The New Era of Indian Agriculture and Allied Sectors

Syllabus: GS3/ Agriculture

Context

• India’s agriculture and allied sectors are witnessing a significant transformation, marked by rising productivity, stronger farmer support systems, and greater resilience.

Agriculture Sector in India

• Agriculture remains the backbone of India’s economy, providing livelihoods to approximately 46.1 percent of the workforce. 
• Livestock and fisheries have maintained stable growth of 5-6 per cent strengthening rural incomes and supporting agricultural diversification. 
• The GVA of the Agriculture and Allied Sector is estimated to have increased to Rs.52.08 lakh crore in 2025-26.
• Budget allocation for the Department of Agriculture and Farmers Welfare increased to Rs.1,40,528.78 crore in 2026-27.
• Agricultural exports rose to USD 51.1 billion (FY25), with the share of processed food increasing to 20.4%, signalling value-added growth.

Major Challenges Faced by the Agricultural Sector

• Water scarcity & irrigation: Agriculture in India is highly dependent on monsoon rain, which can lead to drought and erratic patterns of rainfall.
  • Major issues are access to irrigation facilities and water management especially in water scarce locations.
• Limited access to credit and finance: Small and marginal farmers often have problems in getting access to loans and financial services.
• Small land holdings: The average farmer is a small land holder resulting in fragmented and uneconomical farming techniques.
  • This hampers them to adopt new farming methods and technologies leading to low output.
• Outdated farming practices: A large section of farmers in India still follow traditional and obsolete farming methods.
• Market volatility & price fluctuations: Farmers in India typically encounter price volatility due to lack of adequate market linkages, middlemen and price information. 
• Soil Degradation: Intensive chemical-based farming has degraded about 30 per cent of the entire land in India.
• Excessive use of urea and pesticides and reduction in organic matter have led to nitrogen imbalance, harming soil fertility and ecosystem services.
• Rising Input Costs: The Green Revolution paradigm is reaching the point of diminishing returns, with rising input costs outpacing gains and leading to indebtedness and farmer suicides.
• Impacts of Climate Change: Agriculture production and food security are under threat from rising temperatures, irregular rainfall, floods, droughts and extreme weather events.

Way Ahead

• Diversification: Encourage the shift from cereal-based agriculture to horticulture, dairy, livestock, fisheries, sericulture, beekeeping and agro-forestry to raise farm revenues and minimise dependence on a few crops.
• Expand the usage of micro-irrigation systems using drip and sprinkler technologies for improved water-use efficiency.
• Empower Farmer Producer Organisations (FPOs) and cooperatives and Self-Help Groups (SHGs) to enhance aggregation, bargaining power, access to credit and market linkages.
• Promote food processing, cold-chain networks, warehousing and logistics so as to reduce post-harvest losses and boost farmers’ participation in consumer prices.
• Support start-ups, agri-tech breakthroughs and data-driven farming solutions that boost production, efficiency and market access.

Source: PIB