Over the past five decades, India has witnessed a profound transformation in its economic landscape. One notable shift has been the significant decline in the contribution of the agriculture sector to the country's GDP—from 35% in 1971 to 15% in 2023. This remarkable change reflects a complex interplay of various factors that have shaped the Indian economy. In this blog, we delve into the reasons behind the decreasing share of agriculture in the economic pie and its implications for the nation.

1. Rapid Urbanization and Industrialization:
   The period from 1971 to 2023 has seen unprecedented urbanization and industrial growth in India. As more people migrate to cities in search of better opportunities, the demand for non-agricultural jobs has surged. This urban shift has resulted in a decline in the agricultural workforce and a subsequent decrease in the sector's overall contribution to the GDP.

2. Technological Advancements:
   The Green Revolution, initiated in the 1960s, played a pivotal role in transforming Indian agriculture. The introduction of high-yielding crop varieties, advanced irrigation techniques, and modern farming practices led to increased productivity. However, it also meant that fewer people were needed to cultivate the same amount of land, contributing to the decline in the agricultural workforce.

3. Policy Priorities and Subsidies:
   Over the years, successive governments in India have focused on industrial and service sector growth, often at the expense of the agricultural sector. Policies and subsidies have been directed towards other sectors, leading to a relative neglect of agriculture. The inadequate support for farmers has hindered the modernization and diversification of agriculture.

4. Land Fragmentation and Size:
   The fragmentation of agricultural land into smaller plots has been a persistent issue. Subdivision of land among family members through inheritance has resulted in smaller, less productive farms. The diminishing size of agricultural holdings has made it challenging for farmers to adopt modern technologies and achieve economies of scale.

5. Climate Change and Unpredictable Weather Patterns:
   The agriculture sector is highly dependent on climatic conditions. Changes in weather patterns, including irregular rainfall and increased frequency of extreme events, have led to crop failures and reduced yields. This vulnerability to climate change has impacted the overall productivity of the sector.

6. Market Dynamics and Globalization:
   The opening up of the Indian economy to global markets has exposed farmers to international competition. While this has the potential to enhance efficiency, it also poses challenges, especially for small and marginal farmers who may struggle to compete with larger, more mechanized farms from other countries.

Conclusion:

The decline in the agriculture sector's contribution to India's GDP from 35% in 1971 to 15% in 2023 is a multifaceted phenomenon. While economic diversification and technological progress have contributed to overall national development, the plight of the agricultural sector raises concerns about the well-being of millions of farmers. Addressing the challenges facing Indian agriculture requires a comprehensive approach, encompassing policy reforms, investment in rural infrastructure, and a renewed focus on sustainable farming practices. Balancing the growth of diverse sectors while ensuring the prosperity of those dependent on agriculture remains a crucial task for India's policymakers in the coming years.