A Causal Analysis of Agricultural Performance and Economic Growth in India

Abstract

The present study discusses the growth performance of agricultural and Economic Growth (GDP) in India. Close Relationship between agriculture performance and Economic Growth (GDP). Agriculture growth is one of the most important inputs for economic development. Agriculture production directly causes growth in GDP. Agriculture production plays an essential role in an economy on both demand and supply side. Economic growth in India has largely been associated with increasing Agriculture production. The causal relationship between agricultural performance and economic growth (GDP) in India were using time series from 1980 to 2014 were data gathered from (WB) world development indicator. The study were used Augmented Dickey Fuller (Dickey and Fuller, 1979) and to test for unit root and Granger model to test causality. On the other hand the causality relationships found that there unidirectional relationship were found between Agriculture performance and economic growth which is running from production to economic growth (GDP). Based on the findings, it is recommended that policies aimed at increasing the productivity of crops and Policy-makers should focus more attention to the Small and marginalized farmers. In this paper Granger causality tests were used to examine the relationship between growth performance of agricultural and Economic Growth (GDP).