Indian Agricultural Output in 2025

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Strong Output, But Income Pressures Remain

India is expected to record its highest-ever foodgrain production in 2025-26, supported by good monsoon conditions and higher sowing across both kharif and rabi seasons. Rice, wheat, pulses, and maize performed well overall.

However, uneven rainfall has damaged crops in some regions, and farm income growth has not kept pace with production growth. This gap between output and earnings remains a key concern for the sector.

GST Relief and Continued Government Support

A significant positive in 2025 was the reduction in GST on key farm inputs, including tractors, harvesters, irrigation equipment, and select bio-pesticides. This lowered machinery and input costs and supported demand for farm equipment.

Budgetary support continued through crop insurance, fertiliser subsidies, MSP increases, interest subvention, and direct income transfers. Together, these measures helped reduce cost pressures, although challenges remain for small and tenant farmers.

Export Disruptions and Market Diversification

US tariffs disrupted exports of several farm and food products, leading to order cancellations and margin pressure. In response, exporters shifted focus to non-US markets, which helped stabilise overall export growth.

Later exemptions for many food items provided some relief, underscoring that diversification is increasingly vital for export resilience.

Regulation, Climate Risks, and What Lies Ahead

Concerns about counterfeit fertilisers, pesticides, and poor-quality inputs led to tighter regulation in 2025, with more rigorous enforcement promised going forward. Climate risks, post-harvest losses, and fragmented landholdings remain structural challenges.

As 2026 approaches, attention is on new seed law and pesticide law, which are expected to play a key role in improving input quality, farmer confidence, and long-term productivity.

Data Legend (2025 Snapshot)

Foodgrain production (2025): 357.73 million tonnes
Projected kharif output (2025-26): 173.33 million tonnes
Rice output (projected): 124.5 million tonnes
Maize output (projected): 28.3 million tonnes
Rabi sowing (19 Dec, 2025): 659.39 lakh hectares
Wheat: 301.63 lakh hectares
Pulses: 126.74 lakh hectares
GST on key farm inputs: Reduced from 18% to 5% (effective 22 Sept, 2025)
Estimated savings on tractor purchases: INR 50,000 - INR 1 lakh
India’s agri exports (Apr-Sep 2025): ~9% YoY growth
US agri exports exposure: USD 5-6 billion annually
Agriculture budget (2025-26): INR 1.37 lakh crore
PM-KISAN cumulative disbursement: INR 3.75 lakh crore
PM Dhan-Dhaanya Krishi Yojana: INR 35,000+ crore; 100 low-productivity districts; ~1.7 crore farmers
National Pulses Mission: INR 11,440 crore

(Source: Agriculture Ministry, GST Council, APEDA, NITI Aayog, PTI)

DhruvStar Industry Insights: What It Means for the Agriculture Sector

1) Productivity Alone Is No Longer the Constraint

Researchers, policymakers, and agribusinesses may note that income stress persists despite record output, underscoring the need for stronger market access, value addition, and price risk management alongside productivity gains.

2) Input Regulation Is Becoming a Core Policy Lever

Agri-input firms and state agencies may wish to prepare for stricter enforcement of regulations governing seeds, fertilisers, and pesticides, with compliance, traceability, and quality assurance becoming central to market credibility.

3) Export Strategy Needs Built-In Diversification

Exporters and commodity boards may increasingly prioritise diversified markets and trade-risk hedging, as tariff shocks have shown that dependence on single destinations can quickly translate into income volatility.

Sources

[1] The Economic Times

Contact: dhruvstar.research@gmail.com

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