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Interdendency between agriculture and manufacturing industries

Both agriculture and industry are interdependent in the following ways:
Contribution of Agriculture to Industry
  • Supply of wage goods to the industrial sector: Industrial sectors consume various wage goods for the production of industrial goods from the agricultural sector.
  • Supply of raw materials to agro-based industries: Indian agriculture also supplies necessary raw materials to many of the agro-based industries.
  • Supply of labour force to the industrial sector: To a great extent, industrial workers hail from the agricultural sector as there remains an excess supply of labour. It is also the source of cheap labour for the industrial sector. 
  • Creation of market for industrial goods: Indian agriculture provides a large market for a variety of industrial goods
  • Source of domestic capital for industrial development: Income of the rural people is very low. However, if their savings are mobilised properly, it can be a source of capital for industrial development.
Contribution of Industry to Agriculture
  • Supply of inputs for the advancement of cultivation techniques: Advancement in cultivation techniques and the productivity of land and agricultural labour depend to a large extend on the adoption of pump sets, power-tillers, tractors and chemical fertilisers which are supplied by the industrial sector. 
  • To provide employment opportunities to the rural people: Expansion of various small-, medium- and large-scale industries and village and cottage industries creates sufficient employment and income opportunities among the rural people.

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