Stagnation in public investment has affected agricultural growth:RBI

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Mumbai, June 27 (UNI) Stagnation of public investment for almost a quarter of a century and slowing of irrigation expansion since 1991 has resulted in slow growth in agriculture, according to a study by the Reserve Bank of India.

The study, conducted by the Development Researach Group of RBI's department of Economic Analysis and Policy and released here today, said smaller farm holdings had made it more difficult for the majority of Indian farms to access new technology and adopt more efficient forms of farm production organisation, thereby adversely affecting agricultural growth.

The study, entitled ''Agricultural Growth in India since 1991'', was co-authored by Prof Pulapre Balakrishnan, senior fellow, Nehru Memorial Museum and Library, New Delhi, along with research staff members from the Reserve Bank.

The study did not find evidence to the contention that relative price movement might have played a determining factor in explaining slow growth of agriculture since 1991. The profile of relative prices over the past 15 years indicates too mild a shift, if at all, to consider relative price movements as central to understanding the slowing of agricultural growth since 1991. The role of import liberalisation in determining this price movement appears to be marginal too, except perhaps for some crops in some periods.

The study observed that production is increasingly being carried out in a more open economy, even though import penetration is very low currently for most crops. The study suggested the need for expansion of publicly-provided research and extension to support farming under a changed environment.

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