REIMAGINING ROLE OF AGRICULTURE

In the changed context of economic development, agriculture is seen playing a much larger role than perceived in the dominant thinking in development economics

- RAMESH CHAND

The literature on the role of agriculture in development concludes that structural transformation of economy is marked by decline in share of agriculture in economy's output and employment as an economy grows from low income towards middle and higher income. Based on this, policy emphasis for growth and development tilted towards non-agriculture sectors, specially manufacturing. The root of this line of thinking is traced to the work of British Economist Arthur Lewis (1954), who described economic development as a growth process of relocating resources from agriculture, characterised by low productivity and traditional technology, to modern industrial sector with higher productivity. This theory assigns very passive role to agriculture in economic development but it has been widely used by many developing countries to support industrialisation. In the post-Green Revolution period, some assumptions of Lewis model of development have been refuted. First, the green revolution shows that technology can play a significant role in modernising agriculture and in generation of surplus as visualised for the Industry. Two, the assumption of unlimited supply of labour in agriculture holds no more. These changes have implications for model of economic transformation from agrarian economy to industrialised economy.

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