role of small and medium farms in sustainable agricultural development in india

8/8/2019 Role of Small and Medium Farms in Sustainable Agricultural Development in India

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Role of small and medium farms in

sustainable agricultural developmentin India

M.D.Reddy

AICRP on Cropping Systems, College of Agriculture

Rajendranagar, Hyderabad, Andhra Pradesh, INDIA

1

Presented in "Study meeting on role of small and marginal farms in agricultural development in Asia andPacific. Tehran, 2-8 Nov 2002. Organized by Asian Productivity Organization, Tokyo"


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Agricultural holdings

ma , ragmen e , ca ere

All land that is used wholly or partly for agricultural

production and is operated as one technical unit by one

person alone or with other without regard to the title,

legal form, size or location.

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Table 1: Number and area of operational holdings in India

_____________________________________________________________________________

Number in millions Area in million hectares1970-71 1990-91 1970-71 1990-91 Av. Size

in ha ch

70-71 90-91

____________________________________________________________________________

Marginal holding 36 (51) 62 (58) 15 (9) 25 (15) 0.40

(Below 1 hectare)

Small holding 24 (34) 34 (33) 49 (30) 67 (41) 2.04

(1 to 4 ha)

. . .

(4 to 10 ha)

Large holding 3 (4) 2 (2) 50 (31) 29 (17) 18.09

(10 ha & above)

Total 71 (100) 106 (100) 162 (100) 166 (100) 2.28 1.57

______________________________________________________________________________

Note: Figures in parenthesis are percentages of total in the respective column

Source: Compiled from All India report on Agricultural Census (1976-77) and

Annual Report 1994-95, Department of Agriculture and Cooperation, GOI.Adopted from: Agricultural statistics at a glance (2002)

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Table 2: Distribution of irrigated / unirrigated area by major size-classes of operational

holding, 1990-91 (area in 000 ha)

________________________________________________________________________

Size Class Irrigated Un irrigated Total

________________________________________________________________________

Marginal 13282 (43) 17432 30714

Small 15901 25 48858 64759

Medium 14961 (32) 32021 46982

Large 6615 (25) 19328 25943

_________________________________________________________________________

Figures in paranthesis are per cent irrigated area to that of total area of the size class.

Source : Agricultural Census Division, Ministry of Agriculture, New Delhi

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Table 3: Usage of chemical fertilizers for crops in India by major size-class of holdings and by irrigation

status during 1991-92 Area : million ha

________________________________________________________________________

Size Groups (hectares) Gross cropped Area treated with N+P+K

area fertilizers million tons

________________________________________________________________________

. . .

(Below 1.00) U 16.45 7.44 (45) 0.66

T 29.48 18.76 (64) 2.13

Small I 28.06 24.25 (86) 3.14

(1.0-4.0) U 45.82 21.33 (47) 1.55

T 73.88 45.57 (62) 4.68

Medium I 15.26 13.33 (87) 1.67

(4.0-9.99) U 28.58 12.10 (42) 0.79

T 43.84 25.43 (58) 2.47

Large I 6.87 5.99 (87) 0.78

(10.0 and above) U 16.13 4.81 (30) 0.27

T 22.99 10.79 (47) 1.05

_________________________________________________________________________

Note: The sum of I (irrigated) and U (unirrigated) area may not exactly tally with T(total) area due t

rounding off.Figures in paranthesis are the per cent area treated with fertilizers.

Source : Agriculture Census Division, Ministry of Agriculture, New Delhi.

Adopted from: Agricultural statistics, at a glance (2002).

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Agricultural credit

Non-Institutional - Mone lenders traders relatives

Institutional - Commercial banks, Regional rural

banks, Cooperative credit institutions, Government

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Table 4: Sources of Agriculture Credit (Per cent)

____________________________________________________________

S.No. Source 1951-52 1960-61 1994-95

____________________________________________________________1. Money lenders 69.7 49.2 7

. . .

3. Relatives 14.2 8.8 3

4. Co-operatives 3.1 15.5 34. overnment . .

6. Commercial and 0.9 0.9 35

Rural Banks

7. Others 3.3 14.2 11

____________________________________________________________

Source: Annual Report of National Bank for Agriculture & Rural

Development (NABARD), 20007


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Table 5: Source wise direct institutional finance for agriculture

and allied activities.

____________________________________________________________

,

Cooperative Commercial RRBs Govt. Million

Banks

____________________________________________________________

1990-91 47.3 45.9 3.3 3.5 101877

1991-92 50.2 41.7 5.2 2.9 115375

1992-93 51.8 39.6 5.6 3.1 125298

1993-94 56.5 36.0 5.0 2.5 150130

- . . . .

1995-96 51.9 39.8 5.9 2.4 323879

1996-97 49.1 41.9 6.9 2.2 254987

____________________________________________________________

Source: Reports of Currency and Finance, RBI, 1994-95 to 1997-98 8


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Table 6: All India estimates of institutional credit taken for agricultural purposes from various

sources by major size-class of holdings during 1991-92

Number in 000 : Amount in millions/Rs____________________________________________________________________________

Sl. Size Class Total number Estimated number No.of operational Amount of

No. (Hectares) of operational operational holdings that took institutionalholdings holdings that credit credit taken

took institutional

credit____________________________________________________________________________

1.Marginal 56610 8874 9475 11005(Below 1.00) (15.6)

2. Small 33692 6524 7333 200571.00-4.0 19.4

3. Medium 7217 1620 1768 9581(4.00-10.0) (22.4)

4. Large 1543 347 394 4010

. .______________________________________________________________________________

Note: The sum of individual size-classes may not exactly tally with All Sizes due to rounding offFigures in parenthesis are the per cent of farmers in the size class took credit

Source: Agricultural Census Division, Ministry of Agriculture, New Delhi.

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Existing Institutional Credit - PACS

Cooperative Societies - 0.35 millionsMembers - 180 million

Working capital - Rs.760000 crores (1 crore = 10 million)

san cre t car s - . m on car s ct

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Economic factors - cropping pattern

Farm size

nsurance aga ns r s

Availability of inputs Tenure

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-economic relations

Farmers having < 1 ha

Land and lease by small and marginal farmers

Farmers with 4 ha or more

armers w t a or more

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Modern agricultural technology

Three kinds of conflicts

Large and small farmers

wners an enan armers

Employers and Employees on agricultural farms

Agriculture and employment

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Literacy

Small and mar inal farmers - illiterate

Large farmers - more literateHeavy investments in inputs

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Government Pro rammes

SFDA, MFAL, ITDPIRDP, DPAP, CADP etc

Creation of material status for small and marginalfarmers

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Table 7 : Net availability of cereals and pulses (5-yearly annual average)

______________________________________________________________________________

Per Capita

Net Availability, g day-1

Cereals Pulses Total

______________________________________________________________________________

1950-51 to 1955-56 354.1 64.7 418.8

1956-57 to 1960-61 372.7 68.2 440.9

1961-62 to 1965-66 400.4 60.7 461.1

1966-67 to 1970-71 385.3 48.6 433.9

1971-72 to 1975-76 398.7 43.9 442.6- o - . . .

1981-82 to 1985-86 416.8 39.3 456.1

1986-87 to 1990-91 433.9 40.0 473.9

1991-92 to 1995-96 446.9 37.5 484.4

1996-97 to 1997-98 498.9 35.6 534.5

______________________________________________________________________________

Note: Net production has been taken as 87.5 per cent of the gross production, 12.5 per cent

being provided for seed, feed requirement and waste.

Sources: Compiled and Computed from data provided by Government of India, Economic Survey

(1997-98) S 24. 16


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Table 8 : Share of agricultural sector in total gross domestic

product at factor cost (at 1980-81 prices) Rs. Crores*.

Year Agriculture Total 1 as % of 2

- , , .

1960-61 31,995 62,904 52.5

- , , .

1980-81 46,649 1,22,427 38.1

1990-91 65 653 2 21 253 30.9

1996-97 77,564 2,96,845 26.1

* 1 Crore = 10 millions

Note: Agriculture includes agriculture, forestry and fishing

Source: Compiled from National Accounts Statistics (1998) and Agricultue

at a Glance (1998) 17


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Table 9 : Growth in Production of principal crops since Independence (1950-98)

______________________________________________________________________________Annual rate of

Production, million t growth (%)1949-50 1964-65 1997-98 1949-50

to to- -

______________________________________________________________________________

1. All food grains 55 89 193 3.2 2.4of which

Rice 24 39 82 3.5 2.6Wheat 6 12 66 4.0 5.9

Coarse cereals 17 25 31 2.2 0.3Pulses 8 12 14 1.4 0.3

2. All non-. .

of which

Oilseeds 5 9 24 3.3 2.8Sugarcane 50 122 278 4.3 2.8

Cotton* 3 6 14 4.6 2.0Potato 2 4 24 4.3 5.1

______________________________________________________________________________*million bales of 175 kg each

Source: Economic Survey (1998-99)

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Table 10: Trend in the roduction of food rains in India

_________________________________________________________________ _

Year Production, million tons__________________________________________________________________1970-71 108

1972-73 95-

1979-80 1081990-91 176

1996-97 199

1997-98 194_________________________________________________________________

Source: Economic Survey (various issues)

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Table 11: Growth of the agricultural sector since 1950-51

________________________________________________________________________

Period Compound annual rate

of growth (%)________________________________________________________________________

1951-61 3.3

1961-71 2.2

1971-81 1.7

1981-91 3.9

1991-97 2.8

1971-97 2.8________________________________________________________________________

Source : 1. CMIE, Basic Statistics Relating to Indian Economy

Vol. I, August 1992, August 1994.

2. Economic Survey, 1997-98.

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Table 12: Gross capital formation in Indian agriculture (Rs. In Crores at 1980-81 prices)

_____________________________________________________________________

Year Total Public sector Private sector

_____________________________________________________________________

1970-71 2758 (16.7) 789 (11.3) 1969 (20.6)

1974-75 2975 (14.4) 919 (10.5) 2056 (17.2)

1979-80 5215 (19.1) 1772 (13.5) 3443 (24.1)

1980-81 4636 (18.0) 1796 (15.3) 2840 (20.2)

1984-85 4539 (13.7) 1674 (9.4) 2875 (12.6)

1989-90 4353 (9.8) 1156 (5.6) 3197 (13.5)

1990-91 4594 (9.2) 1154 (5.3) 3440 (12.2)1994-95 6256 (8.8) 1316 (5.3) 4940 (10.6)

1995-96 6961 (9.1) 1268 (5.5) 5693 (10.6)

1996-97 6999 (9.4) 1132 (4.9) 5867 (11.5)

_____________________________________________________________________Compound growth 2.55* 0.52 NS

rate (1970-71 to

1996-97) (CGR)

Figures in parenthesis are per cent of gross capital formationSource: Ravi kumar etc. al 2000

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Table 13 : Gross investment in agriculture (at 1980-81 prices)

_____________________________________________________________________% Share

Year Public Private Total Public Private_____________________________________________________________________

-1970-71 790 1970 2760 29 71

1980-81 1800 2840 4640 39 611990-91 1150 3440 4590 25 75

1996-97 1130 5870 7000 16 84______________________________________________________________________

ource : conom c urvey - .

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Table 14 : Agricultural performance in pre and post macro reform periods

_______________________________________________________________________S.No. Details Pre-reform Post-reform

period of period of

- -

_______________________________________________________________________1 Food grains production index (per 3.13 2.24

cen per annum

2 Non-food grains production index 4.10 2.63

(per cent per annum)3 Agricultural production index 3.49 2.40

(per cent per annum)

4 NDP from agriculture in real terms 3.33 2.97

(per cent per annum)5. Ratio of index of wholesale prices of 108.00 116.00

agricultural to that of manufacturing (0.65) (1.32)

_______________________________________________________________________

Figures in parenthesis are annual compound growth rates 23


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Strategy used in agriculture

Five year plans

Objectives

To increase agricultural production and employment

To reduce pressure of population on land and inequality of

Strategy

IADP, HYVP Heavy investment

Seeds, Fertilizers, Pesticides and Water

Scientific knowledge based technical change (green

revolution

New dry land farming technologies24


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tion l ric lt r l olic - 2

A rowth rate in excess of 4 ercent er annum in the

agriculture sector; Growth that is based on efficient use of resources and

conserves our so , water an o- vers ty;

Growth with equity, i.e., growth which is widespread

across re ions and farmers

Growth that is demand driven and caters to domestic

markets and maximizes benefits from exports of

agr cu tura pro ucts n t e ace o t e c a enges ar s ngfrom economic liberalization and globalization;

environmentally and economically.25


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Agricultural technology generation

Indian Council of Agricultural Research (ICAR)

Research infrastructure

Evolving new location specific and economically viable

Conservation of germplasm

-

Technology transfer

NATP

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WTO - India

Flexibility in domestic agricultural policies

Net export of food grains

Fluctuations in post harvest prices

a ty o n an agr cu ture

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role of small and medium farms in sustainable agricultural development in india

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