How agriculture is helpful in economic growth


Importance of Agriculture in the National Economy

  1. Source of Food Supply. As aforementioned, agriculture has been the basic source of food supply for mankind for centuries. …
  2. Contribution to National Income. Agricultural prosperity has significantly contributed to and fostered the economic advancement of several countries.
  3. Relief from Capital Shortage. …
  4. Pre-Requisite for Raw Materials. …

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A strong agricultural economy brings social progress by increasing productivity, employment and income. Agriculture is the main driver of development in most rural areas. Demand for staple foods, agricultural commodities and – increasingly – processed food is growing in developing countries.


What is the economic impact of Agriculture?

The economic impact of agriculture goes far beyond the traditional farming areas of “cows, plows and sows,” said Department of Agriculture spokeswoman Christi Miller. “Agriculture touches so many things.

How does agriculture affect the economy?

  • The farmer is producing the most basic goods for human livelihood.
  • The farmer is providing social stability through his hard work and the particular structure of the rural society.
  • The farmer’s livelihood is subject to the volatility of weather conditions.

Why is agriculture important and its role in everyday life?

Agriculture Important and its Role in Everyday Life. In most parts of the world, agriculture is an important source of livelihood. This entails hard work, but it contributes to the nation’s food safety and health. Agriculture was the primary source of the economy prior to the industrial revolution.

Why is agribusiness important?

  • According to WHO, “ 1 in 3 women worldwide have experienced physical and/or sexual violence, mostly by an intimate partner. …
  • As per WHO research, “Globally, 30% of women have experienced physical and/or sexual violence by an intimate partner in their lifetime.”
  • “Globally between 38%-50% of murders of women are committed by intimate partners.”

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How agriculture is helpful in economic growth answer?

According to Muir, “Agricultural progress is essential to provide food for growing non-agricultural labour force, raw materials for industrial production and saving and tax revenue to support development of the rest of the economy, to earn foreign exchange and to provide a growing market for domestic manufactures.”

How agriculture is helpful in economic growth India?

Over 70 per cent of the rural households depend on agriculture. Agriculture is an important sector of Indian economy as it contributes about 17% to the total GDP and provides employment to over 60% of the population. Indian agriculture has registered impressive growth over last few decades.

What is the importance of agriculture to the economy?

Agriculture plays a major role in economic growth and development. As the provider of food it is a cornerstone of human existence. As a furnisher of industrial raw materials it is an important contributor to economic activity in other sectors of the economy.

How much does agriculture contribute to the economy?

$1.055 trillionWhat is agriculture’s share of the overall U.S. economy? Agriculture, food, and related industries contributed $1.055 trillion to the U.S. gross domestic product (GDP) in 2020, a 5.0-percent share. The output of America’s farms contributed $134.7 billion of this sum—about 0.6 percent of GDP.

Why agriculture is considered as the backbone of the economy?

Agriculture makes its contribution to economic development in following ways: By providing food and raw material to non-agricultural sectors of the economy, by creating demand for goods produced in non-agricultural sectors, by the rural people on the strength of the purchasing power, earned by them on selling the …

Why is agriculture important in economic development?

The role of agriculture in economic development is crucial because a majority of the population of developing countries make their living from agriculture. We explain below the role of agriculture in detail and point out in what ways agriculture can …

How can agriculture be used to help industrial growth?

Agriculture can also be a major source of saving or capital for industrial growth of developing countries. Even, in poor developing countries, as income from agriculture is unequally distributed, rural people with high incomes can invest their savings for industrial development. In Britain at the time of industrial revolution rich landlords voluntarily invested some of their savings in growing industries. Besides, small farmers can deposit their small savings in banks operating in the rural areas and then these banks can provide loans to the industrialists for investment purposes.

How does agriculture help in eradicating poverty?

In any strategy of eradication of poverty agricultural growth plays an important role. Agricultural growth raises the productivities and incomes of small and marginal farmers, and raises and employment and wages of agricultural workers. With this, it helps to reduce poverty and disguised unemployment.

Why do farmers need to produce food?

Farmers in these developing countries have to produce food over and above their subsistence needs so as to provide necessary food to their urban population. If the industrial and services sectors have to grow, the food requirements of the workforce employed in them have to be met by the marketable surplus of the farmers. As the industrial and services sectors develop further, the agricultural productivity and production must also rise to sustain the industrial development by feeding the increasing industrial workforce.

What is the Lewis model of development with unlimited supplies of labour?

In Lewis “Model of Development with Unlimited, Supplies of Labour,” mobilisation of surplus labour (i.e., disguisedly unemployed) in agriculture for expansion of modern industrial sector and capital accumulation has to be made for employment in expanding industries. The smaller the wages of labour, the lower will be the cost of industrial sector which will bring large profits to the industrialists which can be ploughed back for further industrial development and capital accumulation.

What would happen if the productivity of agriculture did not rise?

If with industrial development, productivity of agriculture does not rise sufficiently and imports of food-grains are not possible due to non-availability of sufficient foreign exchange, the terms of trade will turn heavily against the industrial sector and as several models of growth point out the growth process will eventually stop because industrial production will become unprofitable.

When did the marketable surplus come from the farmers?

If agricultural productivity does not rise the marketable surplus for industrial growth has been obtained by some countries through coercion as was the case in Japan at the time of Meiji Restoration (1869) when through compulsory taxation marketable surplus was extracted from the farmers. More conspicuously, marketable surplus was forcefully collected from kulaks (small class of rich landowners) in 1920-21 during Stalin’s Collectivisation Scheme.

How has agriculture contributed to the growth of the economy?

With the advancement of technology , diverse agricultural machineries have further led to the growth of the economy. Agricultural output has improved with the growing development in the agricultural machineries. It has been seen that increased agricultural productivity and output contributes largely to the overall economic development of a country. Some of the farm machineries used is road sweepers, sweeper attachments, low loaders, bale trailers, hydraulic side arms that are usually utilized for horticulture, livestock production, crop production, application of fertilizers and pesticides, harvesting, planting, tilling and so on. Following are the ways in which the introduction of these machineries has helped the economy at large:

Why is agricultural advancement important?

Agricultural advancement is further crucial to improve the productivity of agricultural production. Shortage of agricultural goods has had an impact on industrial production with a consequent increase in the price level. This will further obstruct an economy’s growth.

What is the backbone of an economy?

If economic development needs to be initiated and made self-sustaining, it needs to initially start with agricultural sector. It is the agriculture sector , which is the main backbone of an economy, providing basic ingredients to all humankind along with raw material for the process of industrialization.

How does agriculture contribute to economic growth?

The market contribution of agriculture to economic growth refers to the fact that the demand from agriculture acts as the source of autonomous demand for industrial goods. As a result of agricultural progress there occurs a market extension for industrial goods. Agriculture thus has linkages with the industrial sector—there is a complementarity between the two sectors.

What is the role of agriculture?

Role of Agriculture: To begin with the concept of priority or preference of one sector and one technology over another is a slippery one. For instance, A. W. Lewis once remarked that “Agriculture has been the weakest link in the development chain.”. On the other hand, there is another argument that suggests that agricultural productivity …

Why is industrialization important?

Industrialisation offers substantial benefits that are crucial for structural transformation of LDCs. The concept of big push or balanced growth reflects deliberate industrialisation of these economies. Those who favour in giving a special priority to industry over agriculture put arguments like:

How does agriculture help rural communities?

Any effort for rural development would help in reducing the rural-urban gaps. Agricultura l development thus helps in improving social welfare, particularly in the rural areas. In the process, the rural masses enjoy a better way of living.

What is the precondition for rapid industrial growth?

A pre­condition for rapid industrial growth is a rapidly expanding agricultural sector. Dr Bright Singh asserts that increase in agricultural production and the rise in farm incomes together with industria­lisation and urbanisation lead to an increased demand for industrial products. Thus, a sluggish growth in agriculture acts as a drag on industrial development.

How does the agricultural sector provide capital?

In addition, agricultural sector provides funds for capital formation through (i) transfer of labour and capital from farm sector to the non-farm sectors, (ii) export of surplus agricultural products, (iii) turning the terms of trade against agriculture by imposing price controls on agricultural goods by taxation or by using multiple exchange rates against agriculture, etc.

Why is industrial growth cyclical?

Industrial growth more or less guarantees income stability and revenue stability to the government. Industry is also subject to cyclical ups and downs but not so like agriculture. Again, because of interdependence between agriculture and industry, the industrial output may exhibit cyclical variability.

Why is agricultural advancement important?

Agricultural advancement is necessary for. improving the supply of raw materials for the agro- . based industries, especially in developing countries. The shortage of agricultural goods has its impact. on industrial production and a consequent increase. in the general price level. It will impede the growth.

What is the role of agriculture in India?

Agriculture sector play the most important role in the developing country like India where more than fifty percentage of its population relay on the agriculture sector (Annual Report 2016-17 Department of Agriculture, Cooperation and Farmers Welfare, Government of India; Mahesh et al. A cloud computing architecture with wireless sensor networks for agricultural applications 2:34–38 (2020) [1–2]). In India agriculture sector faces many challenges that can be overcome to the large extent with the involvement of Information and Communication Technologies (ICT) into the Agricultural farm field (Food and Agriculture Organization of the United Nations Rome, 2017 Information and Communication Technology (ICT) in Agriculture A Report to the G20 Agricultural Deputies; Ramappa (2008) Information and communication technologies (ICTs) in India: an insight into progress of Rural Economy. Finan Agri–A National J Agri Rural Develop; Shalendra et al. ICT Initiatives in Indian agriculture-an overview. Indian J Agri Econ 66:489-497 (2011) [3–5]). This paper proposed a wireless sensor-based architecture that implement various sensor on the farm field and gather environmental data from agriculture farm field than these data are processed in a central server and passed to the farmer as alert for water needs to crop, protection of crop from animals and fire, diseases detection, crop growth information, weather information.

How do nanoparticles affect agriculture?

Nanoparticles (NPs) have the potential to transform agriculture affecting plant growth and production . We explored the effect of magnesium oxide NPs (MgO-NPs) on mungbean (Vigna radiata). NPs negatively regulated the growth of mungbean at all the tested concentrations. Reduction in the morphological parameters and fresh biomass content was observed in the MgO-NPs treated mungbean. A considerable decrease in the chlorophyll levels and carbohydrate accumulation was noticed on MgO-NPs treatment. NPs mediated decrease in enzymatic and non-enzymatic levels led to reduced antioxidant potential of mungbean. Moreover, MgO-NPs considerably reduced the protein content and bioavailability. The present study hence, demonstrates the MgO-NPs mediated down-regulation of mungbean growth. However, the plant responses to MgO-NPs depend upon the plant under investigation and cannot be extrapolated to other plants. Therefore, to identify the use of MgO-NPs as nanofertilizers, more plant types need to be investigated for morphological or biochemical alterations on NPs exposure.

How do pesticides affect the environment?

Among all the pollutants, toxic residues of agricultural pesticides cause numerous diseases as they directly pollute soil and water . Biodegradation by microorganisms is a natural process for eliminating pesticides whereas physical adsorption, membrane separation and advanced oxidation process are also used for removing pesticides. These methods are time consuming and unable to attain complete degradation of pesticide residues. Recently, various organic and inorganic compounds have been synthesized to achieve the targeted goal. Semiconductor materials have a tendency to generate electron-hole charge carriers which further contribute towards oxidation and reduction of pesticides. Large band gap value and fast recombination rate of charge carriers in basic semiconductor materials reduces their catalytic properties. Advancement in this field has been achieved by fabricating a composite by combination of two semiconductors having different band gap values. This newly formed composite exhibited excellent results for photocatalytic degradation of pesticides. The present review focuses on discussion of heterojunctions used for pesticide degradation and their catalytic efficiency in UV or visible radiations. Various investigations have proved that these synthesized materials are cost effective and efficient for utilization as photocatalysts for abating the pollution caused by pesticides.

What is the importance of agriculture in Sri Lanka?

Agriculture plays most important role in Sri Lankan economy like some other developing nations in South Asia such as India, Bangladesh, Pakistan, Nepal and Bhutan. In this way, the agricultural farming sector is identified as a key tool for the economic development in Sri Lanka and it helps to effectively utilize the invaluable resources of the country such as green lands and appropriate climate as it should be and to significantly boost the wealth of the country as well. Furthermore, as it helps to expand the level of GDP, the Interest rates as well as the inflation rates are mostly estimated at present depending on the level of agricultural cultivation sector in the country. It is noteworthy to point out at this occasion that as Sri Lanka is mainly an agricultural nation the most people are involving in individual and joint venture farming activities. At the same time, it is also very important to mention here that most people who involve in agricultural cultivation reach the banks and financial institution for the purpose of getting loans to meet their agricultural financial needs. In this context, this research aims to identify the loan systems which are implemented in agricultural sector among the Muslim community, especially among Muslim farmers who are living in Kekirawa divisional secretariat in Anuradhapura district. The research would be extremely significance due to there is no sufficient previous studies find concerning with agricultural loan systems among Muslim community in particular research area in Sri Lanka. This research is designed as mixed method with the inclusion of qualitative and quantitative data which collected in term of finding the correct solutions and providing appropriate recommendations. The findings of the research reveals that the farmers who live in Kekirawa divisional secretariat of Anuradhapura do not depend and connect with banks or other financial institutions to get any advances, but they use to fulfil their needs of capital for farming from money lenders, shopkeepers, friends relatives and NGOs. Therefore, the system should be introduced under the Islamic banks and financial institutions to promote the Shariah compliance products and interest free loan systems not only for Muslim farmers but also to all citizens who wish to involve in agricultural cultivations. Moreover, NGOs and shopkeepers who provide agricultural credit services should be adapted in accordance with the Islamic Shariah compliance. KEY WORDS: Agriculture, Loan Systems, Farmers, Kekirawa. Shariah Compliance, Islamic Banks

What should the government do to support coffee?

The Government should support coffee’s economic performance in the provision of seed, training, organization of coffee events, and sale of coffee processing technology. However, several areas need to be addressed, including cooperative enterprises, agricultural terminals, and business certainty.

How does increase in agricultural production and the rise in the per-capita income of the rural community, together with?

Increase in agricultural production and the rise in the per-capita income of the rural community, together with the industrialisation and urbanisation, lead to an increased demand in industrial production” It is seen that increased agricultural output and productivity tend to contribute substantially to an overall economic development of the country, it will be rational and appropriate to place greater emphasis on further development of the agricultural sector.

Why is agriculture important?

Agriculture plays a critical role in transforming economies to reach the goal, along with achieving other essential development goals like en suring food security and improving nutrition. Therefore, in order to end hunger and undernutrition while accelerating economic growth, agricultural transformation must become a reality.

How can we make agriculture transform?

There are two key areas to make agricultural transformation a reality. First, it is critical to make modern technologies available. While modern agricultural technologies can come from private and public sectors, national governments need to play a big role in investing in agricultural research and development (R&D). This is due to the difficulty for a private enterprise to fully capture the benefits of developing such technologies. National agricultural research systems must work at provincial levels to find new technologies suitable for local conditions, and the state needs to have extension systems to disseminate these technologies.

Why is modernization important in agriculture?

While the result of this stage is a decreased share of agriculture to GDP and the labor force, the process of agricultural modernization is critical for economic transformation and achieving food security and improved nutrition.

What is the next key area for agricultural transformation?

The next key area for agricultural transformation is adoption of modern technologies, as farmers may not use such technologies even if they are available. Many technologies such as high-yielding seeds require stringent conditions for water, inputs, and knowhow.

What is the central goal of every developing country?

One of the central goals of every developing country is to reach high-income status.

Why do governments need human capital?

Governments will also need to build human capital to ensure a skilled labor force to master new technology, handle logistics and boost each node of the value chain. Economic development is a process of structural transformation, and agriculture is the essential engine to jumpstart the process.

What is economic transformation?

Economic transformation—also called structural transformation—means a country’s shift in the relative contribution of its technology and sectors to its overall Gross Domestic Product (GDP): From traditional technology to modern technology and from agriculture to industry and manufacturing, and then to a high-income service economy.

How does agriculture contribute to economic development?

Another factor contribution of agriculture towards economic development is through the release of labour by the agricultural sector for the non-agricultural sectors.

How does agriculture affect the economy?

Agricultural sector, while helping the development of the other sectors , also finds the income of its people increasing. This increased income, in turn, leads to an additional demand for the products of other sectors, not only for consumption purposes but also for production.

What is the other product contribution made by agriculture for the development of the non-agricultural sectors of the economy?

The other product contribution made by agriculture for the development of the non-agricultural sectors of the economy, especially the secondary sector, is in the form of provision of raw materials.

How does the industrial sector help the agricultural sector?

Developments industrial sector, in turn helps in the development of the agricultural sector through the spread of modern technology in agriculture and providing an expanded market for agricultural products. This is a virtuous circle which in the process gives rise to institutions facilitating two way exchange of commodities.

What are the measures taken by the government to transfer funds from the agricultural sector to the non-agricultural sectors?

Forced extraction of surplus from agriculture by taxation, confiscation, imposition of levies or arbitrarily kept low prices of agricultural products, can be the other measures taken by the government to transfer funds from the agricultural sector to the non-agricultural sectors.

Why does the demand for food grains increase?

The demand for food grains can also increase because of another reason. The farming population still left in agriculture might find its income increased due to higher prices of agricultural products as a result of increased demand. This may spur it to increase its own consumption also.

What will happen to non-agricultural sectors as they develop?

As the non-agricultural sectors develop, their dependence on agriculture for other contributions like that of capital, labour, raw material etc., is reduced. However, dependence of the non-agricultural sectors on agriculture for provision of wage goods will be as strong as ever unless, of course, new scientific innovations also result in the production of perfect synthetic substitutes for food grains.

How does agricultural production affect the economy?

As agricultural production and productivity rises above the subsistence requirement, the volume of marketable surplus increases which provides sinews of industrialisation, particularly in the rural sector. Again, the rising volume of savings and capital formation consequent upon rising farm incomes give strong stimulus to demand for manufactured goods. Investment in one sector pulls investment of other sectors up thereby accelerating overall growth rate of the economy.

Why is agriculture dependent on industry?

Agriculture is also dependent on industry for the supply of materials for building up social and economic overheads in the agricultural sector. Further, many raw materials and inputs used in industrial production, e.g., cotton, jute, sugarcane, tobacco, etc., is supplied by the agricultural sector. Such production linkages demonstrate …

What are the three most important linkages in an underdeveloped economy?

The three most important linkages are : production linkages, demand linkages,

What happens to the agricultural sector as non-farm income increases?

Similarly, the rise in non-farm incomes leads to an increase in the demand for various agricultural products. In the process, agricultural sector becomes diversified, modernised.

Why is self-reliant agriculture important?

A self-reliant agriculture capable of exporting surplus food-grains helps in saving scarce foreign exchange resources of the country. Now these resources can be better utilised for importing capital goods and crucial raw materials needed for industrialisation effort.

How does terms of trade affect agriculture?

Terms of trade will improve for agricultural sector if over a period of time the prices of agricultural commodities move at a higher rate than the prices of manufactured articles. Thus, the terms of trade favouring agriculture results in an increased real income and hence, increased private saving and investment.

What is the vertical axis of agricultural output?

Here we consider two sectors—agriculture and industry. Agricultural production and consumption are measured on the vertical axis above the origin while industrial output is measured on the vertical axis below the origin. Horizontal axis—ON axis— measures the volume of agricultural labour. Agricultural output is indicated by the OQ curve. Its shape is governed by the law of variable proportions. OC curve measures the volume of consumption of agricultural output.

Why is agriculture important for the poor?

Given the importance of agriculture for the livelihoods of the rural poor, agricultural growth has the potential to greatly reduce poverty – a key contributor to poor health and undernutrition.

How can agriculture improve health?

How agriculture can improve health and nutrition. The agricultural sector presents key opportunities for improving nutrition and health. But this connection is often not given due attention, despite parallel initiatives across the three sectors. The potential impacts of agricultural activities on health and nutrition extend across a number …

Why is agricultural intensification important?

Agricultural intensification has been essential to feed the world’s growing population, but it has also brought its own risks for people’s health, including zoonotic diseases, water- and food-borne diseases, occupational hazards, and natural resource degradation and overuse. Similarly, water, energy (electricity) and fertilizer subsidies have been linked to distorted consumption and production choices and the crowding out of public investment.

Why is it important to have partnerships between the private and public sectors?

Partnerships between the private and public sectors play an especially important role in improving the efficiency of post-harvest value chains.

How many people are hungry in the developing world?

Despite major progress, serious concerns remain about the nutrition and health situation throughout the developing world. An estimated 805 million people still go hungry and many people also suffer from hidden hunger, that is, deficiencies of essential vitamins and minerals, which are associated with a number of negative health and economic impacts. At the same time, 2.1 billion people worldwide (37% of men and 38% of women) are obese and overweight and this figure is rising (especially in the developing world), bringing with it a rise in non-communicable diseases (such as diabetes, heart disease and some forms of cancer).


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