Economics & Politics

India’s Growth Trends: Interesting story so far…

India‘s Growth Trends: An Interesting Story through Numbers

  • India got political Independence in 1947 from the foreign rulers but the economic liberalization and the transfer of economic power  to its citizens took some more decades.  For many decades post independence, the Indian economy grew at a slow pace (~4%) that too on a very low base which meant most of the population lived under severe difficult economic situation. Mocked at by all for its Hindu-Rate-of-Growth for decades, India was struggling with the basics and essentials. Sufficient food for large population, keeping the country secure & as one unit against the foreign aggression, facing man-made horrors – multiple wars, always started by neighbors on frivolous counts, and natural disasters – droughts and floods hitting on cyclic basis, at times simultaneously in different parts of the country. Sometime it was lack of planning & foresight, sometime sheer human error of judgement by those leaders who took it upon themselves to decide what the people of India want.
  • It is sad and at least one whole generation of Indian really suffered badly the shortages of everything in terms of Goods or Services. From rationing of essential food items to non-availability of Consumer Durable/ Non-Durable products, there were booking/ waiting periods for everything from telephone, cooking gas connection to Automotive (scooters, bikes, cars). The global brands were not available, only the locally produced (general a cheap & low quality copy of the global products) at exuberant prices. These were the lost decades post independence from 1950’s till 1980’s.
  • But it was not surprising, considering that for centuries, India under the occupation of  foreign invaders who looted it mercilessly, it been sliding downhill. Decline economically, socially, culturally, while the rest of the globe was experiencing Industrial revolutions, Economic booms and Renaissance.
  • Growth rate took a quantum jump post the economic liberalization & reforms in early 1990’s and now India’s growth story is too well-known across the globe.
  • In fact, the India story is not just well-known now, it is becoming rather over hyped. The expectations are ballooning so fast that any sane person would argue a cautionary approach in all this mayhem.
  • Buts it is also a fact that the India Growth Story is far from over, there is still vast areas for improvement, huge potential for growth across various sectors. There is still a long way to go, we just need a good leadership for political & economic direction setting.
  • If that is too much to ask for India at least needs a Government which can Govern effectively.
  • We, the 1.2 billion people of India, deserve something better, after centuries of struggle, and my personal belief is that we will reach there, it may take a little more time then expected, we have the patience.

Lets look at the some interesting trend numbers from India. These were published  in their State of Indian Agriculture report 2011-12 recently by Government  of India.

(Link to the detailed report http://agricoop.nic.in/SIA111213312.pdf )

  • The agriculture sector in India has undergone significant structural changes in the form of decrease in share of GDP from 30% in 1990-91 to 14.5%  in 2010-11.Indicating a shift from the traditional agrarian economy towards a service dominated one.
  • This decrease in agriculture’s contribution to GDP has not been accompanied by a matching reduction in the share of agriculture in employment.
  • About 52% of the total workforce is still employed by the farm sector which makes more than half of the Indian population dependent on agriculture for sustenance (NSS 66th Round).
  • However, within the rural economy, the share of income from non-farm activities has also increased.
  • Plan Wise Share (%) to Total Economy by Economic Activity (2004-05 prices)

  • Growth in the production of agricultural crops depends upon acreage and yield. 
  • Given the limitations in the expansion of acreage, the main source of long-term output growth is improvement in yields.
  • In the case of wheat, the growth in area and yield have been marginal during 2000-01 to 2010-11 suggesting that the yield levels have plateaued for this crop. This suggests the need for renewed research to boost production and productivity. 
  • Due to the challenge of feeding our vast population soon after independence and the experience of food shortages in the pre-independence era, ‘self reliance’ in food grains has been the cornerstone of our policies in the last 60 years. 
  • Food grains dominate the share of total crop output though their relative share has decreased from 42 percent in TE 1990-1991 to 34 per cent in TE 2009-2010. 
  • India has made real progress in terms of overcoming national food insecurity by giving priority to self-sufficiency in food grain production by following an agricultural strategy well-known by the name ‘Green Revolution‘. 
  • As a result of the new strategy, the food grain production increased from 82.02 million tonnes in 1960-61 to 250.42 million tonnes (2nd advance estimate) in 2011-12.
  • All India Estimates of Production of Foodgrains Production (million Tonnes)

  • All India Estimates of Yields of Foodgrains Yield (kg/Hectares)

Production of Commercial Crops (Million Tonnes/bales)

  • Production of horticultural crops has increased considerably as compared to the situation a couple of decades ago. 
  • The area under horticulture crops has increased from 16.6 million ha in 2001-02 to 22.25 million ha in 2011-12 with a corresponding increase in production from 145.8 million tonnes to 247.54 million tonnes, with a productivity level of 8.8 to 11.13 tonnes per ha. 
  • Thus, there has been a phenomenal increase in area, production and productivity during this period amounting to 34 percent, 70 per cent and 26 percent, respectively. 
  • With the growth trend, horticulture is expected to play a dominant role in the overall development of agriculture in the country in the coming years. 
  • Fruits and vegetables, together, constitute about 92% of the total horticultural production in-the country.
  • Area , Production & Productivity of Horticulture Crops (AREA : M.Ha. PRODUCTION: Million tones. Pdty / Yield: Tonne/Ha.)

  • The per capita per day net availability (adjusted for exports, imports, seed feed and wastage and change in stocks) of cereals and pulses has declined since the early 1990s.
  • However, prices of cereals have remained, more or less, stable as there has been a gradual shift in consumer demand from cereals to high value items such as fruits and vegetables; milk and dairy products; and egg, meat and fish as revealed by the household consumption expenditure surveys of the National Sample Survey Office.
  • There is significant shift in the share of consumer expenditure both in rural areas as well as urban areas from cereals to other products. For example, in rural areas, in respect of cereals, the share has significantly reduced from 26.3% in 1987- 88 to 15.6% in 2009-10. The corresponding figures are 15% and 9%, respectively in case of urban areas.
  • As regards changes in the per capita consumption of different commodities there has been a reduction in the case of rice in rural as well as urban areas.
  • However, the consumption of coarse cereals has been considerably reduced particularly in rural areas. There has been increase in the consumption of banana, vegetables, milk, eggs, fish and chicken in both rural and urban areas.
  • The per capita consumption of cereals, fruits and vegetables and milk as reported by the consumer expenditure surveys of NSSO are given above.
  • Per-Capita Net Availability of Foodgrains (Per day) in India ( As on 16.03.2011) (Grams Per Day)

  • Per-capita Consumption of Conventional Food Items

  • Per-capita consumption of Fruits & Veggies, Milk, Eggs, Meat, Chicken and Fish has increased significantly over the years.
  • Per-capita Consumption of Emerging Food Items

  • Expenditure on essential items (e.g. Food, clothing, etc.) as a % contribution to  total consumer expenditure is coming down
  • Consumers are spending more on Discretionary items (Durable goods, Misc. goods & Services)
  • Expenditure on Tobacco, etc. has declined.
  • Though the consumption of beverages & fast food has increased, but the per-capita consumption is still far lower than the developed countries.
  • Percentage Composition of Consumer Expenditure

  • Top 10 Agricultural Exports Items

  • Top 10 Agricultural Import Items

  • Production of Milk, Egg, Meat and Wool -All India

  • India has been successful in increasing production of food over the past decades through the Green Revolution, of milk through the White Revolution, of fish through the Blue Revolution and of F&Vs through the Golden Revolution.
  • However, due to the changing pattern in consumer demand, there has been a high pressure on the prices of high value items despite a substantial increase in the per capita availability of theses items over the years.
  • Apart from population pressures, there has been a slowing down of the rate of growth of yield and production of rice and wheat, especially in the former green revolution belt.
  • The changing pattern of consumer demand calls for a diversification of the agriculture production system.
  • There is need to substantially increase production of pulses, oil-seeds, fruits and vegetables.

We have come a long way since 1947, but there is no time to slow down, it is not yet time to stop as we still have a long way to go…

“The woods are lovely, dark and deep.

But I have promises to keep, and miles to go before I sleep.”

Robert Frost  (American poet, 1874-1963)

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