Agrarian Change in Telangana: A Discussion on Policy Options

Abstract

The paper examined the inclusiveness of strategies for increasing farmers’ incomes in Telangana from the last two decades by using various government reports and statistical abstracts of the Telangana state. Telangana agricultural sector is in a transition from cereal based cropping systems to commercial crops based cropping systems with larger contribution from fruits and vegetables and commercial crops like cotton and soybean. The commercialization of agriculture resulted in high input-high output-high risk agriculture, where in small and marginal farmers are not able to cope with and ultimately end up in huge debt with higher cost of production. Further, faster farm mechanization in the recent years, resulted in increased scale economies with small farmers getting less profit compared to large farmers per unit area. The tenant farmers are especially at risk in the event of yield loss or output price reduction, as they have to pay tenancy fee of about 30% of the average farm returns, even though their yields are lower than average. Remedy is livestock sector, now its contribution is equal to crop sector to gross state domestic product. If an average agricultural household to cross poverty line, he has to have 4.41 hectare of land in Telanagana.

Keywords: Agrarian change, agrarian policies, farmer’s income, India

JEL Classification: Q12, Q18, Q1, Q28