Tuesday, March 8, 2011



A seminar on "Why inclusive growth does not take place in agriculture?" was organized here by the Department of Economics and Sociology, PAU, which saw the participation of the students from the Department of Business Management and Agricultural Journalism. Dr Sucha Singh Gill, a well-known economist and Director General of Centre for Research in Rural and Industrial Development, Chandigarh, delivered a thought- provoking lecture on this occasion.

Addressing the gathering, Dr R.S. Sidhu, Dean, College of Basic Sciences and Humanities, PAU, stated that the idea of inclusive growth, which is a new name for growth with social justice, came from the Constitution of India from Article 39 of the Directive Principles, where the Constitution binds us against the concentration of economic power, wealth, etc. That was the reason for inclusive growth being a focus of the 11th Plan, added he. Dr Sidhu pointed out that despite recent faster growth in the Indian economy; there was no change in the extent of malnutrition among the children in the age group of 0-3 years. Such proportion was 47% in 1988-89 and remained almost unchanged at 46% in 2005-06. Quoting Kuznet's thesis, he said that "as growth takes place, there is a decline in importance of agriculture sector with respect to labour and income". He pointed towards larger contribution of agricultural sector towards national incomes of the developed countries in the early 1980s.

Enhancing the knowledge of the participants, Dr Gill explained that the market forces are not in favor of the farmers as prices of the agricultural inputs and outputs are not determined by them (farmers). The share of producer in consumer's rupee is always much less due to the existence of large number of middlemen in the supply chain of farm produce. Due to all these reasons, Dr Gill added, that almost 95% of the Indian farmers are economically unviable. Income from all the sources does not suffice to sustain their livelihoods and thus they are in debt, said he, while stating that as this debt largely comes from the non-institutional sources, this leads to accumulation of debt over time. He highlighted that despite a sharp decline in poverty ratio over time, there has been a sudden increase in the incidence of malnutrition amongst the farming families during 1999-2000 to 2004-05. This is largely being caused by crippling of health and education services in rural areas. He pointed out that 25 % of the debt of small and marginal farmers was on account of inflated medical bills and the economies of scale are found to disfavor them. The rise in consumption disparities between the rural and urban households was also stressed by Dr Gill. While the ratio of rural-urban consumption was 1:1.33 in 1970s, it widened to 1:1.88 in 2004-05 despite under-estimated figures for the urban areas. He added that the even the value created in agriculture is largely cornered by the non-farm community and hence the system does not favor agriculture as a whole in the development process. This is the reason for the growth becoming exclusive in nature, remarked he.

Outlining the ways to make the growth inclusive in nature, Dr Gill said that it was possible by enhancing public investment in agriculture, especially in public irrigation and land improvement. He laid stress on the need for massive investment in R&D, rural health and education and reduction in the length of supply chains by reducing the number of middlemen. He proposed the need to evolve new kind of cooperative mechanism where farmers pool together for inputs, production, marketing and processing to achieve the economies of scale. Increased public allocation for rural areas was also emphasized with the focus on the active role of the central and state governments.

Earlier, Dr M.S. Sidhu, Professor and Head, Department of Economics and Sociology welcomed the dean, speaker, members of the faculty and students of various departments of PAU. An interactive session took place where all the queries pertaining to inclusive growth were responded by Dr Gill.

News From: http://www.7StarNews.com

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