Stock Taking Paper – Agriculture and Rural Economy

This stock-taking paper assesses the current state of India’s agriculture and rural economy across multiple dimensions.

It begins by documenting shifts in household consumption patterns and nutritional outcomes, then takes stock of major policy instruments including the Public Distribution System, minimum support prices, and input subsidies—examining their scale, functioning, and impacts. The paper reviews the evidence on agricultural diversification, noting the gap between consumption patterns and cropping choices. It surveys critical challenges including groundwater extraction levels, climate vulnerability, environmental impacts of current farming practices, constraints in supply chains and farmer organizations, and India’s agricultural trade performance. The assessment also considers the fundamental structural issue: agriculture’s disproportionate share of employment relative to its contribution to GDP, and what this means for farm incomes and rural livelihoods.

This comprehensive stocktaking provides a foundation for understanding where Indian agriculture stands today and what questions merit deeper investigation going forward.