Advantages And Disadvantages Of Diversification

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Agribusiness is the pre-dominant economic line of work of the rural communities in India, and plays a critical function in the socio-economic development of these communities. India acquires its major portion of production grosss from the rural / agricultural sector of the economic system. The agribusiness sector in India is tremendously important in malice of its worsening portion in GDP. Sectoral displacements occurred as a consequence of the industrialisation which had raised the Services sector portions in GDP during the 1990 ‘s, where as Agriculture, which had a major portion in GDP in the 1950 ‘s, contributed merely 22.5 % by the terminal of March 2004 ( Economic Survey, GOl, 2003-04 ) .

Therefore came up a pressing demand for a paradigm displacement in the authorities ‘s agricultural policy to turn to the jobs faced in the agricultural sector in the new domestic and planetary economic environment and avenues to heighten the income of the husbandmans. The possible solution for bettering the agro sector is Diversification. This survey traces the definition of variegation, country enlargement jobs, immediate demands, and its future chances.

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Diversification can besides affect “ a displacement of resources from one harvest ( or farm animal ) to a larger mix of harvests and farm animal, maintaining in position the varying nature of hazards and expected returns from each crop/livestock activity, and seting in such a manner that it leads to optimum portfolio of income ” ( Joshi, et Al, 2003 ) . It is a manner of a gradual motion from subsistence basic nutrient harvests towards diversified market-oriented harvests which have a larger potency for land returns. DOA being a scheme would open up chances, to a big extent, for value add-on in agribusiness and will besides take to better harvest planning and better the earning chances in the farm community. In India, Andhra Pradesh has been proactive in taking up agricultural variegation as a scheme to speed up the growing of agribusiness.

Crop Diversification

Crop variegation takes into history the economic returns from different value-added harvests. It besides implies the effectual usage of environmental every bit good as human resources to turn a mix of harvests with complementary selling chances, and it entails switching of resources from low value harvests to high value harvests. Due to globalisation, harvest variegation in agribusiness is besides a agency to increase the entire harvest productiveness in footings of quality, pecuniary and quantity value under specific, diverse agro-climatic state of affairss all over the universe.

Horizontal variegation – the primary attack to harvest variegation used in production agribusiness. In this attack, variegation usually takes topographic point through harvest intensification which means adding new high-value harvests to bing cropping systems as a manner of bettering the overall productiveness of a peculiar farm or a part ‘s farming economic system as a whole.

Vertical variegation attack in which value is added to the merchandises by husbandmans through assorted methods such as processing, regional stigmatization, packaging, selling, or other attempts to heighten the merchandise.

Opportunities for harvest variegation usually vary depending upon the hazard, chance and the feasibleness of proposed alterations within a socio-economic and agro-economic context. Crop variegation may happen as a consequence of authorities policies. The “ Technology Mission on Oilseeds ” , “ Spices Development Board ” , “ and Coconut Development Board ” etc is some illustrations where the Indian authorities created policies to thrust alterations upon husbandmans and the nutrient supply concatenation at big as a manner of advancing harvest diverseness.

Crop variegation is the result of several synergistic effects of many factors:

  1. Environmental factors which includes irrigation, rainfall, and temperature and dirt birthrate.
  2. Price-related factors which includes end product and input monetary values with regard to national and international trade policies and other economic policies that affect the monetary values either straight or indirectly.
  3. Technology-related factors which includes seeds, fertilisers and H2O engineerings, but besides those related to selling, crop, storage, agro-processing, distribution, logistics, etc.
  4. Household-related factors which includes regional nutrient traditions, fresh fish and fuel every bit good as the labour and investing capacity of farm people and their communities.
  5. Institutional and Infrastructure-related factors which includes farm size, location and occupancy agreements, research, in-field proficient support, selling systems and authorities modulating policies, etc.

Area enlargement jobs under rice and wheat harvests

Scaling up production country poses several new jobs of significance such as:

  1.  Excessive usage of groundwater taking to hapless H2O usage efficiency and depletion of groundwater.
  2.  Deterioration of dirt wellness or dirt birthrate.
  3. Multiple infestations of weed vegetations, insect plagues and diseases.
  4.  Indiscriminate usage of energy such as chemical, electricity or disease, etc.
  5.  Decrease in the handiness of other protective nutrient and high value harvests.
  6. Pollution of agro-ecosystems.

Despite the enlargement jobs, harvest variegation has the possible to be an economic driver in agricultural parts. It may turn out to go the paramount importance in meeting challenges that arise from a post-green revolution scenario. In position of shrinking of agricultural land and operational retentions due to enlargement of urban centres, alterations in consumer nutrient wonts, exponential population growing rate, husbandmans are pressured to include or replace extra harvests in to the cropping system.

Key Drivers Of Diversification

The cardinal drivers of variegation that are identified are:

  1. Food Security ;
  2. Employment coevals through creative activity of off-farm and non-farm investing chances within the capablenesss of the resource-poor husbandmans ;
  3. Changes in harvest forms and farming systems ;
  4. More effectual usage of land and H2O resources ;
  5. Market entree enterprises replacing hazard antipathy with hazard credence ;
  6. Changing consumer demands irrespective of the nature of habitation and criterions of life due to spread-effect of wellness consciousness caused by the ocular media and non-discriminatory demand for choice goods,
  7. The function of urbanisation in fast developing states like India.

Crop variegation can break digest the ups and downs in the market value of farm merchandises and may guarantee economic stableness for farming households of the state. The inauspicious effects of deviant conditions, such as fickle and bare rainfall and drouth are really common in a huge country in agricultural production of the state. Incidence of inundation in one portion of the state and drouth in the other portion is a really frequent phenomenon in India. Under these deviant conditions state of affairss, dependance on one or two major cereals ( rice, wheat, etc. ) is ever hazardous. Hence, harvest variegation through permutation of one harvest or assorted cropping/inter-cropping may be a utile tool to extenuate jobs associated with deviant conditions to some extent, particularly in the waterless and semi-arid drought-prone/dry land countries.

Immediate Need

In India, harvest variegation in agribusiness takes topographic point vertically or horizontally, depending upon the market forces and besides on occasion due to the domestic demands. With respects to utilize of land and H2O usage and quality, there is an immediate demand to see the undermentioned factors ( Aradhana, 2009 ) :

Farm green goods treating into value added merchandises will offer employment range in non-farm plants as in distillment of active ingredients from medicative and aromatic workss ( herbal merchandises ) , range of industrialisation in agribusiness for sugar, paper board fabrication, etc.

There is a demand to happen place-based attacks for diversifying the agriculture state of affairss under assorted socio-economic conditions, substructure of market, domestic demands, supply of inputs, etc. The research and development on harvest variegation is best done in a farmer-participatory manner where a multi-disciplinary squad consisting of scientists will affect husbandmans from the undertaking be aftering stage boulder clay geting at decisions and solutions. The construct of sustainable productiveness for each land and H2O units through harvest variegation needs to be fostered.

There is critical demand for advancing co-operatives in rural countries to work out micro-level and demographic jobs. Strengthening nutrient processing and other value-added industries in rural countries is a agency to supply employment to rural young person. Alternate cropping systems and farm endeavor variegation are most of import for environment protection.

There are abundant chances in following the subordinate businesss to the rice-wheat cropping systems present in India. They are vegetable agriculture, fruit cultivation, flower gardening, medicative and aromatic workss cultivation, mushroom agriculture, dairying, pig farm, goatery, domestic fowl and duckery, piscary or aquaculture, bee-keeping, to supply ample range for variegation of rice-wheat cropping system in north-western and south India and north-eastern provinces. Farm endeavor variegation will bring forth more income chances and rural employment unit of ammunition the twelvemonth.


Diversification in agribusiness will hold a enormous impact on the agro-socio-economic countries and besides in the uplifting of resource-inadequate agriculture communities. It will be able to bring forth income and employment chances for rural young person around the twelvemonth for the extreme benefits of the Indian husbandmans. It shows the usage of local resources in a bigger mix of diversified cropping systems and farm animal, aquaculture and other non-farm sectors in the rural countries.

As in the WTO epoch along with the globalisation of markets, variegation in agribusiness is an one means to step up the entire production and productiveness with regard to quality, measure and pecuniary benefits under diverse agro-climatic province of personal businesss in the state. There are still legion chances for harvest variegation nowadays in both- irrigated and non-irrigated huge countries in the rural India.

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Advantages And Disadvantages Of Diversification. (2017, Jul 05). Retrieved from

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