{"id":26984,"date":"2022-03-12T17:04:39","date_gmt":"2022-03-12T11:34:39","guid":{"rendered":"https:\/\/plyinsight.com\/?p=26984"},"modified":"2022-03-12T17:07:03","modified_gmt":"2022-03-12T11:37:03","slug":"terms-of-trade-go-against-farming-after-2-years","status":"publish","type":"post","link":"https:\/\/plyinsight.com\/hi\/terms-of-trade-go-against-farming-after-2-years\/","title":{"rendered":"Terms of trade go against farming after 2 years"},"content":{"rendered":"

Though first advance estimates of national income project the farm sector to grow at a robust 3.9 per cent in FY22, how much of it is actually benefitting farmer’s remains questionable.<\/p>\n

This is because the terms of trade in agriculture have started going against them again, after a gap of two years, due to higher inflation in the non-agriculture part of the economy.<\/p>\n

The phrase ‘terms of trade’ for agriculture broadly refers to the gap between the price paid for inputs used in growing agricultural crops, and the prices received from the sale of those crops.<\/p>\n

According to the national income estimate, the deflator in agriculture gross value added (GVA) is projected to grow by 5.2 per cent in FY22, while that in non-agriculture GVA, which largely consists of industry and services, is projected to grow at almost twice the rate, at 10 per cent.<\/p>\n

The deflator measures the rate of change in prices or the inflation rate.<\/p>\n

This broadly means that in the current financial year, farmers are paying a higher price for their inputs and other consumption items such as health and education of their wards, as compared to the price they receive on the sale of farm produce.<\/strong><\/p>\n

\u201cAn unfavourable terms of trade in agriculture basically shows that farmers are paying higher price for their inputs which includes diesel, fertilizes and also for consumption services such as health and education in comparison to the price that they receive by selling their produce,\u201d said S Mahendra Dev, director and vice chancellor of Mumbai-based Indira Gandhi Institute of Development Research (IGIDR).<\/p>\n

He said terms of trade have also reversed as core inflation (non-food and non-fuel) has risen at a faster rate as compared to the food inflation.<\/strong><\/p>\n

Dev said worsening terms of trade for agriculture, coupled with low rural wages, does not augur well for the larger rural economy as such and could delay the rural recovery.<\/p>\n

Recovery in rural areas has been a matter of concern despite faster economic growth as highlighted by several indicators.<\/p>\n

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Though first advance estimates of national income project the farm sector to grow at a robust 3.9 per cent in FY22, how much of it is actually benefitting farmer’s remains questionable. This is because the terms of trade in agriculture have started going against them again, after a gap of two years, due to higher […]<\/p>","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2288],"tags":[2338,2410,316,904,1406,1664],"class_list":["post-26984","post","type-post","status-publish","format-standard","hentry","category-march-articles-2022","tag-agricultural","tag-agricuture","tag-budget","tag-farmer","tag-farmers","tag-inflation"],"yoast_head":"\nTerms of trade go against farming after 2 years - PLY INSIGHT<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/plyinsight.com\/hi\/terms-of-trade-go-against-farming-after-2-years\/\" \/>\n<meta property=\"og:locale\" content=\"hi_IN\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Terms of trade go against farming after 2 years - PLY INSIGHT\" \/>\n<meta property=\"og:description\" content=\"Though first advance estimates of national income project the farm sector to grow at a robust 3.9 per cent in FY22, how much of it is actually benefitting farmer’s remains questionable. 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