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LATEST NEWS UPDATES | Indian agriculture's problem of scale

Indian agriculture's problem of scale

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published Published on Oct 7, 2018   modified Modified on Oct 7, 2018
-Livemint.com

Loan waivers and electricity subsidies are band-aids at best; a deeper transformation is needed

The past few days have neatly summed up the scale and nature of the challenges facing India’s agriculture sector. First, the provisional agriculture census 2015-16 showed that landholdings have continued their decades-long trend of fragmentation, leading to a further rise in the proportion of small and marginal farmers. Then, 30,000 farmers, who had started their march from Uttarakhand last month, reached the national capital on Tuesday, demanding various relief measures. As a real world demonstration of the challenges posed by farm fragmentation, it could not have been better timed.

When the census, carried out every five years, started in 1970-71, it had reported that India had 71 million landholdings. These have more than doubled now to 146 million. Over 86% of cultivated farmland is held by small and marginal farmers who own less than two hectares, while only 0.57% farmers hold 10 hectares or more. Consequently, the average size of operational holdings has more than halved since the first census—from 2.28 hectares to 1.08 hectares.

Farmers consigned to subsistence farming by this fragmentation—that is, the vast majority of them—are unable to generate enough surplus for the investment needed to improve productivity. This is widely accepted. But the policy approach to the problem depends on how the specifics are diagnosed.

In his famous 1962 The Economic Weekly (later renamed to the Economic and Political Weekly) article, “An aspect of Indian agriculture”, Amartya Sen had argued that small farms have higher per-acre output. A number of economists in the 1960s and 1970s drew similar conclusions. Ramesh Chand, P.A. Lakshmi Prasanna and Aruna Singh had presented an intriguing update of this argument in 2011 in Farm size and productivity: Understanding the strengths of smallholders and improving their livelihoods. Cobbling together data from the National Sample Survey Organisation, agriculture census and the Union ministry of agriculture’s input survey, they found that the inverse relationship between farm size and per-hectare agricultural productivity still holds.

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Livemint.com, 4 October, 2018, https://www.livemint.com/Opinion/AWOJfzdPGOL1kPNifewYcI/Opinion--Indian-agricultures-problem-of-scale.html


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