Farming Has Lost the Ability to Be a Source of Subsistence for the Majority of Farmers in India

In its survey of agricultural households for 2012 and 2013, the National Sample Survey Office found that the average Indian farm family earned about six thousand four hundred rupees a month, from all sources taken together. Of this, less than half came from cultivation. The rest came from wages, livestock and non farm work. Behind the figure lay a simple fact, that the typical farm was about one hectare in size. No one can feed a family of five from a plot that small. The topic claims that farming has lost its ability to be a source of subsistence for most farmers, and the numbers lend it a good deal of support.

Agriculture still employs about half of India's workforce, but produces only about a sixth of its national output. The mismatch means that the average farm worker earns much less than people in other sectors. The Agricultural Census of 2015 and 2016 found that about eighty six per cent of holdings were small or marginal, below two hectares, and the average size had fallen from over two hectares in 1970 to about one hectare, as land was divided among sons in each generation. A family on one hectare, even with a good yield, cannot earn enough for a decent life.

Costs and risks have grown. After the Green Revolution of the 1960s, yields rose through high yielding seeds, fertilisers, pesticides and irrigation, but these inputs cost money. Farmers who once relied on their own seeds and cow dung now buy from the market. Diesel for pumps, electricity, tractors and hired labour have all become dearer. Output prices, by contrast, have been volatile, and in years of good harvests prices collapse. Onion and tomato growers have dumped crops on roads when markets paid less than the cost of transport. Droughts and floods make the picture worse, and crop insurance has reached only a fraction of the farmers who need it.

Debt follows. A farmer who borrows from a moneylender at high interest to buy seeds or to marry a daughter may find that a single poor harvest drives him into a spiral. Studies show that roughly half of agricultural households are in debt, and many of the loans are from informal sources. The National Crime Records Bureau reported more than eight thousand suicides among farmers in 2015. The figure is disputed and categories change, but few doubt that distress is widespread, particularly in Maharashtra, Telangana and Karnataka. In June 2017 six farmers were killed in police firing during protests in Mandsaur in Madhya Pradesh, as they demanded loan waivers and better prices.

Behind the figure lay a simple fact, that the typical farm was about one hectare in size.

The response of families has been to diversify. Many members of farming households work as labourers, drivers, masons and domestic workers, and migrate to cities for months each year. Remittances from a son in Surat or a daughter in a Bangalore factory pay for the household's needs. Women, who do much of the farm work, are increasingly left to run the land while the men leave. In this way the farm persists as a home, a store of security and a source of food, but not as a livelihood. The figures on rural poverty suggest that the typical farmer subsists on many sources, of which farming is only one.

The state has responded with a series of measures. Minimum support prices for crops, mostly wheat and rice, protect farmers from collapse in prices, but only a small proportion of farmers, concentrated in Punjab, Haryana and a few other states, benefit from procurement. Subsidies on fertiliser, power and water are large but poorly targeted, and encourage overuse. Loan waivers announced by state governments, such as that of Uttar Pradesh in 2017 worth tens of thousands of crores, give relief but reward default and strain budgets. The government declared in 2016 the goal of doubling farmers' incomes by 2022, an ambitious target that requires growth far above the recent pace.

The topic, however, is a generalisation, and some qualification is due. Large and medium farmers in irrigated regions, such as Punjab, western Uttar Pradesh and parts of Gujarat and Maharashtra, have prospered. Horticulture, dairying, poultry and fisheries have given many small farmers better returns than grain. The milk cooperatives of Gujarat, built under the Amul model, lifted millions of small producers by guaranteeing them a market. Farmers who join producer organisations and grow high value crops such as flowers, spices and organic produce have found better incomes. Not all farming has lost the ability to feed a family, but the typical farm has.

What would restore it? Economists point to several routes. Raising productivity by better seed, water management and extension would help, since Indian yields of rice and wheat are well below those of China. Improving markets, through reforms of the old mandi system, a national electronic market such as e NAM launched in 2016 and better storage, would raise the share of the final price that goes to the farmer. Consolidating holdings through leasing, with protection for tenants, could create viable units. The largest need is for jobs outside agriculture, so that the share of the workforce on the land can fall and the incomes of those who remain can rise.

That last point puts the problem in perspective. Every country that has become rich has seen a fall in the share of its people who farm, from over half in nineteenth century Britain and America to a few per cent today. The decline of the subsistence farm is, in the long run, a sign of development and not a failure. The trouble in India is that the move out of agriculture has not been matched by the creation of enough decent jobs elsewhere, so that people are leaving farms without arriving at factories. The farmer is pushed out and not pulled.

There remains a human question that statistics hide. For millions of families, the farm is not just a source of income but a link to ancestors, a place and an identity. To say that it can no longer support them is to say that a way of life is ending. If the transition is managed well, with training, jobs and security, the children of today's farmers may find better lives. If it is managed badly, they will enter the cities as the poorest of the poor. Which of the two is more likely depends on decisions that are being made in offices far from the fields, by people who have rarely had to live on a hectare.