n a written statement submitted before the House Tuesday, Agriculture Minister Pradeep

Maharathy cited the last National Sample Survey (NSS) report of state-wise data of farmers’
incomes from different sources which indicated the income levels of Odisha farmers.

Accordingly, a farmer’s household in Odisha earns Rs 1407 per month, the second lowest in
the country, whereas the lowest has been recorded in West Bengal where a farmer’s
household income from agriculture alone put at Rs 979.

However, in the state, due to labour wages each farmer household is reported to be earning
Rs 1716 per month, the seventh lowest in the country. When it comes to livestock, it is said to
be earning Rs 1314 per month and Rs 539 from non-agricultural sources. Overall, from all
the categories, a farmer’s household is reported to be earning Rs 4,976 per month.

The National Bank for Agriculture and Rural Development (NABARD)’s All India Rural Financial
Inclusion Survey (NAFIS) released in 2018 shows that in the last four years a farm household
registered a cumulative income hike of just Rs 2,505/month, with an average of only Rs 626/month
every year.

In 2016-17, the average agriculture household income was Rs 8,931/month. But, this income is not
inflation adjusted—meaning in real terms it would be less. So, it doesn’t come as a surprise when
the report says that 43 per cent of India’s indebted households are farm households.

In 2017-18, reports by the Committee on Doubling of Farmers’ Income, set up by the Union
government, came out in 13 volumes. Going by this Committee’s study, the national average income
from cultivation increased by just 3.8 per cent over the 2001-11 decade, when the overall farm
sector grew by 3 per cent annually.

Little wonder remains over the fact that the number of farmers in the country reduced by 8.5 million
between 2001 and 2011. At the same time, farm labourers rose by 37.5 million.

In fact in 16 states farmers reported dip in income after adjusting inflation. These include states like
West Bengal (4.2 per cent dip), Bihar (1.4 per cent) and Uttarakhand (3.4 per cent). Clearly, farmers
are not earning a profit from their produce.

A survey of 23 crops for investment and income during 2004-2014 shows that barring a few ones,
farmers are no more making any money. In the case of paddy, a major crop, farmers in only seven
states reported an increase in their net income, while in six states, including poor states like Bihar,
Jharkhand and Odisha, farmers incurred losses.
Similarly for wheat, profitability is coming down across the country, with Chhattisgarh, Himachal
Pradesh, Jharkhand and West Bengal reporting losses. In major wheat-producing states like Punjab
and Haryana, the cost is recovered due to assured buy-back by the government.

While the whole agrarian sector reels under a crisis, what comes out as a big challenge is the income
inequality among farmers. Inequality of income among the small and marginal farmers group—the
semi- and medium- and large farmers group—is stark.

The lowest among the farmer groups in terms of landholding earns the least. And India primarily
consists of small and marginal farmers, defined as those holding less than two hectares (Ha) of land.
About 85 per cent landholdings in India are below two Ha.

Let’s look at the income equality among various landholding groups. According to the Committee,
the average annual earning of a small and marginal farmer household was Rs 79,779 in 2015-16.

Now compare this with the earning of large farmers having a landholding above 10 Ha. Such farmers
earned seven-and-a-half times more than a small and marginal farmer, or to be specific Rs 605,393
each year. A medium and semi-medium farmer’s household earned Rs 201,083 or two-and-a-half
times more than a small and marginal farmer’s household.

This means that 85 per cent of farmer households earn 9 per cent of the total income, while the rest
earn 91 per cent. If you compare this with overall inequality in India, it’s far too high.

“The initial promise of agrarian reforms was to distribute land to the landless and provide title of
ownership to the cultivators. However, unfortunately, India’s agrarian reforms did not ensure
egalitarianism in the agricultural community,” says the Dalwai Committee Report asking for
agriculture policies to factor in this aspect while crafting ways to double farmers’ income by 2022, as
promised by Prime Minister Narendra Modi.

This raises a pertinent issue that has policy ramifications. The Green Revolution in 1960s focused on
increasing productivity and yield. But since then, landholdings have become significantly
fragmented. Marginal landholdings have tripled in the last 40 years. It means that the old strategy
might not reap the same objectives.

This aspect is important in context of the government’s target of doubling farmers’ income. Small
farmers take longer to increase their income in comparison to large farmers.
For example, during 2003-13, households with over 10 Ha of land were able to double their income.
But a small farmer with up to one Ha of land could increase income by just 50 per cent during the
same time.

The government needs to apply income group-specific strategy to achieve its target of doubling
farmers’ income. And just to reiterate the country’s massive small farmer population: average size of
67 per cent of all landholdings in India is just 0.39 Ha.

MahilaKisanSashaktikaranPariyojana (MKSP)is a special program initiated for livelihood

enhancement and vulnerability reduction launched in 2010-11. The program envisages empowering
women in agriculture and allied activities making systematic investments to enhance their
participation and productivity, and also to create and sustain agriculture based livelihoods of rural
women. The program is being implemented by NRLM in partnership with State Departments/CSOs
as implementing partners (PIAs) across the country. The central to state share in funding for MKSP
stands at 75:25 ratio.

Under NRLM, the core agenda of MKSP is to (i) create sustainable livelihood institutions around
agriculture and allied activities (ii) create sector-specific geography-specific best package of practices
and (iii) create a wide pool of community resource persons for scaling up livelihood interventions in
the entire country.

The mission has narrowed down to two major themes, to work with partners in MKSP programme
which are a) Sustainable Agriculture, b) Non Timber Forest Produce (NTFP).

I. Sustainable Agriculture: The core focus of MKSP under agriculture sector is to promote
sustainable agriculture, where the inputs are localized, risks are mitigated, productivity is enhanced,
food security is ensured and hence net income of family is increased. The important objectives of
MKSP-Agriculture are to:

a. Create sustainable agricultural livelihood opportunities for women in agriculture;

b. Ensure food and nutrition security at the household and the community level;

c. Improve the skills and capabilities of women in agriculture to support farm-based activities;

d. Enhance the managerial capacities of women in agriculture for better management of bio-
diversity

II. Non Timber Forest Produce (NTFP): The core focus of MKSP under NTFP sector is to enhance
livelihoods of NTFP collectors by promoting the entire value chain at various levels - regeneration,
collection, processing & marketing. The important objectives of MKSP-NTFP are to:

a. Ensure a better control of the institutions of the poor women NTFP collectors over the NTFP
value chain.

b. Promote regeneration of NTFP species to improve the bio diversity and enhanced productivity

c. Build the capacity of the community in modern harvesting and post harvesting techniques to
increase their income.

d. Promote value addition of NTFP to ensure higher returns

e. Develop market linkages for NTFP

Progress of the program in Odisha:

1.MKSP (Agriculture): Under MKSP (Agriculture) proposals of seven PIAs have been sanctioned by
MoRD. PIAs under MKSP (Agriculture) are SODI Consortium-Lead-Madhyam / LAVS / Harsha Trust /
Madhyam Foundation / ORRISSA / MS Swaminathan Research Foundation / PRADAN. These
proposals with a total project cost of Rs.38.50 crores for three years will be covering 35,450
MahilaKisans of nine (9) districts of the states. The districts are Koraput, Rayagada, Malkangiri,
Nabarangpur, Kalahandi, Keonjhar, Mayurbhanj, Khordha and Kandhamal.
2. MKSP (NTFP):Out of 37 project proposals received, six (6) proposals were recommended to
National Mission Management Unit after a thorough desk appraisal and technical evaluation by
domain experts. Four proposals have been recommended for further field appraisal, which has been
completed. Project Approval Committee at MoRD has also considered that Odisha has satisfied the
condition for transition to AAP hence delinking the NRLM-PIA relations. Hence these proposals will
be taken up MKSP in Livelihoods Promotion Strategy, as part of Annual Action Plan.

ACTIVITIES PROPOSED UNDER THIS PROJECT:

• Capacity building of the women farmers for upgrading their skill and improving their capabilities
for supporting farming activities

• Agriculture related productivity enhancement techniques/ measures should be given due

importance.

• The agriculture strategy adopted under the Project should revolve around local natural resources
based sustainable agriculture.

• The activities of the project may have blend of agriculture and Allied sector activities with Post
harvest activities including value addition to the agricultural produce and management of cattle
essentially considered in women’s domain should be given due weightage under the scheme.

• Improving market access to women farmers should be a key element under the project.
Knowledge dissemination relating to markets, post harvest practices, village level value addition
should be indicated.

• Drudgery reduction through use of gender friendly tools and technologies should also be made a
key feature of the scheme.

EXPECTED OUTCOMES:
Net increase in the incomes of women in agriculture on a sustainable basis;

(b) Improvement in food and nutritional security of women in agriculture and their families;

(c) Increase in area under cultivation, cropping intensity and food production by women;

(d) Increased levels of skills and performance by women in agriculture;

(e) Increased access of women in agriculture to productive land, inputs, credit, technology and
information;

(f) Drudgery reduction for women in agriculture through use of gender friendly tools / technologies;

(g) Increased access to market and market information for better marketing of their products;

(h) Increased soil health and fertility to sustain agriculture based livelihoods;

(i) Increased visibility of women in agriculture as an interest group –in terms of increased
number of women institutions and increase in their entrepreneurship.

Major issues:

- Odisha agriculture is characterized of subsistence nature of farming, often interrupted by

droughts and flood;

- Capacity for private investment to undertake productivity-raising strategies in terms of access

to agricultural inputs is low both due to lack of own investible surplus and lack of adequate
access to and utilization of institutional credits;

- Low levels and growth of public investment (rural infrastructure) and concentrated in certain
relatively developed pockets (i.e. coastal area and some parts of hinterland);

- Public investment has been skewed; mostly use for repair and maintenance of existing
projects;

- Weak institutional mechanisms for development and maintenance of existing irrigation

projects leading to under-utilization and mal distribution of resources. For instance, water
institutions (watershed developments and pani panchyat) are not functioning properly.
- Adoption of modern farm technology has been limited to certain areas and crops; and in tribal
concentrated areas, dry hinterland areas are low;

- Predominance of paddy crop: accounting for more than 50 per cent of total gross crop areas;
winter paddy constitutes three-fifth of total paddy crop with very low productivity;

- Therefore, average land and worker productivity is very low as compared to national average;
within the state also there are huge productivity differences across regions;

- Need for Multi-Prone Strategies:

1. Improvement of resource use pattern (land, water, forest etc.): Better utilization of resources
through improving the institutional delivery mechanisms, better maintenance and distribution;

2. Redesigning area specific development strategies with focus on tribal and agriculturally
backward areas (drought and flood affected area); long term drought preparedness

3. Better coordination of rural development programmes and MNREGS;

4. Policy focus on creating water infrastructure, access to credits, rural roads and markets, in the
areas where Forest Right Act (FRA) has been implemented recently.

5. Improvement in agrarian structure (tenanurial and land rights) is crucial;

ODISHA 16892(28) 15477(26) 6451(11) 20620(35) 59440

STATES INCOME FROM FARMING INCOME FROM LIVESTOCK INCOME FROM NONFARM
BUSINESS INCOME FROM WAGES/ SALARY TOTAL ANNUAL INCOME

With respect to income from farming, Punjab and Haryana earn the highest while Goa, Odisha,
Delhi,

West Bengal, Lakshdweep, D & N Haveli and Daman & Diu earn the lowest. Average earning
from

farming of a farm household in Punjab is INR 1,30,163 per year or INR 10,847 per month. For
West

Bengal, this income is INR 11,737 per year or approximately INR 978 per month. Haryana farm

households earn a farm income that is 73% of Punjab farm household’s farm income while farm

household in Odisha and West Bengal earn farm incomes that is 13% and 7% of Punjab farm
household’s

farm incomes. In terms of shares, Telangana, Arunachal Pradesh, Madhya Pradesh, Assam
Chattisgarh

and Punjab have 60% or more of their total income coming from farming while Goa, Chandigarh,
D&N

Haveli, Delhi, Lakshadweep and Daman & Diu have less than 20% of the total incomes from
farming.
 Besides expansions of mulberry cultivation to new districts of traditional Sericultural states,
there is in an urgent need to explore large scale cultivation of mulberry in non-traditional states
like, Odisha, North Eastern states, Himachal Pradesh, Uttarakhand, Uttar Pradesh, Jammu and
Kashmir etc. In the new areas, only high yielding mulberry verities namely, V1, S36, S1635, G4
etc. should be popularised

The lac growing regions are characterized by high proportion of tribal population, families living
below poverty line and low literacy percentage (Fig. 7.1). The tribal population mainly depends
on rainfed agriculture and forest produce for its livelihood, and lac is an important source of
cash flow. One of the merits of lac cultivation is that it does not require irrigation or watering
when done on tree species. Keonjhar, Mayurbhanj, Nabarangpur, Rayagada Balasore,
Koraput,Sundargarh

Birthal, et al. (2013) have also noted that diversification into production of fruits and vegetables,
in general, and vegetables, in particular, is likely to benefit the small and marginal farmers more
than the medium and large farmers for the following reasons:

i. Marginal and small farmers tend to allocate a large proportion of their holdings (7.5 per cent
and 6.3 per cent, respectively) than the medium and large farmers (3 per cent and 4.8 per cent,
respectively).

ii. Small farms enjoy a greater comparative advantage in the cultivation of vegetables than
medium and large farms as vegetable cultivation is more labour-intensive than fruit cultivation.
The cultivation of vegetables also needs much less capital than fruit cultivation.53

iii. The cultivators of HVC (including horticultural crops) within farm size groups tend to exhibit a
lower incidence of poverty than cultivators of other crops

From the policy perspective, it is important to address the following question: What is the
additional income to the farmer in a given state if one hectare of staple crop(s) is replaced by a
horticultural crop? It must be noted that using some of the staple crops (say, paddy) may only
marginally impact the farmer’s food security as the area under staple crops is huge in
comparison to the area under horticulture.

It is also expected, that with associated development of cold-chain logistics and supply chain, the
enhanced market connectivity will give a far greater impetus to the expected income gains from
shifting cropping area into horticulture.
Odisha 100231 0.92 91938.78 1358.45 13584.52 124.89 31354.94 0.398
 Odisha and Rajasthan show an impressive acceleration in the growth of area under horticulture
during 2011-12 to 2015-16 as both of them started with negative growth during the period
2005-06 to 2010-11.

Odisha 47.9 52.1 42.1 57.9 43.3 56.7

There is a complex linkage between the agriculture and food processing sectors. Some poor
states show negative Total Factor Productivity (TFP) in food processing, indicating a missing link
between agriculture and industry. These states represent a case of lost opportunity of giving a
push to non-farm income and increasing productive off-farm employment in the economy. This
characteristic is observed in the case of both the poor as well as relatively non-poor states
through

the degree of correlation between the growth of GVA and employment, and the nature of TFP.
Thus, in the food processing industry, no uniform pattern is seen across states showing
sustainable growth in the GVA per factory and employment.

Among the agricultural backward states, Madhya Pradesh, Odisha, Rajasthan and West Bengal
exhibit positive growth of TFP. These states have also recorded higher growth in employment
than that observed at the all-India level (Table 4.11). Among the agriculturally developed,
Gujarat, Himachal Pradesh and J & K show a strong positive TFP, indicating the sustainable
growth in GVA of food processing. Relatively weaker but positive signal of growth of GVA in food
processing is also seen in Haryana and Karnataka.

Among the relatively agricultural backward states that show negative growth of TFP are Assam,
Bihar and Uttar Pradesh. These findings show how different states have been able to exploit the
opportunity of strengthening linkage between agriculture and food processing, while others
have missed this opportunity. The analysis indicates that states can be characterised by the
nature of linkage between agriculture and food processing to generate employment and can be
broadly classified into five groups, including two for the relatively poorer states, and three for
the relatively non-poor states as below (for details, see Annex Table 4.7).

It has been observed that the relatively agricultural backward states with considerable
dependence on agriculture have attracted private investment in processed food.87These states
initiated fiscal and other measures to exploit their comparative advantage in offering lower
transaction and transport costs (for raw materials), better economies of scale, and cheap labour.
It is maintained that a rapid expansion of this relatively more labour-intensive industry in states
with low per capita income, high dependence on agriculture, and high incidence of poverty,
would help absorb more people from agriculture.
These arguments are even more relevant with respect to the unorganized segment of the
industry, which is more spatially widespread, and has a higher potential to absorb labour, but
has low productivity. Public policy thus needs to focus on promoting growth in agricultural
productivity, along with investments in supportive infrastructure. More importantly, the
infrastructure at aggregation level, also serves the larger purpose of connecting farmers with a
wider market, besides the food processing industry, giving them a choice in markets and crop
types.

For a better understanding of the underlying reasons for the vast differences across states in the
performance of food processing industry, one needs to examine the role of the creation of the
necessary infrastructure, investment in food processing technology, the overall business
environment, and policy orientation to promote this industry.

Established linkage between agriculture and food processing. Show potential for growth
although its share in employment in food processing is relatively low at present.

Established linkage between agriculture and food processing. Already contributing to 4.5 per
cent of all-India employment.

All the four states have shown high growth of employment in food processing.

Average annual income of agricultural households from all four income components (Rs