Rating agency CRISIL in its report has said that India’s agriculture growth this fiscal is expected to be marginally better around 1.5 percent than 0.2 percent previous year despite poor monsoon, on the back of support from the allied sectors of horticulture and livestock. However the foodgrains production will be lower, the rest of the agriculture and allied category will provide cushion.
The reports further stated that the growth in livestock, fishing and aquaculture categories in the past has remained healthy at 5 to 5.5 per cent even in years of weak monsoon. These two sectors comprise nearly 27 per cent of the agriculture and allied sector GDP, and their growth rates could hold up this year too. Agriculture GDP comprises crops (foodgrains and horticulture), livestock, forestry and logging, fishing and aquaculture.
Besides, CRISIL in its report said that already rural incomes are dented due to falling wage growth. A below-par agriculture growth will have a telling impact on rural demand, which is already showing signs of faltering due to consecutive bad monsoon, falling product prices and stagnant wages. Another factor that has hurt is falling export prices of agriculture commodities. Almost half of India's GDP comes from rural areas. About 40 per cent of India's households engage in agriculture and within this group, two-thirds are heavily reliant on it.