Market growth of the Agricultural Sector in India in 2016

Agriculture plays a vital role in India’s economy. 58 percent of the rural households depend on agriculture as their principal means of livelihood. Not only agriculture but also  agricultural products in India play a vital role. Fisheries and forestry is one of the largest contributors to the Gross Domestic Product (GDP).

As of 2016, the share of agriculture and allied sectors (agriculture, livestock, forestry and fishery) is 15.35% of the Gross Value Added (GVA).

India is the largest producer, consumer and exporter of spices and spice products. Initially, vegetable production was very high. But since few years, fruit production has taken over. India has become the second largest fruit producer in the world. India’s horticultural output which comprises of fruits, vegetables and spices recorded to 283.5 million tonnes making it third in farm and agriculture outputs. Agricultural export constitutes 10 per cent of the country’s exports.

The  agriculture industry  in India is divided into several sub segments such as canned, dairy, processed, frozen food to fisheries, meat, poultry, and food grains.

Over the past years, many factors have come together to facilitate growth in the agricultural industry. The rise in the disposable income of the people, growth in the household income, consumption, expansion of the food processing industry and increase in agricultural exports has hastened the growth.

Many new trends are also being observed, some of which include rising private participation in Indian agriculture, growing organic farming and use of information technology.

The market size of the Indian agricultural industry is:

v Food grain production- 253.16 million tonnes

v Pulse production- 17.33 million tonnes

v Milk production (India is the largest producer of milk) - 146.3 million tonnes. It contributes to 18.5% of the total world milk production.

v India is the second largest producer of sugar, accounts for 14% of the global output. It is also the 6^th largest producer of sugar accounting for 2.76% of the global exports.

v Rice production- 30 million tonnes

Given the importance of the agricultural sector, the Government of India, in its budget for 2016-17 stated that it has planned several steps for sustainable development of agriculture. It also proposed a slew of measures will be taken to improve agriculture and increase farmer’s welfare.

In the next few years, the agriculture industry  is expected to generate better momentum and increased investments in agricultural infrastructure such as irrigation facilities, warehousing and cold storage.