PHDCCI asks new Govt to step up investments in agriculture

The chamber has asked the new Govt to step up investments in cold storages, irrigation facilities, harvesting facilities and rural roads.

PHD Chamber of Commerce has warned that high economic growth cannot be sustained unless Government steps up investment in the farm sector, which has come down drastically over the last two decades.

HT Image

"If the economy has to sustain high rate of growth in the foreseeable future, the capital expenditure by the Government for the agriculture sector has to increase on a sustained basis," PHDCCI said.

The chamber asked the new Congress-led coalition Government to step up investments in irrigation facilities, cold storages, post and pre-harvesting processing facilities and rural roads.

"Necessary steps shall have to be taken by the state Governments in particular to enhance Government spending on agri-infrastructure as also to improve agriculture productivity and production," it said.

"NABARD may allocate funds exclusively for creating irrigation infrastructure."

PHDCCI also proposed higher spending for R&D on non-traditional and cash crops like pulses, oilseeds, cotton, sugarcane, horticulture and animal husbandry.

"Public sectors's Gross Capital Formation (GCF) in agriculture and allied sectors has halved from 50 per cent in 1980-01 to 2000-01," according to an analysis of PHDCCI, which reflects a sharp decline in investments in the sector.

The declining trend was evident from the fact that contribution of the sector fell from 14-15 per cent in early seventies to 9.5 per cent in 1986-87 "and since then has remained low."

However, only fishing industry in the sector has shown upward trend while agriculture and forestry has shown major downtrends, the chamber said.

The contribution of farm sector to GDP has declined by 10 per cent in all the northern states from 1993-94 to 2001-02 except in J&K where it remained static, while the decline was 4-5 per cent in Rajasthan and UP, it added.