Agriculture is the primary source of living for decades. It started with the start of life and gained a high economic and nutritional position in the world. At present, agriculture above and beyond farming includes forestry, dairy, fruit cultivation, poultry, beekeeping, mushroom, arbitrary, etc. Today, processing, marketing, and distribution of crops and livestock products, etc.
Are all acknowledged as part of current agriculture? Thus, agriculture could be referred to as the production, processing, promotion, and distribution of agricultural products. Agriculture plays a critical role in the entire life of a given economy. Agriculture is the backbone of the economic system of a given country. In addition to providing food and raw material, agriculture also provides employment opportunities to a very large percentage of the population.
Agricultural development is one of the most powerful tools to end extreme poverty, boost shared prosperity and feed a projected 9.7 billion people by 2050. Growth in the agriculture sector is two to four times more effective in raising incomes among the poorest compared to other sectors. Analyses in 2016 found that 65 percent of poor working adults made a living through agriculture.
Agriculture is also crucial to economic growth: in 2018, it accounted for 4 percent of global gross domestic product (GDP) and in some developing countries, it can account for more than 25% of GDP.
But agriculture-driven growth, poverty reduction, and food security are at risk: Climate change could cut crop yields, especially in the world’s most food-insecure regions. Agriculture, forestry, and land-use change are responsible for about 25 percent of greenhouse gas emissions. Mitigation in the agriculture sector is part of the solution to climate change.
The current food system also threatens the health of people and the planet: agriculture accounts for 70 percent of water use and generates unsustainable levels of pollution and waste. 1/3 of food produced globally is either lost or wasted. Addressing food loss and waste is critical to improving food and nutrition security, as well as helping to meet climate goals and reduce stress on the environment.
Risks associated with poor diets are also the leading cause of death worldwide. Millions of people are either not eating enough or eating the wrong types of food, resulting in a double burden of malnutrition that can lead to illnesses and health crises. A 2020 report found that nearly 690 million people—or 8.9 percent of the global population—are hungry, up by nearly 60 million in five years.
Food insecurity can worsen diet quality and increase the risk of various forms of malnutrition, potentially leading to undernutrition, as well as people, being overweight and obese. The cost of healthy diets is unaffordable for more than 3 billion people in the world.
Economic Importance of Agriculture for Poverty Reduction
The Millennium Declaration set 2015 as the target date for halving the number of people living in extreme poverty. Exceptional progress in some developing countries makes achieving that goal globally a realistic possibility. However, many countries will fall far short, and up to 1 billion people are likely to remain destitute by the target date.
Why are some countries doing better than others? This paper seeks to answer this question by looking for shared characteristics of twenty-five developing countries posting extraordinary success in reducing extreme poverty over the past twenty to twenty-five years. These countries were compared using indicators of their macro-economic characteristics and, especially, their agricultural economic characteristics.
The countries chosen for analysis constitute a highly diverse mix. The group includes some of the poorest and some of the richest developing countries in the world, representing virtually all geographic regions. The countries also differ greatly in their systems of governance and economic management. Yet, they are surprisingly similar in their achievements, not only in reducing poverty but across the broad range of macroeconomic and agricultural economic performance measures used to compare them.
Findings from time-series, cross-section regression analysis reveal that while economic growth generally was an important contributor to poverty reduction, the sector mix of growth mattered substantially, with growth in agricultural incomes being especially important.
16 Important Factors to Highlight Importance of Agriculture
Below are the factors why agriculture is important:
Source of Livelihood
Most people’s main source of livelihood is farming. About 70% of people rely directly on agriculture as a livelihood. The result of the non-development of non-agricultural activities to absorb the fast-growing population is this high percentage in agriculture. Furthermore, many people are not engaged in agriculture in developed countries.
Contribution to National Revenue
Agriculture is the main source of national income for most developing countries. However, for developed countries, agriculture contributes a smaller percentage to their national income.
Supply of Food as Well as Fodder
The agricultural sector provides fodder for domestic animals. The cow provides people with milk which is a form of protective food. Moreover, livestock also meets people’s food requirements.
Significance to the International Trade
Agricultural products like sugar, tea, rice, spices, tobacco, coffee, etc. constitute the major items of exports of countries that rely on agriculture. If there is a smooth development practice of agriculture, imports are reduced while export increases considerably. This helps to reduce countries’ unfavorable balance of payments as well as saving foreign exchange. This amount may be well used to import other essential inputs, machinery, raw material, and other infrastructure that is helpful for the support of the country’s economic development.
The growth of the agricultural sector contributes to a marketable surplus. Many people engage in manufacturing, mining, as well as other non-agricultural sectors as the nation develops. All these individuals rely on food production that they might meet from the nation’s marketable surplus. As agricultural sector development takes place, production increases and this leads to the expansion of marketable surplus. This may be exported to other nations.
Source of Raw Material
The main source of raw materials to major industries such as cotton and jute fabric, sugar, tobacco, edible as well as non-edible oils is agriculture. Moreover, many other industries such as the processing of fruits as well as vegetables and rice husking get their raw material mainly from agriculture.
Significance in Transport
The bulk of agricultural products are transported by railways and roadways from farms to factories. Mostly, internal trade is in agricultural products. Moreover, the revenue of the government, to a larger extent, relies on the success of the agricultural sector.
Foreign Exchange Resources
The nation’s export trade depends largely on the agricultural sector. For example, agricultural commodities such as jute, tobacco, spices, oilseeds, raw cotton, tea as well as coffee accounts for approximately 18% of the entire value of exports of a country. This demonstrates that agricultural products also continue to be an important source of earning for a country’s foreign exchange.
Great Employment Opportunities
Construction of irrigation schemes, drainage systems as well as other such activities in the agricultural sector is important as it provides larger employment opportunities. The agriculture sector provides more employment opportunities for the labor force. This, in turn, reduces the high rate of unemployment in developing countries caused by the fast-growing population.
Since agriculture employs many people, it contributes to economic development. As a result, the national income level, as well as people’s standard of living, is improved. The fast rate of development in the agriculture sector offers a progressive outlook as well as increased motivation for development. Hence, it aids to create a good atmosphere for the overall economic development of a country. Therefore, economic development relies on the agricultural growth rate.
Source of Saving
Development in agriculture may also increase savings. The rich farmers we see today started saving particularly after the green revolution. This surplus quantity may be invested further in the agriculture sector to develop the sector.
A stable agricultural sector ensures a nation of food security. The main requirement of any country is food security. Food security prevents malnourishment that has traditionally been believed to be one of the major problems faced by developing countries. Most countries rely on agricultural products as well as associated industries for their main source of income.
Heal The Environment
Agriculture possesses the power to harm or heal. When farmers prioritize biodiversity on their land, it benefits the earth. Having more biodiversity results in healthier soil, less erosion, better water conservation, and healthier pollinators. This is all good news for the environment as a whole, making agriculture an important part of the cycle of life.
Goes Hand-In-Hand With War
Agriculture is such an important part of a country’s infrastructure, it makes sense it would impact conflicts and war. Throughout history, the need for land to grow food fueled many conflicts. In more modern times, specifically WWI, America’s farming industry boomed because they needed to supply Europe with agricultural products. For countries that don’t have assistance, war can break down the agricultural sector, affecting people for decades to come. When discussing agriculture, it’s impossible to not at least mention its connection to the conflict.
Drives Innovation In Technology
Because healthy agriculture is so essential to a country’s well-being, it’s been the setting of some of the most exciting innovations in technology. Through artificial intelligence, blockchain software, gene manipulation, and more, scientists and farmers have been figuring out ways to increase crop productivity, use less water, and reduce negative impacts on the environment. For scientists and tech companies, agribusiness is one of the most fascinating and productive fields to work in.
State of Agriculture Reflects Our Future
When it comes to pollution and climate change, the environment and agriculture suffer the quickest and with the clearest consequences. If effective changes aren’t made, climate change’s impact on agriculture will decimate a country’s economy and eventually wipe out the food supply. To get a better idea about where humanity is going to end up, look at agriculture. What’s being done to adapt to a rapidly changing climate? What will our food supply look like? The state of agriculture is a good litmus test of what we can expect the future to look like.
Importance of Agriculture In Everyday Life
There are several ways agriculture impacts people’s lives every day. It’s an important industry, if not the most important in some regard. The agricultural sector, which includes crops and livestock, produces most of the world’s foods and raw materials.
Agriculture impacts our lives in critical ways that it’s difficult to imagine a world without it. If you don’t think it impacts your life, think again. Agriculture plays a key role in your:
Sure, you may not own a farm or livestock, but agriculture still impacts your entire family. This trickles down to how you feed your family, where the food comes from, how you clothe them, and where those fabrics and other raw materials come from. If it wasn’t for agriculture, it would be impossible, or almost impossible to sustain yourself and your family.
According to the US Department of Agriculture, food and its related industries, all contribute over $1 trillion to the country’s GDP. This vast industry also provides US citizens with over 22 million full-time and part-time jobs. Whenever the ag sector is able to meet the supply and demand curve for food and other agricultural products, their prices go down.
Most crops are always grown for food and for their raw products. However, the health sector benefits from agriculture just as much. Some crops are grown more for their minerals and other nutrients they are rich in. Other plants are grown specifically for medicinal purposes like the yarrow, plantain, sage, elder, and common mallow. Most farmers also grow fruits and vegetables, which are excellent for maintaining a healthy diet and adding vital nutrients to the body.
The importance of agriculture to the community cannot be overstated. For one, it creates jobs for members of the community, boosts the community’s economic growth, sustains the community by the food source, and other raw materials. Basically, agriculture has more positive impacts on the community than most people fathom.
- Cervantes-Godoy, D., & Dewbre, J. (2010). Economic importance of agriculture for poverty reduction.
- Agriculture Goods
- The Important Site
- Imp Off
- World Bank
Useful Article: Which of The Following Is Not A Goal of Sustainable Agriculture?