Agriculture is the dominant sector of Indian economy, which determines the growth and sustainability. About 58% of the population still relies on agriculture for employment and livelihood. Indian agriculture however, has milestones. The green revolution transformed India form a food deficient stage to a surplus food market.
In a span of 3 decades, India become a net exporter of food grains. Remarkable results were achieved in these fields of dairying and oil seeds through white and yellow revolutions. The sector could not however maintain its growth momentum in the post green revolution years, the strategic growth in agriculture and the accelerated growth in industry reversed the structure of national GDP in Indian economy. Despite these major structural transformations, the agriculture sector continues to accommodate the major share of the workforce.
The sector is prone to output fluctuations even after establishing better input facilities and technology like irrigation, High yielding seeds, changes in cropping pattern etc. India is yet to emerge as significant trade partner in the world agriculture market. India holds around 1% of the global trade-in agri commodities. With the ongoing trade negotiations under the WTO, Indian Agriculture needs to reorient its outlook and enhance competitiveness to sustain growth from a demand side. With India being a major negotiator on world agriculture trade, it can be expected that Indian agriculture trade will expand in the years to come. This process started with the India signing the Agreement on Agriculture (AOA) during the Uruguay Round.
Now that the fourth Ministerial of WTO at Doha has mandated further negotiations on agriculture trade to improve market access India can look forward to a bright trade prospects in agriculture with proper policy support. Indian Agriculture is witnessing a phase of diversification. Attention has been shifting to high-value crops from traditional crops. This is expected to enable a desired transition in Indian Agriculture from its stagnation to a growth path. The competitive advantages that Indian agriculture processes are (a) Favorable agro-climatic zones (b) Large irrigated lands (c) Gap between present productivity and potential productivity and (d) Availability of skilled, educated, technical and scientific manpower. To leverage the global competitive advantage, Indian agriculture needs intervention in the areas of policy, technology and market access.


Food processing industry is of enormous significance for India's development because of the vital linkages and synergies it promotes between the two pillars of our economy, industry and agriculture. Fast growth in the food processing sector and simultaneous improvement in the development of value chain are also of great importance to achieve favorable terms of trade for Indian agriculture both in the domestic and the international markets.
The sector however has to go a long way. Even important is the crucial contribution that an efficient food processing industry could make in the nation's food security for instance the post-harvest losses of selected Fruits and Vegetables are about 25% to 30% in our country. Even marginal reductions in these losses are bound to give us better returns and thereby improve the income level of the farmers. During the last one decade, India moved from a position of scarcity to surplus in Food. Given the trade in production of food commodities, the Food Processing Industry in India is on an assured track of growth and profitability. It is expected to attract phenomenal investment in capital, human, technological and financial areas.
The total food production of India is estimated to double in the next ten years. Hence there is an opportunity for large investments in food and food processing technologies, skills and equipment. The major interventions in this context are, for example, Canning, Dairy and Food Processing, Specialty Processing, Packaging, Frozen Food/Refrigeration and Thermo Processing. Fruits and Vegetables, Fisheries, Milk and Milk Products, Meat and Poultry, Packaged / Convenience Foods, Alcoholic Beverages and Soft Drinks and Grains. Health food and health food supplements are other rapidly rising segments of this industry. The Food Processing Industry sector in India has been accorded high priority by the Government of India, with a number of fiscal relief and incentives, to encourage commercialisation and value addition.
The sector has witnessed a high growth rate of about 14 percent in the recent past and is poised to retain a high growth in the near future. The Indian food market is estimated at over US$ 182 billion, and accounts for about two thirds of the total Indian retail market. Further, according to consultancy firm McKinsey & Co, the retail food sector in India is likely to grow from around US$ 70 billion in 2008 to US$ 150 billion by 2025, accounting for a large chunk of the world food industry, which would grow to US$ 400 billion from US$ 175 billion by 2025. In order to further grow the food processing industry, the government has formulated a Vision-2015 action plan under which specific targets have been set. This includes tripling the size of the food processing industry from around US$ 70 billion to about US$ 210 billion, raising the level of processing of perishables from 6 per cent to 20 per cent, increasing value addition from 20 per cent to 35per cent, and enhancing India’s share in global food trade from 1.5 per cent to 3 per cent. This would require an investment of US$ 20.6 billion.