Efforts made to revitalise agri, rural economy

Recent documents by NITI Aayog and periodic labour force surveys on employment show that the importance of agriculture is rising in the Indian economy.

- S MAHENDRA DEV

A Nabard survey shows a sharp rise in the share of agricultural households in the rural sector with the numbers shooting up from 48 per cent in 2016-17 to 56.7 per cent in 2021-22. The share of agriculture in total employment in India rose from 42 per cent in 2018 to 46 per cent in 2024. Agriculture sector has grown at an annual growth rate of 4.2 per cent in the last five years. However, FY24 recorded a dismal 7-year low of just 1.4 per cent.

Agriculture in FY25 is expected to grow at 3.8 per cent.

There seems to be some revival in rural demand and consumption. However, food inflation was high at 8.4 per cent in December 2024. Rural real wage growth has been either low or negative in the last one decade. In the context of rise in the share of agriculture in employment and stagnant wages in rural areas, more push for agriculture and rural demand was expected. Supply side initiatives are needed to contain food inflation.

The Finance Minister has not disappointed. The measures announced in the Budget on agriculture and rural areas are in the right direction. The announcements on capital expenditure, manufacturing, services, MSMEs, health and education, taxation etc. will also help agriculture and rural areas.