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

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Public Expenditure in Agriculture

Unmasking the Real Trends?

Trends in public expenditure related to the agriculture sector in India are recategorised and analysed to understand the spatial and temporal trends in expenditure, the extent to which it has shifted across various subsectors, and assess if the sectors, prioritised and promoted, receive commensurate allocations.

The authors express their sincere thanks to the anonymous referee for their valuable comments. These comments helped them improve the article.

Public expenditure in the agriculture sector and its role in reducing poverty and enhancing household incomes, especially in rural areas, is widely studied and firmly established (Bathla et al 2020; Fan et al 1999, 2000; Fan et al 2008; Mogues et al 2015). In India, the union government and various state governments are the primary sources of public expenditure. Agriculture is a state subject under the Seventh Schedule of the Constitution of India (GoI 2020). However, considering the vast importance of the agriculture sector in the Indian economy (Wagh and Dongre 2016), the union government is also responsible for its development. In addition to spending directly on the sector, the union government allocates a major share of its budgetary resources to the state governments through various available instruments, including central sector schemes, centrally sponsored schemes, and grants-in-aid.

Considering the importance and relevance of public expenditure for public policies, it is critical to not only observe its trend over the years but also analyse its composition and sub-sectoral distribution. To do this, the choice of statistical publications and data sets is a key determinant towards the estimation of expenditure. The issue of selecting appropriate data sets is relevant in developing countries in Asia and Africa (Mogues and Caceres 2018) as well as globally (Mogues and Anson 2018). Researchers and policymakers face the tough choice between expenditure estimates that are either based on administrative or functional classification or use audited account statements. For instance, expenditure towards the forestry sector may be included under the aegis of agricultural expenditure in one country but excluded by others; likewise, one country may categorise expenditure on agricultural research as research expenditure while others include it under agriculture (African Union 2015). These choices have significant implications for the aggregate estimates related to public expenditure.

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Published On : 9th Mar, 2024

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