Analysis of Indian Agricultural Trade Policies and their Global Impact

Desklib provides solved assignments and past papers to help students succeed.

DISSERTATION
1

Table of Contents
1. INTRODUCTION..................................................................................................................4
1.1 INTRODUCTION....................................................................................................................4
1.2 BACKGROUND OF STUDY.....................................................................................................5
1.3 PROBLEM STATEMENT.........................................................................................................5
1.4 RESEARCH OBJECTIVE.......................................................................................................... 6
1.5 RESEARCH QUESTIONS.........................................................................................................6
1.6 RESEARCH DESIGN...........................................................................................................7
1.7 SUMMARY............................................................................................................................7
2 LITERATURE REVIEW...................................................................................................................8
2.1 INTRODUCTION....................................................................................................................8
2.2 THE INDIAN AGRICULTURAL SECTOR...................................................................................8
2.3 SUMMARY..........................................................................................................................12
3 RESEARCH METHODOLOGY..............................................................................................13
3.1 INTRODUCTION............................................................................................................. 13
3.2 RESEARCH ONION.........................................................................................................13
HONEYCOMB MODEL.........................................................................................................14
3.3RESEARCH PHILOSOPHY..............................................................................................15
3.4RESEARCH APPROACH................................................................................................. 15
3.6RESEARCH STRATEGY..................................................................................................16
3.7CHOICES OF THE RESEARCH METHOD.....................................................................16
3.8RESEARCH SAMPLING.................................................................................................. 16
3.9DATA COLLECTION....................................................................................................... 17
2

3.10RESEARCH DESIGN AND TYPE..................................................................................17
3.11SAMPLING PROCESS....................................................................................................18
3.12VALIDITY, TIME FRAME AND RELIABILITY..........................................................18
3.13DATA ANALYSIS...........................................................................................................20
3.14DATA COLLECTION PROCEDURES...........................................................................20
3.15ETHICAL CONSIDERATION........................................................................................21
3.16LIMITATIONS.................................................................................................................21
4. RESULTS OBTAINED................................................................................................................. 22
4.1 QUESTIONNAIRE SURVEY...................................................................................................22
References................................................................................................................................... 29
3

1. INTRODUCTION
1.1 INTRODUCTION
With the increase in globalization and international trade, the agricultural sector of India is also
stepping into the global trade. This has enabled the Indian agriculture to reach to various
countries with increased GDP of India. The process of this international trade is not easy the
Indian government has introduced many policies for the international trade of agriculture. The
ICRIER Indian Council for Research on International Economic Relation have proposed policies
to maintain a certain level of income of the framers and the livelihood of the farmers of India
who are exploited. This has also aimed at improving the nutritional value of the agricultural
products of India. Agriculture is one of the most important sectors of India and about 70%
income is generated from the agricultural activity in India it has found that the agriculture has
helped the Indian economy to rise significantly and also contributed in the increase of the
export.
The several policies which are made for the international trade of the agricultural policy have
made given a sort of protection to the farmers so that they are not exploited by any means and
has also helped to do profitable export of the agricultural items from India The export of Indian
agricultural products are done in various countries like the USA, Canada, Europe, Middle East
etc. which has created a huge market for the Indian agricultural sector for which the
agricultural activities have been increased in India.
This dissertation will discuss the impact of the Indian government policies on the international
trade of agriculture sector. This will enable to study the benefits and demerits of the policies
introduced by the India government and the opportunity which has created by the policies for
the Indian agriculture
4

1.2 BACKGROUND OF STUDY
The agricultural sector is one of the most integral sectors of India as India is having high fertile
land and numerous grains, cereals, pulses etc. are been grown in India and the supply of the
same has significantly helped the Indian economy to rise significantly. Almost 65% of the Indian
population is engaged in agricultural activity and earning a livelihood. When it comes to the
export of the agricultural products to various countries the Indian Government plays a crucial
role. Government has implemented many policies for international trade so that the farmers
can get higher income from the export carried out. The government has to take into
consideration of food stock, strategic reserves, weather conditions etc. The new policies have
sought to integrate the Indian farmers by trying out the different export basket and introducing
high-value export with the focus on the perishable goods. Further discussion and research will
explore the impact of the agricultural policy on the international trade of Indian agriculture.
1.3 PROBLEM STATEMENT
The main problem lies with the policy of the international agriculture is that the high export
duties and the restrictions which are faced in the whole process are making a bit difficult to
make the expected profit from the international trade Although, the Indian government is
pushing the agricultural sector to rise in the global platform.
5

1.4 RESEARCH OBJECTIVE
 The objective of this dissertation is to study the impact of the policies of the Indian
government on the international trade of agriculture.
 To identify the benefits of the policies of international agricultural trade.
 To identify the disadvantages of the policies on the international agricultural trade
 To recommend the Indian government this can be used to enhance the agricultural
trade on a global platform.
1.5 RESEARCH QUESTIONS
 What are changes that are introduced by the Indian government in the international
agricultural trade policy?
 How international trade policies have been beneficial for Indian farmers?
 What kind of consequences did the agrocultur4l sector have to incur due to the constant
flux in trade and policies?
 What are the possible strategies that have been used by the government to overcome
the flaw of the trade policy?
6

1.6 RESEARCH DESIGN
1.7 SUMMARY
The dissertation will cover the various aspects of the international policies that have impacted
the trade of agriculture on the global platform. This will help to know the positives and the
negatives of the policies.
7
INTRODUCTION
LITERATURE REVIEW
METHODOLOGY

2 LITERATURE REVIEW
2.1 INTRODUCTION
This particular topic of the dissertation will give in-depth knowledge of the subject matter that
is the impact of the policies introduced by the Indian government on international trade. This
literature review will cover the impact of the international trade policy on Indian agriculture.
2.2 THE INDIAN AGRICULTURAL SECTOR
According to Agriculture export policy (2019), it was found that the since 1990 the GDP of India
has been increased by 5% where the agriculture is increasing on a significant rate of 3.6%
annually since 2011. The agriculture has been improved with the help of the fertilizers, seeds
and better irrigation facilities. Almost more than 60% of the Indians are engaged in the
agricultural activities followed with diversification from the grains, pulses, fruits and vegetables.
India is supporting 17.84% of the world's population with the production of agricultural
production (Wharton, 2017). The recent study and researches have shown that there is a rapid
growth in the agro-food industry with the high demand for supply to the other countries and
there is a huge opportunity to grow on the international level. The rise in the globalization and
fast lifestyle the need for the nutritionally valued food has increased and India is one of the
major countries which is producing the highest agricultural products. The agricultural policies
have able to achieve the food security in India and giving them incentives to the farmers in
terms of the subsidy so that the farmers can get a better livelihood by getting good
remuneration and avoiding exploitation (Wharton, 2017).
According to Chaudhary (2016), it has found that the farmers are being affected by the
combination of the domestic market and the restrictions on the import and exported the
agricultural products. This has resulted in getting low prices for the products as compared to
others in the international market. The National Food Security Mission (NFSM) has focused on
the achievement of food security by increasing the production of rice and other cereals by
8

maintaining stock for future use. On the other hand, the DoC is focusing on the increase in the
export of agricultural products. The Indian agriculture has given employment to so many people
in villages and cities that the contribution in the GDP has been raised to a significant level
Chaudhary (2016). This has not only given employment but has also helped to enhance the
international trade of agriculture in the diverse sector on the global platform. Agriculture is not
only limited to the production of the cereals, pulses, grains but it has diversified itself and is
also producing meats, fruits, vegetable etc. According to Agriculture export policy, (2019) it was
found that the farmers to produce more and more agricultural products to fulfil the Indian
population and to export the same need support from the government and the public. As the
farmers are being exploited in India although they are been given subsidy they also they are not
given that much incentive in cash so that they can earn a livelihood. Still, many farmers are not
having the irrigation facilities, fertilizers, insecticides etc. and suffering from the poor condition.
In such a condition, it is the responsibility of the government to make the farmers provide the
basic subsidy so that they are not being exploited and provided empowerment to work
Chaudhary ( 2016).
The government policies for the agricultural sector
The agricultural export policy has framed with the focus of increase in the production of the
agricultural products and the supply of the same to the other countries to yield high profit. The
Department of Agriculture Cooperation and Farmer Welfare is focusing on boosting the income
of the farmers and employment generation. There is an urgent need of the government of India
to establish a strong and stable policy for the agriculture export-import policy so that the
expected process for the export can be yield by the government. The export of the agricultural
products is there but the farmers are not been given the deserved cash incentives and wages
which is affecting the productivity of the former agriculture export policy (2019)
Agriculture export policy, (2019) has shown that It is important for the Indian government to
support the farmers against the case file by the various countries in WTO (World Trade
Organization) against the Indian agriculture. In WTO the subsidies are identified in the form of
the boxes, green box (permissible), amber (Slow Down) and red (forbidden). India being part of
9

WTO have many benefits which can be availed by Indian agriculture so that the farmers are not
being exploited in any manner. India has trade relation with Indonesia, Nepal, Korea etc. for
which the export policy should be such that the sale of the agricultural product can dine on high
prices as compared to other countries on the global platform (Brindhah, 2017). The government
has introduced the policy of giving the subsidy to the farmers based on the green box which is a
permissible level up to which the farmers can be given the subsidy so that they can earn a
livelihood and get better facilities to produce more. According to Agriculture export policy,
(2019)the benefit of the introducing the policies is to double the agricultural export and reach
up to $ 100 Billion in next few years by following a stable trade policy. The main aim of the
polity is to give the empowerment to the farmers and to increase the GDP of India by getting a
high rate of the export done for agriculture; products to the various countries. The state is
generating very little surplus revenue on the global platform the implementation of the polities
will help to do so. The implementation of the policy will help in introducing a stable form of
trade policy for the agricultural sector in India so that the farmers can get high income and
subsidy to produce more. Another benefit of the policy will be to deal with the barriers in the
operation of the tread of agricultural activity Chaudhary (2016).
Specific international trade policy acting as a barrier in the operation
The level of the exploitations to the farmers is adversely affecting the productivity and hence
affection the trade on the global level. The level of the profit yield from the export is not up to
mark which is again a barrier in the further operation of the export policy. The subsidy which is
given under WTO is very limited and the better irrigational facilities are not being provided to
the farmers which are another barrier (Brindhah, 2017). The stable policy for the trade is not up
to mark which is leading to the fluctuation in the price of the products to maintain the stability
it is important to keep the tuning with the market on the global level. Carding to (Sayantan
Bera, 2019).The farmers are being heavily impacted by the new trade polio implemented by the
WTO as they are not be getting the proper subsidy to carry out further agricultural activities. It
is important to give the proper subsidy to the farmers. Another aim of the policy is to assure
that the organic products, processed agricultural products will not be restricted under the
10

ambit limit. This will help in liberalizing the import agricultural products for value addition
purpose. Another barrier in the operation of the agricultural export is the proper infrastructures
and logistic provided by the government. The logistic is the most important factor to provide
the gods with the freshness of the perishable items. The logistics provided if improved then it
can help to get export of the perishable items on time with high nutritional value (Anjum and
Khan, 2017.)
Consequences of the barriers
According to (Anjum and Khan, 2017.) it has found that WTO is the main barrier in the
successful export of the agricultural product to the different countries. The subsidy which is
being made limited by WTO has made everything very much difficult for Indian agriculture to
carry further activity. The level of the production has been decreased to a great extent which
has affected the productivity of the further the expected profit yield as compared to the other
countries in terms of the export is very much less of India on the global platform. Moreover, the
role of the middleman in Indian agriculture has also played an important role in the exploitation
of the framers. This has led to the poor condition of the farmers and hence decreases in the
production of the cereal, rice, pulses etc. Due to the implementation of the international trade
policy, it has adversely affected the GDP of the Indian economy arising out of the agriculture
export and has declined the employment also. The agricultural activity has also been affected as
the subsidy has been limited by WTO which has made further activities a little bit difficult for
everyone (Desai 2016.)
The farmers are the one who has greatly impacted from the change in the policies of the
farmers so the Indian government needs to make sure that the domestic policies should be
such that it can cover up the loss causing due to the policies implemented by WTO. The
domestic policies should be able to help the agriculture sector to flourish and enhance the
economy. India has to cut down the trade support by 20% to support the farmers over 6 years.
With various policies the Indian government I trying to help the agriculture sector to produce
high-quality products with high production (Desai,2016.)
11

2.3 SUMMARY
From the above literature review, it can be studied that the policies implemented by WTO for
the agricultural sector have affected the GDP of the Indian economy to a great extent. The
farmers are facing very bad condition because of poor subsidy they are getting from the
government. The level of production has been declined and the farmers are not getting
incentives also. The WTO has affected the farmers to a great extent it has become very
important for the Indian government to make sure that the domestic policies for the farmers
and the agriculture sector should be very strong and sound. The logistic and the storage should
be given on a strong level so that the export of the products is not suffered (Desai, 2016.)
12