It Is Now Time For The Next Agricultural Revolution In India

Meteorologists classified the 2026-27 Super El Nino as one of the most intense ones in the past 75 years. As predicted, India witnessed a severe rainfall deficit—12.6%—in this year's monsoon season. And yet, the remarkable feature of our monsoon-fed agriculture is that there is no shortage of food.

In 2025-26, our food grain production was about 377 million tonnes, a record. In the current year, there is likely to be a marginal fall of 1-2%. Our total food grain production in 1950-51 was about 51 million tonnes. Nowadays, our peak storage of food grains in government granaries alone routinely touches 80 million tonnes.

Along with agricultural technologies, our irrigation expanded over the decades. India's gross irrigated area is about 55% of the gross cropped area. Of the irrigated area, about 25% is by canals and 60% by groundwater.

In the past decade, agriculture witnessed a robust annual growth of over 4%. While we are the world's largest importers of cooking oil, we have a modest trade surplus in agriculture.

However, there are many missed opportunities and market distortions in agriculture. Some of the major challenges deserve close attention: overproduction of foodgrains and shortage of other key foods; inefficient water use and depletion of groundwater reserves; misapplication of fertilisers and depletion of soil fertility; and very little storage, processing, and other post-harvest technologies, poor phytosanitary measures, and unrealised export potential. Let us examine each of them briefly.

While we have a glut of food grains, there is inadequate production of other food items, leading to shortages. But our skewed policies, designed in the 1960s to meet the challenge of acute cereal shortages, are continuing, distorting incentives to farmers.

Procurement of food grains at the above-market minimum support price (MSP) and a vast, leakage-prone public distribution system (PDS) are suppressing the price signal for the farmers. Our food subsidies are nearly ₹2.30 lakh crore per year. The states are spending an additional ₹30,000 crore on food subsidies. Even when there is a glut in the market, farmers are encouraged to produce rice and wheat in our most fertile lands. Food grains account for 80% of agricultural land. The MSP assures a decent and secure income irrespective of market conditions, and farmers are induced to raise cereal crops even when the real demand is low. Up to 40% of the food grains are diverted, and partly recycled into PDS, causing even greater loss to the exchequer. Meanwhile, the supply is not increasing to meet the growing demand for vegetables, fruits, milk, eggs, meat, and fish. As the policies encourage overconsumption of cereals, adult obesity and incidences of type-2 diabetes are rising alarmingly. This is a classic case of unwise policy imposing heavy costs on the public purse, causing shortages of essential foods, leading to malnutrition and sickness, and increasing morbidity and healthcare costs.

Rice and wheat crops consume enormous amounts of water. In general, canal irrigation is fully subsidised in India. In most states, agricultural power is free. Flood irrigation is common for cereal crops, leading to wastage of water. Unmetered and free agricultural power is causing severe losses in the power sector, increasing the burden of power subsidies, and making grid management difficult. In the past decade alone, agricultural power demand nearly doubled. Groundwater is getting depleted very fast in many pockets due to overdrawing. Annual power subsidies, borne mostly by the states, are of the order of ₹1.5 lakh crore and rising.

Fertilisers are heavily subsidised in India. The urea subsidy, at over 90%, is the highest in the world. The fertiliser subsidy bill is about ₹1.7 lakh crore and may exceed ₹2 lakh crore in 2026-27 because of significant rise in oil and gas prices. The heavy subsidy on urea—which provides nitrogen (N)—is leading to an excess application of N and an inadequate application of phosphate (P) and potassium (K). A healthy ratio of NPK should be about 4:2:1 (it varies from crop to crop); in India it is about 10:4:1, and in Punjab and Haryana it is about 30:7:1. Such misapplication of fertilisers is increasing the subsidy bill on urea without any added benefit of productivity and is actually depleting soil health.

Finally, inefficient supply chains are causing post-harvest losses of fruits and vegetables. We produce over 370 million tonnes, and up to 20-30% of the harvest goes waste. Our cold storage is very low, mostly for one crop—potato—and limited to a few states. Our horticulture processing is less than 5%, the lowest among major economies. The US (65-70%), Malaysia (75-80%), Brazil (60-85%), Philippines (75%), and China (25-30%) process a lot more, adding value, ensuring quality, minimising waste, and promoting exports. There is a potential of $100 billion in horticulture exports if we integrate end-to-end supply chains. Because of inefficient supply chains, the quality is compromised alarmingly, posing a health hazard and excluding India from global trade. Over 25% of our vegetable and fruit samples have pesticide residues, and nearly 5% are well above the prescribed maximum residue levels!

The promotion of horticulture and integrated supply chains will address all these four challenges. Horticulture is suitable for drip irrigation, which reduces water wastage. It yields higher profits to farmers if proper infrastructure support is given and supply chains are integrated. A voluntary shift from cereal crops will reduce the MSP burden, and there will be a balanced production of foods. Horticulture needs much less urea and more P and K; the fertiliser subsidy will come down, and soil health will improve with balanced nutrient application. Integrated supply chains will ensure storage, processing, and phytosanitary compliance and will boost consumer health and exports dramatically. If only we redeploy agricultural subsidies in a rational way, it will lead to a win-win solution for the farmers, consumers, public finances, exports, and our current account. It is time for the next agricultural revolution.

The author is the founder of Lok Satta movement and Foundation for Democratic Reforms. Email: drjploksatta@gmail.com / Twitter@jp_loksatta

Published on: Sunday, November 08, 2026, 10:04 PM IST