Share of agriculture in India's GDP sliding down

[Ulhas Joglekar]

The Economic Times Online
Share of agriculture in GDP sliding down
Radhika Singh
NEW DELHI 4 JANUARY
THE SHARE of agriculture in India’s gross domestic product (GDP) is
consistently declining as trends over the last five years revealed.
Last year, high agricultural growth rate was responsible for propping up
GDP, but the share declining in real terms is not a good sign.
According to the figures released by the Central Statistical Organisation
(CSO), the share of agriculture including animal husbandry, forestry, and
fishing in the GDP has been declining. Though the CSO has not yet released
official figures for 1999-2000, the unofficial figure doing the rounds is
2.8 per cent.
The Ninth Plan targeted agricultural growth at 4.5 per cent and the
agriculture ministry is optimistic of achieving that rate. Agriculture
ministry officials said that it is still early to predict the growth rate
for the agricultural year which is calculated from July 1999 to June 2000.
In 1998-99, agriculture has a share of 26.8 per cent in the GDP calculated
at a base of 1993-94 prices of agricultural produce. The previous year it
was pegged at 26.4 per cent. But on a five year average, agriculture’s share
as a per centage of GDP has declined from as much as 29.7 per cent in
1994-95. After marginally recovering to 28 per cent in 1996-97 when India
saw a bumper foodgrain production of 199 million tonne, its been on the
downslide.
An agriculture ministry official said that agriculture’s share of GDP tends
to decline as a result of the process of economic growth and development.
The source said constant decline in the share of agriculture is attributable
to the continued higher growth that is taking place in oher sectors of the
economy.
So far foodgrain production has looked good. Foodgrain production will cross
the magic 200 million tonne mark in 1998-99. Rice and wheat production are
both headed for record yields at 83 and 73 million tonne respectively. The
rice production for this agricultural year is likely to be scaled down by
one to two million tonne after the Orissa cyclone took its toll.
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