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The agriculture and allied sectors are estimated to have grown by just 1.8% in 2012-13. Drought in Maharashtra, Karnataka, Rajasthan and Gujarat because of poor monsoon had affected crop production.
"We had projected average growth rate of 3.4% for agriculture sector in the 11th Plan. All indication are that monsoon will be normal, we expect agriculture sector to do well this year," Rangarajan said at the Assocham conference on gold.
"If monsoon is normal, 3.4% growth rate is achievable in the agriculture sector this fiscal," he added.
South west monsoon -- the lifeline of Indian agriculture -- is all set to bring showers over the Andaman Sea in the next two to three days.
Last month, the weather office had forecast normal monsoon this year with overall rainfall expected to be 98% of the long period average.
Monsoon is crucial for the kharif crops such as rice, soyabean, cotton and maize because almost 60% of the farm land in the country is rainfed.
The country's foodgrain production is estimated to have declined at 255.36 million tonne in 2012-13 crop year from record 259.32 million tonnes in the previous year.
