Greener numbers

The upward revision of farm production estimates for 2004-05, done by the agriculture ministry, lends itself to various interpretations and conclusions. The total foodgrain output is now pegged at a healthy 210.44 million tonnes, against 206.4 million tonnes assessed in January.

The figures for several non-food crops have also been scaled up. The obvious point to conclude from this is that what was trumpeted as a severe drought last year was not the case. It was more a case of poor and erratic monsoon. Viewed from another angle, this could be taken as an indication of the growing resilience of Indian agriculture, thanks to the availability of better seeds and crop production technology.

This aside, the fact that the production loss has been meagre should be viewed as a sign of better management in the face of erratic weather. This may be in response to the media's focus on the monsoon deficiency, because for a change the official machinery did spur into action.

The research network also helped by issuing regular advisories for farmers, advising them on how to cope with the developing situation. As a result, the grain loss in the directly rain-dependent kharif could be contained to 10.9 per cent and the rabi output could be raised by an almost equal extent (10.13 per cent) to largely make up for the loss.

Equally significant is the effect of the revised estimates on the overall national accounts numbers. When the Central Statistical Organisation (CSO) came out with the advance estimate of the gross domestic product (GDP) for 2004-05, in February, it took into account a reduced crop harvest.

The shortfall in foodgrain output was then assumed to be 2.7 per cent, against 1.4 per cent reckoned now. Similarly the shortfall in the output of oilseeds, presumed by the CSO at 1.2 per cent, has turned out to be merely 0.5 per cent.

Quite possibly, the output of sectors like horticulture, livestock, forestry and fisheries was also under-assessed for computation of GDP. Thus, there is every possibility that the overall GDP numbers for agriculture may be raised from the present 1.1 per cent.

This may also happen because rabi production, many agriculture analysts feel, may exceed even the latest estimates. The wheat output figure may have to be scaled up as the temperature and other weather parameters have so far remained highly favourable for a bumper harvest of this main rabi crop.

All this is comforting news. Nevertheless, it does not mean that all is well with Indian agriculture and that the farm sector has left its problems behind.

If anything, it shows that this sector has the potential to boost growth if farmers, farm researchers and policy planners work in tandem to exploit the potential. There is no shortage of challenges before the farm sector, which need to be overcome to get on to a sustained growth trajectory.