At the onset of COVID-19, agricultural sector of India was heading on the path towards recovery after three years of quashed prices. The agriculture sector contributes approximately 12 percent towards the Indian GDP but provides a livelihood for 54 percent of the working population. The agricultural commodities have a low price elasticity of demand such that even when the prices show an downward trend, the revenues do not show a massive increase as people do not often increase their demand in a similar proportion. As the world is making its way towards recession in the wake of Covid-19 pandemic, it is likely to shut down major parts of the global economy for at least a few months more. As per the reports of IMF in March 2021, the global growth is likely to be negative in the upcoming year and the signs of recovery, if any, can be expected not before 2025.
The pandemic has also led to a sharp increase in the rate of unemployment worldwide, according to the International Labour Organisation (ILO). Since the first lockdown in March 2020, the government of India has already declared agriculture to be an essential sector. Being the second most populous nation, executing policies and looking after the implementation comes with its challenges, such as maintaining smooth supply chain and logistics and countering wrong information. However, the situation has opened the opportunity window for new and innovative practices and approaches that may lead to change in trend and have lasting impact.
The coronavirus pandemic has led to a reverse trend in the urban-rural migration. With the closure of public transport and as the labourers from big cities migrated to their home villages, it led to a massive shortage of farm labourers with the wholesale markets also closed.The government at regional and district leveltookan initiative to prepare procurement schedules and shelter campswere set up across the country to provide housing to over a million people.
The pandemic has changed the working environment by introducing Work from Home regime. A sizable proportion of the population has become habitual to the deskbound lifestyles and leading to a change in their dietary pattern- consumption of processed food in extreme quantities. Such unhealthy habits often lead to severe health issues, weight gain and an increase in risk of contracting fatal diseases.
The lockdown has adversely affected the domestic demand and international trade. Farmers growing high value fruits and vegetables saw no market for their produce. Prices of Onion prices slashed by 50 percent owing to excesssupply and lack of storage and labour. Similar situation was in Dairy sector as consumers tried hoarding mil products due to which the production of dairy products saw an increase. However, the milk prices started collapsing soon as the demand from restaurants and final customers started dropping.The wrong information with respect to the consumption of poultry on social media led to its reduced consumption and affected the prices.
The cropping practices are also changing as the farm labour has returned to their home states. For example, the Punjab government is now encouraging the farmers to shift away from the labour-intensive paddy rice.
During the first lockdown itself, the Indian Finance Minister announced a 20 Lakh Crore package, to help the poor and vulnerable, concentrating on their food security also. The wage rate under the NREGS has also been increased by the Government. A special scheme-Pradhan Mantri Garib Kalyan Yojanahas been announced to look after the poor population. Universal ration card system and Additional grain allotments to registered beneficiaries has also been announced for the next three months to around 800 million beneficiaries, although its execution remains a challenge. Financial assistance is also extended towards the farmers.
Post pandemic, urban consumers of India are likely to reduce their expenditure on luxury brands and fine dine in experience in the coming few months. However, expenditureon organic food and fitness is likely to increase as people shift towards a healthier lifestyle.
Good health being vital for improving the social development of the economy, a strong agricultural sector is essential to maintain effective food supply for the growing population along with maintaining the nutritional standards of the people. The agriculture sector is in a dire need of scientific innovation in order to feed the growing population. The natural resources have already been depleted to a non-reversible extent. In such a background, sustainability is the key towards growth and social development of the economy.
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