The Hindu Business Line : `Rural credit, transport vital for farm growth'

Addressing a two-day World Bank workshop inaugurated here today, Mr Mohan Nagarajan of the World Bank, said that with the rural sector contributing a major share of the State's economy, development of agriculture is vital for growth. Increasing farmers' income will also be critical to poverty reduction.

Diversification to high-value and less water-intensive crops, enhancing marketing efficiency, developing rural credit market and addressing inadequate transport networks are important for development of agriculture.

Despite being one of the driest States, water availability per capita is 900 cu m against 2,200 cu m for the rest of India, the water deficit State has allocated about 40 per cent of the gross cropped area to rice and sugarcane, two water intensive crops.

At present, the cost of water does not reflect the scarcity value of water, and the environmental costs are not accounted, Mr Nagarajan said.

Efficient water resource management calls for a State-wide strategic framework for inter-sectoral allocation of water resources, introduction of legally enforceable water entitlement for users in a river basin or aquifer, and allocating clear responsibilities for key institutions such as the river-basin management council, farmers water use associations, local governments and water resources organisation within the Public Works Department.

Tamil Nadu has a liberalised agriculture market among Indian States, he added.