Why agriculture has lost the ability to be a source of subsistence for majority of farmers in India?

Agriculture has important role to play in Indian economy and society. Vibrant agriculture is necessary for ensuring food security, livelihood and as raw material to agro-processing sector.

Despite it being an important sector, it continues to be ridden by problems which have hampered its growth and ability to generate remunerative livelihood. Rising population has resulted in decline in land holding by farmers. Thus India currently has significant population of small and marginal farmers who hold 2-5 ha of land. Equitable and efficient distribution and utilisation of land has been hampered by failure of land reforms. Smaller land size restricts the possibility of mechanization to increase the yield and productivity.

Most of the farmers rely on informal credit arrangement to meet their operational credit requirement due to lack of access to formal credit system caused by absence of rural banking network, lack of land titles and documents. These informal credit arrangements have high interest rates sapping all the income and most of the times pushing them into trap of indebtedness. Farmers even end up losing their land to these lenders.

Public investment in rural areas has been low and whatever is spent has not resulted in development of rural infrastructure. Almost more than half of country lacks irrigation infrastructure. Irrigation is necessary to raise the productivity of dryland farming.

Climate change and intensive agriculture have deteriorated the natural resources such as soil, water etc and increased the risk from pests, extreme climatic conditions. Higher use of chemical fertilizers, pesticides is raising the cost of agriculture and further deteriorating the natural resources. In absence of an effective insurance mechanism against such risks, all the cost is borne by farmers.

In agricultural supply chain, forward linkage is weakened by poor physical infrastructure such as roads, inequitable distribution of cold storage facility, lack of market etc. Food processing industry is still nascent and anti –hoarding laws further act as deterrent. Marketing reforms under APMC act 2003 still eludes agricultural markets in most of the states. E-NAM was launched too promote price discovery and help farmers realize the value of their produce is still to take off. Absence of clear guideline on contract farming has been a hurdle to industry-farmer partnership.

Recent deaths of farmers in Yavatmal due to inhalation of toxic pesticides, is an example of gap in extension services. Research for the development of high yielding and climate resistant seed varieties, sustainable agricultural practices has been slow and inadequate.

Government policies in declaration and procurement of produce under Minimum price support, has fuelled growth of cereal centric agriculture. This has been a major factor behind depletion of resources, lack of diversification.

These factors have raised the input cost and risks in farming without adequately compensating the farmers for their produce. Agriculture has been losing its sheen world over, due to presence of other lucrative opportunities. FAO has mentioned that it is necessary to attract youth towards agriculture by making it a profitable industry.


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