India has always been a country driven by an agrarian economy before the British rule. Most of the population of this beautiful land lived in villages and earned their living by engaging themselves in agriculture. India is best known as the land of farmers and the soul of the country lies in its villages. Thus, the socio-economic development of India was completely or mostly dependent upon agriculture blessed by the natural resources present at that time.
The Indian economy had just put itself on the platform of development with the world economies, then the British rule posed a red flag in front of India’s train of development. The British rule in India was all about exploitation and harassment. Raw materials from India were exported to Britain and manufactured products with these raw materials were sold to Indians at higher prices. Farmers were forced to grow crop as per the requirement of the British and they were never paid a good price. All this led to continuous economic recession in India till Independence.
Even after Independence, the situation was still challenging. The then government had to make certain decisions that were going to shape the Indian cconomy forever. And to choose the Prime Moving Force (PMF) of the economy was one of them. Prime Minister Pandit Nehru was the one in the dilemma of choosing the PMF of the economy. Many meetings were called. At last, the prevailing threat by the continuous development in defence infrastructure by the neighbouring countries became the main driving force to choose industry over agriculture as the prime moving force of the economy.
Motive was simple. To lead India to a level where she is able to protect herself from the possible threats from other nations. And the industrial sector was supposed to take India to this level. But on the other side of the coin, this decision is considered as one of the most criticized decisions in the Indian Economy. There are many arguments to support that. Firstly, if agriculture over industry was chosen as PMF, India could have used the natural resources available to its best, which could directly help in the growth of the economy.
Now, industry being the PMF could not directly use the natural resources making the potential of the resources dull. Secondly, the industry sector needed a huge amount of investment in infrastructure and capital, which was like starting things in the industry from zero. Thirdly, unavailability of proper work force. Industrial sector workers required education level a little higher than those of workers in agriculture sector. India at that time lacked this education base in the workers and thus it took a whole new generation to come up with a required education level and join in the development agendas.
Thus, with this slow pace Indian economy went ahead with industry as PMF. At the same time, if we take a look at China, they chose agriculture as their PMF in 1949 taking into account their natural resources. They first established their people with agriculture in which they had the required skills and resources. Then later they developed infrastructure and industries with the help of the progression realized in agriculture. They are now growing as the second largest economy with huge manufacturing entities.
When India changed its PMF from Industry to Agriculture in 2002, they case studied the Chinese economy. Economists realised that the governments are still unable to bridge the gap between the education level of workers in agriculture and the workers in industries. India moved likely to become a place for only the people engaging in industry sector, thus making people engaged in agriculture poor to poorer and the people engaging in industries rich to richer.
Now, it is too late for the agriculture sector to stand up properly. At this moment, all this sector needed was a huge investment. Introduction to new technologies, incentivisation to AgriTech startups, promotion of agricultural market and most importantly intention and attraction of work by the government. But what we see on ground is something different.
Governments are focusing more on subsidies, loan waivers to satisfy their vote bank instead of developing technology and using them in the agricultural sector. Loan waivers and subsidies directly impact badly in the economy and these are also not permanent solutions for farmers empowerment. Data shows that these things are helping only a part of the farmers who are rich, as most of the small and marginal farmers haven’t taken loan from formal lenders like banks.
Marketing has also been a huge problem in the agricultural sector. Farmers are not getting proper markets to sell their goods. Government should incentivize the investors to invest in the agriculture sector and enter into the Agriculture Marketing instead of implementing vote bank oriented schemes.
To conclude, we are the most rapidly growing economy in the world. India has crossed even China in growth statistics in recent times. But if we look into the contribution of different sectors of the Indian economy, agriculture even being the PMF of the Indian economy still contributes the least to the GDP of India. And there’s definitely a problem if the PMF is contributing the least in the economy. We the people and the Government need to introspect into this crucial issue before the politicization of agriculture sector makes further damages the economy.