Contribution of agriculture in the economy of Bangladesh

The economy of Bangladesh is primarily dependent on agriculture. About 84 percent of the total population live in rural areas and are directly or indirectly engaged in a wide range of agricultural activities. The agriculture sector plays a very important role in the economy of the country accounting for 31. 6 percent of total GDP in 1997-98 at constant (1984-85) prices. The agriculture sector comprises crops, forests, fisheries and livestock. Of the agricultural GDP, the crop sub-sector contributes 71 per cent, forest 10 per cent, fisheries 10 percent and livestock 9 per cent.

The sector generates 63. 2% percent of total national employment, of which crop sectors share is nearly 55 %. Agricultural exports of primary products constituted 10. 4% of total exports of the country in 1997-98. In the past decade, the agriculture sector contributed about three percent per annum to the annual economic growth rate. The agriculture sector is the single largest contributor to income and employment generation and a vital element in the country’s challenge to achieve self-sufficiency in food production reduce rural poverty and foster sustainable economic development.

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The Government has therefore accorded highest priority to this sector to enable the country to meet these challenges and to make this sector commercially profitable. Agriculture has been playing a vital role in socio-economic progress and sustainable development through upliftment of rural economy, ensuring food security by attaining autarky in food gains production, alleviation of poverty and so on. In FY-2004-05, the combined contribution of all sub-sectors of agriculture (crop, livestock, forestry and fisheries) to GDP is 21.

91 percent (table 7. 2). The crop sub-sector alone is projected to contribute 12.

10 percent to GDP and fisheries sub-sector accounts for 5. 03 percent. Of the total labor force in Bangladesh, 5. 17 percent are engaged in agriculture (BBS labor force survey, 2002-2003). The contribution of agriculture products (including raw jute, jute goods and tea) to the total export of the country is 5. 79 percent (FY2004-2005). In terms of value addition, the contribution of agriculture to the national economy is immense. Contribution of agriculture in GDP.

Declining trend of contribution of agriculture sector to the Gross Development Products (GDP) continued in the present outgoing fiscal year. The growth of agriculture sector in the GDP has also gone down drastically in the last three years. National Economic Survey 2004 showed despite rise in crop production by six lakh metric ton and Taka 300 crore allocation for agricultural subsidy in the fiscal year for 2003-04, the contribution of agriculture sector in GDP has declined by 0. 54 percent from the last year. (2002-2003).

After the fiscal year 2000-01, crop production did not witness any significant growth in the last three years like the growth during 1996-97 - 2000-01. Due to high volume of crop production, total food production rose to 267. 57 lakh metric tons in the FY 2001-01 from 203. 37 lakh metric tons. Even in the year of severe flood in 1998, food production increased by 12 lakh metric tons. Financial Year Contribution of Agriculture 1991-92 28. 70 1992-93 28. 21 1993-94 27. 30 1994-95 26. 02 1995-96 25. 68 1996-97 25. 87 1997-98 25. 34 1998-99 25. 28 1999-00 25. 58 2000-01 25. 02.

2001-02 23. 98 2002-03 23. 47 2003-04 23. 08 2004-05* 21. 91 Fig 1: Contribution of Agriculture in GDP In the last two fiscal years, the food production has gone down from the level in the Fiscal Year 2000-01 (FY '01). Though the growth was slightly over one percent this year compared to last year, experts think that the growth was not sufficient in the last three years. Food production rose to 273 lakh metric tons in the current fiscal year (2003-2004). Growth rate in agriculture sector has gone down to 2. 41 percent in the FY 2003-04 from 5. 5 percent in the FY 2000-01.

Agriculture growth had witnessed a negative growth of about 0. 6 percent in the following fiscal year 2001-2002. Fig: Growth of Agriculture. In the last five years, the highest growth of 6. 9 percent in agriculture sector was achieved during 1999 - 2000 when the growth in crop production was 8. 1 percent. During the year of negative growth, individual growth in crop production was also negative - 2. 4 percent. Comparatively, when the growth in agriculture sector was the highest during 1999-2000, crop production was also the highest in the last 10 years.

In that year, crop production had yielded 8. 1 percent growth. Growth in crop production was much higher during FY '00 and FY '01 in the last 10 years. During the FY '01, the growth in crop production was 6. 2 percent. Even in the year of severe flood, growth in crop production was 3. 1 percent. During FY '94, FY '95 and FY '96, the growth in agriculture sector was -0. 7 percent, -1. 9 percent and 2 percent. In FY '97, production started to rise and achieved 5. 6 percent in that year with 6. 4 percent growth in crop production.

The trend of food production in the last ten years as charted in the Bangladesh Economic Survey 2004 has projected that food production was stagnating around 190 lakh metric tons from FY '94 - FY '96. But from FY '97 to FY '01, food production had increased from 203 lakh metric tons to 267 lakh metric tons. Contribution of Agriculture sub sector on GDP of Bangladesh Total agriculture sector is explained under four sub-sectors.

They are- Growth rate in Agricultural Sector (In percentage) Budget Year Agriculture &Forestry Average Fishery Average 1991-92 1. 39 0. 44 8. 24 7. 76 1993-94 -0. 65 0. 44 7. 91 7. 76 1994-95 -1. 93 0. 44 6. 79 7. 76 1995-96 2. 03 0. 44 7. 39 7. 76 1996-97 5. 57 4. 58 7. 67 6. 18 1997-98 1. 63 4. 58 8. 98 6. 18 1998-99 3. 24 4. 58 9. 96 6. 18 1999-00 6. 92 4. 58 8. 87 6. 18 2000-01 5. 53 4. 58 -4. 53 6. 18 2001-02 -0. 62 1. 67 2. 22 2. 92 2002-03 3. 29 1. 67 2. 33 2. 92 2003-04 4. 38 1. 67 3. 09 2. 92 2004-05 -0. 37 1. 67 4. 02 2. 92 Contribution of each sub-sector in the economy of Bangladesh is discussed below.