Economic Growth, Agriculture and Food Systems: Explaining Regional Diversity

Despite India’s per capita GDP doubling over the last decade, states like Goa compare to countries in Latin America, while states like Uttar Pradesh compare to low-income countries in sub-Saharan Africa in terms of their development outcomes. In this chapter, we identify that comparative advantages that arise due to resource availability, agro-climatic conditions, investments in human capital and the differential growth of the non-agricultural sector explain this subnational divergence. We show that states that continue to develop economic sectors in which they have no comparative advantages will remain locked into a low growth equilibrium. Reorienting agriculture based on comparative advantages in agricultural production, reducing entry barriers into the urban labor market and upskilling the rural and urban workforce are keys to develop equitable food systems for the future.