techniques it is possible to identify pests and diseases in plants, automation of irrigation, and fertigation. Internet of Things (IoT), with reliable and improved sensors, provides intelligent data integration related to soil reports, weather reports, insect infections, historical meteorology, and also assists in crop monitoring. India being an agricultural economy blockchain will be the revolutionary technology in the primary sector. Physical paperwork, files, and reports can be systematically replaced by providing an efficient digital ledger, this mainly helps in maintaining surveys and landholdings data. Other financial data and credit details can be securely stored on the blockchain as it is decentralized in nature and cannot be altered. Thus ensuring fraud prevention and cheating in ledger maintenance. Transparency can be achieved efficiently with blockchain technology, adopting it in the food supply chain can build trust among customers. As the information about the product will remain unchanged product’s exact details can be retrieved and authenticated. In March 2022, the Prime minister launched Kisan Drones under the ‘Drone Shakti Scheme’ with the aim of making drones more accessible to farmers. Primarily Kisan drones will assist farmers with spraying insecticides and nutrients, crop assessment, and digitization of land records under the ‘SWAMITVA scheme’. Since the pandemic began the option to trade agro-products online has resulted in the immense growth of start-ups. Many agri-tech start-ups focused on platforms where farmers can directly participate so that middlemen can be eliminated. Farmers can get an effective price for their yield. The ‘Farm to business venture’ (F2B) model is a great opportunity for new change agents in the market. The Indian online grocery market size was valued at $200B by the end of 2020. This clearly indicates direct network with farmers and logistics can generate huge revenue for everyone within the network. A recent start-up in Mumbai, ‘Farm2Fam’ focused on growing microgreens that are free from pesticides and chemicals, with the main intention of creating awareness about the capacity of the human body to heal itself with natural food. Government should support start-ups with unique innovations by launching funds with blended capital to finance agriculture start-ups and promote chemical-free natural farming. Possible areas government can focus on, harnessing the potential of allied activities which includes animal husbandry, dairies, and fisheries. Secondly, promote the use of alternative fertilizers like nano urea and organic fertilizers.
Final thoughts
So far now, the global pandemic has shown many loopholes in the legacy agricultural policies and practices that have existed for many years. Government and Policymakers need to understand that agriculture cannot survive solely on orthodox methodologies and need to focus on bringing changes in technology, organic farming, supply-chain, and assisting agri-tech start-ups. Through this farmers could be transformed into market players serving urban and global markets easily which helps in boosting rural and agrarian economies further, this post-pandemic.