INDIA: THE FOODGRAIN OUTLOOK THROUGH 1985

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001900030061-8
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 64
• Document Creation Date: December 19, 2016
• Document Release Date: August 18, 2005
• Sequence Number: 61
• Content Type: REPORT

STAT
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INDIA: The roodg.: a.in Out) ook
Through 19 5
E1:
25X1
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I.
St.at:c".'.tcn L of c i3ject-i :'c s .and Conc3.usions
1.
11.
Dack.(jrounc:,: i'rt t. I erformanr_e nnd Current
Status of I1:Uian .:r~]: ir:ul.tule
4
IT I.
Factors Affecting Future Demand
1.4
IV.
Supply Factors
A. Government Policy
20
B. Prospects for Growth in Foodgrain
Production
28
.V.
Foodgrain Shortfall in 1985
45
VI.
Finance Development and Grain Imports
48
Tables and Charts
Table Number
Head ina
1.
India:
Foodgrain Production, 1949-74
2.
India:
Foodgrain Area, 1949-74
3.
India:
Foodgrain Yields, 1949-74
4.
India:
Foodgrain Imports
5.
India:
Public Sector Investment
6.
India:
Agricultural Taxes
7.
India: Trends in Government Procurement
and Wholesale Grain Prices, 1968-74
8.
India:
Increase in Gross Area Irrigated,
Planned and Achieved, 3.968-79
9.
India:
Projected Foodgrain Situation in
3.985
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im
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}lctnu:i.nq
1.. IIld i.o : }?oc,d,;rr:;in Production, Tr?,ports
and Pc: Cw)j.1-a 1.950-74
2. .i.T;cl. ; aa M.it7.cl of 1:gr.icni._tul"a]. to
Tr~iu~.l:.rial P..:icc:;, 1.952-74
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-Object i .cs~
The ob:jcctivc.? of this parer are to ass~:ss past and
prospective Indian agric,ultura l development and, on the
basis of this,- assessment, to forecast the probable 1985
gap between foodgrain producti.on and requirements.
Conclusions
Indian agriculture has made soli.d advances since the
government began giving greater emphasis to its development
in the :nid-60s. Peak year foodgrain production rose from
77 million tons in the 1950s to 99 million tons in the 1960s
and 108 million tons so far in the 1970s. Imports declined
steadily from a high of 10 million tons in 1965/66 to less
than half a million tons in 1971/72, but since then have
been rising.
But New Delhi will have to muster a more concerted
effort even to maintain the current rate of agricultural
growth. Moreover, accelerated growth must be attained if
requirements are to be met from domestic production over
the next decade.
The pressure of population growth on India's agri-
cultural resources has been growing at an increasing rate.,
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No significant decline is in sight:. Death rates have fall( 21-1
sharply, but family planning measure:; have had little impact.
Duclgetary support for bir.?Lh control programs is declining and
pro--natal .st policies e::t c ndi-?7g tan-:, land and welfare privileges
to large families; arc being continued. Idhc teas Indian planners
forecast a sharply declining birthrate and a 1985 population of
695 million, independent demographers consider Indian estimates
of the current birth rate and population understated, foresee
little change in the birth rate and project a 1985 populaticn.
approaching 750 million.
Clearly, there is good potential for raising agricultural
production. For example, India ranks among the world's lowest
in fertilizer application; nearly 80% of cultivated acreage is
unir:rigated; less than 20% of cultivated land is under high
yielding varieties (HYV) of grain; and less than 1% is sown to
high quality HYVs.
There are also substantial obstacles to the realization
of India's agricultural potential. Heretofore, in formulating
its agricultural policies, New Delhi has usually bowed to
expediency, adopting a patchwork of 'measures having limited
impact and sometimes countereffective. Now that many of the
easier steps toward agricultural gains have been taken, the
going will get tougher. Areas that require particular attention
include:
1._r.. rwr . ~w .v.~. . tuy wM1r . .... ~uw wY-^ rp v+. ... r -. w .'vfw r . _+-.-ro . ? ~ . -._
TAY.,
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more rapid c?cvaioi:ment. Of irrigati.on, esp(cia:L].y of
intensive ca-lpable of su);pport_ing the multi-
crapping of I?YVs,
Improved interstate ccordination of planning and
implemental:ion of irricjation projects, now under state
autonomy.
Massive improvement in the development, production
and distribution of fl \T seeds.
. Increasing production incentives and reducing government
interference in domestic grain trade.
. Expanding agricultural credits and giving a larger share
to small farmers.
We believe that the Indian government could formulate and
implement policies that would promote self--sufficiency in food-
grains by 1985. In the light of past performance, however,
this is an unlikely achievement. We believe Indian agricultural
policy will continue to be sporadically responsive to production
shortfalls.
Unless government performance changes dramatically, the
1985 gap between production and domestic demand appears likely
to fall. within a range of 8 to 16 million tons. Then, as now.,
India will have great difficulty financing imports to close
that gap.
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II. I,,!ckc;ioii cl
About three-quarters of the Indians are farmers
most of who.-'l Provide just about enough food for i:heir fa.i;m:i.lies.
Domestic food supp~.i. a to c]_t.:i..c?s and food deficit arl-.as
acco lnt~.; i o a rG ~.'.': E_ly STll:lll phi re of total output.
Primitive -)roductLion methods hold down yields and farm
income, and the resulting poverty in turn hinders the adoption
of improved agricultural methods. Living on the margin of
subsistence, large numbers of farmers are heavily burdened
with debts and are unable to buy more fertilizer, water, or
improved seeds. Many seek not the biggest crop, but the
surest one, and they rely on time-proven methods. For the
country as a whole the shortfall between production and
consumption at present low per capita levels is small.. In
most years imports amount to less than 5 of total food
consumption. Nevertheless, closing the gap is difficult
because the volume needed runs into the million of tons and
India has difficulty paying for it.
Some less developed countries have resolved their
food shortage problems by increasing exports to pay for food
imports. A few have
through expanding cropped areas and using improved technology.
But many, including India, have been unable to do either and
often seek foreJgn aid to meet some of their foodgrain needs.
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India ran out of newly avai.lab"!c land for cultivation by the
earl.y 19 G C ; only One- i..: "h of tl~c cultivated land
diver-Led to e c ::c., ., r_;i.: , ,~o,,
na do 3 .r,.,,. ,. in c: s (stl.y sugarcane, oil. seeds,
and cotton) , :ere I:: , c beer: fe ;, opportunities to expand grain
Fu.r ^err,:c~ c India.' s devel.opr ent: strategy over the
years has _ocu_~d on building an industrial base, and this has
required large amounts of -foreign exchange. Pith exports
stagnating India de amended heavily on foreign aid for two decades .
From the beginning of the PL-480 program in India in 1957 until
India ceased taking concessional grain at the end of 1971,
PL-480 foodcrain 4:-,,ports amounted to 59 million tons valued at
US $3.7 billion, accounting for. 3/4 of India foodgrain imports
during the period.
Production Since 1950
Foodgrain output, according to revised Indian data,
peaked at about 1.08 million metric tons in 1970/71,* following
two decades in ;chich output increased an average of about 3.5'L
annually. Much of the increase came during the first
decade (see ;'able 1) , however, when output expanded at 4.3`:
per year compared with 2.6% during the 1960s. The major
* Crop cars, ?_ July-a0 J. '.'e. Rates of increase computed
using a three-veer moving average, with 1949-1951, 1.959-1961,
and 1.969-1971 as bases and final years. Since 1970, the
Indian Bureau of Statistics in the %linistry of Pgricult:.ure has
revised the ?,,,".cle series of foocgrain production data beginning
in 1.949. Growth rates cc::nuted using the old series show
output growing at 3.5% during the 1950s and 2.2% during the
1960s.
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reason for the was the decreasing availability of
cultivable land in the 1.960s, whereas expansion of cultivated
area accounted for some 407, of the increase in production
during the fifi:ics (see Table 2) . Surprisingly, ttie growth
in yields for ~.i1 foo(lgrainri also declined from 2.6% per year-
in the 1950s to 2.0 in the 19GOs (see Table 3). Average
yields vcre retarded in the 1960s by the virtual stagnation
of yields of coarse grains and pulses, which %?.ere allocated
the poorest lands. Significant increases in yields achieved
in the relatively small areas sown in high-yield wheat did
not offset the less than 1% annual growth in yields of coarse
grains and pulses, which together accounted for 60% of the
foodgrain area in 1960. Rice yields also increased at only
about 1.1% annually in the 1960s.
While it appeared in the late 1960s that an upward
shift in the production growth rate was occurring, pooz grow-
ing weather since the bumper harvest of 108 million tons in
1970/71 distorts any attempts to measure growth. In 1972/73,
output declined to 105 million tons,irf~part because of dry
weather in the upland coarse grains area; the 1972/73 monsoon
failure dropped output in all seasons and for all crops to
only 95 million tons; and in the 1973/74 crop year just
ended, a dry cold winter and other.
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production problems 6:o be cl:isr.us:,c:ci }:,clo,')hol.cl output to
about 1.03 million tons.
Production trends during the 1970s re-emphasize
IIld~.a, ba-;J.C'. u:CobleI;, of J.nsuffJ.cient ..at?e;r. The gro,~wth of
production has been not only very slo,?w but also highly irregular
because of variations in the weather. At times, annual rises
and declines have been suect:a.cula:r-. Absolute declines in
foodgrain output have occurred in about one out of every three
years since 1950. with nearly 80l of the farmland lacking
irrigation, the monsoon's failure- to arrive on time and/or
with enough precipitation is critical,. influencing not only
yields but the area planted as well. In monsoon areas; there
is practically no rainfall except during the monsoon season.
Largely because of poor monsoons, production gains during the
early 1960s were small. The 1965 and 1966 droughts, the worst
in 60 years, caused foodgrain output to drop 20% in 1965/66
and to remain at nearly the same level in 1966/67. Fortunately,
improvements in Indian agricultu.re,mainly the addition of
tubewell irrigation and use of new wheat seeds, made the decline
in output following the poor monsoon in 1972 considerable less
severe.
Because foodgrain production during the early 1960s
lagged behind increasing demand, imports rose from 3.8% of
total food.grain available in the 1950s to about 6.3% in the
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19G0 s. In };solute terms,. c~ ai?? a:::?~c~rl:s averaged 2.8 million
tons annually during the, 1.950s and 5.3 million tons in the,
1.9GOs, of 10.2 :::i.lli.on tons in 1965 (sec chart
Figure ?) T.- ort- ,Icy;?:cd in the late 1960s as
domestic
preduct~.on .nc.-c::_ :,ci and. c)ot.crr. vent i~uff:.er stocks were built
up. In 1972, fcllowir.g the 3_08 million-ton }.bur,:,pcr crop, buffer
stocks of about 10 million tons filled all available storage,
areas and is , ports amounted to only 500,000 tons, the lowest
level in 20 years. The 1972/73 drought, however:, quickly drew
down stocks and brought India into the ccrm?mercial. grain
market in late 1.972. Imports in 1.973 rose to 3.7 millic,.. tons;
in 1974 imports probably will reach 5 million tons.
Serious efforts to improve the performance of India's
agriculture began in the mid-?1960s, prom,pte^1 by the disastrous
drought and growing import needs. New Delhi's strategy
consisted of applying new technology in water-assured areas,
expanding irrigation, increasing the general availability of
chemical fertilizer, pesticides, and other modern inputs, and
maintaining farm prices at incentive levels. The success of
the now techrolegy -- the so-called "Green Revolution" --
dep=r3ect on new high--yielding varieties (HYV) of seeds and the
whole package of inputs required to make them productive. ,t
The cr-~ cal c..c raci tris- is of the ne;a varieties is their
short stiff stems which enable them to carry heavy seed heads --
produced ny heavy applications of fertilizer and water ?-- with-
out falling over, or lodainc. Traditional varieties, when
heavily fertilized, grow tall and lodge ;,Mien _r~75RQQ,1.
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III. Fac:.tors 11Frrc:t_a_lir, 1,ut.t:re h-:::tnci
According to Ne:l t)clh_i, India now has about 58G million
mouths to fee 1, or more than the combined polpulatiors of the
Western IIomS.s1 )1Ci'e. Western demogra)..Dhers believe this
official C ,"-.t'4 J Lo is conservative. Their checks indicate the
population couY* w.,,ol1. be 30 million higher. Either way, India
is the world's second most populous nation.
The Indian government estimates the present growth rate
of population at 2.0% annually with a subsequent decline to
1.3% by 1985. Analysis of factors influencing population
growth, however, indicates that the present growth rate is
higher and that little decline can be expected during the
next decade. Independent demographers' estimates range from
2.1% to 2.5% with 2.2% as the most common esti.nate. Thus,
New Delhi projects population at 695 million in 1985, but it
is more likely to be around 750 million.
Trends in birth and death rates give India a high potential
for population growth. Based on Indian census data, death
rates have declined more rapidly over the last 20 years than
birth rates, and consequently, population growth rates increased
from 1.3% during the 1940s to 2% during the 1.950s and to 2.2%
during the 1960s. Success in reducing infant and child
mortality through improved sanitation and disease control has
so changed the population age structure that the proportion
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of ~:cr;rn of childbearing ales has increased ma~,x}:cdly. Several
deino;ra;.hers bolicvo that death rates may have hit a plateau,
after de,-1i.11 ::c; #; ._ 50 nears. Estimates of the death rate
range fro.-1 14 per. I., C'30 to 17 per 1,000. The death rate was
much higher in so:-,.ce states (e.g., in Uttar Pradesh, Bihar, and
Orissa) and lower in others (s';crala, Haryana, and Punjab)
.
Birth rate estimates rar.ae from 37 per 1,000 to 42 per 1,000.
Goverr. ent plans to s.lo?.: population growth arc unlikely
to have much impact in the near future. The Indian government
introduced a program of -family planning in 1951, but implemen-
tation from its inceotion through 1964 was slight. From 19G4
through 1972, public e:;_ erdit res on family planning rose
eightfold. Unfortunately, 1972 expcrd.itur s may prove to be
a peak since family planning expenditures fell 13% in 1973 and
are budgeted to decline another 1% in FY 75* despite rapid
inflation. The program has encompassed all means short of
coercion: contraceptives of all types, sterilizations, raising
the legal age of marriage, and reducing tax exemptions for
large families. The government' s family planning program has
bogged down, as the encouraging momentum built up during the
late 1960s has been dissipated. Artbivalence and scepticism
toward population control at the top levels of the Indian
government, the often mediocre quality of many family planning
officials, and incompetent lower-level management have further
*The Indian fiscal year er.cs on 30 Jun oz the year designated.
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hir.cerea pcpula.tia:i centr.cl perforrianc:e. Even at... its peals,
the f a:::ily pJ ar.nirg p:: oqra::: reached only snarl fraction of
the po t:l~.'~.i.nn. On the other hr:nc1, New Delhi's pr.?ov:i.c;ion of
tax, lenC., r:nci wc].farc3 advantages to lards fami.lie:_; are pro-
natalist policies that uncer::tinc its family planning goals.
Not only are goverl:.~:c t birth control program:, insufficient,
but also the pre-conditions or their success do not yct exist.
Although religion is not an obstacle to birth control, tradition
and econe.ics are. A large family is a form of social security
and parents, aware of the high rate of child mortality,
continue having children until at least one son grows to man-
hood. In addition, tradition required that a son be present to
light his parents' funeral pyre. The low level. of literacy
and econc::ic development also hampers the success of any birth
control program. These conditions are not likely to change
rapidly in India, where 80% of the population lives in rural
areas where they are engaged principally in subsistence
agriculture.
The quality of the average diet is very low and mal-
nutrition is endemic. While most of the rural population
subsists on what they grow, the average urban wage-earning
family spends nearly two-thirds of its budget on food.
Consumption of leafy vegetables is low, and meat is not eaten
by many Hindus because of religious prohibitions. In most
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homes, only non-pcrishai bic, foocil~tuffs can he stored. Thus
foodgra.in s account for 80 of the calories and a major share
of they protein ir. the rl:i.c t. I-;ith little margin for clecreasinCx
per Capita cons 11il1~tiUI":, CiccJi11C i in too jrain availability can
quickly become disastrous. Despite massive foodgrain import
campaigns, droughts in 7.966, 1967, and 1972 caused serious
food shortages in affected areas that led to increased deaths
through lowered resistance to disease, if not by starvation.
In general, India's population can be considered immobile,
with only 3a of the people residing outside of the states in
which they were born. The strongest force- for interstate and
intrastate migration is the lure of the large cities. The
percentage of the population living in urban areas increased
from 18.0% in 1961 to 19.9% in 1971. Although small compared
to the total population, this represented 108 million people.
Furthermore, the migration to the cities has been accelerating.
The continuing migration to urban areas further compli-?
sates the feeding and employment of the population. The Indian
government pays a disproportionate amount of attention to its
urban populations partly because of their sheer density, arid
partly because city dwellers are often more sophisticated and
politically active. Low incomes and high unemployment make
the cities potential trouble spots. To feed large urban
populations requires complex food distribution systems,
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unnecessary in rural areas. In an attempt. to be responsive
to urban food nc cls, New Delhi maintains a food distribution
system at subsi.d zcd prices to supplement the free market.
Since 1955, official foodgrain stocks have been distri-
buted in scarcity areas through government fair-price shops --
.S
small private s et) licensed to sell at fixed prices. Each
state establishes the prices of foodgrains sold in the fair-
price shops within its borders. In 1965, the government greatly
expanded the. system of fair-price shops and also began the
statutory rationing of foodgrains in some areas. Statutory
rationing continues in Bombay, Calcutta, and the Durgapur-
Asansol area of West Bengal. Under the more wide-spread
informal rationing, consumers with identity cards can purchase
limited quantities of foodgrains from the fair-price shops,
while supplementing their rations through purchases on the open
market.
Foodgrain demand also is affected by the price and income
elasticity of demand -- the degree to which changes in the
price of foodgrains and average income will affect consumption
of foodgrains. Three factors lead to the exclusion of price
elasticity from consideration:
Since foodgrains make up such a large part of the
diet and substitutes are scarce, it is reasonable
to assume that price elasticity of demand is low.
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? The f e,q studies undertaken suggest that: the price
elast.ici tv of demand is in fac;::. - ery low.
There .-,'-s no reliable method for predicting changes
in the Ind i.an uri.ce structure over the next decade.
Therefore, it is ass is:. ed that the price structure remains
basically unchanged.
The income elasticity of demand f:o: =oodgrains on the other
hand cannot. be ignored because per capita income levels probably
will change significantly over the next decade. Sample
measurements of income elasticity in Irwia by the FAO and the
National Council of Applied Economic Research in New Delhi.,
each using several methods of calculation, range from .38 to
.49. (An income elasticity of .45 mean. that for each 1v
per ca r? H;i
increase in per capita income, the, dema;:_d for foodgrains would
increase 0.45%.)
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IV. ua )I:>l~. F cLr.,rs
A. Gov C]"I.P.1c'Ilt P o1.1.CV
Following the two disastrous droughts of the mid-1960s,
government investment in agriculture increased sharply.
Investment shifts f#~'vorabl.e~ to agriculture also occurred
in industry --- prio.r.:itics were given to producing fertili-
zer, pesticides, agricultural implcmc:nt:s, and products for
other agricultural needs. Emphasis on agricultural_ invest-
ment continued throughout the Fourth 1"ive Year Plan, altho-,ci:
investment in irrigation fell. considerably short of target
(see Table 5). Fifth Plan investment goals give relatively
less emphasis to direct agricultural investment, but increase
allocations to fertilizer and electric power production.
Although government policy establishing the level of
agricultural investment plays an important role in expanding
production, the conception and execution of agricultural
programs also are important considerations. Agriculture
has been hindered by the inconsistency of New Delhi's
efforts to expand the fertilizer and electric power indus-
tries and by inept administration, particularly over the
production and sL.pply of improved seeds, and the provision
of credit to cultivators. The government also has been
deficient in (a) promoting new research on dry farming and
seed improvement; (b) initiating agricultural programs with
adequate preliminary planning; and '(c) introducing consti-
tutional changes essential to the establishment and enforcer.-.ent
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 h ;0
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of national agricultural goals --? slates have virtual
auLonoiny in ITiati.ers relating to land and1 water rights.
Imp].ementat.i.on of agricultural policy has been crrati,;.
During and immediately following agr.i.cultura]. crisis,
agriculture has b!~en given priority. After a few good har-
vests, however, support invariably has been reduced, agri-
cultural programs shunted aside, and long-term projects
postponed. To counter recurring agricultural crises, New
Delhi has had a propensity for crash programs that tend to
quickly fade away. The sharp down--turn in foodgrain pro-
duction in 1972/73, for example, prompted New Delhi to
institute an emergency program to raise foodgrain output
through expansion of irrigation facilities and increased
use of essential inputs. The program was ill-organized,
had little lasting effect, and virtually no impact on production.
Occasionally, ad hoc programs appear to be designed more for
window-dressing than effectiveness. In late June 1974 a
5-member Cabinet Committee headed by the Prime Minister was
established to implement an emergency plan to boost farm
production in selected well-irrigated areas by providing
all the fertilizers and insecticides required. The "emergency"
plan is yet to be funded.
Government neglect of the electric power industry has
affected agriculture directly by limiting the effectiveness
and availability of power and tubewell irrigation and in-
directly by hampering production of materials -?- fertilizer,
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insecticides, cement, and pipes -- needed to improve agri-
cultural production and irrigation. During the Fourth Five
Year Plan (1969-73) only 50a of planned additions to
installed electric power generating capacity was achieved
-- 4.6 million k?;:. compared to a 9.3 million kw. plan.
The shortfall has further increased the gap between demand
and supply w?;iii cis is likely to per. si::st through the next decade.
Failure of the government to ensure priority consign-
ment of crucial rasa materials -- especially diesel fuel.
and cement --- to the agricultural sector also has hampered
production and irrigation. Government intervention has
been limited to appeals by the Minister of Agriculture that
non-farm sectors divert essentials to agriculture.
In the 196Or changes in New Deihi's policies on agri-
cultural prices, taxes, and subsidies improved the farmers'
capaci1-y to invest In agriculture. Farmers' terms of trade
became 1r1~:_L ingly f3.vorable until they peaked in 1967-68
and since 3.9,1-72 have again been improving (see Chart 2).
Since 1966, agr.~'.eultare has been heavily subsidized and
lightly taxes:; (see "able 6). Mrs. -Gandhi's concern with the
nation's Inountin--j ii_flation, however, prompted. her recently
to exhort state governments to increase agricultural taxes.
She specifically requested taxation of incomes of wealthy
land-holders -- currently virtually tax exempt -- and with-
drawal of subsidies to power and water for irrigation, which
also benefit weal by land--owners in particular. Whether
state governments will take this action against the, class
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 Approved For Release 2005/12/14: CIA-RDP85T00875R001900030061-8
that provides much of their political support remains to be
seen. For her part, Mrs. Gandhi in J'uJ.y 1974 withdrew a
major federal subsidy to fertilizer sales.
India's grain pricing policy in recont years has been
increasingly oriented to the interests of consumer, rather
than to those of fL.rmers.* Both support and procurement
prices have been e ,i~c:.;? i.rh d annually for each grain.
Support prices have been pegged so far below market prices
as to be meaningless, however, and were abandoned altogether
for this year's kharif crop. Procurement prices in the
past two years have fallen far behind rising market prices
(see Table 7).
New Delhi':: programs for procuring foodgrains and re-
distributing them at subsidized prices worked effectively
to benefit both producers and consumers in the 1960s and
early 1970s. During the late 1960s, the procurement price
was set relatively high compared to the market price, thus
supporting the grain market and providing an incentive to
farmers. In those years harvests were good, the difference
between market and procurement prices was slight and pro-
curement was not difficult. Grain also was available on
the world market at prices below those in India and often
on concessional terms. Thus, domestic procurement could
readily be supplemented by imports to meet seasonal needs.
This trend is a reversion to earlier consumer-oriented
policies.
--Approved Foor-Release-2005/12/14: CIA-RDP85T00875RO01900030064-8 .
 Approved For Release 2005/12/14: CIA-RDP85T00875R001900030061-8
New Delhi's redistribution prccram dealt mainly in wheat,
which provided the largest marketable foo cram surplus
since the beginning of the Green 11e olution. The system
was effective 3-.--cause dependence on it was not pre s:i.ng.
The situaion has changed since 1971. Domestic pro-
duction -- especi a.Lly of wheat -- has fallen. T,,'orld grain
supplies have become tight and high-priced. Shortages have
caused open market prices to soar and made procurement diffi-
cult at any price, yet New Delhi. granted only small raises
in procurement prices and placed tight controls on grain
trade. (See Table 7.) Consequently, production incentives
have been dampened.
Rather than concentrating on measures to increase
grain production, New Delhi has shown a compulsion to tamper
with the marketing process, usually with unfavorable results.
In early 1973, the govenrment nationalized the wholesale
wheat trade. Six months later, after wheat procurement fell
off drastically, the scheme was abandoned and plans to
nationalize the rice trade were dropped. Early this year,
in another move to boost procurement New Delhi established
wholesale and retail price ceilings for wheat and ordered
wholesalers to earmark half of their wheat purchases for
resale to thegovernment at somewhat lower prices. The
policy has encouraged cultivators to shift to other crops
(despite their lower yields), to hoard grain and to sell
illegally, thereby circumventing government goals in all
instances.
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.w^!~?Pnw.nw.Yw.r..M~^.V~~Y~Pww.~.. /.w.r~. ~..~.re slowly than import prices.
Chronic balance of payments strictures arc likely to worsen.
India %v ' 1? be unable to pay for increased foodgrain imports
without inc:;cased foreign aid.
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 Approved For Release 2005/12/14: CIA-RDP85T00875R001900030061-8
India: Foodgrain Production, 1949-74
1.1il.lion Metric Tons
Rice
Coarse
Crop ycar
(Milled)
e:it
Grai
Pulses
Totalc/
1949/51
23.54
6.39
16.82
8.16
54.92
1950/51
20.58
6.46
15.38
8.41
50.82
1951/52
21.30
6.18
16.09
8.42
52.00
1952/53
22.90
7.50
19.61
9.19
59.20
1953/54.
28.21
8.02
22.97
10.62
69.82
1954/55
25.22
9.04
22.82
10.95
68.04
1955/56
27.56
8.76
19.49
11.04
66.85
1956/57
2904
9.40
19.86
11..55
69.86
1957/58
25.52
8.00
21.23
9.56
64.31
1958/59
30.85
9.96
23.19
13.15
77.14
1959/60
31.68
10.32
22.87
11.80
76.67
1960/61
34.57
11.00
23.74
12.70
82.02
1961/62
35.66
12.07
23.22
11.76
82.71
1962/63
33.22
10.78
24.63
11.53
80 1.5
1963/64
37.00
9.85
23.72
10.07
80.64
1964/65
39.31
12.26
25.37
12.42
89.36
1965/66
30.59
10.39
20.92
9.94
72.35
1966/67
30.44
11.39
24.05
8.35
74.23
1967/68
37.61
16.54
28.80
12.10
95.05
1968/69
39.76
18.65
25.18
10.42
94.01
1969/70
40.43
20.09
27.29
11.69
99.50
1970/71
42.23
23.83
30.55
1.1.82
108.42
1971/72
43.07
26.41
24.60
11.09
105.17
1972/73
38.63
24.92
22.16
9.49
95.20
1973/74x/
43.5
22.5
27.5
9.5
105.0
3
a. 1 July - 30 June
b. Including grain sorgium, millets, corn, and barley
c. Because of rounding, components may not add to the totals
shown
Preliminary
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a' able 2
India: Foodgrain Area , 1949-74 a/
Czaa Ye =.z-b/
Rice
('Iii ie )
W :coat
Coarse
Graf .cc/
Pins es
Total
1949/50
30.52
9.76
38.84'
20.32
99.28
3.950/51
30.81
9.75
37.67 ?
18.68
97.32
1951/52
29.83
9.177
38.88
18.81
96.96
1952/53
29.97
9.83
42.45
19.89
102.09
1953/54
31.29
10.68
45.37
21.77
109.06
1954/55
30.76
11.26
43.92
21.95
107.86
1.955/56
31.52
12.37
46
23.25
110.56
1956/57
32.28
13.52
02
23.35
111.14
1957/58
32.30
11.73
?.91
22.58
109.48
1958/59
33.17
12.62
14.66
24.35
114.76
1959/60
33.82
13.38
43.79
24.88
115.82
1.960/61
34.13
12.93
44.96
23.56
115.58
1961/62
34.69
13.57
44.73
24.24
117.23
1962/63
35.70
13.59
44.29
24.27
117.84
1963/64
35.81
13.50
43.93
24'.1.9
117.42
1964/65
36.46
13.42
44.35
23.79
11.8.11
1965/66
35.27
12.66
43.16
22.08
113.17
1966/67
35.25
12.84
45.09
22.26
115.30
1967/68
36.44
15.00
47.34
22.65
121.42
1968/69
36.97
15.96
46.24
21.26
120.43
1969/70
37.68
16.63
47.24
22.02
123.57
1970/71
37.59
18.24
45.96
22.53
124.32
1971/72
37.76
19.14
43.57
22.15
122.62
1972/73
/
36.02
19.88
41.12
20.40
117.43
1973/74
38.50
20.00
39.50
22.50
11.4.70
1. Data as reporze;: o=ricia1 statisz cs. ??ne cifrere:nces
between the sty:. of the ccmponents and the to~als are
unexplained in Indian statistics.
b. 1 July - 30 June.
C. Including grain sorchum, millets, corn, and barley.
d. Preliminary.
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 Approved For Release 2005/12/14: CIA-RDP85T00875R001900030061-8
India: 1?oodgrain Yields., 1949-74 a/
ICil.orrr ^is Pa.r.
HN:ctarc
CrOn Ycarl?/
Ric
(Mil IA c?)
Wheat
`
Coarse
Gr,.iirisC/ Pulses Total
1949/50
1950
53
771
655
433
405
553
/
.
668
633
408
441
522
1951/52
1952
53
714
653
414
448
536
/
1953
54
764
763
462
463
580
/
1954/55
902
750
506
489
640
1955/56
820
803
520
500
631
1956
57
874
708
448
476
605
/
1957
58
900
695
473
495
629
/
1958/59
790
682
495
424
587
1959
60
930
789
519
541
672
/
937
772
522'
475.
662
1960/61
1961
62
1,013
851
528
539
710
/
1962/63
1,028
890
519
485
705
1963/64
931
793
556
475
680
1964/65
1,033
730
540
416
687
1965/66
1,078
913
572
520
757
1966
67
'.869
824
490
444
636
/
1967
68
863
887
533
377
644
/
1968
69
1,032
1,103
608
534
783
/
1969
7
1,076
1,169
545
490
781
/
0
1,073
1,209
578
531
805
1970/71
1971
72
1,123
1,307
664
524
872
/
1972
7
1,141
3.1380
565
501.
858
/
3
1973
d/
1,072
1,254
539
465
811
/74
1,130
1,125
696
422
828
a. All yields computea using unrounded data =or production and
area. Because of rounding, components may not add to the
totals shown.
b. 1 July - 30 June.
C. Including grain sorghum, millets, corn, and barley.
d. Preliminary.
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 Approved For Release 2005/12/14: CIA-RDP85T00875R001900030061-8
Table 4
India: Foccigr ain Imports
Thousand Metric Tons
Calendar
Yca r.
Wheat
Palled
12ice
Ccarse
Grains
Total
1947-502/
1,467
G28
701
2,796
1951
3,064
761
976
4,801.
1952
2,551
734
641
3926
1953
1,711
17B
146
21035
1! A
200
635
8
843
1955
442
269
..-
711
1956
1,113
330
1,443
1957
2,898
748
--
3,646
1958
2,716
397
in
3,224
1959
3,553
295
143
3,868
1960
4,386
699
'143
5,137
1961
3,092
384
134
3,495
1962
3,250
390
87
3,640
1963
4,073
483
61
4,556
1964
5,621
645
113
6,266
1965
6,583
783
229
7,462
1966
7,832
787
1,739
10,358
1967
6,400
453
1,819
8,672
1968
4,1.66
446
482
5,694
1969
3,090
487
295
3,872
1970
3,425
206
--
3,631
1971
1,814
240
--
2,054
1972
NA
NA
NA
320
1973
NA
NA
NA
4,200
1974?(
NA
DTA
NA
5,000
a. Annual average
b. Estimated.
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Table 5
India: Public Sector Investment
(By Percent of Total)
Agricultural Sector
A
i
/
Irrigation and
Total
gr
culture a
Flood Control
Total
Indus
Pop,er
Other
Percent
billion r
yes
Second Plan (1956-60)
11.0
9.0
20
24
10
46
100.0
Third Plan (1961-65)
12.7
7.8
20.5
20.1
14.6
44.8
100.0
85.8
Annum Plan (1966-68)
14.9
7.3
22.2
23.3
18.7
35.8
100.0
64.6
1969
14.1
8.8
22.9
20.4
21.5
35.2
100.0
21.8
1970
14.9
8.3
23.2
18.4
20.4
38.0
100.0
25.2
1971
14.1
8.0
22.1
19.2
19.7
39.0
100.0
30.8
1972 Plan
1973 Pl
17.2
6.8
2-1.0
19.0
15.6
41.4
100.0
36.5
an
Anticipated Fourth
Plan (1969-73)
15.8
15.4
6.9
7.6
22.7
23.0
17.6
18.8
16.1
18.1
43.6
39.8
100.0
100
0
42.6
159
0
Original Fourth Plan
(1969-73)
Fifth Pl
(1974
15.5
12
8
6.9
22.4 .
21.3
15.6
40.7
.
100.0
.
156.5
an
-78)
.
7.2
20.0
24.0'
16.3
39.7
100.0
372.5
a. India counts grain purchases for the public distribution system as public sector investrent. Such purchases
are excluded from this tabulation.
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 India: Agricultural Taxesl/
Million Rs.
Plan Period
Land
Income
Total
Total
State Taxes
Agri cultural
Taxes as a
%
f
o
Total
First Plan
(1951-55)
653.4
48.2
701.5
2,514.2
27.9
Second Plan
(1956-60)
910.0
85.0
995.0
3,795.8
26.0
Third Plan
(1961-65)
1,140.6
97.8
1,238.4
6,679.8
18.4
Plan Holiday
(1966-68)
1,023.6
109.7
1,133.3
10,744.4
10.7
Fourth Plan
(1969-73)
1,076.8
124.9
1,201.7
16,937.8
7.0
1. Annual average.
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 Approved For.Release 2005/12/1 4 : C(A-RDP85T008 58001900030061-8
India: Trends in Government Procurement and Wholesale Grain Prices, 19G8--114-
(1968 = 100)
Wheat
Rice
Year
ProcurcmcntL/ Wholesale?/
Procurement
W
l
l
Y
zo
csa
c
1968/69
100
100
100
100
1969/70
100
105
101
100
1970/71
100
102
103
_03
1971/72
100
102
102
104
1972/73
100
109
105
118
1973/74
(1st Half)
100
104
105
137
19`11/74
(2na Half)
100
118
140
151
1974/75 April/Flay 138
1703/
140
1743/
1. Mexican/Common White Procurement
2. Average of Fiscal Year
3. Week of 4 May 1974.
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 Approved For Release 2005/12/14: CIA-RDP85T00875R001900030061-8
Increase in Cross Area Irrigated, Planned and Achi_cvecd
Fbu.r. Ui Plan Par:i.cx`l. Draft Fifth Plan Period
(1968/69` 1973/71) 1973/71 - 1972/79)
Planned Ftipoi-t' d Planned
-
Ad-iieva Lent-a/
CanaLsv/ 3.9 2.6
Minor surface -1
water schenns
-,f
TOTAL 7.1 7.1
11.2
a. Preliminary
b. Includes only major and mcdium surfaoa water sclza*res casting
over 1Zs 2.5 million each.
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 Approved For Release 200/12/1 CIA-RD $ T00 : 58001960030061 .8
Table V 4
India: Projected Foodgrain Situation in 11085
Assumed Annual Growth Rates (g) Results (million metric tons)
Foodgrain Real Real NNP Foodgrain Foodgrain
P opulafii nn Drnr7v,-4
f 2.2
2.2
Si]T
138.5 8.8
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 S' 7
i- S
rrdi'a?:?Foodgratn. Production., Imports, ands Poz en,i;t n $?ra3ln;~j it
3495),-7,4;
(:~il1ton Metric Tonn)1
T'ears'
Populationf
(:zillion)'
Production.
Imports)
Total
Av
il
bl
Per Capita 2).va1labl iity.
Index Q1 Pcx Capita
a
a
e.
(Kilogram. Per C~~pita)
Eooc?rrair.- F>~ai18}~i3i~V.
1950/51
1951/52'
361.4
3
50-.82'
4!.81
55.62
153!
100
1952/53!
69.6
376
1
52.00
'
.3+.93:
55.93!
151,
,
93
7
1953/5"
.
.20
59
2-.0048
6``1.24.
163;
.
,
~r6
5
195
382.9
69.82
0.84-
70.66
134,
.
4/55
1955/56
390.2
63.04
0.71
68.75
176,
115
7
397.8
66.35
1.44:
63.29
7~ 7.'2?
.
.
1.12. ?};
1956/57
1957/58
405.8
414
3
69.86
3.65.
73.51
131
118
3
:753/57
.
42
64.31
3.22
67.53
1.63
.
,
06
5
1
1959/60
3.3
77.14
3.37
61.01
191
.
,
24
s
196., 61
432.7
44
76.67
5.14
81.81
189
.
123
5
1961/62
2.4
82.02
3.49
85.51
193
.
126
1
452.2
82.71
3.64
86.35
191
.
124.8
1962/63
1963/64
462.0
472
60.15
4.55
84.''1%
;83
?
19
6
19
4/65
.1
482
5
50.64
8
6.26
86.90
184
,
120.3
1965/65
.
493
2
9.36
7.45
96.0^1
201
131
4
19c6/ G7
.
504
2
72.35
7
10.34
82.64
1Sa
.
10,
0
1967/68
.
515
4
4.23
8.66
82.89
164
.
107.2
.
95.05
5.69
100.74
196 -
126.1
1968/69
1969/70
527.0
538
9
94.01
3.85
97.86
186
121
6
1970/71
.
99.50
3.58
103.02
191
.
124
8
?
550.3
108.4
2.03
110
43
200
.
197
1/72
1972/73
562.5
574
2
105.17
0.48
.
105.65
188
133.7
122.9
1973/74 est
.
586
3
95.20
3.7
98.90
172
112.4
.
.
103.0
5.0
108.00
184
120.3
a. Crop year, 1 July - 30 June.
b. A5 of 1 July of the second year stated.
c. Imports for January - December of second year stated.
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 .._ AppKavad-Far -ReFease? 2005/4 21-14? : -CIA-RDP85T00.875ROO.19AQ03.0.0.61.-8_ ...___._.. ,.,_,.-
Iriciia: Ratio o of A!'ricu1tura7. to Industrial Prices, 1952-74
Finish^c1 i?lanu- Foodgrain
facture. Goods Wholesale
Yea.r.
Who].o,sa].c
I'-'ice
Indc:?.
Price Indcx
Ratio
1952-53
100
100
5.00
1955-56
100
, 73
73
1960-61
123
102.
83
19G1-G2
125
100
80
1962-63
127
106
1963-64
130
116
1964-65
135
144
1965-66
145
150
103
1966-67
178
114
1967-68
223
141
1968-69
162
195
1969-70
174
202
1970-71
186
I
201
1971-72
199
209
1972-73
209
240
115
1973-74
237
287
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