After slipping into the league of least-growing states in agriculture, Punjab has made a turnaround in the last two years with the advance estimates for 2008-09 putting the state's growth rate at 5.08 per cent.

The state, which registered a low 2.7 per cent growth rate during the 10th Five Year-Plan (2002-07), showed first signs of recovery in 2007-08 when it posted a 4.87 per cent growth rate.

While the buoyancy is a result of a number of factors ranging from record production of crops to increased investment in agriculture, the high minimum support price (MSP) for the main crops of wheat, paddy and cotton in the last two years has played the most determining role in the course correction.

The state produced 16.72 million metric tonnes (MT) of paddy and about 15.73 million MT of wheat in 2008-09, accounting for nearly 30 per cent and 45 per cent of total contribution to the central pool.

The high production, also a result of increase in the area under these crops by nearly one lakh hectares in case of paddy and 50,000 hectares for wheat coupled with good MSP of Rs 850 for paddy and Rs 1,080 for wheat, led to manifold increase in the net income from agriculture sector.

Though the area of cultivation under other crops such as cotton and sugarcane suffered last year from diversion towards more remunerative paddy, the MSP of Rs 2,800 per quintal for cotton offset the impact on the net income derived by the state from the crop.

... contd.