7th Five Year Plan (Vol-2)

Chapter: 1 || 2 || 3 || 4 || 5 || 6 || 7 || 8 || 9 || 10 || 11 || 12 || 13 || 14 || 15 || 16 || 17 || 18 || 19 || 20 || 21

AGRICULTURE AND ALLIED ACTIVITIES

Approach and Major Thrusts in the Seventh Plan

1.1 Agriculture occupies a key position in the Indian economy because of its contribution to over-all economic growth through supplies of food, raw materials and exports. It is a source of livelihood for a majority of the population and provides a large market for non-agricultural goods and services.

1.2 The area, production and per hectare yield of foodgrains and major commercial crops from First Plan onwards are given in Annexure I. It will be seen that agriculture output continued to grow at a steady rate during the Sixth Plan period. The performance was particularly impressive in the case of foodgrains. The output of foodgrains which was 132 million tonnes in 1978-79 rose significantly to 151.5 million tonnes in 1983-84. This has been made possible by the accelerated increase in area under irrigation and increased use of high yielding varieties of seeds and fertilizers (Table 1.1). Apart from the provision of infrastructure, the factors mainly responsible for these achievements are the extension of new technology and procurement of foodgrains at remunerative prices. As a result of these developments, not only self-sufficiency in foodgrains has been achieved but also significant possibilities have opened up for further growth of agriculture through modernisation.

1.3 However, there is no evidence, as yet, of a decline in the amplitude of annual fluctuations in the output of foodgrains in the country, because a large proportion of foodgrains continues to be produced under conditions of uncertain rainfall, and even a good part of minor irrigation including the so-called controlled irrigation through wells is vulnerable to the vagaries of monsoons. The persisting fluctuations in agricultural output suggest that there is no basis for complacency and slackening of developmental efforts in agriculture in the wake of a succession of good harvests and consequent accumulation of stocks. It also suggest the need for regional dispersal of output growth through the expansion of assured irrigation in areas where the proportion of area irrigated is low and through the development of dryland farming where irrigation is either not possible or is uneconomical. In a large country like India with significant spatial variations in agro-climatic conditions, a regional dispersal in the growth of foodgrains output is tikely to even out annual fluctuations in aggregate output and reduce the costs of distribution on account of carrying stocks from year to and transportation across the regions.

1.4 Another feature of agricultural performance is that the bulk of increase in output particularly foodgrains, has been concentrated in a few regions which are well-

endowed with infrastructure like surface irrigation, rural electrification, roads and markets and where farmers are resourceful in terms of their capacity to invest and bear risks. The favourable institutional framework in such areas is also responsible for the initiative and drive displayed by the farmers. It has been estimated that such developed areas accounting for less than 15 per cent of the area under foodgrains in the country contributed as much as 56 per cent of the increase in foodgrains production in the post-green revolution period. Because of this concentration of growth among the developed regions where the consumption of foodgrains is already at a high level, the marketed surpluses of foodgrains have been rising at a high rate, resulting in accumulation of large stocks with the government, especially when there is succession of good monsoons, while the per capita consumption of food-grains in the country has not been rising appreciably. It has also been estimated that the growth of agricultural output in the recent past has not been commensurate with the increase in inputs, indicating a decline in productivity of inputs. Although the demand for labour generated in high growth pockets has led to large-scale employment of migrant labour from the poorer regions, the demand for labour-displacing machinery like harvest-combines has also been growing. A more balanced growth of agriculture as between different regions and classes of farmers can lead to a rise in the purchasing power of the rural poor through the rise in employment and wages and incomes of small and marginal farmers in the less prosperous areas. Such a pattern of growth is also likely to be cost-effective because of low wages in the less developed regions due to under-employment. Also, since yields are low in these areas, the output response to the package of modern inputs is likely to be greater than in areas where the use of such inputs is already at a high level. The strain on storage and transportation of foodgrains will also be eased because of greater regional dispersal of surpluses.

1.5 Another aspect of imbalance in Indian agriculture concerns crop-wise disparities in growth, between food-grains and non-foodgrains on the one hand, and among different foodgrains themselves on the other. Part of this inter-crop imbalance derives from regional imbalances. For instance, a breakthrough in rice output in the eastern region where the yields are low and where there is a significant potential for growth, can redress part of this inter-crop imbalance. Similarly, a breakthrough in dryland farming by raising the output of millets, pulses and oilseeds can also correct these inter-crop imbalances. Since small and marginal farmers predominate in these regions, they can benefit a great deal from such development. Fixation of prices of crops at appropriate levels to ensure inter-crop parity and procurement of output would also be necessary for promoting optimal use of agricultural resources by correcting inter-crop imbalances. A further area of major concern is the adverse environmental effects of continued decline in area under forests because of denudation. A massive effort to restore ecological balance through afforestation would be necessary for water and soil conservation which would raise crop productivity in addition to meeting the growing requirements of fuel and fodder.

1.6 It follows from the above that broadening the base of agricultural growth and modernisation through infrastructure development, e.g., irrigation, drainage, roads, markets and credit institutions in the less developed regions, extension of new technology, particularly breakthrough in dryland farming, afforestation and appropriate price and procurement policies for crops are essential for accelerating the growth of agricultural output, reducing annual fluctuations in output and for correcting interregional, inter-crop and inter-class disparities. Such a pattern of growth can also provide the necessary impetus to rural development through the dispersal of agro-industries. This is how agriculture can contribute more effectively to the fulfilment of the national objectives of self-reliance, removal of poverty, increase in productivity and eco-preservation.

1.7 The target fixed for the growth of agricultural output during the Seventh Plan period is 4 per cent per annum and the target for foodgrains output is 3.7 per cent per annum. To achieve these targets, efforts will be made to irrigate an additional area of 11 million hectares during the Seventh Plan period. The consumption of fertilizers will be increased from 8.4 million tonnes in 1984-85 to 13.5-14.0 million tonnes in 1989-90.

1.8 The major programme thrusts in the Seventh Plan are:

1. Special Rice Production Programme in the Eastern Region.
2. National Oilseeds Development Project,
3. National Watershed Development Programme for Rainfed Agriculture,
4. Development of Small and Marginal Farmers, and
5. Social Forestry.

These programmes, discussed in the later sections, are briefly mentioned below:

(i) Special Rice Production Programme in the eastern region In the eastern region comprising the States of Assam, Bihar, Orissa and West Bengal, eastern Uttar Pradesh and eastern Madhya Pradesh, the gap between the potential and actual yields of rice is the highest among the regions. For exploiting this potential for higher yields, a Special Rice Production Programme is being launched during the Seventh Plan period as a Centrally Sponsored Scheme in 20 per cent of the blocks in the eastern region. The emphasis of the project will be on removing the basic infrastructural constraints, both physical and institutional, through the development of irrigation, particularly exploitation of ground water, drainage, improvement in land tenure and development of credit and marketing institutions. For the success of this programme, special efforts will be made to evolve new varieties of rice and appropriate cropping systems to suit the varying agro-climatic conditions in this region.

(ii) National Oilseeds Development Project

Recently, the area under sunflower, soyabean and summer groundnut (irrigated) has been increasing significantly in certain States. This experience shows that the propects of achieving self-sufficiency in oil seeds are bright provided special efforts are made to extend the available technology, evolve new technologies and ensure price and marketing support. The National Oilseeds Development Project will be continued during the Seventh Plan period as a Centrally Sponsored Programme by providing operational flexibility to the State Governments to draw up programmes suited to local situations. Besides, a major technology mission for oilseeds will be mounted to evolve new varieties and practices for achieving a breakthrough in yields. Since raising profit margins for farmers as well as reducing variability in yields and prices are extremely important in the case of oilseeds, the efforts at vertical integration of production, marketing and processing through the growers' cooperatives will be encouraged. In this context, efforts will be made to strengthen the State-Level Oilseeds Growers' Federations, organised under the National Dairy Development Board's Oilseeds Project.

(iii) National Watershed Development Programme for Rainfed Agriculture

On the basis of the past experience, it is proposed to take up during the Seventh Plan a new Centrally Sponsored Scheme called the National Watershed Development Programme for Rainfed Agriculture, to supplement the State efforts, by merging the ongoing programmes. The main components of Watershed Development Programme for Rainfed (Dryland) Agriculture are to harvest water and conserve soil moisture from the low rainfall which is also highly variable in these areas, and to extend farming practices and cropping systems which increase production by minimising yield risks. Since watershed is a natural drainage unit, it is the most suitable physical unit for land treatment and water management, which is the prerequisite for scientific development of dryland agriculture. It is proposed under this project to delegate to the State Governments the responsibility for evolving a suitable administrative framework for planning as well as implementing the project while Central Government would be responsible for the overall policy formulation and monitoring.

(iv) Scheme for assistance to small and marginal farmers for increasing agricultural production

The number of small and marginal holdings as well as the total area operated by them have been increasing whereas the average size of these holdings has been declining. In view of the growing importance of small and marginal holdings and their vulnerable economic position, raising productivity among these holdings is essential for stepping up the overall growth of agriculture as well as for ensuring social justice. The major constraint is their low capacity to invest and bear risks. These categories of farmers could not be adequately covered under the Integrated Rural Development Programme. The speical programme for small and marginal farmers is designed to assist them in the investment for irrigation and to provide various inputs. This programme will have to be supplemented by measures to improve their access to credit and extension services. Security of tenure and regulation of rents for share-croppers would be necessary to provide incentives for intensification of input use. Consolidation of holdings so as to bring small and marginal holdings into continuous blocks of land will help provide various services to them economically and raise their initiative and group-effort.

(v) Social Forestry

Apart from the long-term benefits of eco-restoration including soil and water conservation, the immediate benefits of afforestation are substantial in terms of generating employment as well as providing fuel and fodder. Besides the State Sector schemes of social forestry, the Centrally Sponsored Scheme of Social Forestry including Rural Fuelwood Plantations, in operation in 157 districts at present, will be extended to cover all fuelwood deficit areas during the Seventh Plan period. Special attention will be given to the identification and propagation of indigenous, location specific and thermal-efficient species acceptable to the people. Efforts will also be made to bring down the unit cost of afforestation and to secure people's participation in a big way. Forest management would be made more sensitive to the aspirations and needs of the public. A National Wasteland Development Board has been established, which will formulate perspective plans and programmes for the management and development of wastelands in the country. The Council for Forest Research and Education would be strengthened for intensifying the activities of the Forest Research Institute and for promoting problem-oriented research by the research institutes established by the State Government, Universities and other agencies.

1.9 The implementation of the major programmes outlined above during the Seventh Plan would require concerted efforts in several areas influencing agricultural production. The areas requiring special attention during the Seventh Plan are: (i) water management, (ii) research and extension, (iii) credit institutions, (iv) agricultural price policy, and (v) farmers' participation. These are briefly discussed below.

(i) Water management: As discussed in Chapter 3 on Irrigation, a high priority is given in the Seventh Plan for improving the utilisation of irrigation potential already created. Command Area Development Programme is designed to increase the effective area under irrigation as well as to raise productivity per unit of water used through its regulation and proper distribution and also through extension of new technology, supply of inputs, provision of marketing facilities, etc. Besides, exploitation of ground-water will be stepped up, particularly in the eastern Gangetic plains. Also, drainage will form an important component of water management during the Seventh Plan period. In the implementation of all these programmes, priority will be given to areas where the proportion of area irrigated is low and there is a preponderance of small and marginal holdings, so that the increase in irrigation and improvement in its quality can lead to the maximum increase in cropping intensity and employment.

(ii) Research and extension: Of considerable promise in the field of agricultural research is the effort to bridge the gap between the proven potential and the actual yields on the farms through adaptive research to suit the varying agro-climatic and socio-economic conditions. Priority will also be given during the Seventh Plan period to evolving intercropping and multiple-cropping systems suitable for different agro-climatic conditions. Research for biological fixation of nitrogen and to increase the fertilizer-use-efficiency by minimising losses in its use and for evolving varieties incorporating multiple resistance against pests and diseases and adverse environmental conditions will be encouraged. Steps will be taken during the Seventh Plan period to streamline and strengthen the extension service by bringing about coordination between T and V system and supply of inputs and related services. Measures will also be taken to enhance the capabilities of extension staff through training in professional skills, encouraging mutual exchange of experience and by providing necessary incentives to improve motivation.

(iii) Credit institutions'. Mounting overdues of agricultural cooperative credit institutions have prevented recycling of scarce resources for expanding farmers' access to credit. This effects growth as well as impairs equity. Effective measures will, therefore, be taken during the Seventh Plan period to restore the cooperative movement to its normal health. In line with the major programme thrusts in the Seventh Plan, greater flow of credit needs to be ensured for the eastern region, dryland farming, oilseeds development and for small and marginal farmers. To achieve these goals, steps will be taken to improve the operational efficiency of cooperatives by ensuring adequate manpower with the requisite training as also by simplifying the procedural formalities. During the Seventh Plan period a comprehensive crop insurance scheme will be taken up under which there would be a built-in crop insurance cover in all crop loans.

(iv) Agricultural price policy: Whereas the use of high yielding varieties aided by incentive prices and public procurement have contributed to a break through in the output of certain crops, notably wheat, they have also led to the creation of surpluses which cannot readily be absorbed while shortages persist in respect of certain other commodities. Agricultural price policy needs to be increasingly concerned with the maintenance of a scale of appropriate relative prices of crops so that the supplies of different commodities are brought in line with the respective demands. Also, procurement operations have to be strengthened for crops like rice, oilseeds and pulses in areas inadequately served with marketing infrastructure, to ensure that the producers are in fact, able to sell at the prices fixed by the Government.

(v) Farmers' participation: While the farmers have individually responded adequately to the opportunities offered by the new technology and various infrastructural facilities and services provided by the Government, not much headway has been made in regard to their group or cooperative endeavour. In the ensuing phase of agricultural and rural development, the nature of activities is such that cooperative effort on the part of farmers would be particularly beneficial. Because of the growing awareness of farmers, the prospects for cooperative efforts are also encouraging. Water-management and pest-control on a group basis and joint endeavour in land development offer large benefits to individual farmers participating in them. Similarly, there is considerable scope for the exploitation of groundwater by bringing together small and marginal holdings. Growers' cooperatives for commodities like oilseeds can help to increase earnings by eliminating middlemen's margins in trading and processing. Afforestation, on the scale being envisaged, cannot succeed without the active involvement of people for growing and protecting the trees through groups effort and vigilance. In all these sectors, special efforts will be made during the Seventh Plan period to enlist farmers' participation on a large scale through decentralised planning by elected bodies, and through activity-specific associations and cooperatives.

AGRICULTURAL PRODUCTION

Targets of Crop Production for the Seventh Plan

1.10 The targets of crop production envisaged for the Seventh Plan are given in Table 1.2. The Statewise break-up of the production targets of foodgrains, cotton,jute, oilseeds and sugarcane are given in Annexure 2. The State Governments will have to disaggregate these targets further and fix district-wise and crop-wise targets separately for irrigated areas, assured rainfall areas and dryland farming areas so that there could be proper focus on evolving, implementing and monitoring suitable strategies for maximising production and productivity in each of the situations. Areawise break up of all India Plan target of foodgrains production is given in Table 1.3

1.11 Rice: For increasing rice production and productivity, steps will be taken for diversification of varieties, higher seed replacement, intensification of community nurseries programme and development of technology suitable for problem areas like deep water, drought/flood prone areas, pest-infested areas and saline and alkaline areas. Emphasis will be placed on the use of low cost and non-monetary inputs like timely sowing, line-sowing, optimum plant population, efficient water management and weed control measures.

1.12 The eastern region accounts for about 67 per cent of the total rice area in the country but contributes only less than 50 per cent of the country's rice production. In these States, the productivity of rice is much below the national average. Stagnation of production and low productivity levels of rice are affecting the income level of about 66 million rice farming families in these six States. The important factors responsible for this situation are the lack of suitable technology, particularly availability of improved varieties capable of withstanding the problematic environment as well as socio-economic constraints like poor infrastructure for input supply, credit and extension, inadequate irrigation and drainage facilities, small size of holdings and poor economic conditions of the farmers.

1.13 In order to overcome the existing constraints and accelerate the growth of production and productivity of rice is these areas, a pilot project was initiated in 1984-85 in 51 selected blocks in the eastern region, as a Central Sector project. A sum of Rs. 10 lakhs per block was sanctioned to the participating States for the implementation of the project. On the basis of the experience gained in implementing the pilot project, a special rice production programme is being launched during the Seventh Plan period as a Centrally Sponsored Scheme in 20 per cent of the blocks in the eastern region. The project will aim at identifying constraints in the way of rice production at the block level and undertake planning and implementation of suitable location-specific programmes. It will consist of several sub-projects having different components based on actual area needs. The emphasis of the project will be on the removal of basic physical and infrastructural constraints through development programmes such as exploitation of groundwater and development of irrigation and drainage facilities. Stress will also be laid on strengthening institutional framework through improvements in land tenure, water use efficiency, credit, marketing, storage and post-harvest handling, timely delivery of inputs and services as well as research for evolving new varieties and appropriate technologies so as to make a tangible impact on rice production and productivity.

1.14 Pulses: Growth in the production and improvement in the productivity of pulses have not been quite satisfactory largely due to factors like high risk and low profitability, small proportion of irrigated area, inadequate use of modern inputs and gaps in technology and extension. The major elements of the strategy envisaged for achieving the Seventh Plan target of pulses production are the following:

1. introduction of pulses in irrigated farming systems;
2. bringing additional area under short-duration varieties of moong and urad in rice fallows in the rabi season and as a summer crop where irrigation facilities are available;
3. inter-cropping of arhar, moong and urad with other crops;
4. multiplication and use of improved seeds;
5. adoption of plant protection measures;
6. use of fertilizers and rhizobial culture;
7. improved post-harvest technology;
8. remunerative prices relative to competing crops;and
9. marketing support.

To supplement the efforts of the States in increasing the production of pulses, it is proposed to undertake a new Centrally sponsored National Pulses Development Programme.

1.15 Oilseeds; The main constraints in the way of accelerating production are:

1. preponderance of rainfed cultivation;
2. inability/hesitation on the part of the farmers to use modern inputs due to high risks for yields and prices;
3. high cost and inadequate availability of certified seeds;
4. susceptibility of oilseeds crops to pests and diseases which cause substantial losses;
5. inadequate use of improved agricultural implements for proper placement of seeds and fertilizers, and
6. problems of price support, particularly in times of bumper production.

1.16 Recent trends of oilseeds production indicate certain encouraging features. Firstly, the area under sunflower has increased five-fold during the Sixth Plan period. Sunflower, which is spreading rapidly in Karnataka and Maharashtra and to a lesser extent in Madhya Pradesh and Gujarat, is drought tolerant and, therefore, farmers find it a low-risk crop under rainfed conditions. Secondly, the area under soyabean is increasing fast in Madhya Pradesh, and the crop is also spreading in some districts of Maharashtra bordering Madhya Pradesh. Thirdly, summer groundnut is becoming popular in many States. These developments indicate that, given a low risk environment which is dictated by the crop variety and agro factors, farmers do take up oilseeds cultivation and apply cash inputs. The research and demonstration efforts should, therefore, focus on identifying the opportunities in the midst of constraints and adopting suitable measures to exploit these opportunities. However, at present, there are many gaps in the research and development efforts in the areas of technology, credit, inputs and irrigation management. The strategy for oilseeds development in the Seventh Plan will, therefore, aim at bridging these gaps. In particular, attention will be given to procuring oilseeds from the farmers at remunerative prices through appropriate agencies.

Table 1.4
Projected requirement of cotton-Seventh Plan

Table 1.5
Staple-/wise Cotton Production-Seventh Plan

1.18 To achieve this target, it is proposed to adopt a two-fold strategy, namely, productivity increase through better spread of technology and area increase through measures of inter-cropping, sequence cropping and relay cropping. The National Oilseeds Development Project, initiated in 1984-85, will be continued during the Seventh Plan period as a Centrally Sponsored Scheme. The funds provided under this project will be mainly utilised for (a) filling the gaps in the existing programmes for overcoming the perceived constraints, and (b) intensifying the existing level of services in the selected districts. Operational flexibility will be provided to the State Governments so that they can draw up suitable programme components depending on local situations. This programme will be closely monitored so as to facilitate a critical review of its progressive impact.

1.19 The programmes envisaged under the National Oilseeds Development Project would be supplemented by the State sector programmes. Besides, the State-level Oilseeds Growers' Federations, organised under the National Dairy Development Board's Oilseeds Project, would be strengthened to help in increasing the production of oilseeds. Under this project, assistance in the shape of arrangements for production of inputs, marketing and extension would be provided to the member-growers. In additions, funds available through the cess on vegetable oil collected by the National Oilseed and Vegetable Oils Development Board would also be utilised for promoting vegetable oil production in the country.

1.20 Cotton: Compared to the productivity of 167 kg/ha in 1978-79 which itself was low, the average yield declined further in the subsequent years. The main constraints in the way of cotton production have been: (a) preponderance of rainfed cultivation; (b) inadequacy of quality seeds; (c) high incidence of pests and diseases; and (d) unstable market and low price realisation when farmers market their kapas.

1.21 The requirement of cotton at the end of Seventh Plan (1989-90) is estimated at 9.5 million bales, as indicated in Table 1.4:

1.22 To meet this requirement, the Seventh Plan envisages cotton production to rise from the assumed base of 7.5 million bales in 1984-85 to 9.5 million bales in 1989-90.

he staplewise break-up of cotton production will be broadly as shown in Table 1.5.

1.23 Since the scope for area expansion is limited, much of the additional production of cotton in the Seventh Plan will be achieved through increased productivity. The strategy for raising production and productivity of cotton during the Seventh Plan period will consist of the following components:

1. accelerating the spread of improved technology in both irrigated and rainfed areas, with stress on the use of pure seeds, optimum agronomic practices, integrated pest management, inter-cropping in rainfed area and bringing more area under cotton in rice fallows;
2. expansion of irrigated area in the commands of major and minor irrigation projects;
3. maximising the area under high yielding hybrids of cotton including the new desi-cotton hybrids being developed for the rainfed areas; and
4. provision of adequate facilities for voluntary grading of kapas in selected markets to enable farmers to realise better prices commensurate with the quality.

1.24 There is wide gap between the production and consumption of medium staple and long staple cotton whereas the production of superior long staple cotton is far in excess of the requirements. Appropriate pricing in favour of medium and long staple cotton is called for to correct this imbalance. This should be preferred to the alternative of exporting superior long staple cotton and Importing medium staple cotton.

1.25 Jute and Mesta: The constraints in securing a sustained increase in the production of jute and mesta mainly relate to the inadequacies in respect of availability of improved seeds, retting facilities, credit and research support for specific situations.

1.26 The main strategy for raising production of jute and mesta from the assumed base level of 7.5 million bales in 1984-85 to 9.5 million bales by 1989-90, will consist of the following:

TABLE 1.6
Achievements in Sixth Plan and Targets lor Seventh Plan in respect of Horticultural Crops

1.27 The success of this development strategy will largely depend on the appropriate price policy backed by effective marketing support. It will also be necessary to impart training to the farmers in the grading of fibre. Further, with a view to supplementing the efforts of the State Government, the on-going Centrally Sponsored Scheme for intensive development of jute, mesta and Sann-hemp will be continued on an expanded scale during the Seventh Plan period. was also envisaged to exploit the potential for the export of fresh and processed fruits and vegetables.

1.28 Sugarcane: Productivity of sugarcane has remained stagnant during the last five years. In fact, the record production achieved in 1982-83 was entirely due to area expansion. Since sugarcane crop occupies the field for a long time and requires considerable quanity of water and fertilizer, the aim would be to stabilise its area at a slightly lower level and concentrate on measures for increasing the average yield of cane.

1.29 Production of sugarcane is, to a large extent, influenced by the sugar policy and the price paid for sugarcane by sugar factories. An integrated approach to sugarcane development to meet the requirements of sugar, khandsari and gur is, therefore, quite crucial.

Horticulture

1.30 The Sixth Plan aimed at achieving an additional production of 2.5 million tonnes of fruits and 4 million tonnes of vegetables through a well conceived strategy. It

1. accelerating the use of improved jute/mesta production technology in both irrigated and rainfed areas;
2. larger coverage of jute/mesta under the multiple cropping sequence;
3. timely provision of critical inputs for increasing productivity; and
4. creation of adequate retting facilities in areas where they are deficient, with a view to improving the quality of fibre.

1.31 Estimates of production in respect of various horticultural crops during the Sixth Plan period and targets for the Seventh Plan are given in Table 1.6

1.32 During the Seventh Plan period efforts will be made to integrate horticulture with agriculture in hill areas/ lands, dryland areas and coastal saline areas for diversifying agricultural production and raising incomes in these areas. For this purpose, Research and Development effort as well as services and infrastrctural support for improving the quality of output, post-harvest technology and marketing strategy will be strengthened. Emphasis will also be laid on promoting export of horticultural produce.

Plantation Crops

1.33 The targets set for production of plantation crops under the Sixth Plan and their achievements are indicated in Table 1.7.

TABLE 1.7
Performance of Plantation Crops—Sixth Plan

production during the Seventh Plan period would, therefore, depend on removing these constraints and undertaking necessary support measures.

1.34 The production of tea, coffee and cardamom were adversely affected by the unusually severe and prolonged drought experienced during the years 1981-82 and 1982-83. In the case of coffee and cardamom, though the first drought year of 1981-82 did not witness any significant loss to the crops, the adverse impact of the second prolonged drought in 1982-83 was so severe that it continued to inhibit production even during the third year 1983-84. Rubber plantation, however, registered some increase in production during this period. It is possible that absence of rain over long intervals provided more tapping time to register higher overall production. In regard to cardamom, there was large scale damage reported due to severe drought experienced in major cardamom growing areas of South India.

1.35 The major constraints inhibiting production and productivity of plantation crops are non-availability of suitable areas for extending their cultivation, paucity of irrigation facilities leading to instability in production, particularly in the case of tea, coffee and cardamom, preponderance of low yielding and aged bushes in the case of tea, rubber and cardamom and predominance of small farmers which has a direct bearing on the extent of overall investment in land improvement and infrastructure facilities. Some problems more specific to tea, which affect its productivity are lack of drainage which is particularly acute in North Eastern India and incidence of pests and diseases. It is estimated that about 10 per cent of the potential tea crop is lost due to pests, diseases and weed infestation. The prospects of achieving higher

1.36 The targets of production of plantation crops envisaged for the Seventh Plan are given in Table 1.8:

TABLE 1.8
Targets of Plantation Crops—Seventh Plan

The targets set for tea and coffee take into consideration the requirements of domestic consumption and export. The increase in production envisaged in respect of plantation crops during the Seventh Plan period over the anticipated production during 1984-85 range from 19 per cent in the case of tea to 86 per cent in the case of cardamom.

1.37 The strategies proposed for achieving the Seventh Plan targets of plantation crops are briefly indicated below:

(a) Tea: The target of 766 million Kgs. is proposed to be achieved by concentrating on measures to improve drainage and creating irrigation facilities as well as by undertaking a large-scale programme for rejuvenation and gap filling of tea bushes. A programme for replantation and new plantation of about 8000 he. per annum, which is twice the Sixth Plan achievement, is also envisaged. A districtwise survey of development potential has been made and suitable areas for extension planting, replanting, etc. have been identified.

(b) Coffee: Areas suitable for coffee plantation in non-traditional regions are proposed to be identified, and the Coffee Board would provide research and extension support as also technical assistance to the area expansion programme. The additional area that will be brought under the crop is estimated at 50,000 hectares of which 30,000 hectares will be in non-traditional areas, mainly in Andhra Pradesh, Orissa and North Eastern States, and 20,000 hectares in the traditional areas of Karnataka, Kerala and Tamil Nadu.

(c) Rubber. The area under rubber is proposed to be expanded by one lakh hectares of which 61,000 hectares will be in the non-traditional areas. The target of replantation is proposed at a modest level of 35,000 hectares. The main non-traditional areas are located in Tripura, Assam and Orissa. The organisational set-up of the Rubber Board is proposed to be strengthened in the North Eastern Region to achieve this objective.

(d) Cardamom: Most of the cardamom bushes are 30 to 40 years old and productivity has stagnated at around 62 kg. per hectare. The crop has also suffered extensive damage as a result of drought in recent years. The Seventh Plan strategy consists of replantation programme covering about 39,000 hectares and development of irrigation facilities to guard against drought conditions.

Dryland/Rainfed Farming

1.38 About 70 per cent of the total cultivated area in the country is dryland/rainfed area and a large proportion of the output of important crops such as coarse cereals, pulses, oilseeds and cotton comes from these areas. These areas, however, contribute only 42 per cent of the total foodgrains production in the country. Further, production in these areas is low and fluctuates widely depending on the behaviour of the monsoon. Apart from risk and uncertainly associated with crop production in the dryland areas, concentration of agricultural development efforts mainly on irrigated areas for securing higher production has led to the widening of regional disparities as between dryland areas and irrigated areas. There is also widespread unemployment and under employment in the dryland areas mainly because of monocropping and frequent weather aberrations. Because of the risky nature of cultivation and low incomes, farmers in these areas are unable to invest in and take advantage of the modern technological practices. Also, due to the high risk involved, availability of institutional credit to the dryland farmers is extremely poor. Thus, the dryland/rainfed areas are caught in a vicious circle of high risk, low investment, poor technology and low production. Therefore, in order to achieve steady increase in production of foodgrains, particularly coarse cereals, pulses, oilseeds and cotton and also the national objectives of reduction of poverty, unemployment and regional disparities, the development of dryland/rainfed farming assumes importance and immediate relevance.

1.39 In pursuance of the new 20-Point Programme announced in January 1982, action was initiated for the development of dryland/rainfed farming through the strategy of: (a) intensive approach aimed at integrated development of the selected micro-watersheds; and (b) extensive approach for promoting the adoption of available technologies like use of improved and drought resistant seeds, fertilizers, seed-cum-fertilizer drills and other implements, agro-forestry, etc. As a result, work was taken up by the end of 1984-85 in about 4,400 micro-watersheds, covering an area of about 4.2 million hectares. Besides, an area of 12.8 million hectares was estimated to have been covered under the extensive approach in areas outside the watersheds. The major components of watershed development are: (a) land development; (b) construction of water harvesting storage structures; and (c) coverage of area with improved/ drought resistant seeds and fertilizers.

1.40 During the Sixth Plan period, two schemes—one for the propagation of water Conservation/Harvesting Technology for Dry Farming Areas (Central Sector Scheme) and the other for the development of Dryland Agriculture through popularisation of seed-cum-fertilizer drills, growing of improved crop varieties, application of fertilizer, etc. were sanctioned for implementation with a Plan allocation of Rs. 10 crores in 1983-84 and 1984-85. These schemes were implemented in 19 selected districts located in 15 States. A World Bank assisted pilot project for watershed Development in Rainfed Areas was also initiated in the States of Karnataka, Andhra Pradesh, Maharashtra and Madhya Pradesh at total cost of Rs. 44.23 crores for a period of 7 years. In each of the States, a total area of about 25,000 to 30,000 hectares was to be brought under comprehensive watershed development with a view to increasing the productivity on a permanent basis through improvement of land and water resources base and by superimposition of improved production systems. An IDA assisted Kandi Watershed and Area Development Project was taken up in Punjab with effect from April 1980. The main aim of the project was to provide ecological stabilisation of degraded foot-hills, development of agricultural land and control of erosion and floods. This project includes a number of components like soil conservation, irrigation, drainage, horticulture, forestry animal husbandry and fisheries. In addition, with the help of inter-departmental co-operation and functional linkage between the Ministry of Agriculture and Rural Development, ICAR and State Government, detailed projects for 47 model watersheds were developed. Finally, a number of Central and Centrally Sponsored Schemes like Pules, Oilseeds and Cotton Development, National Rural Employment Programmes (NREP), Rual Landless Employment Guarantee Programme (RLEGP), Drought Prone Area Programme (DPAP), Desert Development Programme (DDP) and Small and Marginal Farmers Programme have been under implementation and they benefit the dryland areas also. However, these programmes function in isolation and an integrated approach on area development basis could have created a much better impact.

1.41 Thus, a number of initiatives and Programmes have been undertaken during the Sixth Plan period for the promotion of dryland farming. There is a growing awareness about the need to draw up comprehensive programmes. Financial institutions like NABARD and AFC are also keen in preparing and financing suitable dryland development projects.

1.42 In the Seventh Plan, high priority is envisaged for the development of dryland/rainfed farming with a view to raising productivity and achieving the other important objectives of reduction in poverty, unemployment and regional disparities. The main focus of development strategy is to minimise the risk to the farmers and to provide them with area-specific technolgical packages, inputs and services. Emphasis will be on area development approach, taking watershed as a unit of development. The development measures to be undertaken in the micro watersheds would include soil and moisture conservation, land shaping, bunding, construction of water harvesting and drainage structures, increased use of improved drought resistant seeds, chemical fertilizer and improved implements like seed-cum-fertilizer drills as also adoption of carefully worked out cropping patterns. Efforts would be concentrated on non-water intensive crops, e.g. coarse cereals, pulses, oilseeds and chillies and also on greater farm management efficiency through attention to cash and non-cash inputs. Closer attention would be given to develop an efficient delivery system for the supply of inputs as well as efficient use of fertilisers. Further in order to provide adequate tree cover and promote subsidiary occupations, horticulture, afforestation and pasture development would be an important part of the dryland farming programme.

1.43 It is proposed to take up a National Dryland/ Rainfed Farming Project as a Centrally sponsored scheme in the Seventh Plan to supplement the State efforts. The components of the National Programme would include land development, rain water management, provision for the design and development of farm implements and machinery, afforestation and pastures development, organisational support and manpower development as well as infrastructural support.

1.44 For the successful implementation of the national and the State programmes as well as projects that are likely to be funded by institutional agencies like NABARD and AFC, it is necessary to ensure the following:—

1. stepping up to R and D efforts to evolve specific, cost effective and low cost technologies;
2. strengthening of the extension services;
3. training and development of field manpower;
4. efficient delivery system for timely supply of inputs including contingency seeds stocking;
5. adequate availability of short-term loans to farmers whenever the watershed is developed so as to enable them to adopt a higher level of farming technology;
6. provision of adequate price and marketing support to rainfed crops like coarse creals, pulses and oilseeds;
7. suitable organisational structure of planning, implementation and monitoring of the watershed management programmes; and
8. integration of various Central/Centrally Sponsored and State programmes to optimise the resource use.

Soil and Water Conservation

1.45 Till 1979-80, an area of about 23.40 million hectares was treated by various soil conservation measures. Against the Sixth Plan target of covering additional 7 million hectares under soil and water conservation measures, the achievement is about 6 million hectares. Thus, by the end of Sixth Plan period, the area treated under soil water conservation measures aggregates to about 29.4 million hectares. Also, organisational capabilities have been created and strengthened; particular mention may be made of the State Land Use Boards, National Land Resources Conservation and Development Commission and National Land Use Board.

1.46 The Centrally Sponsored Scheme of soil conservation in the catchments of River Valley Projects, intitiated in the Third Plan, at present covers 27 catchments in 17 States. Another Centrally Sponsored Scheme of Integrated Watershed Management in the catchments of flood prone rivers, taken up during the Sixth Plan period, covers 200 watersheds in 8 catchments in the Indo-Gangetic basin.

1.47 The Seventh Plan aims at intesifying the soil and water conservation programmes with a view to checking soil erosion and land degradation as also enhancing the productivity of available land. To supplement the efforts of the States, the Centrally Sponsored Scheme of soil conservation in the catchments of river valley projects and Integrated Water Management in the catchments of 8 flood prone rivers in the Indo-Gangetic basin will be continued and intensified during the Seventh Plan period.

1.48 Emphasis will be laid on proper maintenance of the works completed. Although 14 States and 2 Union Territories have enacted Soil Conservation Acts, the legislation has no provision to secure people's participation for effective maintenance of the soil conservation works and utilisation of the assets created. They also do not have provisions to prevent diversion of good agricultural land for other purposes. Steps will have to be taken to remove these lacunae in the existing legislation.

1.49 Closer attention will be given to continuous monitoring of the programmes during implementation for assessing their progress as also their effectiveness. Steps will be taken to ensure effective functioning of the various Organisations and Boards already set up for proper planning, implementation and monitoring of the soil conservation programme. It is also necessary to provide appropriate institutional framework with a view to forging close linkage among the various line Departments concerned with soil health and land use.

Land Reclamation and Development

1.50 About 80 million hectares out of the total net cultivated area of 140 million hectares is estimated to be suffering from varying degrees of soil degradation. The main difficulties in the way of progress in containing the degradation of land resources and bringing them back to productive uses relate to the following:—

1. management of community lands;
2. lack of infrastructural development;
3. high investment and long gestation; and
4. non-availability of institutional finance due to low credit worthiness of the beneficieries having marginal and sub-marginal lands.

1.51 According to present indications possibilities exist, for reclamation and development of about 40 million hectares of saline alkaline, ravine and coastal sandly areas as also culturable waste land and old fallows other then current fallows. This is gigantic task which would need suitable technological practices, trained manpower, organisational capabilities and funds from various sources including beneficiaries. The Seventh Plan attaches high priority to land stock improvement covering reclamation and development of these problem areas. This would involve concerted efforts by the ICAR and State Agricultural Universities, State Land Use Boards and other organisations both at the State and the Centre. Suitable programmes for each type of degraded land will have to be formulated on the basis of systematic surveys. It is proposed to take up these programmes during the Seventh Plan period under the Central/Centrally Sponsored Sector, subject to their technical feasibility, availability of resources and the state of preparedness on the part of the State Governments.

Scheme for Assistance to Small and Marginal Farmers for increasing Agricultural Production

1.52 Economic development through increased agricultural production on the lands of small and marginal farmers is of cardinal importance for bringing prosperity to the farming community in the country. Small and marginal farmers with holdings of lands upto 2 hectares represent about 73 per cent of the land holdings but are cultivating only about 23 per cent of the cropped area. Their yields are low and land is of very poor quality. The number of persons which each hectare of their holdings has to sustain is 4 to 5 times more than the number of dependant persons per hectare of land by the big farmers. There is, therefore, great need to raise considerably the crop yield of small and marginal farmers.

1.53 The erstwhile Small Farmers Development Agency Scheme (SFDA) was replaced in the Sixth Plan by the Integrated Rural Development Programme (IRDP) with emphasis on assisting 600 poorest families in each block per annum. Although a provision for assistance to small and marginal farmers exists under the IRDP, it is not commensurate with the needs of such farmers because IRDP is basically oriented to the poorest of the poor, most of whom do not operate any land. In view of the need for a separate agricultural project to enable small and marginal farmers to take to new technology for increasing agricultural production, a Centrally Sponsored Scheme for assisting the small and marginal farmers for increasing agricultural production was sanctioned on 50:50 basis for all the blocks in the country during 1983-84. The scheme envisaged an outlay of Rs. 5 lakhs per block in all the States and the Union Territories for enabling the small and marginal farmers to invest in minor irrigation, take up land development works, plant fuel and fruit trees in their lands and increase production of oilseeds and puleses through the use of minikits of seeds and fertilisers.

1.54 The outlay of Rs. 5 lakhs per block was visualised with the following break-up;

The State Governments were given the flexibility to divert funds from one component to another within block but it was made clear that the outlay of Rs. 5 lakhs per block should not be changed and the component-wise proportion of investment, 7:1:2 between minor irrigation, tree planting, minikits and land development including staff should be retained at the district level.

1.55 On a further review of the scheme, it has been decided that if some States, inspite of the above-mentioned flexibility are unable to invest Rs. 5 lakhs in every block on the approved components or maintain inter-sectoral ratio of expenditure for the district as a whole, they could make a specific proposal, under the Seventh Plan, to the Government of India for necessary relaxation in the ratio and such relaxation will be allowed in exceptional cases after due consideration on the basis of merits.

1.56. In regard to individual components of the scheme, the Government of India have liberalised the pattern of financing. The present ceilings of Rs. 3000 for small farmers, Rs. 4000 for marginal farmers and Rs. 5000 for tribal farmers on the amount of subsidy for minor irrigation works have been removed and instead, the amount of subsidy payable to an individual beneficiary would be at the rate of 25, 33V3 and 50 per cent, respectively taking the unit cost of minor irrigation works as fixed by the NABARD for the different agro-climatic regions in the country. The community irrigation projects will be undertaken in areas where more than 50 per cent of the land holders in the ayacut are small and marginal farmers and they own not less than 25 per cent of the land. These projects will be taken up from the Government funds, with 50 per cent assistance from the centre. The minikit programme under the scheme would include only improved seeds of pulses oilseeds and coarse grains. In other words, the minikits would not include fertilisers as at present. These minikits will be distributed against a nominal charge from the year 1976-77 onwards. With these measures recently taken by the Government of India, it is hoped that the scheme would become more effective in its implementation during the Seventh Plan period.

Inputs and Services

1.57 Targets: Apart from material inputs, namely, fertilisers and manures, seeds, plant protection chemicals and improved implements and machinery, a variety of services like extension, credit, insurance, storage, marketing and processing play an important role in increasing agricultural production. The targets of key inputs contemplated in the Seventh Plan are indicated in Table 1.9. The measures that are proposed to be taken to increase availability of these inputs and services and to improve the delivery system are discussed in the following paragraphs.

1.58 Fertilisers and manures: A target of 9.60 million tonnes of fertilisers in terms of nutrients was originally envisaged for the Sixth Plan. This was later on revised to 8.4 million tonnes which is reported to have been achieved by the end of 1984-85. It consists of 5.6 million tonnes of N, 1.9 million tonnes of P. and 0.9 million tonnes of K A number of steps were taken to accelerate the consumption of fertilisers during the Sixth Plan period. These included block level delivery of fertilisers the cost being borne by the Central Government, reduction of fertilisers prices, upward revision of distribution margins and adequate arrangement for the grant of short-term loans. In addition, the number of sale points was increased from 110 thousand in 1980-81 to 147 thousand by 1984-85. A scheme for assisting small and marginal farmers was introduced in the latter part of the Sixth Plan period and phosphatic fertiliser was supplied in minikits. To implement fertiliser promotion and development programmes, arrangements for unloading and storage of fertilisers and supply of imported fertilisers were strengthened.

1.59 It is worth noting that the eastern States with deficient water control (flooding) in kharif, little irrigation for rabi cultivation and undeveloped infrastructure in the form of roads, electricity and credit facilities show very low utilisation of fertilisers. Efforts are afoot to improve the infrastructure and take up a package of measures to increase the consumption of fertilisers in the northeastern region.

1.60 The target of fertiliser consumption contemplated for Seventh Plan is in the range of 13.5-14.0 million tonnes of nutrients. State wise breakup of this target is given in Annexure 3. To achieve this target, the strategy would consist of strengthening of fertiliser distribution and handling arrangements at ports, undertaking enforcement of quality control by increasing the number of samples to be tested and promoting measures necessary for the efficient use of fertiliser. One of the major goals will be to increase fertiliser consumption in rainfed areas.

1.61 A substantial increase in handling facilities will be provided both at the major and minor ports by way of mechanical unloading, conveyor belts for carrying the materials, bulk storage of 25,000 to 30,000 tonnes capacity, mechanised, bagging arrangements, storage for bagged materials as well as facilities for loading of materials for transportation both by rail and road. It would also be necessary to increase the infrastructure facilities at some of the minor ports for providing barges, tugs, warehouses, etc. With a large volume of fertiliser movement by rail, it is essential that facilities for unloading the materials at the terminal points are increased. For this purpose, a project for development of nodal facilities for handling of fertilisers will be taken up. This apart, the

TABLE 1.9
Targets of Key Inputs—Seventh Plan

This includes both certified seeds (an estimated 3.0 million quintals) and quality seeds (the balance of 4.04 million quintals) of all crops. This stands, for only certified seeds of all crops except oilseeds, pulses and potatoes, This also includes provision for export and buffer stock. promotional efforts for accelerating consumption of fertilisers specially in the remote areas, reducing regional disparity in fertiliser consumption and ensuring that this input gets within the easy reach of the farmer by opening more sale points in different areas, will be continued. Extension support for guiding the farmers in the proper use of fertilisers has proved to be quite useful. Steps are required to be taken to intesify this effort. Also soil testing facilities need to be intensified. Future growth in fertiliser consumption will depend on a number of factors and especially the extent to which the technology is developed and extended, investment in irrigation is stepped up and credit situation is improved. If the logistical problems in the eastern region are attended to, continued growth in fertiliser consumption in that region could be ensured apart from an occasional set-back due to drought. A special project to increase the fertiliser consumption in rainfed areas in conjunction with the National Dryland Farming Project will be taken up during Seventh Plan period.

1.62 In addition, attention has to be given, in an increasing measure, to the conservation and use of organic wastes and biological wastes for nitrogen fixation and supply. Bio-fertiliser programme involving the popularisation of rhizobium, blue-green algae, azolla and other sources will receive further attention. Adequate outlays will be provided for implementing new programmes contemplated above.

1.63 Seeds: The area under high yielding varieties has reached the level of 56 million hectares in 1984-85 against 38.4 million hectares in 1979-80. Table 1.10 indicates the progress of distribution/production of breeder, foundation and certified seeds during the Sixth Plan period.

TABLE 1.10
Progress of improved seeds-Sixth Plan

1.64 In the Sixth Plan it was proposed to have a replacement rate of 10 per cent for the self-pollinated crops like wheat and paddy, 100 per cent for hybrids and 5 per cent for pulses and oilseeds. Experience has shown that replacement rates of seeds differ from State to State. In States like Madhya Pradesh, they are very much low. This is attributed to a number of reasons, the more important being lack of extension effort in popularising certified seeds, high sale price of the seeds and nonavailability of foundation and breeder seeds for some of the crops, especially potato and groundnut. Higher replacement rates in some of the States like Assam, Manipur and Tripura (where they vary from 32 to 70 per cent) are due to the fact that it is not possible for the farmers of these States to have their own seeds because of the agro-climatic conditions.

1.65 Having regard to the present position, it is proposed to have an overall replacement rate of certified seeds at 10 per cent for the country during the Seventh Plan period. A target of 11.7 million quintals of certified/ quality seeds is contemplated for the Seventh Plan. Encouragement will be given to the private sector in seed production.

1.66 Adequate provisions have already been made in different Acts and Orders for ensuring the right quality of seeds. There is, however, no effective enforcement by the agencies concerned. Necessary steps are required to be taken to strengthen these agencies and increase the number of samples to be tested. In addition, seed testing laboratories have to be strengthened by way of manpower, equipment, training arrangement and organisational set up. Further the risk hazards of seed production are the same as in the case of other agricultural commodities. There are also instances of damage to seed crops due to adverse weather conditions. For ensuring adequate supply of seeds, seed producer should be covered under the Crop Insurance Scheme especially in the dry farming areas. This would prove to be an incentive for the farmers to produce more seeds. In less developed areas of Madhya Pradesh, Rajasthan, Bihar and eastern Uttar Pradesh, high cost of seeds has been a major problem being faced by farmers. In the absence of certified seeds, full advantage of other inputs like fertilisers and irrigation is not being taken. This requires priority of attention and a subsidy on certified seeds may be given.

1.67 There are a number of on-going programmes like setting up of seed processing plants, development of seed farms, strengthening of seed testing laboratories and creation of additional storage capacity. These would continue to receive attention during the Seventh Plan period. Also, for meeting the emergent needs of seeds in different States the programmes for building up buffer stocks of seeds by the National Seeds Corporation and reserve stocks of seeds by the State Governments would be taken up on a larger scale.

1.68 Plant protection: While seeds and fertilisers are the basic inputs to increase agricultural production, plant protection measures are required to save the crops in the field from the ravages of pests and diseases. However, the use of pesticides has to be judicious and need-based. The thrust in the Seventh Plan, will therefore, be the need-based use of plant protection measures instead of prophylactic treatment. The use of pesticides is undertaken when the pest population increases beyond the economic threshold level. Vigorous control of pests and diseases in endemic areas would, however, be continued as at present. Steps will be taken to strengthen the surveillance organisations. Aerial spraying of pesticides would be taken up in an increasing measure for meeting the pest and disease attack on crops like oilseeds, cotton, etc. More Central Biological Control Stations and Central Surveillance Stations are proposed to be set up during the Seventh Plan Period. The major thrust of Government policy on plant protection in the coming years will be the Integrated Pest Management (IPM). The IPM approach implies the adoption of cultural, mechanical, biological and chemical methods of control.

1.69 Arrangements for the collection of data on the consumption of pesticides in the fields are not adequate and hence reliable estimates of pesticides consumption for agricultural crops are not available. A target of 75,000 tonnes of pesticides is contemplated for the Seventh Plan. This is against the Sixth Plan achievement of about 50,000 tonnes vis-a-vis the target of 80,000 tonnes of pesticides. Achievement of this target would call for vigorous efforts and close monitoring on the part of different agencies in different States and Union Territories.

1.70 Agricultural implements and machinery: A special drive for popularising improved implements is required in areas where inadequacy of farm power is the major constraint in raising agricultural production. The Central Sector Scheme for strengthening the existing farm machinery training and testing Institutes at Budni, Hissar and Anantpur would be continued. Besides, two new farm machinery training and testing institutes are proposed to be set up in the western and eastern regions during the Seventh Plan period.

1.71 Agro-Industries Corporations have been set up in most of the States. These Corporations will have to play a greater role in the large-scale manufacture of improved agricultural implements and their distribution. Having regard to their past performance, the need for proper monitoring of their activities is stressed.

1.72 Another important scheme started during the Sixth Plan period is the setting up of Farmers' Agro Service Centres Work on this scheme will be intensified in another 2000 blocks during the Seventh Plan. Here too, suitable arrangements for monitoring the scheme will have to be made by the State Governments.

1.73 Agriculture Extension: The Sixth Plan laid special emphasis on strengthening extension machinery to carry out the programmes of transfer of technology and train the farmers to improve their skills. In this context, reorganisation of the agricultural extension service under the Training and Visit System (T and V) was taken up in 13 States during the Sixth Plan period.

1.74 Despite initial difficulties the T and V system has made considerable contribution in relation to introduction of new crops in non-traditional areas, new crop rotations and increasing the intensity of cropping. The large increase in the area under soyabean in Madhya Pradesh, the increase in the area under sunflower in Karnataka and Maharashtra, the step-up in the yield of wheat, groundnut, cotton and mustard in Rajasthan, the diversion of marginal paddy lands to oilseeds and pulses in Orissa, the introduction of rice in non-traditional areas and the popularisation of summer moong cultivation between the kharif and rabi seasons in certain areas have been a few notable results of the extension effort. Under the T and V system attention was given to improve the educational and technical competence of the extension functionaries and also to bring about close linkage between Agricultural Universities, Extension Wings of the the State Agricultural Departments and the farming community. Steps were taken to undertake training of women and the weaker sections, including Scheduled Castes and Scheduled Tribes. Tours were arranged for farmers from agriculturally less developed areas to developed areas so that they would acquire practical knowledge regarding improved aricultural practices.

1.75 A new project caled the National Agricultural Extension Project (NAEP) was taken up with World Bank assistance in September, 1984. It has three components;

(i) the State component covering the States of Orissa, Madhya Pradesh and Rajasthan where the on-going extension projects have already been completed and the second phase is to be introduced, (ii) the Central Sector Project for strengthening the Directorate of Extension, Extension Educational Institutes and the setting up of a National Institute of Extension, and (iii) the Centrally Sponsored component consisting of special sub-projects to bridge the gaps and rectify weaknesses in the ongoing projects. The second phase of NAEP covering the States of Gujarat, Haryana, Karnataka and Jammu and Kashmir has been negotiated with the World Bank and the project has already become operative.

1.76 Having regard to the past perpormance, it is crucial that all possible steps are taken to streamline and strengthen the extension service during the Seventh Plan period. In this context the following aspects should receive special attention:—

1. Coordination between T and V system and supply of inputs and related services;
2. linkage between the Research Institutions, Agricultural Universities and Extension set-up in different States;
3. need for orienting extension programme to specific conditions; and
4. strengthening of operational functionaries by equipping them with adequate professional skills and exposing them through actual field visits and suitable incentives and recognition.

1.77 Agricultural credit: Cooperatives, Commercial Banks and Regional Rural Banks are the three main institutional agencies in the field of credit for agriculture and allied sectors. The cooperatives with their countrywide net work of 94089 primary agricultural credit societies constitute the most important agency in terms of volume of loans advanced and territorial coverage. Commerical Banks have over 36000 semi-urban and rural branches and the Regional Rural Banks number 182 with 8727 branches as on March 31, 1985. The Sixth Five Year Plan had aimed to increase the disbursement of agricultural credit through these institutional agencies from the base level of Rs. 2550 crores in 1979-80 to Rs. 5415 crores by 1984-85. Against this, the level of disbursement of credit in 1984-85 is reported to be Rs. 5810 crores. The agency-wise break-up is given in Table 1.11.

1.78 Thus, the targets laid down in the Sixth Plan for Co-operative Credit have been more or less accomplished. The disbursement of credit by commercial banks has exceeded the Plan target since they were asked to increase the flow of credit for the agricultural sector. The increasing role of commercial banks in providing credit for poverty alleviation programmes, like IRDP is also responsible for these increased figures.

TABLE 1.11
Progress of disbursement of credit—Sixth Plan
(Rs. crores)

1.79 Although there has been an appreciable increase in the flow of credit from the institutional agencies there is no perceptible improvement in the recovery of loans. During the year 1982-83, the latest year for which data are available, ratio of overdues to demand at the level of primary agricultural credit societies as well as the level of primary land development banks was reported to be 40 to 42 per cent. The recovery position in the case of commercial banks has been even worse and the proportion of overdues to demand in their case stood at 47 per cent in 1982-83. Even the regional rural banks, which entered the field of credit last of all had overdues mounting to 49.6 per cent. The health of agricultural credit institutions, both: cooperative and commercial banks, is in a very sad state in several parts of the country. Wilful default and overdues are mounting in a number of States including some cooperatively progressive States like Maharashtra and Gujarat. By writing off agricultural loans and providing subsidies out of the States exchequer some of the States have set a bad example to the entire country. If this trend is not reversed and if banks are reduced to institutions providing grants rather than recycling scarce resources to get the maximum benefits for the country as a whole, the banking system will be unable to provide more credit to meet the growing needs of farmers. Further, the implication of present trends is that even if the fertiliser prices are reduced, banks and cooperatives may not be able to increase their lending because of mounting overdues. The Ministry or Agriculture and Rural Development and State Cooperation Departments, should, therefore, adopt effective measures to restore the cooperative movement to robust health so that they can play an effective role in providing credit to farmers on an increasing scale.

1.80 An important development in the field of agricultural credit during the Sixth Plan period was the establishment of the National Bank for Agriculture and Rural Development (NABARD) in July, 1982. NABARD has emerged as an apex national institution accredited with all matters concerning policy, planning and operation in the field of credit for agriculture and other economic activities in rural areas. It has so far been following policies, procedures and practices inherited from the Reserve Bank of India. It has laid greater emphasis on agricultural credit and, as a result, its business has gone up from the level of Rs. 703 crores in 1982-83 to Rs. 1056 crores in 1984-85. The drawal of funds from NABARD by RRBs has significantly gone up. NABARD also provided substantial refinance for IRDP. For effecting necessary improvements in the lending for poverty alleviation programmes, field studies are also conducted by NABARD. It is, however, yet to adopt an innovative approach in keeping with its function as an apex development bank of the country.

1.81 A major policy objective in the sphere of agricultural credit during the Seventh Plan period would be to ensure a substantial increase in the flow of credit, particularly for weaker sections of the population, for the less developed areas especially the north eastern region, for dryland farming and for pulses and oilseeds development. Also, special measures for improving the recovery performance of loans advanced would be taken. Finally, attention would be given to credit planning and monitoring in a coordinated manner at the National, State and District levels.

1.82 These objectives can be achieved only if adequate measures are taken to strengthen the operational efficency, in terms of manpower, financial resources and procedural formalities, of the lending institutions, particularly the cooperative institutions. Primary agricultural credit societies would be coverted into multi-purpose cooperatives in a phased manner so as to enable them to handle not only credit but also all other services and supplies. Similarly, Central Cooperative Banks, State Cooperative Banks and Land Development Banks would be strengthened on the lines recommended by the CRAFICARD Report. Arrangements would be made to realise the concept of 'one window approach' for assistance to farmers, particularly belonging to the weaker sections. It is worth noting that the flow of agricultural credit has so far been confined to the irrigated areas particularly for the cultivation of paddy and wheat crops. In the Seventh Plan however, there would be major emphasis on dryland farming and cultivation of pulses and oilseeds. Hence, steps would be taken to ensure massive credit support for these programmes also during the Seventh Plan period. Table 1.12 gives the targets of agricultural credit by different institutions visualised for the Seventh Plan period.

TABLE 1.12
Targets of Agricultural Credit by Different Institutions—Seventh Plan
(Rs. crores)

1.83 To oversee the working and coordinate the operations of various institutional credit agencies, State level Co-ordination Committees have already been set up. However, these Committees have not been able to bring about the necessary coordination in the operations of the various institutional agencies. As a result, the commercial banks' credit has tended of flow largely to those areas where cooperative structure is already strong. This snag in the working of the institutional credit agencies would be rectified during the Seventh Plan period through the formulation of district credit plans, which are expected to bring about the necessary coordination and specifically approtion the special roles and responsibilities to the various credit institutions operating in the area.