Non-farm activities need a big push to boost rural incomes, say experts

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What is the news?

The National Sample Survey (NSS) in its latest findings mentioned that Doubling farmers’ income by 2022 is not feasible. The findings also mentioned reasons such as reduced earnings from crop production and increased debts for not achieving it. The findings also highlighted the need for a strong policy response to reverse the trend.

What are the key findings of the latest NSS findings?

Reduced Incomes: Incomes from crop production have dropped while wages have become the mainstay for rural households. But, wages also aren’t growing in rural areas because economic activities outside farms are limited and landholding size is also shrinking. In the non-farm sector income opportunities are limited or going down.

This trend was seen in the last NSS of 2013, followed by the Financial Inclusion Survey of 2015-16 (of the National Bank for Agriculture and Rural Development) and now the current one.

NSS Findings
Source: Business Standard

Increased migration: India is also witnessing an increase in migration because income-generating opportunities in the rural sector have been diminishing.

Farming took a backseat: According to the latest survey, farming had taken the backseat in rural India at an aggregate level. While the number of farming households increased from 90 million to 93 million in six years, the number of families not engaged in farming rose from 66 million to nearly 80 million in the same period (2013-19).

Increased Farm debt: The NSS findings showed an average farm household in India had debts of Rs 74,121 in 2018-19 compared to Rs 47,000 in 2012-13. Debt is growing for a rural household because expenditure on health and education is rising in rural areas.

Low real income growth: As income grew 60 percent over six years, average debt, too, rose with a similar degree, by 57 percent. But, in real terms, income growth was even lower at 21 percent between 2012-13 and 2018-19 (six years)

What are the key suggestions from the NSS Findings?

To improve farm income: The NSS findings calls for stronger and structural measures to overcome the challenges facing the country’s rural sector. These changes need to diversify the crop sector through promoting more high-value products that generate higher incomes, while changing the mindset that prevailed in the 1960s.

Shift to integrated cropping: In India at present, mono-cropping has taken over the crop sector in a big way. But it has to give way to integrated farming systems.

Source: This post is based on the article “Non-farm activities need a big push to boost rural incomes, say experts” published in Business Standard on 16th Sep 2021.

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