India : Papers on demand and supply prospects for agriculture.

This paper reports a set of demand projections for agricultural commodities in India. The main objective was to assess the effects of Income growth, population growth and other non-price variables on the future pattern of consumption of agricultural commodities in India. A second objective was the development of a projection model that would be compact, flexible and fully documented. The model should be capable of projecting demand for any number of commodities and future time periods in a single pass with a minimum of file manipulation. It should also readily accommodate altered assumptions regarding urbanization, expenditure growth, income redistribution and population growth. The resulting model is documented separately. 1/

The 28th Round of the National Sample Survey (1973/74) is the most recent large-scale expenditure survey available. The 32nd Round (1977/78) is also directed to household expenditures, but it has not yet been released. Restricted to this data base, the projections assume relative prices are constant, and model only the demand side of the market. Projections for 17 commodities at five year expenditure elasticities, and calorie demand per capita are presented and compared with other research. Changes in income distribution and consequent effects on demand received particular attention. 2/ Sensitivity analysis was performed on expenditure and population growth, expenditure distribution, and urbanization. As a final step in sensitivity analysis. estimates were made of the elasticities of future demand with respect to key assumptions.