UNIT 8 DIVERSIFICATION TRENDS OF

INDIAN AGRICULTURE
Structure
8.0 Objectives
8.1 Introduction
8.2 Principle of Optimal Utilization
8.3 Process of Diversification
8.4 Agricultural Diversification in India
8.4.1 Determinants of Agricultural Growth/Diversification
8.4.2 Progress of Diversification in Indian Agriculture
8.4.3 Merits of Diversification

8.5 Approaches for Diversification

8.5.1 Location Specific Programme
8.5.2 Contract Farming

8.6 Crop Diversification as a Strategy for National Commitment

8.6.1 Poverty Alleviation and Food Security
8.6.2 Natural Resource Management for Sustainable Agricultural Development
8.6.3 Area Approach to Agricultural Planning

8.7 Constraints and Prospects in Crop Diversification

8.7.1 Globalization and Crop Diversification
8.7.2 Emerging Technology and Crop Diversification
8.7.3 Research and Development Support for Crop Diversification
8.7.4 Institutional and Infrastructure Development for Crop Diversification

8.8 Strategy for Promoting Agricultural Diversification

8.9 Let Us Sum Up
8.10 Key Words
8.11 Some Select References
8.12 Answers/Hints to Check Your Progress Exercises

8.0 OBJECTIVES
After reading this unit you will be able to:
 outline the concept of diversification of agriculture;
 indicate the need for diversification in the agricultural sector;
 discuss the two main approaches for agricultural diversification;
 explain how diversification can be instrumental in transforming the agricultural
22 sector making it a commercially viable modern enterprise;
 identify the constraints in the process of diversification of agriculture; and Diversification Trends of
Indian Agriculture
 suggest policy measures required for strengthening the process of
diversification.

8.1 INTRODUCTION
The contribution of Indian agriculture and its allied sectors to the GDP is nearly
15 percent with about 50 percent of the population currently dependant on
agriculture for their livelihood. Agricultural output, however, depends on monsoon
as nearly 60 percent of area sown is dependent upon rainfall. Further, majority of
small and marginal farmers mainly cultivate low value, subsistence crops. Due to
this, they are facing various problems like: low productivity, low income, low
investment and capital formation, low prices, high production costs, low purchasing
power, infrastructure deficits, etc. To overcome these difficulties, agricultural
diversification is often suggested as a means of improved farm productivity and
income. The concept of agricultural diversification basically refers to a shift of
resources from low value crop mix to relatively high value crops and farm products.
In this unit, we shall study issues of diversification like determinants, approaches,
constraints, strategy, etc. We shall, however, discuss to begin with the: (i) principles
of optimal utilization of resources; and (ii) meaning, need and significance of
diversification in agriculture.

8.2 PRINCIPLE OF OPTIMAL UTILIZATION

One of the basic universal economic principles is to ensure the optimal utilization
of any given resource whether natural or man-made. The theory of optimal
utilization, particularly of natural resources, has two important aspects.
i) The first aspect is that while utilizing any resource we should assure the
insurance of its renewability. This means, if any factor of production has a
renewable property, then its conservation and regeneration potential must be
given utmost priority. In other words, it should not be unsustainably used but
its use should be proportional to its renewable potential. Otherwise, it will be
like killing the goose that lays golden eggs in order to have all the eggs at one
time instead of remaining satisfied with one golden egg every day for a long
time.
ii) The second aspect of optimal utilization relates to deriving optimum benefit
from a given resource. For instance, in case of agriculture, land is such a
factor. It is a natural gift of nature with full potentialities of renewability. But
this natural resource is scarce in comparison to demand from human population
for which reason land is intensively used. However, the intensive use of land,
without regard to its fertility regain consideration will be against the principle
of optimal utilisation.
A mid-path between the two needs of optimum utilization and renewability, is to
go for ‘diversification of agriculture’. As said above, agricultural diversification
implies shifting of resources from crops and farm activities with low productivity
to relatively high value crops and other farm products. Sustainability of land and
water resources is also an important consideration in agricultural diversification.
Diversification of agriculture is a response to changing demand for agricultural
23
Agricultural Development products with the rise in incomes and the growing global integration of agricultural
Through the Plans
markets. It is thus a challenge as well as an opportunity.

8.3 PROCESS OF DIVERSIFICATION

Agricultural diversification is a wide-ranging process. In a general sense,
diversification of agriculture may mean:
i) Diversification between agriculture and allied activities like animal husbandry,
fishing, etc.; and/or
ii) Diversification in cropping pattern.
The second category may be sub-divided into:
a) Diversification between food crops and non-food crops;
b) Diversification between cereals and non-cereal food crops;
c) Diversification between traditional crops and horticulture; and
d) Diversification between low productivity or low value crops to high value
crops.
Alternatively, crop diversification can be divided into two categories:
i) Horizontal Diversification; and ii) Vertical Diversification.
i) Horizontal Diversification
The commonly understood mechanism is the addition of more crops to the existing
cropping systems (i.e. multiple cropping), which is in a way broadening the base
of the system. This method of diversification has special significance under small-
holder production systems and has proved beneficial to production increases due
to increased cropping intensities.
ii) Vertical Diversification
The other type is vertical crop diversification, which reflects the extent and stage
of industrialization of the crop production. Practicing of enterprises like agro-
forestry, dry-land horticulture, medicinal and aromatic plants and other economic
shrubs and livestock come under this. Note that crop diversification takes into
account the economic returns from different crops. In light of this, it is different
from the concept of multiple cropping. Both types of diversification (i.e. multiple
cropping or horizontal diversification and agri-business or vertical diversification)
will be essential to improve crop yields and income generation at local, regional
and national levels.
Check Your Progress 1 [answer in about 50 words in the space given below]
1) Do you agree that ‘diversification of agriculture’ is a mid-path between the
two essentials of the ‘principle of optimal utilisation’?
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2) What are the four sub-categories of ‘diversification in cropping pattern’? Diversification Trends of
Indian Agriculture
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3) How is ‘crop diversification’ of agri-business type different from ‘multiple
cropping’?
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8.4 AGRICULTURAL DIVERSIFICATION IN

INDIA
Agriculture sector is prone to high levels of risks which include uncertain events
like droughts/famines, floods, cyclones, hailstorms, frosts, cold/heat waves, etc.
Besides, diseases related to plants and animals, and insects and pests also have
adverse effect on agricultural output posing losses or risks. The agricultural sector
is also subject to uncertainties by environmental, technological and economic factors
which impact seriously on the demand and supply dynamics of agricultural products.
Such fluctuations, in turn, adversely affects the potential of agricultural trade.
Agricultural diversification is also a method of minimising some of these risks by
resorting to protective practices.

8.4.1 Determinants of Agricultural Growth/Diversification

Agricultural growth is a function of the level of technology, government policies,
cropped area and production portfolio. Temporal change in agricultural growth
(i.e. changes in output levels of agricultural products over time) is, therefore, the
cumulative effect of changes in all these components/variables. A well informed
policy formulation to promote the agricultural growth/output ideally requires a
decomposition of the effect of each one of these components on output. For
national accounting purposes, the value of gross output from agriculture (minus the
value of inputs) is considered as a measure of income from agriculture. For empirical
purposes, crop yields are used as proxy for the cumulative effect of variables like
government policies, gross cropped area, change in production–portfolio (i.e. crop
substitution) for agricultural diversification, etc. While these are exogenous (i.e.
independent) factors which influences the decision on agricultural diversification,
as individuals farmers take certain factors into consideration before deciding on
bringing about changes in their cultivation habits. These, therefore, could be counted
under endogenous (i.e. dependent) factors.
How do farmers change their cultivation practices or what motivates them to do
so? Farmers, being rational economic agents, would change their cropping pattern
only when they expect an economic gain from such a change. Various determining
25
Agricultural Development factors, from the farmers’ angle, for the adoption of agricultural diversification
Through the Plans
would therefore be: profit margin of new system, availability of market for produce,
risk coverage, availability of technology, alternative incentives, and other compelling
reasons to shift for a new system, etc.

8.4.2 Progress of Diversification in Indian Agriculture

India is currently producing more than 275 million tonnes of food grains every
year. The first Green Revolution (GR) during 1960s helped India in achieving the
record agricultural produce. Green Revolution was essentially supply-driven. Large
incentives were provided to increase production and enhance supply of essential
foodgrains. The techniques developed by the Green Revolution are: (i) extensive
use of chemical fertilizers; (ii) irrigation; (iii) use of heavy machinery; and (iv) use
of pesticides. The GR substantially increased rice production in India using a
package of new seeds, fertilizers and irrigation. The first stage of GR in agriculture
was followed by ‘White Revolution’ (i.e. milk production in which with 90 million
tonnes of milk production a year, India is among the highest milk producers in the
globe), Blue Revolution (in fisheries) and Yellow Revolution (in edible oil, especially
mustard/ rape seed oil). Besides these achievements, India also ranks at a high
position in the production of fruits and vegetables. While all these are some major
strides taken in diversification of Indian agriculture, these are no longer adequate
for India whose population is projected to touch 140-150 crores by 2025. Further,
associated with increase in income levels, there is also a change in the pattern of
consumption (or demand) of consumers. As we already noted in unit 7, our import
of food items have exceeded the exports. Due to all these factors, there is a
compelling need to infuse modern methods in agriculture to make the Indian
agriculture not only more self-sufficient in all farm products but also become
leading food producer in the world. In short, there is a need for a second GR. In
recent years, genetic engineering techniques have been used to further enhance
some of the GR advances. For instance, many commercial crops have been
treated with herbicide tolerance so that their application have eliminated weeds
leaving the crops unaffected.
The second GR is expected to follow a strategy distinctly different from the first.
Whereas the first GR mainly focused on popularization of high yielding varieties
(HYV) and crop varieties to overcome food shortage, the second GR is likely to
be driven by changing consumer preferences which are increasingly in favour of
high value farm products. The response will be based on harnessing a bouquet of
new technologies drawn from the advances made in space, Information Technology
(IT) and Bio-Technology (BT) areas. It will, therefore, focus not only on traditional
farming but on aspects of commercial farming like: horticulture, floriculture,
sericulture, aquaculture, medicinal/aromatic crops and linkages with agro-processing.
In all this, one of the main components would be launching an action plan for
massive crop diversification.

8.4.3 Merits of Diversification

The merits of diversification are many. These may be stated as follows.
i) Different crops require different types of soil fertility. A combination or
rotation of crops is expected to utilize more fully all the properties of
the soil than does concentration, year after year, on one crop. For
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 instance, cereals use a great deal of nitrates, cabbages more of Diversification Trends of
Indian Agriculture
sulphates, clovers take a lot of lime and root crops make heavy demand
on phosphates. If different crops are grown in successive years, it will
be possible to restore the elements which one crop uses up before the
same crop is planted again sometime later.
ii) Rotation of crops facilitates reduction of weeds as it permits cleaning
operations at different times. It thus minimises any type of weeds from
nourishing and spreading year after year.
iii) Diversification makes it possible to grow more than one crop in a year
in the same field where it would be impossible to plant and harvest the
same crop twice. It also facilitates breeding of live stock which feeds
on the residue of crops/grasses. It, therefore, provides additional source
of income to the farmer in the form of meat, milk, wool or fuel.
iv) Diversification permits more even demand for labour throughout the
year due to different crops grown.
v) Diversification makes it possible for farmer and his family to consume
a variety of food that is grown.
vi) Diversification enables the farmers to spread his risk. If one concentrates
on one crop/product, a harvest failure or a price collapse may ruin
him. It is very unlikely that all crops/products fail simultaneously in the
same year.
vii) Diversification enables the income of the farmer to be more regular as
the crops and animal products will be sold evenly throughout the year.
viii) Diversification increasingly assumes switching from low value crops to
high value crops and helps not only to meet the changing demand for
farm products but also increase farmers’ income.
Check Your Progress 2
1) Fill in the blanks.
a) India is currently producing more than ........... million tonnes of food
grains every year.
b) The first green revolution used a package of ................, .................,
and ..............
c) The wheat production at present in India has increased from .................
million tonnes to ........ million tonnes.
d) Diversification of Indian agriculture has successfully encompassed other
products/areas like ..................., .........................., and .....................
2) Mention some examples of alternative areas for commercial farming on which
the second green revolution is expected to lay its thrust/focus.
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Agricultural Development ........................................................................................................................
Through the Plans
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3) Do you agree that ‘diversification helps an Indian farmer to spread his risk’?
State the rationale behind this contention.
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8.5 APPROACHES FOR DIVERSIFICATION

It is clear from the above that in the modern era, agricultural diversification is very
essential for economic growth. The approaches to diversification should be based
on economic considerations helpful in minimising losses or maximising profits. The
two considerations can be exemplified by delayed transportation of perishable
items which causes losses to the farmer and assured market/price for products
grown under terms of ‘contract farming’. The approaches for diversification would
thus be based on the following considerations.

8.5.1 Location Specific Programme

Location specific diversified farming system could be adopted for minimising losses
of perishable items. Cold storage facilities and agro-processing will minimise losses.
Diversification into high value crops and high value products like diary, poultry etc.
would be essential. Large areas of Eastern India, which are prone to water logging,
can, inter alia, be put under profitable acquatic farming system for products like
Makhana, Singhara, Swamp-taro, etc. as well as fisheries.

8.5.2 Contract Farming

Contract farming is another innovation that has been introduced in many states and
could accelerate diversification. Indian farmers are constrained in taking to high
value crops due to lack of cold storage and ready marketing facilities. India’s laws
on agricultural land do not allow corporate bodies to purchase land and operate
large scale farms due to a national policy to prevent displacement of a large
number of small farmers. Under this situation, corporate buyers who can cater to
domestic/export markets, or operate enterprises in agro-processing, can engage in
‘contract farming’ to produce high quality produce. Under this scheme, buyers
select area suitable for the crops they are interested in and organize farmers to
produce these crops under contract. They provide planting material of the right
quality and technical expertise. The process enables the farmers to eliminate their
marketing risks while the corporate buyer is assured of quality supplies. The
development of agro-processing, based on contract farming, will thus spur agricultural
diversification. However, contract farming requires: (i) providing suitable incentives
for diversification for which formulating attractive policy initiatives are essential;
and (ii) increasing public investment in irrigation, water, rural roads and rural
electrification, etc. These infrastructure facilities in turn would attract private
investment.
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 Diversification Trends of
8.6 CROP DIVERSIFICATION AS A STRATEGY Indian Agriculture
FOR NATIONAL COMMITMENT
Crop diversification can be helpful in addressing some of the national problems
like: (i) alleviation of poverty and ensuring food security and (ii) ensuring sustainable
agricultural development. It can also help in balanced regional development by
focussing on area approach to agricultural planning. In fact, the achievements of
the past six decades goes to confirm this.

8.6.1 Poverty Alleviation and Food Security

The agricultural growth rate of around 2.7 percent per annum in the post-
independence period was much higher than the negligible growth rate of 0.3
percent per annum in the first half of the 20th century. It is not only in the areas
of food grain production but also in the production of commercial crops like
cotton, oilseeds, sugar cane, fruits and vegetables as well as livestock products
and fisheries that we achieved significant increases since independence. This
achievement has contributed to significant reduction in poverty. For instance, the
incidence of poverty declined from 54.9 percent in 1973/74 to 27.50 percent in
2004/05 i.e. by exactly half or 50 percent. The National Agenda for Governance
of the present government has, therefore, given top priority to doubling food
production in the next ten years. This includes rice, wheat, coarse cereals, pulses,
oilseeds, sugar, fruits and vegetables, meat, milk, and fish. The Action Plan envisages
a detailed strategy with specific problems of productivity identified and addressed
so that substantial increase in the supply of various food items can be so achieved
that the demand for such items for the entire population is not only met but some
exportable surplus also remains available. The development strategy to be pursued
in the medium term has been consciously interwoven with the country’s food
security concern. If there is a completely market-driven diversification without
regard to national priorities there is likely to be threat to food securtiy. For
instance, shifting of area under food crops to commercial crops like ‘jetropa’ for
bio-diesel may upset food security. Therefore, caution should be exercised in
agricultural diversification.

8.6.2 Natural Resource Management for Sustainable

Agricultural Development
It is a known fact that there is little scope for further expansion of the net sown
area (142 mha) and that land scarcity will become an acute feature of the rural
economy. Water is a precious national asset and there are several concerns regarding
water resources in the country. Therefore, a judicious use of land and water
resources will be the central theme for sustainability of agricultural growth. There
has been a growing concern in recent years about the deteriorating conditions of
soil and water resources due to improper management and pollution. The
deterioration has been in the form of land degradation, water-logging and decline
in water table. There is a greater need to have an integrated approach in the
management of plant nutrients, chemicals and taking effective measures to deal
with the overall pollution problems. There are several possible technologies and
alternatives to reduce the use of chemicals in agriculture. These alternatives are not
perfect substitutes to chemicals but adoption of these can substantially reduce the
adverse impact on environment. Proper land and water management policies would 29
Agricultural Development reduce environmental degradation. Community and village institutions are envisaged
Through the Plans
to be encouraged to participate in protecting the natural resources from degradation.
Under this, programmes for regeneration of land and water resources will be
strengthened.

8.6.3 Area Approach to Agricultural Planning

A new approach to agricultural planning - the Agro Climatic Regional Planning
(ACRP) was put into action in 1988. This was a holistic approach which explicitly
recognized the local resource endowments and constraints of the agro-climatically
homogeneous regions which quite often cut across different states. The ACRP was
a bridge between the resource base and decentralized planning which aimed at
providing a scientific support to planning for attainment of sustainability with due
regard to basic resources and the local needs. The project was initiated by
regionalizing the country into 15 zones/regions, later divided into 73 sub-regions.
The principles used for this sub-regionalization were intrinsically related to the
character of the agricultural economy like soil, climate, rainfall, etc.
The above brief account has spelt out the various steps taken in the past, and
being taken now, to address some of the national issues like poverty alleviation,
food security and sustainable/balanced regional growth through diversification of
agriculture. In the next section, we shall see what constraints specifically lie in the
path of crop diversification.

8.7 CONSTRAINTS AND PROSPECTS IN CROP

DIVERSIFICATION
Crop diversification in the recent years is taking the form of increased area under
commercial crops including fruits and vegetables. However, this has gained
momentum in the last decade favouring increased area under vegetables and fruits
and also to some extent on commercial crops like sugar cane, cotton and oilseeds,
especially soya-bean. The major problems and constraints in crop diversification,
with varied degrees of influence, are primarily the following .
i) Over 117 mha of the cropped area in the country (63 percent) is completely
dependent on rainfall.
ii) Sub-optimal and over-use of resources like land and water have caused a
negative impact on the environment and sustainability of agriculture.
iii) Inadequate supply of seeds and plants of improved varieties.
iii) Fragmentation of land holding working against modernization and mechanization
of agriculture.
v) Poor basic infrastructure like rural roads, power, transport, communications,
etc.
vi) Inadequate post-harvest technologies and inadequate infrastructure for post-
harvest handling of perishable horticultural produce.
vii) Weak agro-based industry.
viii) Weak research-extension-farmer linkages.
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ix) Inadequately trained resources compounding the persistent and large scale Diversification Trends of
Indian Agriculture
illiteracy among farmers.
x) Host of diseases and pests affecting most crop plants.
xi) Poor database for horticultural crops.
xii) Decreased investments in the agricultural sector over the years.

8.7.1 Globalization and Crop Diversification

With the advent of WTO, the scenario of the agricultural sector has changed and
will further change very much. Trade liberalization and market access for agricultural
products between the different countries has compelled the promotion of a more
vibrant diversified agriculture. But there are limits to trade and diversification. For
crops on which we have substantial area and production, specially food-grains,
the import market has to be insulated through increased productivity which gives
us a kind of comparative advantage and also a level playing field so that large
scale importation is contained and farmers’ interests are protected. The crops
which are traditionally exported like basmati rice and spices and condiments also
need to be supported in terms of area expansion and quality improvement. More
opportunity for both production and post-harvest handling needs to be established.
Accelerated growth in fruits and vegetables production is also required for improved
nutrition of the country’s population. With improved living standards along with
increased purchasing power, more and more people will seek nutritional and
quality food which call for greater crop diversification. There are some production
areas such as food crops, plantation crops, poultry, dairy, sugar, cotton and oilseeds
in which India has made its mark. There are some in which its emerging strength
is evident like sericulture, marine and inland fisheries. No country grows such a
wide range of fruits, vegetables, and flowers and in such abundance as India and
yet it has no record worth mentioning in horticultural exports. The rich variety
when processed and marketed, can help India take care of the health needs of its
population becoming a major exporter of these commodities.

8.7.2 Emerging Technology and Crop Diversification

The agriculture of the twenty first century will increasingly be dependent on farmers’
entrepreneurship. This demands harnessing technologies to optimize returns from
land and investments made on it. Biotechnology and genetic engineering in crops
with focus primarily on productivity and quality is expected to give significant
boost for many important crops/plants. With the advent of emerging technologies
and consequent scope for increased economic returns, diversification in favour of
such crops would have to be the future focus. Many other related technologies
and their adoption will also inject an added dimension in crop diversification.
Decision support systems, governmental policies, geographic information system,
application of information technology leading to market information, etc. will also
lead to crop diversification primarily on economic considerations.

8.7.3 Research and Development Support for Crop

Diversification
Future agriculture will be much more knowledge and skill based. In the wake of
globalization and opening up of the markets, there will be much more opportunity
31
Agricultural Development for entrepreneurship development in agriculture. This calls for paradigm shifts in
Through the Plans
research and technology development and also transfer of technology for successful
crop diversification. The research system not only needs to be vigilant in the areas
of emerging technologies but also create a cadre of scientists through continuous
upgrading of skills and human resource development. It also needs to popularize
the technologies, impart knowledge and skills to the extension functionaries for the
transfer of technologies to the farmers. This knowledge-based farming will call for
much more interaction between the researchers, extension workers and farmers.
The fruits of the innovative technologies should reach the farmers at the earliest
and also spread it in the quickest possible time.

8.7.4 Institutional and Infrastructure Development for

Crop Diversification
To sustain and operationalise crop diversification, institutional support is required
to the two thirds of the country’s crop area which is dependent on rains. Crop
diversification in terms of reducing the risk of rain-fed farmers is vital to a country
like India where two- thirds of the farmers are resource poor. The National
Agricultural Research System with its Crop and Commodity based Institutions,
Natural Research Management Based Institutions and State Agricultural Universities
are jointly addressing the issues connected with crop diversification. The government
has also developed a counter support mechanism through the establishment of
Crop Directorates for each of the major crops and groups of crops like Oilseeds
and Pulses with technology transfer as its focus on each of these crops and
commodities. These directorates act as a coordinating agency between the research
and development activities and technology transfer including promotional activities.
Check Your Progress 3 [answer in about 50 words in the space given]
1) What are the two main approaches advocated for agricultural diversification?
Which one of these ‘minimise economic losses’ for the farmers?
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2) Which are the two main areas in which greater attention is required to be paid
in order to make ‘contract farming’ approach for diversification function well?
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3) Fill in the gaps.
a) Agricultural growth has increased from ....... per cent per annum (p.c.p.a.)
in the pre-independence period to ........ p.c.p.a. in the post-independence
period.
b) Agricultural growth has contributed to reducing poverty from ...... percent
in 1973-74 to ......... percent in 2004-05.
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 c) The developmental strategy to be pursued in the medium term has been Diversification Trends of
Indian Agriculture
consciously interwoven with the country’s ......... ............. concern.
d) Proper ............ and .............. management policies would help reduce
environmental degradation.
e) The ‘agro-climatic regional planning’ (ACRP) approach was a bridge
between ........ ........ ............ and .......... ................ Further, the principles
used for this were intrinsically related to the character of the agricultural
economy like ..........., ........., ....................., etc.
f) ........... percentage of total cropped area in India is totally dependent on
monsoons.
g) In the emerging 21st century Indian agriculture, ................... and
.................. .................. in crops with focus primarily on ............... and
................ considerations is expected to give significant boost for
agricultural diversification.

8.8 STRATEGY FOR PROMOTING

AGRICULTURAL DIVERSIFICATION
In the modern era, agricultural diversification is an important strategy for agricultural
development. The process of agricultural diversification is largely demand-driven
in contrast to the supply-driven process of Green Revolution. In a country like
India, there is a greater role to smallholders in agricultural diversification in future
in contrast with the rich farmer-driven Green Revolution of the past. There is also
greater participation of the private sector especially in marketing and processing.
Agricultural diversification for meeting the demand for high value commodities
need incentives, institutions and investments. The direction for policy support and
emphasis for agricultural diversification, already indicated in the previous sections,
is once again reiterated below as suggestions for strategy for agricultural
diversification in India.
1) Integrated policy such as research, production, post-harvest management,
processing and marketing, etc. should be taken under one umbrella.
2) Public sector investment in agricultural sector which has witnessed a major
decline in the past two decades should be rejuvenated.
3) Emphasis on integrated farming system comprising of farming, pisciculture,
horticulture, rearing animal, poultry, piggery and goat, etc. to be laid.
4) Location-specific diversified farming system to be adopted.
5) Measures to conserve and efficiently manage water resources to be facilitated
with technological and extension services.
6) India’s great potential in the field of fruits and vegetable, floriculture, pisciculture,
horticulture and animal husbandry, etc. to be harnessed for optimum utilization
of the available resources.
7) Post-harvest management, storage and marketing facilities to be emphasized.
These are critical areas in which the weaknesses should be removed.
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Agricultural Development 8) Availability of institutional credit to be enhanced.
Through the Plans
9) Through attracting and retaining youth in farming, agricultural diversification
can be taken to its potential heights. A policy for this to be crafted and
implemented in full earnestness.
10) The export basket is varied and full of opportunity. Thrust on export of
agricultural products which tends to rise agricultural diversification to be duly
promoted.

8.9 LET US SUM UP

Crop diversification means moving away from growing a single crop to a number
of crops. Such a move towards crop diversification helps in: (a) better use of
available land, labour, water and other resources; (b) reduce risks arising out of
crop failures, yield losses and market failures; and (c) help realize quicker/regular
returns to farmers. However, these advantages of diversification are not without
costs as: (i) crop diversification demands higher level of managerial input from the
individual farmer; and (ii) small surpluses of various agricultural commodities create
difficulties in efficient handling and marketing of the produce. Effective policy and
public investment are needed to reduce these inherent weaknesses in Indian
agriculture. Indeed, crop diversification has been recognized as an effective strategy
for achieving the multiple objectives of food/nutrition security, income growth,
poverty alleviation, employment generation, judicious use of land and water
resources, sustainable agricultural development and environmental improvement.

8.10 KEY WORDS

Diversification of Agriculture : Refers to the re-allocation of productive
resources into new activities.
Vertical diversification : Diversification by way of multiple cropping in
which a production enterprise moves into a
different level of the supply chain.
Horizontal diversification : Refers to diversification of agri-business type
in which a business enterprise develops or
acquires new products that are different from
its core business.

8.11 SOME SELECT REFERENCES

Anil Kumar Thakur and K. B. Padmadeo (eds.), Growth and Diversification of
Agriculture, Deep, New Delhi, 2008.
P.K. Joshi, Ashok Gulati and Ralph Commings Jr (eds.), Agricultural Diversification
and Smallholders in South Asia, Academic Foundation, New Delhi, 2007.
World Bank, Poverty and Hunger: Issues and Options for Food Security,
Washington D.C. 1998.

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 Diversification Trends of
8.12 ANSWERS/HINTS TO CHECK YOUR Indian Agriculture
PROGRESS EXERCISES
Check Your Progress 1
1) See Section 8.2 and answer.
2) See Section 8.3 and answer.
3) See Section 8.3 (ii) and answer.
Check Your Progress 2
1) (a) to (d): see section 8.4.2 and answer.
2) See section 8.4.2 and answer.
3) See section 8.4.3 and answer.
Check Your Progress 3
1) See section 8.5 and answer.
2) See section 8.5 and answer.
3) (a) to (c): see section 8.6.1 and answer; (d) see section 8.6.2 and answer;
(e) see 8.6.3 and answer; (f) see 8.7 and answer; (g) see 8.7.2 and answer.

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