Prelims 2020

Q. In India, which of the following can be considered as public investment agriculture?

1.Fixing Minimum Support Price for agricultural produce of all corps
2.Computerization of Primary Agricultural Credit Societies
3.Social Capital development
4.Free electricity supply to farmers
5.Waiver of agricultural loans by the banking system
6.Setting up of cold storage facilities by the governments

Select the correct answer using the code given below :
a) 1, 2 and 5 only
b) 1, 3, 4 and 5 only
c) 2, 3 and 6 only
d) 1, 2, 3, 4, 5 and 6
Correct Answer : c) 2, 3 and 6 only

Question from UPSC Prelims 2020 GS Paper


Public Investment in Agriculture

1. Fixing Minimum Support Price (MSP) for agricultural produce of all crops: While MSP is a crucial policy tool for ensuring farmers get a minimum price for their produce, it is not a direct investment in agricultural infrastructure or services. It’s more of a price support mechanism.

2. Computerization of Primary Agricultural Credit Societies (PACS): This is a direct investment in improving the efficiency and reach of financial services to farmers. By computerizing PACS, the government or public sector is directly investing in the agricultural sector’s infrastructure, making it easier for farmers to access credit and other financial services.

3. Social Capital Development: This involves investments in community-building activities, training, and development programs that enhance the social infrastructure within rural and farming communities. It’s a form of public investment aimed at improving the social fabric and cooperative capabilities among farmers, which indirectly supports agricultural productivity and sustainability.

4. Free Electricity Supply to Farmers: While providing free electricity can significantly reduce the operational costs for farmers, especially those relying on irrigation, it is more of a subsidy than a direct investment in agricultural infrastructure or services.

5. Waiver of Agricultural Loans by the Banking System: Loan waivers provide immediate financial relief to indebted farmers but do not contribute to the development of agricultural infrastructure or services. Like subsidies, they are financial support mechanisms rather than investments in the sector’s growth or efficiency.

6. Setting up of Cold Storage Facilities by the Governments: This is a clear example of public investment in agriculture. By establishing cold storage facilities, the government directly invests in the agricultural supply chain infrastructure, reducing post-harvest losses, and improving the marketability of agricultural produce.

Therefore, options 2 (Computerization of PACS), 3 (Social Capital Development), and 6 (Setting up of Cold Storage Facilities) are direct forms of public investment in agriculture, focusing on building or enhancing the sector’s infrastructure and services.

More Questions:
UPSC Factory App
Get everything you need for upsc preparation with just one click! Install now!