The note deals with issues which are often discussed in terms of a false dichotomy of agriculture versus industrial development. Though economic development leads to a decline in the relative importance of the agricultural sector, it plays a crucial role in the process of developing an underdeveloped country by making some major contributions. These contributions are in terms of supplying agricultural products, earning foreign exchange, releasing labour force for the non-agricultural sector, making a net contribution to the capital formation, providing a stimulus to industrial expansion.