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Subjects /Indian Economy / Indian Agriculture

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Introduction
14 Apr 2022

  • Agriculture is the primary source of livelihood of India’s population. 
  • As per 2018, agriculture employed more than 50% of the Indian work force and contributed 17–18% to country's GDP.
  • The history of agriculture in India dates back to the Indus valley civilisation. India ranks second worldwide in farm outputs.
  • Consumer spending in India will return to growth in 2021 post the pandemic-led contraction, expanding by as much as 6.6%.

Land Reforms

Land Reforms

Land Reforms usually refers to redistribution of Land from rich to poor. It includes the following activities:

  • Abolition of ‘Zamindari system’ and Intermediaries
  • Tenancy Reforms and Regulation of Rent
  • Ceiling of Land
  • Reorganisation of Holding (Size of plot) and Consolidation of Holding.
  • Co-operative Farming
  • Bhoodan Yojana

In an agrarian economy like India with massive inequalities of wealth and income, great scarcity and an unequal distribution of land, coupled with a large mass of people living below the poverty line, there are strong economic and political arguments for land reforms.

Land reform is the major step of the government to assist people living under adverse conditions. It is basically redistribution of land from those who have excess land to those who do not possess with the objective of increasing the income and bargaining power of the rural poor.

The purpose of land reform is to help weaker sections of society and do justice in land distribution.

Objective of Land Reform

Objective of Land Reform

The objective of land reforms includes:

  • To enhance the productivity of land by improving the economic conditions of farmers and tenants so that they may have the interest to invest in and improve agriculture.
  • To ensure distributive justice and to create an egalitarian society by eliminating all forms of exploitation.
  • To create a system of peasant proprietorship with the motto of land to the tiller.
  • To transfer the incomes of the few to many so that the demand for consumer goods would be created.
  • In 2nd FYP, it was emphasized to remove the hurdles in the way of agriculture production as may arrive from the character of agrarian structure and to evolve an agrarian economy conducive of high level of efficiency and productivity.

Pre-Independence - Challenges with Land Reforms

Under British Raj, the farmers did not have the ownership of the lands they cultivated, the landlordship of the land with the Zamindars, Jagirdars etc.

Several important issues confronted the government and stood as a challenge in front of independent India:

  1. Land was concentrated in the hands of a few and there was a proliferation of intermediaries who had no vested interest in self-cultivation.
  2. Leasing out land was a common practice.
  3. The tenancy contracts were expropriative in nature and tenant exploitation was almost everywhere.
  4. Land records were in extremely bad shape giving rise to a mass of litigation.
  5. Land records were in extremely bad shape giving rise to a mass of litigation.
  6. Land was fragmented which resulted in inefficient use of soil, capital, and labour. 

Post-Independence - Issues related with Land Reforms

  • Landlessness is directly linked to rural poverty and causes a ‘Spiral of Impoverishment’. Land is not a commodity but an essential component of human dignity and wellbeing. In India over 70% of the population resides in rural areas with majority depends on land-based activities for their livelihood. Many studies have shown that owners of productive plots of land tends to be economically better off and generally conform to at least the minimum standard of living.
  • In this context landlessness is the main cause of rural poverty.
  • In the absence of legal title, it is difficult for the landless to obtain insurance for their crop, loans from banks or avail benefits from government schemes.
  • Common problem for rural landless is the inability to profit from their labour and investment.
  • Vulnerable groups of society and SC/STs feel the adverse effect of landlessness more keenly.

Components of Land Reforms

A committee, under the Chairmanship of J. C. Kumarappan was appointed to look into the problem of land. The Kumarappa Committee's report recommended comprehensive agrarian reform measures.

The Land Reforms of the independent India had following components:

  1. The Abolition of the Intermediaries (Zamindari System)
  2. Tenancy Reforms
  3. Consolidation of Landholdings.
  4. Reorganisation of Holding (Size of plot) and Consolidation of Holding.
  5. Co-operative Farming
  6. Bhoodan Yojana

These were taken in phases because of the need to establish a political will for their wider acceptance of these reforms.

Abolition of Zamindari

Abolition of Intermediaries/Zamindari System 

The first important legislation was the abolition of the zamindari system, which removed the layer of intermediaries who stood between the cultivators and the state.

It succeeded in taking away the superior rights of the zamindars over the land and weakening their economic and political power. The reform was made to strengthen the actual landholders, the cultivators.

  • The abolition of intermediaries made almost 2 crore tenants the owners of the land they cultivated.
  • More lands have been brought to government possession for distribution to landless farmers after the abolition of intermediaries.
  • A considerable area of cultivable waste land and private forests belonging to the intermediaries has been vested in the State.
  • The legal abolition brought the cultivators in direct contact with the government.
  • However, zamindari abolition did not wipe out landlordism or the tenancy or sharecropping systems, which continued in many areas. 
  • It only removed the top layer of landlords in the multi-layered agrarian structure.
  • It has led to large-scale eviction. Large-scale eviction, in turn, has given rise to several problems – social, economic, administrative and legal.

Tenancy Reforms

Tenancy regulation was also another major land reform.

The rent paid by the tenants during the pre-independence period was exorbitant; between 35% and 75% of gross produce throughout India.

Tenancy reforms introduced to regulate rent, provide security of tenure and confer ownership to tenants.

With the enactment of legislation (early 1950s) for regulating the rent payable by the cultivators, fair rent was fixed at 20% to 25% of the gross produce level in all the states except Punjab, Haryana, Jammu and Kashmir, Tamil Nadu, and some parts of Andhra Pradesh.

The reform attempted either to outlaw tenancy altogether or to regulate rents to give some security to the tenants.

In West Bengal and Kerala, there was a radical restructuring of the agrarian structure that gave land rights to the tenants.

Issues: In most of the states, these laws were never implemented very effectively. Despite repeated emphasis in the plan documents, some states could not pass legislation to confer rights of ownership to tenants.

Few states in India have completely abolished tenancy while others states have given clearly spelt out rights to recognized tenants and sharecroppers.

Although the reforms reduced the areas under tenancy, they led to only a small percentage of tenants acquiring ownership rights.

Ceilings on Landholdings and Consolidation of Landholdings

Ceilings on Landholdings

Land Ceiling refers to the ceilings on landholdings referred to legally stipulating the maximum size beyond which no individual farmer or farm household could hold any land. The imposition of such a ceiling was to deter the concentration of land in the hands of a few.

  • By 1961-62, all the state governments had passed the land ceiling acts. But the ceiling limits varied from state to state. To bring uniformity across states, a new land ceiling policy was evolved in 1971.
    • In 1972, national guidelines were issued with ceiling limits varying from region to region, depending on the kind of land, its productivity, and other such factors.
    • It was 10-18 acres for best land, 18-27 acres for second class land and for the rest with 27-54 acres of land with a slightly higher limit in the hill and desert areas.
  • With the help of these reforms, the state was supposed to identify and take possession of surplus land (above the ceiling limit) held by each household, and redistribute it to landless families and households in other specified categories, such as SCs and STs.

Issues: In most of the states these acts proved to be toothless. There were many loopholes and other strategies through which most landowners were able to escape from having their surplus land taken over by the state.

  • While some very large estates were broken up, in most cases landowners managed to divide the land among relatives and others, including servants, in so-called ‘benami transfers’ – which allowed them to keep control over the land.
  • In some places, some rich farmers actually divorced their wives (but continued to live with them) in order to avoid the provisions of the Land Ceiling Act, which allowed a separate share for unmarried women but not for wives.

Consolidation of Landholdings

Consolidation referred to reorganization/redistribution of fragmented lands into one plot.

  • The growing population and less work opportunities in non- agricultural sectors, increased pressure on the land, leading to an increasing trend of fragmentation of the landholdings.
  • This fragmentation of land made the irrigation management tasks and personal supervision of the land plots very difficult.
  • This led to the introduction of landholdings consolidation.
    • Under this act, if a farmer had a few plots of land in the village, those lands were consolidated into one bigger piece of land which was done by either purchasing or exchanging the land.
  • Almost all states except Tamil Nadu, Kerala, Manipur, Nagaland, Tripura and parts of Andhra Pradesh enacted laws for consolidation of Holdings.
  • In Punjab and Haryana, there was compulsory consolidation of the lands, whereas in other states law provided for consolidation on voluntary basis; if the majority of the landowners agreed.
  • Advantages: It prevented the endless subdivision and fragmentation of land Holdings.
    • It saved the time and labour of the farmers spent in irrigating and cultivating lands at different places.
    • The reform also brought down the cost of cultivation and reduced litigation among farmers as well.
  • Result: Due to lack of adequate political and administrative support the progress made in terms of consolidation of holding was not very satisfactory except in Punjab, Haryana and western Uttar Pradesh where the task of consolidation was accomplished.
    • However, in these states there was a need for re-consolidation due to subsequent fragmentation of land under the population pressure.
  • Need of re-consolidation: The average holding size in 1970-71 was 2.28 hectares, which has come down to 1.08 hectare in 2015-16.
  • While Nagaland has the largest average farm size, Punjab and Haryana rank second and third in the list respectively.
    • The holdings are much smaller in densely populated states like Bihar, West Bengal and Kerala.
  • The multiple subdivisions across generations have reduced even the sub divisions to a very small size.

Did You Know

  • There are hymns in Vedic literature dedicated to – Agriculture.
  • Agriculture is the largest employer in the world.
  • Only 1% of agricultural land produces organic products worldwide as the productivity is very low.
  • India is biggest producer of milk.
  • India holds first position in organic farming.
  • Sikkim is the first state in the world to go for 100% organic farming.