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Food grain production estimated at 229.85 million tonnes during 2008-09
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RICE PRODUCTION GROWS BY 2.8 PER CENT: WHEAT TO BE MARGINALLY LOWER BY 1.2 PER CENT
FARM CREDIT FLOW INCREASES TO RS. 2,64,455 CRORE
HIGHER MSP LEADS TO RECORD WHEAT PROCUREMENT
FOOD SUBSIDY UP BY 40 PER CENT
SUREVEY CALLS FOR RENEWED FOCUS ON IMPROVING PRODUCTIVITY
The Economic Survey for 2008-09 has put the production of foodgrains at 229.85 millions tones during 2008-09 in accordance with the third advance estimates for the year. This is an improvement of 1.97 million tones over the production estimated in the second advance estimate for 2008-09. However, the output at this level is marginally lower than the final estimates of 230.78 million tones for 2007-08.
The production of rice was 99.37 million tones in 2008-09 which is 2.8 per cent more than the production in the previous year. The survey says that increase in production of rice was mainly on account of Kharif season output growth of 3.4 per cent over the corresponding period of previous year. The production of Rabi rice is estimated to be lower by about 0.9 per cent in 2008-09. The wheat production, according to the Economic Survey, is expected to be marginally lower by 1.2 per cent at 77.63 million tones in 2008-09.
The Economic Survey also underscores a growth in area sown under all Rabi crops taken together as on 27th March 2009. Accordingly an area of 638.33 lakh hectares has been reported to be sown under Rabi crops in 2008-09 against 619.68 lakh hectares in the corresponding period of 2007-08. The area sown under Kharif crops during 2008-09 was however, lower by 2.3 per cent as compared to 2007-08.
The credit flow to the farm sector kept up the momentum as envisaged in the Farm Credit Package announced in June 2004. Accordingly, the farm credit flow during 2008-09 increased to 2,64,455 crore, up from Rs. 2,54,657 crore in 2007-08. The Survey emphasizes number of steps taken by the Government to enhance credit support to farmers. In this context the Survey mentions role of Kisan Credit Cards, revival of short terms rural co-operative credit structure through signing of MOU between the States and Government of India-NABARD, agriculture debt waiver and debt relief scheme 2008 etc. Under rehabilitation package for distress farmers for 31 suicide prone districts, in 4 States of Andhara Pradesh, Karnataka, Kerala and Maharashtra, Government of India has released Rs. 15,889.02 crore as on 31st March, 2009.
The Minimum Support Prices (MSP) for Kharif crops were raised substantially in 2008-09 and similarly MSPs of Rabi crops of 2008-09 ( to be marketed in 2009-10) were also raised. The higher MSP for Rabi Marketing Season (RMS) 2008-09 lead to a record procurement of 22.68 million tones of wheat. The procurement of rice in the financial year 2008-09 too was significantly higher at 32.8 million tones as compared to 26.3 million tones in 2007-08. The Survey points out that the procurement of foodgrains by FCI continues to be higher in the States of Punjab, Haryana, Uttar Pradesh and Andhra Pradesh. The overall procurement of coarse grains in Kharif Marketing Season till 31st March, 2009 has increased to 11.18 lakh tones from 2.04 lakh tones in 2007-08 due to highly remunerative MSPs. Elaborating performance under decentralize procurement scheme (DCP), the Survey observes that the States under DCP operations have shown a healthy increase in procurement of rice. The downward trend in procurement of wheat has been arrested in RMS 2008-09.
Food subsidy during 2008-09 has increased to Rs. 43,668 crore (provisional) during 2008-09 recording an increase of 40 per cent over the subsidy of Rs. 31,260 crore in 2007-08. The Survey observes that a total amount of subsidy as continued to rise at the national level. It points out that a provision of minimum nutritional support to the poor through subsidized foodgrains and ensuring price stability in different states are twin objectives of the food security system. " In fulfilling its obligation towards distributive justice, the Government incurs food subsidy" the Survey adds.
Referring to the challenges and future outlook the Economic Survey underlines a clear need for the renewed focus on improving productivity in specially in the light of limitations on increasing net sown area and the shrinking farm size. It also calls for maintaining current focus on developing rural infrastructure like rural roads for providing connectivity which is essential for movement of agricultural produce. Stating that the irrigation sector requires thrust in terms of investment and modern management, the Survey underscores a need for development of micro irrigation system and watersheds. It also emphasises the need for narrowing kept between the producer prices and consumer prices, development of marketing infrastructure and storages and warehouses, cold chains and modern technology driven spot markets. "Innovative institutional mechanism to provide credit and financial products for farm sector keeping their risk bearing ability in view is the need of the hour" Survey adds.
The Survey also states farmers needs to be facilitated for taking up value additions such as processing of agricultural produce, horticulture, pisciculture, poultry etc. In order to ensure benefits accruing to the targeted population, the Survey calls for a mission approach on promotion of Smart Cards with its cross reference to ration cards and voter ID cards. It also invites attention to the issues of sustainability of agriculture in the light of environmental concerns like soil erosion, water logging, reduction in ground water level and decline in surface irrigation. The Survey stresses that the consequences of climate change on Indian agriculture needs to be factored in the strategy for development of agricultural sector. "On the whole, while the challenging faced by the agricultural sector are numerous, the possibilities for new investment, the use of new technologies that could generate values of the society and incomes to the rural sector are immense", the Survey concludes.
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