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Agriculture is the livelihood of most workers of Karnataka. But it has seen sluggish growth over the last one decade. The rapidly declining share of agriculture in the economy and its poor growth prospects indicate its inability to absorb the growing workforce and provide productive opportunities or higher incomes.
This is highlighted in the draft - Karnataka - A Vision for Development, prepared by the State Planning Board. The draft was presented recently to the Vision 2020 group headed by CM Yeddyurappa.
The sector exhibits low growth of 0.8 per cent but is absorbing a large amount of labour as it still employs about 61 per cent of the workers. This also shows a decline in output per worker and falling labour productivity.
The draft says Karnataka's Gross State Domestic Product (GSDP) has grown at a decent rate of 6% between 1983-84 and 2004-05. But this has not translated into an equally impressive growth in its employment potential.
While the share of the State's income has been shifting rapidly away from agriculture, the employment potential of the growing industries and services sectors has not been impressive.
Employment in agriculture hardly decreased from 65% to 61% in the period 1993 to 2005, whereas its GSDP contribution halved from 36% to 18%. This means that a disproportionately high number of workers in the State depend on this sector for their livelihood.
Moreover, agricultural productivity in Karnataka has not seen any appreciable improvements. Almost one-fourth of the total cultivable area in the State is under ragi, bajra and jowar. But increase in their yields over the past 50 years has been at a compound annual growth rate of only 0.6%, 1.1% and 1.8% respectively.
The draft further says around 70% of rural households in the State have land holdings of less than one hectare. The average size of operational holdings has nearly halved from 3.20 ha in 1970-71 to 1.63 ha in 2005-06. In addition, close to half of the land holdings are marginal with an average size of 0.45 ha and their uneconomical size has adverse effects on land productivity. Movement of workers out of agriculture into more productive sectors will help ease pressure on land, improve overall productivity, and increase incomes for those remaining in the sector.
The draft gives the example of Korea and Malaysia where agriculture sector took a beating like in the State. Korea's agriculture contributed to 43% of the GDP and 63% of employment in 1963. This has shifted to 3.4% and 7.9% respectively in 2005. Malaysia's agriculture contributed to 43% of the GDP and 63% employment in 1965.
This has shifted 8.2% and 13.3% respectively in 2005. These countries have rapidly aligned their employment structure to the shifting nature of GDP composition through policies for equitable distribution of growth including thrust on universal literacy and skill development of the workforce, female education, reduction in poverty etc., and this is what Karnataka should also aspire for.
While output per worker in agriculture changed from Rs 14,600 in 1993-94 to Rs 15,000 in 2004-05 (at 1999-2000 prices), it grew at a much faster rate of in services from Rs 58,500 to Rs 1,05,000. If the existing trend continues in sectoral growth and employment absorption, this ratio will increase further and disparities in the State's workforce will worsen. |
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