UNCTAD’s World Development Report, 2008

World Development Report, 2008, entitled ‘‘Agriculture for Development’’ has been released by World Bank with a note that the agriculture and rural sectors have suffered from neglecting the investment over the past 20 years. The report calls for greater investment in agriculture in developing countries. The report warns that the sector must be placed at the centre of the development agenda if the goals of halving extreme poverty and hunger by 2015 are to be realized.

Some important conclusions of the report are—

• While 75 per cent of the world’s poor live in rural areas in developing countries, a mere 4 per cent of official development assistance goes to agriculture.
• In Sub-Saharan Africa, a region heavily reliant on agriculture for overall growth, public spending for farming is also only 4 per cent of total government spending and the sector is still taxed at relatively high levels.
• For the poorest people, GDP growth originating in agriculture is about four times more effective in raising incomes of extremely poor people than GDP growth originating outside the sector.

According to the report, a dynamic ‘agriculture for development’ agenda can benefit the estimated 900 million rural people in the developing nations who live on less than $ 1 a day, most of whom are engaged in agriculture and hence, the need of the day is to give agriculture more prominence across the board.

According to the report, agriculture can offer path-ways out of poverty if efforts are made to increase productivity in foods sector; connect smallholders to rapidly expanding high-value horticulture, poultry, aquaculture and dairy so as to generate jobs in the rural nonfarm economy.

The report also warns that global food supplies are under pressure from expanding demand for food, feed and biofuels; the rising price of energy and increasing land and water scarcity; as well as the effects of climate change. This in turn is contributing to uncertainty about future food prices.

Agriculture consumes 85 per cent of the world’s utilized water and the sector contributes to deforestation, land degradation and pollution. The report recommends measures to achieve more sustainable production systems and outlines incentives to protect the environment.

The report says that in agriculture-based countries (which home to 417 million rural people, 170 million of whom live on less than $ 1 a day) the agricultural sector is essential to overall growth, poverty reduction, and food security. Most of these countries are in Sub-Saharan Africa, where the sector employs 65 per cent of the labor force and generates 32 per cent of GDP growth. For Sub-Saharan Africa’s development, the report highlights issues to be urgently confronted: too little public spending on agriculture; donor support for emergency food aid with insufficient attention to income-raising investments; rich country trade barriers and subsidies for key commodities such as cotton and oilseeds; and the under-recognized potential of millions of women who play a dominant role in farming.

For transforming countries such as China, India and Morocco the report says that agriculture contributes on average only 7 per cent to GDP growth, but lagging rural incomes are a major source of political tensions. Dynamism in the rural and agricultural sectors is needed to narrow the rural-urban income gap and reduce rural poverty.