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Backward and Forward Linkage Between The Agriculture, Eco

The document discusses backward and forward linkages between key sectors in the Indian economy: 1. Agriculture, industry, and services all have strong interdependencies through backward and forward linkages. Agriculture supplies raw materials to industry and services provide financing. 2. Specific examples are given of linkages between agriculture and banking, seed processing, and tourism. Automobiles also have linkages as they transport agricultural goods and tourists. 3. The automobile industry in particular relies on backward linkages to other industries like metals and electronics, and supports services through transportation. Its growth is driven by rising incomes, infrastructure investment, financing availability, and outsourcing.

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8K views11 pages

Backward and Forward Linkage Between The Agriculture, Eco

The document discusses backward and forward linkages between key sectors in the Indian economy: 1. Agriculture, industry, and services all have strong interdependencies through backward and forward linkages. Agriculture supplies raw materials to industry and services provide financing. 2. Specific examples are given of linkages between agriculture and banking, seed processing, and tourism. Automobiles also have linkages as they transport agricultural goods and tourists. 3. The automobile industry in particular relies on backward linkages to other industries like metals and electronics, and supports services through transportation. Its growth is driven by rising incomes, infrastructure investment, financing availability, and outsourcing.

Uploaded by

mediquip
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Backward and forward linkage

between the agriculture, services


and the industrial sectors.

Presentation by
Smita Shanbhag
Roll no 37
Indian economy depends on:
•Agriculture- It is one of the most significant part of the
Indian economy
•Industry- includes auto industry, biotechnology, cement,
drugs and pharmaceuticals, fertilizers, food processing, gems
and jewelry, heavy industry, mines, oil and gas, real estate , steel
and textiles
•Services – includes construction, trade, hotels, transport,
restaurant, education, communication and storage, social and
personal services, insurance, financing and business services.
Definitions-
•Backward linkage- Channels through which information,
material and money flow between a firm and its suppliers and
create a network of economic independence.
•Forward linkage- Can be defined as a distribution chain
connecting a producer or supplier to its customers
Interdependence of service and
agriculture(Banking)
•Forward linkage – loans from bank to farmers
•Backward linkage- interest paid by the farmers to the
bank

Interdependence of agriculture and


industry(seeds)
•Forward linkage- Seeds sent to industry for processing
•Backward linkage- processed seeds sent back for better
productivity.
Interdependence of Tourism (Mixed sector)
and automobile rental industry

Forward linkage-Automobile rented to Tourism companies


Backward linkage- Rent paid by the tourism companies
Interdependence of the agriculture, industry
and service sector

Trees, bamboo,
Bagasse, Molasses Supplies paper for
for production of education
paper

Forward Forward
Agriculture Paper industry Education
Backward Backward (Service)
Through research
Employment and innovation,
better
technologies and
hence revenue
Linkage between agriculture, industry and
service sector
Eg 2 - Automobile sector
• It has emerged as one of the fastest growing sectors of the
Indian economy.
• Backed by a rapidly growing economy and look-in by a
majority of the global vehicle manufacturers, India is set to
emerge as one of the global centres for vehicle & auto
component manufacture.
• Automobile industry, due to its strong forward and backward
linkages with other segments of the economy viz., machine
tools, aluminium, rubber, plastics, electrical/electronics,
forging & machining etc., has a high economic impact.
Growth drivers
• Rising per capita income and changing demographic distribution i.e. India has a
high proportion of population below 35 years with increasing per capita income.
• Infrastructure thrust: Investment in infrastructure facilities like roads will drive
the commercial vehicles segment of the market.
• Availability and easy access to finance: Penetration of vehicle financing has been
an important factor for the growth of Indian auto industry as financing accounts
for 80-90% of cars bought in India.
• Increasing Exports: Due to high quality standards and low cost skilled manpower,
India is fast emerging as the manufacturing hub for global automobile industry
and is expected to spur the growth of Indian automobile industry.
• Outsourcing: Global auto majors shift manufacturing to low cost countries.

• Reference- paper-Backward & Forward Linkages by-Sabith Ullah Khan


Low Cost skilled Vehicles for
manpower transportation
services

Agriculture Automobile Service

Income through Provides finance


employment
Thank you
Key sectors- sectors with above avg
backward and forward linkages

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