ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Globalisation of Indian Agriculture

Globalisation of Indian Agriculture C H HANUMANTHA Rao and Ashok Gulati ('Indian Agriculture: Emerging Perspectives and Policy Issues', EPW, December 31,1994) have strongly advocated integration oflndian agriculture with the world market, on the plea that such a process would improve terms of trade of agriculture, the benefits of which would also percolate to the poor. Towards that end in view the authors have suggested a strategy for agricultural development, including broad policy changes in supply side factors and a shift from foodgrain production to new activities with favourable domestic and export demand, such as dairying and other animal products, horticulture and floriculture in order to boost agro-processing. Their view is based on the premise that growth rate in domestic demand for foodgrains has been declining and may not exceed the long-term foodgrain output growth rate of 2.6 per cent per annum due basically to the availability of a wide range of non- foodgrains and urban consumption goods in rural areas and, therefore, agricultural growth need not any longer be limited by the goal of self-sufficiency but may benefit from trade so as to raise the overall rate of growth. This view may be questioned on the ground that the consumption basket of the minority of population might have undergone a change in favour of non-foodgrains and urban consumption goods but certainly not the consumption basket of the vast majority of rural population which contains mainly cereals and the contents of which are shrinking due to rapid erosion of purchasing power, consequent upon rise in the prices of basic consumption goods. The declining demand for foodgrains may be partly due to lack of purchasing power in the hands of majority of population. Nearly two-thirds of rural population consist of small and marginal fanners and landless labourers. Their demand for food is not fully met and they are net purchasers in the market. This vast segment of rural population cannot participate in the process of globalisation of agriculture. Since 'surplus' of foodgrains may not be real, food self-sufficiency will continue to remain one of the goals of agricultural policy in the face of rising population and increasing demand of the poor.

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