Despite the implementation of the Green Revolution, about 65 per cent of India's population continued to be engaged in the agriculture sector till 1990. The primary reason was that the industrial sector and the service sector did not absorb the people working in the agricultural sector.

The Green Revolution led to a significant increase in agricultural productivity and enabled India to achieve self-sufficiency in food grains by the late 1960s. The use of high yielding variety (HYV) seeds for wheat and rice, along with fertilisers, pesticides, and regular water supply, increased output substantially. This meant that agricultural output could have grown with much fewer people working in the sector.

However, the surplus labour from agriculture was not absorbed by other sectors of the economy. Between 1950 and 1990, while the proportion of GDP contributed by agriculture declined significantly, the proportion of population depending on agriculture only marginally decreased from 67.5 per cent to 64.9 per cent.

Many economists consider this an important failure of policies followed during 1950-1990. As a nation becomes more prosperous, typically both the proportion of GDP and population in agriculture decline considerably. In India's case, this expected structural transformation did not occur.