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Punjab, a state occupying 1.5% of the geographical area of the country contributes a major role to the economic development of the country. Since Green Revolution, the state has significantly contributed in the growth of agriculture sector in the country. However, during the recent years Agriculture and Allied Sector’s contribution to Gross State Value Added (GSVA) at constant  prices has declined. The share of Agriculture and Allied Sector in the GSVA (30.81%) in 2011-12 has declined (27.22%) as per quick estimates of 2014-15 and which is further estimated to be at the same level as per advance estimate of 2015-16. The declining share represents the structural transformation of the economy from agriculture to the other sectors of the economy. The growth in agriculture sector is affected due to the following factors:

  • Full exploitation of cropping intensity & irrigation potential
  • Saturation of growth in productivity
  • Un-willingness of farmers to take risks due to assured returns of wheat & paddy
  • Less advances in R&D sector

Source: Economic and Statistical Organization, Punjab (2015-16)

The Gross Capital Formation (GCF) in agriculture and allied sector (showing extent of investment) has an increasing trend since 2004-05. The GCF in agriculture & allied sector remained below 7% from 2007-08 to 2013-14 and the agriculture GSDP has also shown the same trends.

The Gross Capital Formation in Agriculture Allied Sector(Rs. in Crore)

Source: Economic and Statistical Organization, Punjab (2015-16)