LAST YEAR, the agricultural sector achieved a growth rate of 3.1 per cent against the target of 3.4 per cent.
Low production of wheat and some minor crops was the main cause of missed targets despite better harvests of some major crops like cotton, sugarcane and maize along with satisfactory performance by the livestock sector.
Bad weather and floods predominantly remained the major causes of lower agricultural output.
In the same year, GDP growth was recorded at 3.7 per cent, lower than actual target of 4.2 per cent but above the revised target of 3.6 per cent and also the three per cent in 2010-11.
The positive correlation of agricultural GDP with the overall GDP suggests that agriculture is a significant factor in determining the economys performance. Keeping in view the thrust of growth of agriculture sector, a target of 4.1 per cent was fixed for this year.
The targeted growth was based on the expected contributions by the major crops (four per cent), minor crops (4.5 )), livestock (4.2), fisheries (two) and forestry (two per cent).
The projections for major crops were based on the output of 25.5 million tons wheat, 6.9 million tons rice, 59 million tons sugarcane, 14.5 million bales of cotton, and 4.3 million tons of maize. The assumption was based largely on the level of production already achieved along with the performance over the last three years. Minor crops such as gram, onion and sunflower remained extraordinarily low because of unfavourable weather conditions last year. It was expected that performance of minor crops will revive and contribute positively towards the overall agricultural GDP.
For the crop sector, key contributing factors, including weather conditions, have remained comparatively better. Agriculture credit disbursement is increasing along with availability and use of fertilizer and improved seed. Plant protection measures and farm mechanisation are improving.
The underlying assumptions for the livestock sector, whose contribution in agricultural GDP (55 per cent) is more than the crop sector, are that its performance has been very steady being less prone to vagaries of weather.
The sector has achieved growth of about four per cent for the last many years. The poultry sector also witnessed sustained high growth rates well above six per cent annually.
A big push in growth rate of livestock is, however, not possible due to peculiar nature of the activities and gestation period required for an activity to become productive. The resilience of the livestock supports growth even in worst natural calamities. Target for fisheries and forestry growth has been fixed at two per cent. The share of both is negligible in agricultural GDP and hence to the overall economy.
In Kharif (or summer) season, major crops like cotton, rice and sugarcane are grown. Wheat is only the major crop of Rabi or winter season.
The Kharif season is already over. Provisional production data available from Suparco indicate that about 13.9 million cotton bales of standard weight (170 kg) will be produced this year. The production of sugarcane and rice can be anticipated at 68.5 and 7.2 million tons respectively.
If the production of minor crops is assumed normal and the livestock sector follows the fixed growth pattern i.e. around 4.1 per cent per year, wheat remains the only decisive factor to determine the actual agricultural GDP for 2012-13.
With the available data of cotton, rice, sugarcane and anticipated achievement of livestock sector, the performance of agricultural GDP may be viewed in two scenarios depending upon the production of wheat crop in ensuing season. In one instance, if wheat harvest meets the target of 25.5 million tons, the agricultural GDP will record a growth rate of 4.6 per cent.
However, if it misses the target by one million tons, the agricultural GDP will comfortably surpass the target figure of four per cent.
Wheat productivity largely depends on weather conditions along with the availability of critical inputs in the coming Rabi season. Weather is single most important factor in wheat production. Pre-Rabi rains provide moisture for timely sowing in rain-fed wheat growing areas which contribute to around 15 per cent towards overall production.
Likewise rains during the growth period of wheat especially in December, February and March are very significant. Intensity and duration of frost, fog and temperature in the later part of the wheat plant life are very decisive. Because of the non-filling of Mangla reservoir up to the level of last year i.e. 1210 feet, comparatively less irrigation water will become available for wheat crop but it may not affect the overall productivity, being strongly linked with other factors of production. The factors under human control such as timely sowing with certified seed, balanced fertilizer use, and good crop husbandry will also have significant impact on wheat production.
Presently, the agricultural outlook appears positive. Policy and overall sector environment suggests a healthy growth in agriculture sector. Due to strong vertical and horizontal linkages of agriculture with the countrys economy, a high level of economic activity is expected. Most importantly, food security will be ensured for the ongoing as well as for the year to come.
Heavy dependence of overall GDP on agriculture also suggests a better overall economic performance.
The writer is Chief, Food and Agriculture, Planning Commission
Courtesy: The Dawn