Since this was the period of food shortage agriculture, including irrigation, was accorded top most priority during the first five year plan. Out of the total investment of Rs. I960 crore Rs. 610 crore or 31.1 % was allocated to agriculture sector (actual expenditure Rs. 724 crore or 37% of the plan out lay). As a result of it about 5 lakh hectares of land was reclaimed and brought under cultivation. Similarly about 57 lakh hectares of the agricultural area was brought under irrigation and the consumption of chemical fertilisers was doubled.
During this plan the agricultural growth rate was 2.8% and the index of agricultural production moved by 22%. The production of food grains increased from 50.8 million tons in 1950-51 to 65.8 million tones recording a growth of 29.5% while the output exceeded the plan targets in case of food grains and oil seeds but failed a little short in cash crops like sugarcane, cotton and jute. This agricultural development not only reduced the quantum of import of agricultural commodities but helped in arresting inflation and stabilizing the economy.