Agriculture Runs the World


Dr. BK Mukhopadhyay

A noted management economist and an international commentator on business and economic affairs. He may be reached at m.bibhas@gmail.com

The World Bank has nicely opined on the agri-sector – agricultural development is one of the most powerful tools to end extreme poverty, boost shared prosperity and feed a projected 9.7 billion people by 2050.  Growth in the agriculture sector is two to four times more effective in raising incomes among the poorest compared to other sectors. 2016 analyses found that 65% of poor working adults made a living through agriculture. This sector is also crucial to economic growth: in 2014, it accounted for one-third of global gross domestic product (GDP). Side by side: a 2016 report found that hunger is a challenge for 815 million people worldwide and in 2014, 2.1 billion people were overweight and obese, 62 percent of them in the developing countries.

As the matter stands at this juncture it is thus clear that in the first half of this century, when the world’s population grows to around 9.15 billion, global demand for food, feed and fiber will nearly double, while increasingly, crops may also be used for bioenergy and other industrial purposes. New and traditional demand for agricultural produce will go on putting increasing pressure on already scarce agricultural resources. And while agriculture will be forced to compete for land and water with sprawling urban settlements, it will also be required to serve on other major fronts: adapting to and contributing to the mitigation of climate change, helping preserve natural habitats, protecting endangered species and maintaining a high level of biodiversity. It is also clear that in most regions fewer people will be living in rural areas and even fewer will be farmers, who, in turn, will need new technologies to grow more from less land, with fewer hands de facto.

Clearly, if the current trends are of any indication, the food and agricultural policy system itself is in disarray. The symptoms of such a disarray are not difficult to locate – incoherent/ inadequate response to exploding food prices; slow down in agricultural productivity growth; water problems; a disorderly response to continuously disturbing energy prices; rapid concentration in multinational agri-business cope rations without adequate institutional innovation aiming at properly guiding them; lack of progress in addressing scarcity; widespread nutritional problems [hunger/ obesity/ chronic diseases] plus agriculture-related health hazards [avian influenza, etc] and adverse impact on climatic fluctuations.

Underinvestment in areas related to food, nutrition/agriculture [research/infrastructure/rural institution] invite spillover effects/global impacts, among others.

The ongoing situation calls for giving a big push to farm investment, especially keeping in view the plight of the entire developing nations. Though 60 percent of South Asian countries are still dependent on this sector, yet the growth rate of this sector, in particular, leaves much to be desired. In the entire developing block, this is the reality emanating mainly from inadequate investment, rural infrastructure, research and development and inadequate diversification to high-value crops.

Non-availability of quality and cost-effective inputs, low efficiency of inputs use and fast deteriorating soil health and water resources remain as the critical concerns. Agriculture requires a big push and so as to realize the much coveted high growth rate vis-à-vis food security.

We are really entering into a difficult stage globally and nationally in agriculture. In Sri Lanka, 32 percent of country’s food requirements are met simply by imports for which the annual expenditure is 100 billion Sri Lankan rupees. Dwindling food stocks and rising prices reflect the reality – the very concern, which, in turn, must be given top priority. Tackling the threat of climate change and reducing the yield gap are the crying needs, among others. In many of the current analyses, it is being pointed out that Thailand becomes one of the gainers out of these upward trends in food prices as this country produces surplus foodgrains. But what is the gain emerging from this trend for the farmer – their plight remains more or less the same and it is the traders who are gaining most of the prices that are obtained.

The real challenge that comes in the way of making agriculture an instrument of development lies outside agriculture – managing the political risks (political economy of agricultural policies and simultaneously strengthening governance for implementation of these policies). The crucial need is there to share ideas, experiences, and expertise, setting up a common seed bank, joint research centre, surveillance and early warning system among nations. Investment and regional cooperation in research and development must be at the top of regional meets, be it north or south. Building up a partnership with the scientists and research bodies have now become more essential than ever before. And then go for rapid technological innovation.

The reality should not be denied as well. In so far as fast-emerging economies like India are concerned, the fact remains that the ongoing trend is steadily moving in terms of registering quicker growth in agricultural productivity. Good going – growth and modern farm practices and inclusive technologies are being implemented in order to foster the rural growth process. It is also a fact that cellular technologies, wireless communication networks as well as GIS-based agro – software technologies are reaching rural India to disseminate vital information and updates on weather, farming technologies, fertilizers, livestock, commodity prices as well as stock markets.

Still, a huge number of villages do not have access to advanced farming technologies and interactive communication networks, not to a speck of the pace of rural electrification and clean drinking water. Is it not the appropriate time to broaden the sight and look at vital aspects – re-identifying policy dimensions and initiative; capacity building through PPP, individual initiatives and joint ventures; boosting agri-business and agri-marketing; GIS mapping and harvesting trends; mitigating climatic change hazards; precision farming – optimum utilization of resources; lending heavily on most modern agri-practices; micro-finance and microcredit and attaching top importance to food security?
Let us finally look at what the World Bank specifically opines- agriculture-driven growth, poverty reduction, and food security are at risk:  Climate change could cut crop yields, especially in the world’s most food-insecure regions. Agriculture, forestry and land use change are responsible for 25 percent of greenhouse gas emissions. Mitigation in the agriculture sector is part of the solution to climate change.

The current food system also threatens the health of people and the planet: agriculture accounts for 70 percent of water use and generates unsustainable levels of pollution and waste. Risks associated with poor diets are also the leading cause of death worldwide. Approximately three billion people are either not eating enough or eating the wrong types of food, resulting in illnesses and health crises.

Time is ripe for more well-knitted coordinated actions so as to: initiate inter-sectoral-linkages; progressive decision making, information sharing and performance improvement; capacity building; creating more opportunities for partnership building, development reorganization and capacity enhancement for the rural stakeholders.