Agriculture Is Still the Engine of Economic Growth: Empirical Evidence from Uttar Pradesh, India

This paper assesses intersectoral linkages in Uttar Pradesh to identify the lead sector in its economy. It is based on time series data spanning 1980/81 to 2009/10 and used the vector autoregression framework to examine intersectoral linkages. The results suggest that agriculture is the main sector driving the other sectors (industry and services) in the state. Agriculture supports both the industry and service sectors through demand and production linkages. Despite being the leading sector in the economy, the performance of agriculture is far from satisfactory. The findings underscore the need to revive the agriculture sector to achieve high economic growth in the overall economy of the state. Further, the paper recommends developing the emerging food processing industry because of the state's strong potential for competitive advantage.