8. Increase agricultural productivity

Increasing agricultural growth is critical not only for India to sustain high growth rates, but also to move millions out of poverty. Currently, 60% of the labour force is employed in agriculture, which contributes less than 1% of overall growth.

The Goldman report says that there needs to be movement on three fronts for agricultural productivity to increase:

• The quantity and quality of public investment in agriculture needs to be substantially increased. Currently, subsidies are four times the amount of investment, which does not enhance future productivity.
• New technology needs to be harnessed to raise yields.
• Agriculture needs to be deregulated to allow greater commercialisation and economies of scale.

The recent increase in contract farming is encouraging. It allows greater investment, better technology, access to land and finance, a market focus in terms of crop selection, incentives to boost productivity.