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Indian Economy

Increased Farm Exports

  • 05 Feb 2021
  • 3 min read

Why in News

According to the Ministry of Commerce and Industry, farm exports have registered 9.8% growth for the period of April-December 2020.

Key Points

  • Data for April-December 2020:
    • Overall merchandise exports: Registered 15.5% fall.
    • Farm exports: Registered 9.8% growth.
      • Overall merchandise exports include all the goods manufactured in India while Farm exports include only the agricultural products.
  • Reasons For Growth in Farm Exports:
    • Rising International Prices:
      • Normalisation of Demands:
      • Chinese Stockpiling:
        • Global prices have also been increased by Chinese stockpiling.
        • It had stepped up imports of everything – from maize, wheat, soyabean and barely to sugar and milk powder – to build strategic food reserves amid geopolitical tensions.
    • Dry Weather of Different Countries:
      • The current export revival is equally a result of dry weather conditions in major producing countries such as Argentina, Brazil, Ukraine, Thailand and Vietnam.
      • Russia (world’s largest wheat exporter) and Argentina (No. 1 in soybean meal and No. 3 in maize) have even announced temporary suspension or taxes on grain shipments in response to high domestic food inflation.
    • India’s Surplus Monsoon:
      • India, on the other hand, hasn’t faced serious weather issues; both 2019 and 2020 recorded surplus monsoon rainfall along with timely onset of winter.
    • Agriculture Exempted from Lockdown:
      • Farmers harvested a bumper rabi crop during April-June, enabled by the government exempting agriculture-related activities from lockdown restrictions.
  • Significance of Rising Exports:
    • If it sustains, it can help increase crop prices when the next rabi harvest is due from March 2021. This may be politically useful in a context of farm unrest.
    • It will help in achieving the USD 5-trillion economy goal by India.
    • It will help achieve an ambitious target of doubling farmers' income by 2022.

Source: IE

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