Why Are Farms in India Less Productive—And What Farmers Can Do to Change That

Written By: Jagriti Shahi 

Introduction

Despite being one of the largest producers of agricultural commodities globally, India's farm productivity remains far below its potential. On average, an Indian farmer produces less per hectare than counterparts in China, Brazil, or even neighboring Bangladesh. With over 43% of India's workforce dependent on agriculture and contributing only about 18% to GDP (2023 estimate), the productivity gap is a structural concern with socio-economic ramifications.

Section 1: India’s Low Farm Productivity in Numbers

1. Labour Productivity:

2. Land Fragmentation:

Section 2: Key Reasons for Low Productivity

1. Land Fragmentation & Size Inefficiency

• Small plots reduce the viability of mechanization and irrigation.

• Economies of scale are lost in input procurement and output marketing.

• Consolidated farms in the US and Brazil enable higher productivity per dollar invested.

2. Dependence on Monsoon

• Only 52.7% of net sown area is irrigated (Ministry of Agriculture, 2022).

• Regions like Maharashtra and Karnataka often face drought cycles, leading to productivity volatility.

3. Low Input Use Efficiency

• Fertilizer usage: India uses 165 kg/ha of NPK, but with imbalanced application (urea-heavy).

• Water productivity: India uses 2–3 times more water per unit of food output than China.

• Mechanization is 40%, compared to 60%+ in China and 95%+ in the US.

4. Weak R&D and Extension Services

• India spends only 0.3% of agri-GDP on research (vs 1% in China and 3% in Brazil).

• Extension coverage is inadequate—only ~10% of farmers have access to timely agri-advice.

5. Market Inefficiencies

• Only 30% of produce reaches organized markets; rest is sold via middlemen or distress sale.

• MSP coverage benefits only 12% of farmers.

• Poor post-harvest infrastructure leads to ~15-20% losses in fruits and vegetables (ICAR estimate).

Section 3: What Farmers and Policymakers Can Do

A. Adopt Scientific Farming Practices

• Use Soil Health Cards and balanced NPK fertilizers.

• Switch to high-yielding varieties (HYVs) and climate-resilient seeds.

• Example: Pusa Basmati 1121 offers 20–25% higher yield than traditional basmati.

B. Shift to Farmer Producer Organizations (FPOs)

• Over 10,000 FPOs registered under the central scheme.

• FPOs allow collective bargaining, lower input costs, and better market access.

• Studies show 30–50% rise in income for FPO-linked farmers (NABARD, 2022).

C. Invest in Micro-Irrigation

• Drip and sprinkler systems save 40–60% water and increase yields by 20–30%.

• PMKSY (Per Drop More Crop) subsidy covers up to 55% cost for small farmers.

D. Embrace Digital Tools

• Precision agriculture, drone-based spraying, and mobile apps improve efficiency.

• Platforms like Kisan Suvidha, AgNext, CropIn, and DeHaat help optimize resources.

E. Participate in Carbon and Sustainability Markets

• Crop residue management + organic farming = carbon credits.

• Farmers can earn INR 3,000–5,000 per acre/year via verified carbon programs.

F. Diversify Cropping Pattern

• Shift from water-intensive paddy/sugarcane to pulses, oilseeds, and millets.

• The government now offers a 50–75% subsidy on millet promotion programs (International Year of Millets, 2023).

G. Post-Harvest Infrastructure & Food Processing

• Investing in cold storage, grading units, and solar dryers can reduce wastage.

• Value addition through food processing increases farmer margins by 25–80%.

Section 4: Way Forward—A Policy-Ecosystem Shift

1. Land Leasing Laws:

2. Credit and Insurance Access:

3. Agri-Education and Skilling:

Conclusion

India’s agricultural productivity problem is a mix of structural issues, technological lag, and policy inertia. However, with a combination of farmer-led innovation, FPO consolidation, technology adoption, and policy reforms, Indian farms can transition from subsistence models to profitable, sustainable enterprises.

If India increases its average yield by just 25% across major crops, it could add $50–70 billion in agri-GDP and pull millions out of rural poverty.