India has experienced a remarkable transition in recent decades, from chronic food deficits in the 1960s to national food surpluses on average today, despite a more than doubling of the population. This has been accompanied by an equally dramatic reduction in poverty; from about 60 percent of the population in the 1960s to less than 30 percent today. Poverty and malnutrition still persist at unacceptably high levels, but this is due to insufficient access to income rather than the ability of the agricultural sector to feed the entire population. But even as one battle has been won, the agricultural sector is challenged by a rapidly changing market situation, continuing high rural poverty levels and rural underemployment, and serious water management problems that require a significant response if rural areas are to continue to prosper. Growth in domestic demand for food staples is now flat, and India faces limited export opportunities for these crops. While there are still far too many Indians who do not get enough to eat, solving this problem now requires solutions that raise the incomes of the poor, not solutions that simply produce more food. Given these limited market prospects for food staples, further increases in farm incomes will to a significant extent have to come from diversification into higher value crop, livestock, and processing activities. Fortunately, the improved performance of the national economy in recent years has raised living standards for many, and demand for higher value foods (fruits, vegetables, oils, fish, livestock products, etc.) and processed and precooked foods has grown at unprecedented rates. Add to this the potential for new export market opportunities that trade liberalization is bringing about for many of the same products, and there is a match between the demands of the market and the need for farmers to diversify into higher value activities.
|Title of host publication||Economic Reform in India|
|Subtitle of host publication||Challenges, Prospects, and Lessons|
|Editors||Nicholas C. Hope, Anjini Kochar, Roger Noll, T.N. Srinivasan|
|Publisher||Cambridge University Press|
|Number of pages||38|
|Publication status||Published - 1 Mar 2013|