Context:- The UN Trade and Development Report highlights recent fluctuations in food commodities prices, coinciding with substantial profits reported by global food traders. This economic landscape prompts a call for policy shifts and financial reforms to address macroeconomic challenges and sustain agricultural growth. Agricultural Profit has emerged as a key of food crisis in Africa & India’s export surge. Learn UNCTAD’s recommendations on institutional reforms to address macroeconomic challenges & sustain agricultural growth in this must read blog.

Global Agricultural Trends:

1. India’s Export Surge: India achieved a historic milestone in 2021-22, emerging as a net exporter of agriculture and allied products with record export revenue of $50.2 billion. The agriculture sector remains the largest employer in the country.
2. UNCTAD Recommendations: The Trade and Development Report 2023 advocates policy changes by leading central banks. It calls for institutional reforms proposed during the COVID-19 crisis. The report emphasizes the need for financial reforms and pragmatic strategies to tackle inflation and inequality. Additionally, it stresses enhanced oversight of critical markets to avoid prolonged economic stagnation.
3. Global Economic Projections: The report anticipates a global economic growth slowdown from 3% in 2022 to 2.4% in 2023, with limited signs of recovery. While certain countries like Brazil, China, Japan, Mexico, and Russia might exhibit growth, it is expected to be moderate.

India’s Agricultural Scenario:

1. Declining Growth Rate: India witnessed a decrease in agricultural growth from 3.3% in 2020-21 to 3% in 2021-22. Over the past six years, the sector has maintained an average annual growth rate of 4.6%.
2. Investment Shifts: Government investment in agriculture has dwindled, dropping from 5.4% in 2011-12 to 4.3% in 2020-21. Conversely, private investment surged to 9.3%, indicating a rising trend of corporatization in the agricultural domain.

Future Prospects and Challenges:

1. Resilient Sector Performance: Despite challenges such as the pandemic and global conflicts like the Ukrainian war, the agricultural sector demonstrated robust growth and resilience.
2. Sector Reorientation: Addressing challenges posed by climate change, fragmented landholdings, inadequate mechanization, low productivity, disguised unemployment, and escalating input costs is imperative for the sector’s reorientation.

Conclusion:

The evolving global economic landscape highlights the necessity for strategic policy shifts and increased investments. India’s shifting agricultural dynamics further emphasize the importance of comprehensive reforms. A refine approach is need of hour in the agricultural sector, focusing on addressing structural impediments. Embracing technological advancements is crucial to navigate challenges and sustain growth for its continued progress.

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