He also said farmers' income and agri-land yields need to be enhanced to meet the growing foodgrains demand in the coming years, building on the success of the 11th Plan.
Addressing the 57th meeting of the National Development Council (NDC), Singh said: "Paradoxically, we should not aim at increasing total employment in agriculture. In fact, we need to move people out of agriculture by giving them gainful employment in the non-agricultural sector."
"It is only when fewer people depend upon agriculture that per capita incomes in agriculture will rise significantly and sufficiently to make farming an attractive proposition."
Although the agriculture share in GDP has fallen to 15 per cent, about half of the population still relies on farm activities as its principal income source, he added.
Since large population is engaged in farm activities, Singh said, "what happens in agriculture is therefore critical for the success of inclusiveness."
Better agricultural performance during the 11th Plan is an important reason why poverty declined faster, he added.
Agriculture being a state subject, the Prime Minister said that most of the policy initiatives needed are in the realm of state governments.
However, the 12th Plan strategy contains many elements which will ensure growth is as inclusive as possible, he said.
During the 11th Plan (2007-12), the average agriculture sector growth reached 3.3 per cent from 2.4 per cent in the previous Plan period, while farm wages grew annually at 6.8 per cent in the recent years, compared to only 1.1 per cent in the period before 2004-05, he added.
