India’s agriculture is dominated by small-holders and will continue to be so in the near future, noted P. K. Mishra, Principal Secretary to the Prime Minister of India in the Nineteenth C. D. Deshmukh Memorial Lecture delivered by him. There are 168 million operational holdings out of which small holdings of less than 2 hectares contribute to 88 percent. The concentration of small-holdings has remained very high in Asia. The conventional postulate of shifting workforce from agriculture to non-agriculture will not hold fully. The movement will be slow as compared to its share in the GDP.

Agriculture’s share in the GDP has markedly declined from 42 percent in 1970-71 to 18 percent in 2023-24, whereas in the workforce the figures are respectively 70 percent and 46 percent. A study shows that by 2050 the sector’s contribution to GDP is projected to decrease to about 7 percent, whereas its share in the workforce is expected to remain at about 27 percent. For a more inclusive, equitable and sustainable economic growth, it is necessary to have a higher share of income by farm households. The disparity in per worker productivity or income between agriculture and non-agriculture is witnessed even in countries such as China, Vietnam and Indonesia as in India.

He observed that several studies show that crop productivity per unit of land is higher for small farms than large farms. There is an inverse relationship between farm size and productivity. Despite strong advantages in land productivity, small-holders earn a low level of income from agriculture on a per capita basis primarily due to very adverse land-man ratio. Small farmers face several challenges relating to access to credit, marketing, education and technology.