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India's Strong Macro Economic Fundamentals & Robust Agriculture Sector: Overview & Future Trends

Discover India's thriving macroeconomic fundamentals and dominant agriculture sector, with valuable insights into production, machinery, and trade. Explore the country's fiscal stability, FDI inflows, global trade, and agriculture's significant contribution to the economy. Delve into agriculture production statistics, major crops, and changing agricultural machinery trends, alongside future requirements and trade policies.

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India's Strong Macro Economic Fundamentals & Robust Agriculture Sector: Overview & Future Trends

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  1. Dr Amit Mitra Secretary General Federation of Indian Chambers of Commerce and Industry (FICCI) Rome 30-31 May 2008

  2. INDIA - Strong Macro Economic Fundamentals • US $ 1 Trillion Economy Average Growth Rate (%)

  3. INDIA - Strong Macro Economic Fundamentals • Improving Fiscal Situation Fiscal Deficit

  4. INDIA - Strong Macro Economic Fundamentals • FDI Inflows on the Rise [US$ Million] Foreign Direct Investment (FDI)

  5. INDIA - Strong Macro Economic Fundamentals • Rapidly Increasing Global Trade [US$ Billion]

  6. INDIA - Strong Macro Economic Fundamentals • World’s Fourth Largest Foreign Exchange Reserves • US$ 313 Billion as on April 25, 2008 Forex Reserves

  7. INDIA - Agriculture • Agriculture in India • Contributes 18.5% to the National GDP • Provides Employment to Nearly 50% Workforce or • 70% of Population • Second Largest Arable Land in the World. Highest • Arable Land to Land Size Ratio • Largest Irrigated Land Network • Favorable & Diverse Agro-climatic Conditions for a • variety of crops Milk Largest Producer 91 Mn T Cattle / buffaloes Largest in the world 283 million F & V #2 in the world 129 Mn T Fisheries Marine: 2.7 Mn T Inland : 3.1 Mn T Tea Largest Producer (0.85 Mn T) Food Grains #2 in the world (218 Mn T) Goat & Sheep 182 million Sugarcane # 2 in the world (245 Mn T)

  8. INDIA - Agriculture • Dominating Crops WHEAT RICE

  9. INDIA - Agric ulture • Food Grains Production (Million Tonnes) TOTAL FOODGRAIN RICE WHEAT COARSE CEREALS PULSES 2007-08 figures pertain to III Advanced Estimates

  10. INDIA - Agriculture • Commercial Crops Production (Million Tonnes) OILSEEDS COTTON JUTE & MESTA SUGARCANE 2007-08 figures pertain to III Advanced Estimates Cotton – Million bales of 170 kg each Jute & Mesta – Million bales of 180 kg each

  11. INDIA – Agriculture Machinery Sector Need for Mechanization Total = 68% (207 M) • Even though Agriculture still Supports the Majority of Indian Population, Yet • Non-farm activities in rural areas are witnessing a rise in entrepreneurship and employment. As a result, number of people involved in agriculture is declining over the years. • Crop Diversification • Migration • To Achieve Higher Productivity • Monsoon Dependent (less Time lag for Manual Operations) Total = 60% (238 M) Total = 52% (250 M) Food grain production (Mt) : 129 210 209 Acreage (M ha) : 125 123 122 Labor/ area : 1.6 1.9 2.0 Tractor Pop. (M) : 0.7 2.5 3.1 Source: NSSO, 2005

  12. INDIA – Agriculture Machinery Sector • Changing Focus on Agri-mechanization - Automation Percentage share of Power usage in Indian agricultural sector Total Power Consumption (kW/ha) Source: Indiaagristat.com, Zinnov Research, 2007, Vision 2020 India, John Derre

  13. INDIA – Agriculture Machinery Sector Comparison of Mechanization with Other Countries, 2003 Source: FAO Yearbook 2003

  14. INDIA – Agriculture Machinery Sector • Indian Farm Equipment Market is expected to grow at a CAGR of ~5% • Indian Agriculture Farm Equipment Market is now widely exposed to International Trade • Favourable Factors: • Monsoon • Government Declared Support Prices for Crops • Supportive Credit Policy of Banks

  15. INDIA – Agriculture Machinery Sector • Usage Trends of Major Farm Equipment

  16. INDIA – Agriculture Machinery Sector Tractors • Use of Tractors has witnessed an increase of more than 78% since 1994 • There are nearly 13500 tractors per million hectares at present in India

  17. Combines Migration - Rabi and Kharif Wheat- From Punjab & Haryana to MP and Maharashtra (till end of March) and then to Haryana and UP (till 10th April).Return back to Punjab (by 15 Apr)

  18. Combines Migration - Rabi and Kharif Rice & Soyabean-From Punjab & Haryana to MP and Maharashtra for Soyabean(till Oct 15) and then to Haryana and UP for Rice (till Oct end).Return back to Punjab (by 1st week of Nov)

  19. INDIA – Agriculture Machinery Sector Future Requirements of Farm Equipments • Equipment for Seed Bed Preparation • Roto Tillage • Strip Till Drill • Zero Till Drill • Sowing and Planting • Pneumatic Precision Planter • Sugarcane Sett Cutter Planter • Vegetable Transplanter • Potato Planter & Rice Transplanter • Plant Protection Equipments • Power Weeder • Plastic Mulching • Electro Static Spraying • Orchard Sprayer • Irrigation Equipments • Sprinkler Irrigation System • Drip Irrigation System • Surge Flow Irrigation • Harvesting & Threshing • Strip Harvestor cum Reaper Windrower • Mechanical Cotton Picker • Grain Combine Harvestor • High Capacity Multicrop Threshor

  20. INDIA – Agriculture Machinery Sector Agriculture Machinery Trade (Million US$) EXPORTS IMPORTS

  21. Policy Mandate • Requirement for Farm Mechanization • Farm Power Requirement by 2020: 2KW/Ha • Removal of Regional Disparities • Infrastructural & Institutional Framework • Adequate Engineering Infrastructure at Implementation Levels • Effective Training and Extension Service • Repair & Maintenance Facilities • Machinery Banks for Custom Hiring Services • Credit at Simpler Terms • Appropriate Farm Machines & Equipments • For Small and Marginal Land Holdings • Crop Specific & Quality Machines • For Hill Agriculture • Gender Specific

  22. Policy Initiatives by the Government of India to Promote Farm Mechanization • Training • Establishment of Four Farm Machinery and Technology Training Institute (FMTTI) • Demonstration • Large Scale Demonstration of Equipment at Farmers Field • Incentives for Purchase of Equipment • Subsidy Through MMA, NFSM, NHM and Similar Other Schemes Available to all Categories of Farmers • Incentives for establishment of Machinery Banks at Block Levels for Custom Hiring Services • Identification of Machines • Hill Agriculture • Gender frienfdly Tools and Equipments • Crop Specific Package of Machines

  23. Policy Initiatives by the Government of India to Promote Farm Mechanization • Manufacturing Sector • De-reservation of Manufacturing of Agricultural Machines from Small Scale Sector • Training on Manufacturing Technologies Introduced • Quality of Machines • Minimum Performance Standards for Tractors, Power Tillers & Combine Harvesters Framed • Standard Specifications for All Machines • Equipment Promotion Through Subsidy: Testing by FMTTI or BIS certification is mandatory • Credit • NABARD Refinance available & Financing Norms Simplified • Agro Processing Sector • Scheme on Post Harvest Technology • Technologies Developed by ICAR / CSIR Promoted

  24. Rome 30-31 May 2008

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