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TNPSC Free Notes Economy In English- Agriculture

இந்தக் கட்டுரையில், TNPSC குரூப் 1, குரூப் 2, குரூப் 2A, குரூப் 4 மாநிலப் போட்டித் தேர்வுகளான TNUSRB, TRB, TET, TNEB போன்றவற்றுக்கான  முறைகள் இலவசக் குறிப்புகளைப் பெறுவீர்கள்.தேர்வுக்கு தயாராவோர் இங்குள்ள பாடக்குறிப்புகளை படித்து பயன்பெற வாழ்த்துகிறோம்.


Role of Agriculture in Economic Development
Agriculture occupies a very important place in the economic life of our country.
It is the backbone of our economic system.
Agriculture has been the major source of livelihood in the Indian economy.
India is primarily an agricultural country.
The fortunes of the economy are, even now, dependent on the course of agricultural
The importance of agriculture in the national economy can be best explained by considering
the role of agriculture under the following heads.
1. Contribution to National Income
Agriculture contributes even now a major share of the national income in India.
The distribution of national income by industrial origin for the period 1950-51 to 1979- 80
shows that the share of various agricultural commodities, animal husbandry and
ancillary activities has always been more than 40 percent.
As a matter of fact, during the fifties, it contributed around half of the national output.
During the eighties and nineties, a further fall in this proportion took place.
During 2002-03, it stood at about 25 percent.
2. Major source of Livelihood
The main source of livelihood is agriculture.
Six out of every ten persons in India depend upon agriculture.
In industrially advanced countries like U.K., U.S.A., etc, the number of people dependent on
agriculture is very low as compared to India.
Over the years 1921-2001, the size of the labour force dependent on agriculture had more
than doubled.

The sector is plagued by evils such as underemployment, disguised unemployment and low
productivity employment.
3. Provider of Employment
Agriculture provides employment and work to an overwhelming majority of the Indian
In villages, about seventy percent of the people earn their livelihood from cultivation and
allied agro-industries.
In absolute terms, agriculture provided employment to 97 million persons in 1995; the
number of people working on land (cultivators and agricultural labourers) increased to
235 million.
4. Industrial development
Agriculture provides raw materials to the industries.
Cotton and Jute textile industries, sugar, vanaspati and plantations – all these depend on
Many of our small-scale and cottage industries like handloom weavings, rice husking, coir,
khadi etc., depend upon agriculture for their raw materials.
There are many other industries, which depend on agriculture in an indirect manner.
5. International Trade
Indian agriculture plays an important role in the country’s international trade.
The main exported agricultural commodities are tea, oil cakes, fruits and vegetables, spices,
tobacco, cotton, coffee, sugar, raw wool and vegetable oils.
Agriculture contributes to a sizeable part of exports and it is an important segment of
imports of the economy.
The agricultural sector is a net earner of foreign exchange.
6. Capital Formation and Investment
The major part of production assets of the country is in the form of agricultural assets like
land, irrigation facilities, tractors, agriculture implements, ploughs, pump sets and
Since agriculture contributes about 25 percent of the national income, this sector is the
primary source of savings and hence capital formation for the economy.
7. Food and Fodder

In India, agriculture meets almost the entire food requirements of the people.
Agriculture also provides fodder to sustain livestock whose number runs to several crores.
8. Economic Planning
Agriculture is the backbone of the Indian economy and the prosperity of agriculture can also
largely stand for the prosperity of the Indian economy.
Importance of agriculture in the national economy is indicated by many facts.
For example, agriculture is the main support for India’s transport system, since railways and
roadways secure the bulk of their business from the movement of goods.
Internal trade is mostly the agricultural products.
Agricultural growth has a direct impact on poverty eradication.

9. International Ranking
At the global level, Indian agriculture has ranked in certain commodities.
In the case of,
Groundnuts production, India stands first in the world.
In rice production, it ranks second,
For tobacco production, it occupies the third rank in the world.
The significance of India arises also from the fact that the development in agriculture is an
essential condition for the development of the national economy.
According to Ragnar Nurkse, surplus production in agriculture should be removed and used
in newly started industries and public works in rural areas.
By doing so, agricultural productivity will be increased on the one hand, and on the other,
new industrial units would be set up with the use of surplus labour.
Agriculture is not only the largest and most important sector of the Indian economy but also
the most backward one.
The growth of agriculture, therefore, is of vital importance for the growth of the entire
Contribution of Agriculture to Economic Growth
Simon Kuznets identifies four possible types of contribution that the agricultural sector is
capable of making for overall economic development.
These are:
Product contribution i.e., making available food and raw materials.

Market contribution i.e., providing the market for producer goods and consumer goods
produced in the non-agricultural sector.
Factor contribution i.e., making available labour and capital to the non-agricultural
Foreign Exchange contribution.
Relationship between Agricultural and non-agricultural sector
During the process of development, interdependence between agriculture and the industry
has become stronger through the,
Production linkages
Demand linkages
Savings and investment linkages.

1. Production Linkages
Production linkages arise from the interdependence of agriculture and industry for
productive inputs.
i.e., supply of agricultural materials such as cotton, jute, sugarcane, etc., to agro-based
industries and supply of fertilizes, machinery and electricity by industry to agriculture
over the last five decades.
These linkages have got further strengthened with agriculture’s dependence on industry
reflecting the modernization of the agricultural sector.
2. Demand linkages
The impact of incomes and industrialization on the demand for food and agricultural raw
materials is generally recognized.
3. Savings and Investment linkages
Equally significant is the impact of rural income on industrial consumption goods, i.e.,
clothing, footwear, sugar, edible oils, TV sets, washing machines, refrigerators, motorbikes,
etc. A recent study concludes; “Rural bazaar outbuys urban market”.


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