Subsistence Agriculture: The Economic Survey 2024, presented recently by Finance Minister Nirmala Sitharaman, highlights a pressing issue that affects every household in India—rising food inflation. Over the past three years, food inflation has doubled, with the primary culprit being the increasingly unpredictable and extreme weather patterns driven by climate change. This situation is further exacerbated by crop diseases and other agricultural challenges, painting a worrying picture for the country’s food security and economic stability.
Subsistence Agriculture: The alarming rise in food inflation
Food inflation has become a significant concern, especially as it has nearly doubled in just three years. According to the survey, the Consumer Food Price Index (CFPI) has risen from 3.8 percent in the fiscal year 2022 to 7.5 percent in 2024. This sharp increase is largely due to adverse weather conditions and climate-related disruptions in agriculture. The erratic monsoon patterns, unseasonal rains, and prolonged droughts have severely affected crop yields, leading to a surge in the prices of essential food items.
Take, for instance, the sudden spike in tomato prices in July 2023. This was not just a result of seasonal factors but also due to a combination of region-specific crop diseases and early monsoon rains in North India. Similarly, the prices of onions have also seen a steep rise, influenced by factors such as poor Rabi crop quality due to excessive rainfall, delayed sowing in the kharif season, and drought conditions. These examples underscore how climate change is directly impacting food production and, consequently, food prices.
Subsistence Agriculture & Climate Change: A Key Driver of Rising Food Prices
The Economic Survey 2024 emphasizes that climate change is now a major driver of food inflation. This trend is not unique to India but is part of a global phenomenon where extreme weather events are increasingly disrupting agricultural production. The survey highlights how the agriculture sector has been particularly vulnerable in the last two fiscal years, with extreme weather events leading to lower crop yields and reduced storage levels. This has had a cascading effect on food prices, especially for staples like vegetables and pulses, which are essential components of the Indian diet.
One notable example is the rising prices of Tur and Urad, two commonly consumed pulses. The survey notes that these price increases are a direct result of adverse weather conditions that have affected production. In particular, slow sowing during the rabi season and climatic changes in southern states have led to lower yields, pushing up prices. These developments highlight the urgent need to address the impact of climate change on agriculture to ensure food security and stabilize prices.
Subsistence Agriculture: A Call for Rethinking Economic Policy: Revitalizing Agriculture
In response to these challenges, the Economic Survey 2024 calls for a strategic shift in India’s economic policies, particularly concerning the agricultural sector. For years, the national strategy has focused on moving people away from agriculture and towards non-agricultural sectors in the hopes of creating more jobs and wealth. However, this approach has not yielded the expected results, leading to a need for reassessment.
V. Ananth Nageswaran, the Chief Economic Advisor to the Ministry of Finance, suggests a “return to the roots” strategy. He argues that revitalizing the agricultural sector could provide the much-needed employment opportunities and wealth creation that the current policies have failed to deliver. He points out that the traditional economic growth model, which involves transitioning from agriculture to manufacturing and then to services, is being challenged by new global dynamics. Technological advancements, geopolitical shifts, and the rise of artificial intelligence have changed the economic landscape, reducing the growth potential in manufacturing and services. In this context, agriculture presents a unique opportunity for high-value addition, increased farmer incomes, and the development of food processing and export industries.
The survey makes a compelling case for making agriculture an attractive and productive sector, especially for India’s urban youth. By investing in agricultural research, improving crop resilience to climate change, and developing infrastructure for food processing and storage, the sector can not only generate employment but also contribute significantly to the country’s economic growth. This shift in focus is crucial for addressing the current economic challenges and ensuring long-term food security.
Subsistence Agriculture & Economic Growth Projections: A Balanced Outlook
Despite the challenges posed by rising food inflation and climate change, the Economic Survey 2024 remains optimistic about India’s economic prospects. The report projects a real GDP growth of 6.5–7% for the fiscal year 2024–25, with the risks being broadly balanced. This positive outlook is based on the strong growth momentum seen in the previous fiscal year, which is expected to continue into the next.
However, the survey also warns that external challenges, such as global economic uncertainties and the ongoing impacts of climate change, could pose risks to this growth trajectory. To mitigate these risks, the report emphasizes the importance of maintaining a balanced and diversified economy, with a strong focus on sustainable development and climate resilience.
Conclusion of Subsistence Agriculture: Addressing the Dual Challenges of Food Inflation and Climate Change
The Economic Survey 2024 highlights the urgent need to address the dual challenges of rising food inflation and climate change. The report calls for a strategic shift in economic policy, with a renewed focus on revitalizing the agricultural sector. By making agriculture an attractive and productive sector, India can not only stabilize food prices but also create new opportunities for economic growth and employment.
As the country moves forward, it will be crucial to invest in sustainable agricultural practices, improve crop resilience, and develop infrastructure for food processing and storage. These efforts will not only help mitigate the impacts of climate change on food production but also ensure long-term food security and economic stability. The Economic Survey 2024 serves as a timely reminder of the need to adapt to changing circumstances and embrace new opportunities for growth in an increasingly uncertain world.
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