q.what do you men by NITI aayog . discuss the main funtion of its.

NITI Aayog: Definition

8
NITI Aayog, or the National Institution for Transforming India, is a policy
think-tank of the Government of India established on January 1, 2015,
replacing the Planning Commission. Its primary role is to foster cooperative
federalism by involving states in the policy-making process and to act as a
catalyst for achieving sustainable and inclusive growth in India.
7
Main Functions of NITI Aayog
. Policy Formulation and Implementation:
○ Develop long-term strategic and technical frameworks for India's

economic development.
○ Provide policy inputs to both the central and state governments.
6
. Cooperative Federalism:
○ Encourage active participation of states in policy development and

decision-making.
○ Promote coordination between the center and states for effective

implementation of policies.
5
. Think Tank and Knowledge Hub:
○ Serve as a platform for sharing knowledge, best practices, and

research among states and central ministries.

○ Facilitate dialogue and collaboration between the public and
4
private sectors.
. Monitoring and Evaluation:
○ Monitor and evaluate the implementation of government policies

and programs to ensure efficiency and accountability.

○ Suggest corrective actions based on real-time feedback and data.
3
. Resource Allocation:
○ Advise on the allocation of financial resources and prioritize

development areas.
○ Work on innovative financing mechanisms for projects.

. Fostering Innovation and Entrepreneurship:

2
○ Promote innovation and entrepreneurship through initiatives like

the Atal Innovation Mission.

○ Encourage the adoption of technology and innovation to improve

governance and service delivery.

1
. Promoting Sustainable Development:
○ Focus on achieving the Sustainable Development Goals (SDGs) by

2030.
○ Work on environmental sustainability, renewable energy, and

climate action.
. Acting as an Intermediary:
○ Act as a bridge between different stakeholders, including the
 ○

central government, state governments, private sector, academia,

and international institutions.
Key Initiatives by NITI Aayog
● Aspirational Districts Program: Focuses on transforming
underdeveloped districts.
● Digital India: Enhances the digital infrastructure and services.
● Atal Innovation Mission (AIM): Promotes innovation and
entrepreneurship.
● Health and Nutrition Programs: Works on improving healthcare and
eradicating malnutrition.
NITI Aayog’s flexible and dynamic approach enables it to address India’s
complex economic and social challenges effectively.

q. define an underdeveloped economy and its main case?

An underdeveloped economy is a term used in economics to describe a

country or region where the level of economic development is relatively low
compared to more advanced economies. It is characterized by low income
levels, limited industrialization, high unemployment or underemployment, and
poor living standards.
Main Characteristics of an Underdeveloped Economy:
. 1st Low Per Capita Income: The average income of the population is
significantly lower than in developed countries.
. 2nd Primary Sector Dominance: The economy is heavily dependent
on agriculture and other primary activities, with limited industrial and
service sectors.
. 3rd High Population Growth: Rapid population growth often
outpaces economic growth, leading to lower per capita availability of
resources.
. 4th Unemployment and Underemployment: A large portion of the
workforce is either unemployed or engaged in low-productivity jobs.
. 5th Lack of Infrastructure: Insufficient transportation,
communication, and energy infrastructure hamper economic activities.
. 6th Low Levels of Education and Skill: Limited access to quality
education and skill development reduces productivity and innovation.
. 7th Economic Dualism: The coexistence of a modern industrial
sector and a traditional agricultural sector with minimal interaction
between them.
. 8th Capital Deficiency: Low levels of savings and investment restrict
economic growth.
Main Cause of Underdevelopment:
The primary cause of underdevelopment is often considered to be a vicious
circle of poverty. This concept suggests that low income leads to low savings,
which in turn results in low investment. Low investment leads to low
productivity and economic stagnation, perpetuating the cycle of poverty.
Other contributing factors include:
● ? Historical exploitation (e.g., colonization).
● ? Political instability and corruption.
● ? Poor governance and policies.
● ? Limited access to technology and innovation.
● ? Trade imbalances and dependency on developed nations.
These elements create barriers to sustainable economic growth and
development in underdeveloped economies.

Q. what do you mean by liberalisation, privitasation and globlization.

describe the advantage and also disadvantage of privitation in indian
economy.

Liberalization, Privatization, and Globalization (LPG) are the three pillars of

economic reforms introduced in India in 1991 to improve its economic growth
and integration with the global economy. Here's what they mean:
1. Liberalization
Liberalization refers to the relaxation of government regulations and restrictions
in the economy, enabling free-market principles. This includes reducing taxes,
opening up industries for private participation, and allowing foreign
investments.
2. Privatization
Privatization is the process of transferring ownership or management of state-
owned enterprises (SOEs) to private individuals or organizations. This can be
done through disinvestment, selling shares, or full-scale transfer of ownership.
3. Globalization
Globalization is the process of integrating the Indian economy with the global
economy. It includes promoting foreign trade, investment, and cultural
exchange to encourage global interconnectedness.

Advantages of Privatization in the Indian Economy

. Increased Efficiency
Private companies operate with profit motives, which often leads to
better management, innovation, and utilization of resources.
. Reduction in Fiscal Burden
Selling loss-making government enterprises reduces the financial
burden on the government, freeing up resources for other areas like
education and healthcare.
. Boost to Investment
Privatization encourages foreign direct investment (FDI), bringing in
capital, technology, and expertise.
. Improved Services
Competition introduced by private players often results in better
quality services and products.
 . Market Growth
It fosters competition, leading to a more dynamic and robust market.

Disadvantages of Privatization in the Indian Economy

. Job Losses
Privatization often results in layoffs as private companies seek to
reduce costs and improve efficiency.
. Profit Motive Over Public Welfare
Private companies may prioritize profits over the welfare of society,
neglecting social and developmental goals.
. Monopolization
Certain sectors may become monopolized, reducing consumer choice
and leading to exploitation.
. Loss of Government Control
Critical sectors such as energy, railways, or defense might lose public
oversight, which could be a national security concern.
. Inequality
Privatization may widen the gap between rich and poor, as it may favor
wealthy investors and disadvantage the marginalized sections of
society.

Q.explain the method of national income estimation in india give main

feature of national income.
Methods of National Income Estimation in India
National income is the total monetary value of all the final goods and services
produced within a country during a specific period (usually a year). In India, the
Central Statistical Office (CSO), now part of the Ministry of Statistics and
Programme Implementation (MoSPI), estimates the national income using the
following three methods:

1. Production Method (Value Added Method)

● Description: This method calculates the contribution of each
productive sector to the economy by summing up the "value added"
at each stage of production.
● Process:
. The Gross Value of Output (GVO) is calculated.
. Intermediate consumption (raw materials, services used in
production) is subtracted to derive the Gross Value Added (GVA).
. GVA from all sectors is added to get the Gross Domestic Product
(GDP) at factor cost.
● Used For: Agriculture, manufacturing, and industrial sectors.

2. Income Method
● Description: This method calculates national income by summing up
the incomes earned by factors of production (land, labor, capital, and
 ●

entrepreneurship) within the country.

● Components:
. Wages and salaries (compensation to employees).
. Rent (for land).
. Interest (on capital).
. Profits (entrepreneurial income).
. Mixed income (for self-employed individuals).
● Used For: Service sectors like trade, transportation, and personal
services.

3. Expenditure Method
● Description: This method calculates national income by summing up
all expenditures incurred in the economy on final goods and services.
● Components:
. Private consumption expenditure.
. Government expenditure.
. Gross capital formation (investment).
. Net exports (exports minus imports).
● Used For: Estimating GDP from the demand side.

Features of National Income

. Comprehensive Indicator
Represents the economic activity of the entire country.
. Aggregate Measure
It measures the total income or production, not individual incomes.
. Based on Final Goods and Services
Avoids double counting by excluding intermediate goods.
. Real and Nominal Values
Can be measured in real terms (adjusted for inflation) or nominal terms
(current prices).
. Includes Factor Incomes Only
Includes only incomes earned through productive activities, excluding
transfer payments like pensions or subsidies.
. Territorial Scope
Measures the income generated within the geographic boundaries of
the country.
. Net vs. Gross Income
Can be measured as Gross National Income (GNI) or Net National
Income (NNI) by deducting depreciation from GNI.
. Indicator of Economic Growth
Changes in national income over time indicate the economic health
and growth of a country.

Conclusion
Estimating national income is essential for understanding the economic
performance, planning, and policy-making of a country. By combining the
production, income, and expenditure methods, India ensures a comprehensive
calculation that reflects the complexity of its diverse economy.

Q. write short note on 1. make in india programme 2. national food sequrity

mission
1. Make in India Programme
The Make in India initiative was launched by the Government of India in
September 2014 to transform India into a global manufacturing hub. The
program aims to attract investments, foster innovation, enhance skill
development, and build world-class infrastructure for various sectors.
Key Features
● Focuses on 25 sectors like automobiles, textiles, aviation,
biotechnology, and defense.
● Simplifies regulatory processes to encourage foreign and domestic
investments.
● Promotes "Zero Defect, Zero Effect" manufacturing to ensure quality
production with minimal environmental impact.
● Encourages job creation and entrepreneurship.
Achievements
● Growth in FDI inflows.
● Development of industrial corridors and smart cities.
● Boost to sectors like electronics manufacturing and automotive
production.

2. National Food Security Mission (NFSM)

The National Food Security Mission (NFSM) was launched in 2007-08 by the
Government of India to ensure food security by increasing the production of
rice, wheat, pulses, and other essential crops.
Objectives
● Achieve an additional production of 25 million tons of food grains.
● Reduce the dependency on imports for pulses and other crops.
● Bridge the yield gap in underperforming districts.
Strategies
● Providing subsidies on fertilizers, seeds, and pesticides.
● Promoting modern agricultural practices and farm mechanization.
● Enhancing soil fertility through balanced nutrient management.
Impact
● Significant increase in food grain production.
● Improved livelihoods for farmers.
● Contribution to India’s self-sufficiency in food production.

Q. how many types of unemployment in india give suggestion to solve

unmployment problem to india.
Types of Unemployment in India
India faces several types of unemployment, reflecting the complexities of its
economy. Below are the major types:
. Disguised Unemployment
○ Found mainly in the agricultural sector, where more people are

employed than needed.

○ Example: A farm requiring 5 workers has 8, with the extra 3

contributing little to productivity.

. Structural Unemployment
○ Occurs due to a mismatch between workers' skills and the jobs

available.
○ Example: Workers trained in traditional industries unable to find

jobs in modern industries.

. Frictional Unemployment
○ Temporary unemployment during transitions between jobs.
○ Example: A person leaving one job to search for another.

. Seasonal Unemployment
○ Common in agriculture and tourism, where work depends on the

season.
○ Example: Farmers being idle during non-harvest periods.

. Cyclical Unemployment
○ Caused by economic downturns or recessions leading to reduced

demand for goods and services.

○ Example: Layoffs during a recession in manufacturing industries.

. Technological Unemployment
○ Caused by the replacement of workers with machines or

automation.
○ Example: Factory workers losing jobs due to robotic automation.

. Educated Unemployment
○ When individuals with higher education cannot find suitable jobs.
○ Example: Graduates unable to secure employment matching their

qualifications.
. Underemployment
○ Workers are employed below their skill level or work fewer hours

than desired.
○ Example: An engineer working as a clerk.

Suggestions to Solve the Unemployment Problem in India

. Promote Skill Development
○ Launch skill enhancement programs to bridge the gap between

education and industry requirements.

. Encourage Entrepreneurship
○ Provide financial support, training, and incentives for startups to

create job opportunities.

 . Boost Labor-Intensive Industries
○ Focus on sectors like textiles, agriculture, and construction that

require more manpower.

. Strengthen Education System
○ Introduce vocational and technical education to align with market

demands.
. Promote Rural Development
○ Create non-agricultural job opportunities in rural areas to reduce

disguised and seasonal unemployment.

. Support Small and Medium Enterprises (SMEs)
○ Offer loans and subsidies to SMEs, which have significant potential

to generate jobs.
. Encourage Foreign Direct Investment (FDI)
○ Attract foreign companies to set up operations in India, leading to

job creation.
. Implement Public Works Programs
○ Launch government schemes to provide jobs in infrastructure

development, such as road construction and housing projects.

. Focus on Technological Adaptation with Training
○ Provide training to workers to adapt to new technologies rather

than replacing them entirely.

. Revive Agricultural Sector
○ Modernize agriculture and promote allied activities like animal

husbandry and fisheries to provide stable employment.

Q.what is poverty line? what are the cause of poverty in india.

Poverty Line
The poverty line is the minimum level of income or consumption required to
meet basic necessities such as food, clothing, shelter, healthcare, and
education. It serves as a benchmark to identify individuals or households living
in poverty.
Measurement in India
● Rural Areas: Calculated based on calorie consumption (2,400 calories
per person per day).
● Urban Areas: Based on calorie consumption (2,100 calories per
person per day) and higher non-food expenses.
● Committees like the Tendulkar Committee (2009) and Rangarajan
Committee (2014) have proposed updated poverty lines in terms of
monthly expenditure per capita.

Causes of Poverty in India

. Population Growth
○ Rapid increase in population puts pressure on resources,

employment, and public services, keeping many people below the

poverty line.
 . Unemployment and Underemployment
○ Lack of sufficient job opportunities, especially in rural and informal

sectors, results in income insecurity.

. Inequality of Wealth Distribution
○ Economic disparities mean a large share of wealth is concentrated

in the hands of a few, leaving many with insufficient income.

. Low Agricultural Productivity
○ Dependence on agriculture with outdated practices, fragmented

landholdings, and lack of irrigation leads to low incomes for rural

households.
. Inflation
○ Rising prices of essential goods and services erode the purchasing

power of the poor.

. Social Factors
○ Caste system, gender inequality, and lack of social mobility hinder

economic progress for marginalized groups.

. Poor Education and Skills
○ Lack of access to quality education and skill development keeps

people trapped in low-income jobs.

. Weak Infrastructure
○ Inadequate roads, electricity, healthcare, and housing contribute

to persistent poverty, especially in rural areas.

. Health Issues
○ Poor health and lack of access to affordable healthcare drain the

resources of low-income families.

. Political and Administrative Inefficiency
○ Corruption, mismanagement, and poor implementation of poverty

alleviation programs limit their effectiveness.

. Historical Reasons
○ Colonial exploitation drained India’s resources, leaving a legacy of

economic stagnation and inequality.

. Climate and Natural Disasters
○ Dependence on monsoons for agriculture and frequent natural

disasters like droughts and floods increase vulnerability.

Conclusion
Poverty in India is a multi-dimensional problem rooted in social, economic, and
systemic issues. Addressing poverty requires targeted policies focusing on
economic growth, education, healthcare, and social inclusion to break the cycle
of deprivation and inequality.

Q.what are cause of population? explosion in india what efforts have been
made to solve the problems.
Causes of Population Explosion in India
India has experienced rapid population growth, particularly in the post-
independence era. Below are the primary causes of the population explosion:
1. Decline in Death Rate
● Improved medical facilities, vaccinations, and sanitation have
significantly reduced mortality rates, leading to a higher survival rate
of individuals.
2. High Birth Rate
● Cultural and social factors, including preference for large families and
lack of awareness about family planning, contribute to high birth rates.
3. Early Marriage
● In rural areas, early marriages lead to longer reproductive periods and,
consequently, more children.
4. Poverty and Illiteracy
● Poor and uneducated families often view children as economic assets
who can contribute to the family income.
5. Religious and Social Beliefs
● Some communities oppose family planning due to religious or cultural
reasons, perpetuating high fertility rates.
6. Lack of Awareness
● Limited awareness about contraception and family planning methods
contributes to unchecked population growth.
7. Improved Food Security
● Advances in agriculture and food production have reduced famine-
related deaths, increasing population survival.
8. Migration to Urban Areas
● Migration for better opportunities leads to concentrated population
growth in cities.

Efforts Made to Solve the Problem

India has implemented several policies and programs to address the issue of
population explosion:
1. Family Planning Programs
● India was the first country to introduce a national family planning
program in 1952, promoting contraceptive use and small family norms.
2. Awareness Campaigns
● Campaigns like Hum Do, Hamare Do (We Two, Ours Two) promote
the idea of smaller families.
● Media outreach has increased awareness about contraception and the
benefits of population control.
3. Incentives and Disincentives
● Monetary incentives are given to families that adopt permanent
contraception methods.
● Some states disincentivize large families by denying certain benefits
to households with more than two children.
4. Education and Empowerment
● Efforts to improve literacy, particularly among women, aim to reduce
 ●

fertility rates.
● Women’s empowerment programs encourage delayed marriages and
smaller families.
5. Legal Measures
● The Child Marriage Restraint Act prohibits early marriages to reduce
the reproductive period.
6. Health Infrastructure Development
● Increased access to healthcare facilities ensures safe childbirth and
awareness about family planning.
7. Promotion of Late Marriages
● Encouraging people to marry at a legal and mature age reduces the
reproductive span and birth rates.
8. Use of Technology
● Digital platforms and mobile applications provide information about
family planning and reproductive health.
9. Focus on Rural Areas
● Special programs target rural populations, where fertility rates are
typically higher due to poverty and illiteracy.

Conclusion
Although India's population continues to grow, sustained efforts in family
planning, education, and healthcare have slowed the growth rate in recent
years. However, addressing the root causes—poverty, illiteracy, and cultural
norms—remains essential for achieving long-term population stabilization.

Q.what is the importance of agriculture in indian economy? what steps

have been taken it developed agriculture sector.
Agriculture is a critical sector in the Indian economy, contributing significantly
to the nation's GDP, employment, and food security. Its importance can be
broken down into several key points:
Importance of Agriculture in the Indian Economy:
. Contribution to GDP: Agriculture contributes around 17-18% to
India's GDP. While the proportion has decreased over the years as
services and industry have grown, it remains a substantial part of the
economy.
. Employment Generation: Agriculture is the primary source of
livelihood for about 50% of India’s workforce, especially in rural areas.
It serves as the backbone for employment in many regions.
. Food Security: Agriculture ensures the production of food crops like
rice, wheat, and pulses, which are essential for meeting the nutritional
needs of the population.
. Rural Economy: A large proportion of rural incomes depend on
agricultural activities, which drives demand for goods and services in
rural markets.
. Exports: India is one of the world's largest producers and exporters of
 .
agricultural products, including rice, spices, tea, coffee, and cotton.
Agriculture plays a vital role in foreign exchange earnings.
. Economic Linkages: Agriculture links with several other sectors such
as manufacturing, services, transportation, and retail. It contributes to
industrial growth by supplying raw materials like cotton, jute, and
sugarcane.
Steps Taken to Develop the Agriculture Sector:
. Green Revolution: In the 1960s, the Green Revolution led to the
introduction of high-yielding variety seeds, chemical fertilizers, and
better irrigation techniques, resulting in increased crop production,
especially wheat and rice.
. Government Schemes and Policies:
○ National Mission on Sustainable Agriculture (NMSA): Focuses

on promoting sustainable agricultural practices, including organic

farming.
○ Pradhan Mantri Fasal Bima Yojana (PMFBY): A crop insurance

scheme designed to protect farmers from losses due to natural

disasters and price fluctuations.
○ PM-KISAN Scheme: Provides direct income support to farmers,

helping them with financial stability and farm inputs.

○ Soil Health Management: Programs to improve soil health and

provide soil testing to ensure optimal farming practices.

. Technology Integration:
○ Digital Agriculture: The government and private sector are

working to integrate technology such as AI, drones, and satellite

imagery to improve precision farming and increase productivity.
○ eNAM (National Agriculture Market): A digital platform for

farmers to sell their produce directly to buyers across the country,

ensuring better price realization.
. Irrigation Projects:
○ Pradhan Mantri Krishi Sinchayee Yojana (PMKSY): Focuses on

providing irrigation infrastructure and promoting efficient water

use.
○ National Irrigation Scheme: Strengthens the irrigation network to

ensure water availability for agriculture, especially in drought-

prone areas.
. Agri Credit:
○ Kisan Credit Card (KCC): Provides farmers with access to

affordable credit, enabling them to meet agricultural production

needs.
○ Interest Subvention Scheme: Offers farmers low-interest loans to

reduce their financial burden.

. Market Reforms:
○ Agricultural Produce Market Committees (APMC) Reforms:
 ○

Several states have started reforming the APMC Act to enable

farmers to sell their produce at market rates without
intermediaries.
○ Contract Farming: Encouraging contract farming through reforms

to ensure that farmers get a fair price and have guaranteed buyers
for their crops.
. Promotion of Organic Farming:
○ National Programme for Organic Production (NPOP): Supports

the certification of organic products, helping farmers transition to

organic methods and gain access to international markets.
○ Organic Farming Support: Financial assistance and training

programs to promote sustainable agricultural practices.

. Rural Infrastructure Development:
○ Investments in rural infrastructure like roads, cold storage, and

warehousing, improving the overall supply chain and reducing

post-harvest losses.
These steps have contributed to improvements in agricultural productivity, rural
incomes, and farmers' welfare, though challenges like climate change, water
scarcity, and small landholdings persist.

Q.what is green revolution? what impact has it made on indian economy.

The Green Revolution in India refers to a series of initiatives and technological

innovations introduced in the 1960s to increase agricultural productivity,
particularly in food grains. It was driven by the introduction of high-yielding
varieties (HYVs) of seeds, chemical fertilizers, pesticides, and improved
irrigation techniques. The goal was to achieve food self-sufficiency in the
country, which was facing widespread famine and food shortages at the time.
Key Components of the Green Revolution:
. High-Yielding Variety (HYV) Seeds: The introduction of new
varieties of wheat, rice, and other crops that were more resistant to
diseases and pests, and produced higher yields compared to
traditional varieties.
. Use of Chemical Fertilizers and Pesticides: The adoption of
chemical fertilizers to provide essential nutrients to crops and
pesticides to protect them from pests and diseases.
. Irrigation Infrastructure: Development of irrigation systems to
ensure water availability for crops, especially in regions with
inadequate rainfall.
. Mechanization of Agriculture: The use of modern equipment such as
tractors, harvesters, and plows to increase efficiency and reduce labor
costs.
. Extension Services and Training: Providing farmers with knowledge
and training on new agricultural practices, technologies, and crop
management techniques.
Impact of the Green Revolution on the Indian Economy:
. Increased Agricultural Productivity:
○ The Green Revolution led to significant increases in crop yields,

especially for wheat and rice. India's food grain production surged,
enabling the country to achieve self-sufficiency in food
production, reducing dependency on imports.
. Food Security:
○ The primary goal of the Green Revolution was to address food

shortages. It made India self-reliant in food production, reducing

the risk of famines and hunger.
. Economic Growth:
○ The increased agricultural productivity helped boost India's overall

economic growth. It laid the foundation for the development of

food processing, agribusiness, and related industries.
. Reduction in Import Dependency:
○ Before the Green Revolution, India was dependent on foreign

countries for food aid (notably from the United States through
PL-480). The increased agricultural output helped reduce the
need for such imports.
. Rural Employment:
○ While mechanization reduced the need for manual labor in some

areas, the Green Revolution led to an increase in agricultural

employment due to the expanded acreage and more intensive
farming practices.
. Growth of Agri-Industry:
○ The revolution stimulated the growth of industries related to

fertilizers, pesticides, seeds, and agricultural machinery. This also

led to the expansion of rural credit institutions and marketing
networks.
. Improvement in Farmers' Incomes:
○ Farmers in regions where the Green Revolution technologies were

implemented (such as Punjab, Haryana, and western Uttar

Pradesh) saw a substantial increase in their incomes due to higher
yields and better crop prices.
. Regional Disparities:
○ While the Green Revolution had a transformative impact in regions

with access to resources like water, technology, and credit, it

deepened regional disparities. Areas without these resources,
especially in dryland regions, did not benefit equally. This led to an
uneven development of agriculture across India.
. Environmental Concerns:
○ The increased use of chemical fertilizers and pesticides caused

environmental problems, such as soil degradation, water pollution,

and the depletion of groundwater resources. Additionally, the
 ○

focus on a few high-yielding crops reduced biodiversity.

. Increased Dependence on Irrigation:
○ The success of the Green Revolution was largely dependent on

irrigation systems. Over time, this put pressure on water

resources, leading to the over-extraction of groundwater in several
areas.
. Economic and Social Inequalities:
○ Wealthier and large landholding farmers benefitted most from the

Green Revolution, while small and marginal farmers faced

challenges in accessing technology, credit, and markets. This
exacerbated income inequality in rural areas.
Conclusion:
The Green Revolution had a profound impact on the Indian economy by
significantly improving agricultural productivity and ensuring food security. It
helped transition India from a food-deficient country to one that could feed its
growing population. However, its benefits were not evenly distributed, and the
environmental and social challenges that emerged from its practices are still
being addressed today. The legacy of the Green Revolution is a mix of
impressive achievements in food production, alongside lessons on the need for
sustainability and equitable development.

Q. explain main defeat of agriculture price policy of india. suggest some

measures for its improvement.
India's agricultural price policy has faced several challenges over the years,
particularly in balancing the needs of farmers with the interests of consumers,
maintaining food security, and ensuring fair prices. Despite the policy's
successes in certain areas, such as achieving food self-sufficiency, there are
several significant defeats or shortcomings.
Main Defeats of Agricultural Price Policy in India:
. Price Volatility:
○ Agricultural prices are highly volatile, with fluctuations caused by

factors like weather conditions (droughts, floods), pest

infestations, and changes in global commodity prices. The lack of
stability in prices leads to uncertainty for farmers and consumers.
○ Farmers face the risk of falling prices during periods of surplus

production, resulting in a loss of income. On the other hand,

consumers suffer when prices rise due to supply shortages.
. Ineffective Minimum Support Price (MSP) System:
○ The Minimum Support Price (MSP) is meant to provide a safety

net for farmers by ensuring they get a fair price for their produce.
However, it often fails to reach a large number of farmers,
especially those in remote areas where procurement infrastructure
is weak.
○ The MSP is often seen as insufficient to cover the rising input

costs for farmers, leading to distress in the farming community.

 ○

Additionally, only a limited number of crops benefit from MSP,

leaving other crops vulnerable.
. Regional Disparities:
○ The MSP system is not uniformly implemented across all regions.

Farmers in certain states (like Punjab, Haryana, and Uttar Pradesh)

have better access to MSP and procurement systems, while those
in other regions struggle with inadequate support.
○ Similarly, some crops that are grown predominantly in specific

regions do not benefit from MSP, leading to imbalanced growth in

agricultural sectors.
. High Intermediary Margins:
○ The role of middlemen and intermediaries in the supply chain

increases the price paid by consumers, while farmers receive a

fraction of the price. This reduces farmers' income and makes
food prices higher for consumers.
○ Lack of direct access to markets for farmers means they are often

forced to sell their produce at lower prices to intermediaries.

. Limited Coverage of Farm Products:
○ The government often focuses on a limited number of staple crops

(like wheat, rice, and sugarcane) in its price policy, leaving many
other important crops like pulses, oilseeds, and fruits neglected.
As a result, farmers cultivating these crops have little protection or
price support.
. Inadequate Storage and Infrastructure:
○ Poor storage facilities and infrastructure lead to post-harvest

losses, reducing the amount of produce available in the market

and worsening price fluctuations. Farmers often sell their produce
immediately after harvest when prices are low due to a lack of
storage options.
. Lack of Timely Market Intervention:
○ Government intervention in the market through price support

mechanisms and buffer stock procurement often comes too late to

help farmers during price crises or natural disasters. As a result,
farmers face significant losses before corrective measures are
taken.
. Subsidy Dependence:
○ Heavy reliance on subsidies, such as for fertilizers and electricity,

distorts price signals and leads to inefficiencies. Overuse of

fertilizers and water can degrade soil quality and deplete natural
resources, which in the long run hurts agricultural productivity.
Measures for Improvement of Agricultural Price Policy:
. Strengthen MSP and Procurement Systems:
○ Expand the MSP to cover more crops, including fruits, vegetables,

and pulses, to ensure fair prices for all farmers.

 ○ Improve the reach of procurement systems by setting up more
purchasing centers in rural areas, especially for regions not well-
served by existing infrastructure.
○ Use technology and data analytics to predict production trends

and ensure timely procurement during surplus production.

. Direct Market Access:
○ Promote direct farmer-to-consumer sales through platforms like

eNAM (National Agriculture Market) and farmer producer

organizations (FPOs). This can help reduce the role of
intermediaries and ensure farmers get better prices.
○ Encourage contract farming, where farmers can agree on prices

with buyers in advance, reducing price volatility and ensuring

assured income.
. Better Storage and Warehousing Infrastructure:
○ Invest in cold storage facilities, warehouses, and modern

logistics networks to reduce post-harvest losses and stabilize

prices by allowing farmers to store produce for a longer period and
sell when prices are favorable.
○ Promote private sector involvement in storage infrastructure to

increase competition and efficiency.

. Enhance Price Forecasting and Risk Mitigation:
○ Implement better price forecasting mechanisms to predict

market trends and offer timely advice to farmers, helping them

make informed decisions about planting and selling.
○ Develop comprehensive crop insurance schemes to mitigate

risks of crop failure, price crashes, or weather-related disasters.

. Encourage Diversification:
○ The government should promote diversification of crops to

reduce the over-dependence on a few crops like wheat and rice.

Supporting alternative crops like pulses, oilseeds, and millets can
improve overall agricultural resilience and income for farmers.
○ Provide incentives for organic farming and sustainable

agricultural practices to reduce dependence on chemical inputs

and enhance long-term productivity.
. Reform Agricultural Marketing Systems:
○ Reform the Agricultural Produce Market Committee (APMC) Act

to enable farmers to sell directly to buyers without the interference

of middlemen, ensuring better price realization.
○ Strengthen local market networks, particularly in rural areas, to

reduce transportation costs and improve price transparency.

. Incentivize Technological Adoption:
○ Promote the use of digital platforms to provide farmers with

information on real-time prices, weather forecasts, and best

agricultural practices.
 ○ Encourage the adoption of precision farming technologies, such
as drones and IoT devices, which can optimize input use and
improve yield prediction, reducing costs and improving
profitability.
. Support for Small and Marginal Farmers:
○ Provide targeted support to small and marginal farmers, who make

up a significant proportion of India’s agricultural workforce. This

includes facilitating access to finance, market information, and
improved farming techniques.
○ Strengthen farmer producer organizations (FPOs), which can

help small farmers aggregate their produce and negotiate better

prices in the market.
. Improve Policy Coordination:
○ Agricultural price policies should be better integrated with other

agricultural policies, including land reforms, irrigation, and

agriculture credit schemes to ensure a holistic and efficient
approach to farming.
○ Ensure that price policies are aligned with the principles of

sustainability and long-term growth rather than short-term

relief.
By addressing these issues and implementing comprehensive reforms, India
can create a more sustainable and equitable agricultural price policy, ensuring
better income for farmers while keeping consumer prices stable.

q. write short note on 1. food coorporation of india. 2. new india economic

policy 1991. 3. indian economic characterstics and features.

1. Food Corporation of India (FCI):

The Food Corporation of India (FCI) was established in 1965 under the Food
Corporations Act, with the primary objective of ensuring food security in India.
FCI's responsibilities include:
● Procurement: It procures food grains such as wheat, rice, and coarse
grains from farmers at the Minimum Support Price (MSP) to ensure fair
prices and stabilize the agricultural economy.
● Storage and Distribution: FCI stores these food grains in its godowns
and ensures their efficient distribution to public distribution systems
(PDS), which supplies food to the poor at subsidized rates through
ration shops.
● Price Stabilization: By controlling the stock of essential food grains,
FCI plays a key role in regulating market prices and preventing extreme
fluctuations in food prices.
● Buffer Stock Maintenance: FCI maintains buffer stocks to address
any shortages during lean seasons or natural disasters, ensuring that
food security is maintained even in times of crisis.
2. New Economic Policy (NEP) of 1991:
The New Economic Policy (NEP) of 1991 was a major turning point in India's
economic history, initiated by then-Finance Minister Dr. Manmohan Singh. The
policy aimed to transform India's largely closed, controlled economy into a
more market-driven one by introducing wide-ranging economic reforms. Key
elements of the NEP include:
● Liberalization: Removal of licensing requirements for industries,
reducing government control over the private sector, and encouraging
foreign investment.
● Privatization: Gradual privatization of state-owned enterprises (SOEs)
and disinvestment to improve efficiency and reduce the fiscal burden
on the government.
● Globalization: Opening up the Indian economy to global markets by
reducing tariffs, devaluing the rupee, and encouraging exports. This
allowed for greater foreign direct investment (FDI) and integration with
the global economy.
● Financial Sector Reforms: Liberalizing interest rates, introducing new
banking regulations, and strengthening the capital markets to improve
the flow of capital.
● Tax Reforms: Rationalization of tax policies, reducing tax rates, and
expanding the tax base to improve government revenue.
The NEP led to rapid economic growth, increased foreign investment, and a
shift toward a more open, competitive, and integrated economy.
3. Indian Economic Characteristics and Features:
India’s economy has several distinctive characteristics and features:
● Agriculture-Dependent: A significant portion of the Indian population
still relies on agriculture for their livelihood, even though its
contribution to GDP has declined over time.
● Mixed Economy: India has a mixed economy, combining both public
and private sector enterprises. The government plays an active role in
sectors like defense, railways, and energy, while private enterprises
dominate in sectors like services, technology, and manufacturing.
● Large Informal Sector: A substantial portion of India's workforce is
employed in the informal sector, including small businesses,
agriculture, and self-employment, often without formal contracts or
social security benefits.
● Rural-Urban Divide: There is a significant gap between rural and
urban areas in terms of infrastructure, education, healthcare, and
income levels. Rural areas are still heavily dependent on agriculture,
while urban areas are more industrialized and service-oriented.
● Demographic Dividend: India has a young population, with a large
working-age group, which offers potential for economic growth if
adequately employed and skilled.
● Service-Oriented Economy: In recent decades, services, particularly
IT, software, and business process outsourcing (BPO), have become
major contributors to India's GDP, making the economy increasingly
 ●

service-oriented.
● Government Intervention: While market forces are increasingly
influential, the government still plays an essential role in areas such as
agriculture, welfare programs, subsidies, and infrastructure
development.
● High Poverty and Inequality: Despite rapid economic growth, India
continues to face high levels of poverty and income inequality, with
large sections of the population still living below the poverty line.
These characteristics shape India’s economic policies and strategies for
development, focusing on inclusive growth, poverty reduction, and
infrastructure improvement.