NAINITAL, India, Sept 23: Indian Prime Minister Manmohan Singh said on Saturday the country's sluggish farm sector growth is a cause for concern and urged reforms to boost productivity of foodgrains, pulses, edible oils and vegetables.
Policymakers say the farm sector, which accounts for nearly a fifth of gross domestic product, needs to grow at least four per cent annually for the economy to post double-digit growth.
Agriculture is certainly an area that needs priority attention. The agricultural growth rate is a cause for concern, Singh told a conference of chief ministers of states ruled by his Congress party.
It is certainly not comparable to the rest of the economy.”
The farm sector grew by 3.9 per cent in the year ended March 2006 against 0.7 per cent in 2005. In contrast, the industry and services sectors each grew more than eight per cent in 2005/06.
A modest rise in farm output helped the economy to expand by an estimated 8.4 per cent in 2005/06.
India has resorted to wheat imports, which could reach 7.0 million tons, for the first time in six years after a fall in production.
The country also faces crop losses from a drought affecting 500,000 hectares of land in the country's largest rice growing state of West Bengal, where output could fall by about 1.2m tons.
Wheat and rice are the two staple foods for a majority of the country's 1.1 billion population.
The sugarcane crop in western Maharashtra and the cotton crop in adjoining Gujarat have also suffered losses due to erratic rains.
Traders say India might not be able to achieve the projected 23 to 24 million tons of sugar output in the crushing season beginning October 2006.
Agricultural production must go up across the spectrum -- in foodgrains, pulses, edible oils and vegetables. As our economy grows and as our people become more prosperous, the demand for agricultural products is bound to rise, Singh said.
The prime minister also urged the chief ministers to boost efforts to improve irrigation. Nearly 70 per cent of the country's farmers are still dependent on rain, as India lacks proper irrigation facilities.
Singh, who launched India's economic reforms more than a decade ago, said indebtedness among farmers was a matter of concern.
The government appointed a panel to suggest ways of providing relief to distressed farmers, and Singh said he hoped the situation will improve once the proposals are implemented. —Reuters
