The Survey cautioned that the government's role was important for not only raising public investment but also for inducing private investment for boosting growth in agriculture.

The Survey noted that the worrying aspect was that growth rate in agricultural investment rose only for a decade following the green revolution in early 70s and thereafter declined. In recent years though, some buoyancy has been observed in private investment in agriculture which has been steadily increasing from Rs 2840 crore (at 1980-81 prices) in 1980-81 to Rs 3440 crore in 1990-91 and Rs 5867crore in 1996-97.

The rising trend in private investment reflected the improved incentives for agriculture, especially arising from favourable changes in trade policy, the survey noted.

But defending the cause for decline in public investment in agriculture in real terms at 1980-81 prices to Rs 1132 crore in 1996-97, the survey attributed the decline to the diversion of resources from investment to current expenditure. A large portion of public expenditure on agriculture in recent years went into current expenditure in form of increased output and input subsidies.

The Eighth Plan had stipulated that the level of investment in agriculture should be raised to at least 18.7 per cent of total investment. However, it could at best reach only 11 per cent of the total investment. As much as the creation of irrigation potential in the Eighth Plan period has fallen short of target in spite of efforts to reverse the trend by introducing accelerated irrigation benefit programme (AIBP) in 1996-97, the surveynoted.

It stated that due to shorter gestation period and relatively lower investment levels, preference was given to minor irrigation schemes covering both surface and ground water. While ground water scheme included dugwells, shallow tubewells and pumpsets, the surface water schemes included tanks and reservoirs diversion schemes and lift irrigation from rivers and streams.

But the survey cautioned in this connection and said that increased fresh water demand in rural and urban areas was already creating acute pressure on water resources. Wastage of fresh water in irrigation system and on farm lands needed to be reduced through improved water management practices. Rivers, lakes and estuaries are faced with high degree of pollution. Concern for water quality needed to be given adequate priority in water resources development and management policy.

Commenting on the choked flow of credit to the agriculture sector, the survey noted that the serious problem of overdues had dampened the flow of creditbesides affecting adversely the economic viability of lending institutions, especially the cooperatives and regional rural banks.