Indian agriculture has seen a steady transformation from subsistence to semicommercial
and commercial mode. Following a phase of stagnation and agrarian
distress due to heavy indebtedness of farmers, frequent droughts and floods, and an
uncertain global economic environment, Indian agriculture has been in the path of
revival due to policies and programs aimed to accelerate the pace of agricultural
growth. At the macro level, investment in agriculture has increased-from 12 per cent
in 2005-06 to the current 21 per cent of the agricultural gross domestic product
(GDP). Consequently, agricultural growth peaked at 4 per cent during the eleventh
Five Year Plan, and foodgrain production reached a record level of 264.38 million
tonnes in 2013-14. Higher crop productivity driven by technological change has been
the main source of higher foodgrain production. Agricultural exports have increased
and terms of trade turned in favour of agriculture. Contrary to past trends, a larger
share of incremental gains in agricultural growth was attributed to non-cereal
commodities (horticulture, dairy, poultry etc.) and non-Green Revolution areas.
Yet there are concerns about the growing number of landless labourers and
smallholder farmers - smallholder farmers being defined as those owning less than 2
hectares (ha) - given the slow decline in dependency on agriculture and agriculture’s
rapidly diminishing share in GDP. This share declined to about 13.7 per cent in 2012-
13, when the sector still had employed about 51 per cent of the workforce.
Apparently, a large proportion of the population is dependent on agriculture for food
and income. Though literature is replete with instances of smallholder farmers being
efficient in production, their increasing number and shrinking farm size raise
questions about their viability and sustainability. Globally too, smallholders have
regained attention due to their growing numbers and significant contribution to food
production. The United Nations has declared 2014 to be the “Year of Family Farms,”
which globally account for about 85 per cent of farm holdings. These farms provide
livelihood opportunities to about 2.5 billion people across the world; 84 per cent
belong to the category of smallholders (Lowder et al., 2014). Available estimates
show that about 87 per cent of the world’s 450 million smallholders are in Asia and
the Pacific region (IFPRI 2007; Thapa and Gaiha, 2014). China and India together
account for about two-third of smallholders, with those in India contributing about 50
per cent of total agricultural output (Thapa and Gaiha, 2014).