Agriculture Output Report

The agriculture sector in India is witnessing a significant transformation with a shift from traditional staple crops like cereals to high-value crops such as fruits, vegetables, spices, and animal products. This change reflects evolving consumer preferences, increased incomes, technological advances, and government focus on nutritional security and export potential.

Key Highlight of the Report

1. Growth in Agriculture Sector Value

• Gross Value Added (GVA) at current prices rose sharply by 225%, from ₹1,502 thousand crore in 2011–12 to ₹4,878 thousand crore in 2023–24.

• Gross Value of Output (GVO) at constant prices (2011–12 base) increased by 54.6%, from ₹1,908 thousand crore to ₹2,949 thousand crore, indicating steady real growth.

2. Shift from Staples to High-Value Crops:

• Cereals’ share in agriculture GVO (Gross Value of Output) declined from 17.6% (2011-12) to 14.5% (2023-24).

  Increased focus on fruits (strawberries, pomegranates), vegetables (parmal/parwal, mushrooms), and spices (dry ginger) reflects changing consumer preferences, nutritional awareness, and export opportunities.

3. Dramatic Rise in Certain Crops:

• Strawberries: GVO jumped over 40 times from Rs 1.32 crore to Rs 55.4 crore (constant prices) between 2011-12 and 2023-24.

• Parmal (Parwal): Nearly 17 times increase to Rs 789 crore.

• Pumpkin: Nearly 10 times increase to Rs 2,449 crore.

• Pomegranate: Over 4 times increase to Rs 9,231 crore.

• Mushrooms: 3.5 times increase to Rs 1,704 crore.

• Dry Ginger: 285% increase in GVO to Rs 11,004 crore (thanks to better processing).

4. Rising Meat Consumption:

• Share of meat in agriculture & allied sectors' GVO increased from 5% to 7.5% (2011-12 to 2023-24).

• Meat production grew by 131%, though still behind growth in high-value crops like strawberries.

5. Consumption Patterns:

• Fresh fruit consumption in rural areas increased slightly in expenditure share (2.25% to 2.66%), but declined marginally in urban areas.

• Despite small percentage changes, more rural households (from 63.8% to 90.3%) are consuming fresh fruits, including lower-income groups.

• Cereal consumption share in monthly expenditure fell significantly in both urban (6.61% to 3.74%) and rural areas (10.69% to 4.97%).

6. Engel’s Law in Action:

• As incomes rise, the share of expenditure on food is decreasing:

  • Rural: from 52.90% (2011-12) to 47.04% (2023-24)

  • Urban: from 42.62% to 39.68%

7.Spices & Condiments:

• Dry ginger witnessed a 285% increase in GVO, reaching Rs 11,004 crore, supported by improved processing.

Driving Factors

• Changing Consumer Preferences:
  With rising incomes, people diversify their diets and demand more fruits, vegetables, and protein-rich foods like meat.

  Market Opportunities:
  Increasing urban demand combined with improved supply chains open new markets for high-value agricultural products.

  Technological Shifts:
  Advances in farming methods, storage, and processing (e.g., for dry ginger) help farmers grow and market perishable, high-value crops effectively.

  Policy Orientation:
  Government policies emphasize nutritional security by promoting diverse diets and supporting export potential for high-value crops.

Implications and Insights

• Agricultural Transition: Indian agriculture is moving away from traditional staples toward diversified, nutrient-rich, and higher-value crops.

  Nutrition and Income: Increasing income and awareness are driving demand for fruits, vegetables, and animal products, enhancing nutrition.

  Market and Policy: These shifts suggest a need for policy focus on high-value crop production, processing infrastructure, supply chains, and nutritional security.

  Rural Empowerment: More rural households, across income levels, are adopting better diets, indicating improving living standards and reduced inequality in food consumption.

Engel’s Law

• As household income rises, the proportion of income spent on food decreases, even if the absolute expenditure on food increases.

Gross Value Added (GVA)

Gross Value Added (GVA) in Agriculture refers to the total value of output (all agricultural products like crops, livestock, forestry, fishing) minus the value of intermediate inputs (like seeds, fertilizers, labor, machinery used in production).  GVA = Total agricultural output value – Value of inputs used in producing that output

It measures the net contribution of the agriculture sector to the economy, showing the actual value created by farming activities. It helps estimate the economic contribution of agriculture.It reflects the productivity and efficiency of the sector. It Used for policy-making, planning, and tracking sectoral growth over time.