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Indian and AP Economy — Mains Depth · Chapter 7

Agricultural Development

What to remember

  • Land reforms had four parts: abolition of intermediaries, tenancy reform, ceilings on holdings and consolidation of holdings. Abolition of zamindari was the most successful part.
  • The Green Revolution (from the mid-1960s) used high-yielding seeds, fertiliser and assured water. It raised wheat and rice output first in Punjab, Haryana and western Uttar Pradesh, and later spread to coastal Andhra.
  • MSP is announced by the Central Government on the advice of the Commission for Agricultural Costs and Prices (CACP). The Swaminathan Commission asked for MSP at least 50 per cent above the comprehensive cost (C2).

Land reforms

At Independence, agriculture was dominated by intermediaries such as zamindars, jagirdars and inamdars. Farmers who actually tilled the land paid heavy rent. Land reforms aimed at justice (to the tiller) and at productivity.

MeasurePurposeResult in brief
Abolition of intermediariesEnd the layer between state and tiller; give ownership to cultivatorsMost successful; about all states passed laws in the 1950s
Tenancy reformRegulate rent, give security of tenure, give ownership to tenantsPartly successful; tenants often evicted or recorded informally
Ceilings on land holdingsTake surplus land above a limit and give to landlessWeak; loopholes, transfers to relatives
Consolidation of holdingsJoin scattered plots into compact unitsGood in Punjab, Haryana, western Uttar Pradesh; slow elsewhere
Bhoodan and GramdanVoluntary donation of land and villagesStarted by Vinoba Bhave in 1951 (first gift at Pochampally); limited

Land is a State subject, so laws vary across states. Many state land reform laws were placed in the Ninth Schedule to protect them from court challenge. Telangana region and coastal Andhra both saw tenancy and ceiling laws, and the Telangana peasant struggle of the late 1940s influenced early reform. Digitisation of land records and the question of recording tenants are recent concerns.

Green Revolution

In the mid-1960s India faced food shortages and imports. The "New Agricultural Strategy" of 1966-67 gave farmers high-yielding variety (HYV) seeds, chemical fertiliser, irrigation, pesticides and assured procurement. Norman Borlaug developed dwarf wheat varieties; M.S. Swaminathan is known as the Indian father of the movement.

Features:

  • It began with wheat and then rice. Crops like pulses, oilseeds and coarse cereals were left behind.
  • Regions with assured irrigation gained most. This increased regional inequality.
  • Large farmers adopted the technology first. Later small farmers also benefited because the seeds were scale-neutral, but inputs needed credit.
  • Negative effects: falling groundwater, soil degradation, high chemical use, rice-wheat monoculture.

Other "revolutions": White Revolution (milk; Operation Flood; Verghese Kurien; National Dairy Development Board), Blue Revolution (fisheries), Yellow Revolution (oilseeds) and Golden Revolution (horticulture). A second, "evergreen" approach looks for sustainable growth.

Cropping pattern

India has three crop seasons: kharif (monsoon sowing; rice, maize, cotton, groundnut), rabi (winter sowing; wheat, gram, mustard) and zaid (summer; vegetables, watermelon). Cropping intensity is the ratio of gross cropped area to net sown area. Cropping pattern changes with irrigation, price support, climate and markets. Concerns are over-dependence on rice and wheat, and need to diversify to pulses, oilseeds, horticulture and millets.

Agricultural credit

  • Informal sources (moneylenders, traders) charge high rates.
  • Co-operative credit: a three-tier structure (primary agricultural societies, district central banks, state co-operative banks).
  • Commercial banks and Regional Rural Banks: bank nationalisation (1969), RRBs (1975) and priority-sector lending push credit to farmers.
  • NABARD was set up in 1982 as the apex body for rural credit, after the recommendations of the Shivaraman Committee.
  • Kisan Credit Card (KCC) gives farmers flexible short-term credit; interest subvention reduces the cost for timely repayment.
  • Farm loan waivers are debated: they give relief but can harm credit discipline.
  • Crop insurance: Pradhan Mantri Fasal Bima Yojana (2016) covers yield losses from natural risks.
  • Direct income support: PM-KISAN transfers cash in instalments to eligible farmer families.

Agricultural marketing, MSP and procurement

Agricultural Produce Market Committees (APMCs) regulate mandis under state laws. Problems were many middlemen, market fees and limited choice. e-NAM (2016) is an online trading platform linking mandis. Three central farm laws of 2020 tried to open markets and contract farming, but were repealed in 2021. Warehousing, cold chains and Farmer Producer Organisations (FPOs) help small farmers to sell collectively.

Minimum Support Price (MSP): the price at which the government is ready to buy. It is announced for a number of crops before the sowing season on the advice of CACP (set up in 1965 as the Agricultural Prices Commission). MSP is a signal; effective purchase happens mostly for rice and wheat. Procurement is carried out by the Food Corporation of India (FCI, 1965) and state agencies. It builds buffer stocks and supplies the public distribution system under the National Food Security Act, 2013.

Cost concepts: A2 (paid-out costs), A2+FL (A2 plus imputed family labour) and C2 (A2+FL plus rent and interest on owned land and capital).

Cost conceptIncludes
A2Cash and kind expenses actually paid
A2+FLA2 plus value of family labour
C2A2+FL plus imputed rent and interest on owned assets

Swaminathan Commission ideas

The National Commission on Farmers (chaired by M.S. Swaminathan, 2004-2006) said:

  • Land reform: distribute ceiling-surplus land and protect tribal land from diversion.
  • Water and irrigation: raise water-use efficiency and ensure access.
  • Credit and insurance: cheaper credit, wider insurance.
  • MSP at least 50 per cent more than weighted average C2.
  • Strengthen market institutions and farmer organisations.
  • Focus on dryland farming and food security.

The government later announced MSP at 1.5 times the A2+FL cost, which is a different base from C2, so the debate continued.

Organic and natural farming

Organic farming avoids synthetic inputs and uses organic manure, with certification. The Paramparagat Krishi Vikas Yojana (PKVY, 2015) promotes cluster-based organic farming. Sikkim was declared India's first fully organic state. Natural farming (Zero Budget Natural Farming idea of Subhash Palekar) uses cow-dung based inputs, mulching and mixed crops with no purchased chemicals. Andhra Pradesh promoted a state programme of community managed natural farming through a farmer-linked society, and set up Rythu Bharosa Kendras (RBKs, renamed Rythu Seva Kendras in 2024) as village-level service centres.

AP agriculture (qualitative)

  • Large share of workers still depend on agriculture and allied sectors.
  • Rice is the main food crop in the Godavari and Krishna delta, irrigated by the delta canals.
  • Groundnut, pulses, millets and cotton in the drought-prone Rayalaseema, mostly rain-fed.
  • Commercial crops: chillies (Guntur), tobacco, cotton, sugarcane, oil palm, mango and other fruits.
  • Aquaculture (prawn and fish) along the coast is a strength; the state is a leading seafood exporter.
  • Issues: dependence on monsoon, delta tail-end water shortages, cyclones and floods, pest attack, price fluctuations, tenant farmers lacking formal credit.

Present challenges and reforms

  • Small holdings: a majority of farmers are marginal and small, so scale and mechanisation are limited. FPOs and custom hiring centres try to solve this.
  • Irrigation: many farmers depend on rain or on groundwater. Micro-irrigation (drip and sprinkler) saves water; the Pradhan Mantri Krishi Sinchayee Yojana aims at "more crop per drop".
  • Soil and inputs: the Soil Health Card scheme advises balanced use of fertiliser. Fertiliser subsidy is large and tends to favour urea, which distorts nutrient balance.
  • Price risk: MSP covers few crops in practice; price deficiency or market intervention schemes are other tools.
  • Value addition: food processing, storage and cold chains reduce post-harvest loss and raise farm income.
  • Diversification: shifting from paddy to pulses, oilseeds, millets and horticulture reduces water stress and import dependence.
  • Climate risk: drought, floods and cyclones call for crop insurance and climate-resilient seeds.

Exam traps

  • 1. Green Revolution mainly helped wheat and rice, not pulses.
  • 2. NABARD (1982) is apex for rural credit; RBI is the central bank.
  • 3. MSP is announced by the Government on CACP advice; CACP itself does not fix it.
  • 4. Bhoodan was voluntary; ceiling laws were legal.
  • 5. C2 includes rent and interest on owned assets; A2+FL does not.
  • 6. Operation Flood relates to milk, not fish or oilseeds.
  • 7. Kharif crops are sown with the monsoon; rabi in winter.
  • 8. Land is a State subject; agriculture is also a State subject.

One-liners

  • 1. Zamindari abolition was the most successful land reform.
  • 2. Bhoodan movement began in 1951 under Vinoba Bhave.
  • 3. New Agricultural Strategy came in 1966-67.
  • 4. M.S. Swaminathan chaired the National Commission on Farmers.
  • 5. Verghese Kurien is linked with Operation Flood.
  • 6. NABARD was established in 1982.
  • 7. The Kisan Credit Card gives short-term crop credit.
  • 8. e-NAM is an online agricultural trading platform.
  • 9. FCI conducts procurement and buffer stocking.
  • 10. MSP advice comes from the CACP.
  • 11. Sikkim is known as the first fully organic state.
  • 12. Guntur is famous for chilli.

Practice questions

  1. Which land reform measure is generally regarded as the most successful in India?

    1. Ceiling on holdings
    2. Cooperative farming
    3. Tenancy regulation
    4. Abolition of intermediaries
    Answer

    D. Abolition of intermediaries

    Zamindari and other intermediary systems were abolished in most states in the 1950s.

  2. The Bhoodan movement was started by

    1. Mahatma Gandhi
    2. Acharya Kripalani
    3. Vinoba Bhave
    4. Jayaprakash Narayan
    Answer

    C. Vinoba Bhave

    Vinoba Bhave launched Bhoodan in 1951, with the first gift at Pochampally.

  3. Consolidation of holdings means

    1. Giving land to the landless
    2. Fixing a maximum land limit
    3. Joining scattered plots of a farmer into compact units
    4. Taxing large farms
    Answer

    C. Joining scattered plots of a farmer into compact units

    It reduces fragmentation by exchanging plots to form compact holdings.

  4. Land reform laws were placed in the Ninth Schedule mainly to

    1. Give powers to Parliament over land
    2. Protect them from court challenge
    3. Increase tax on farmers
    4. Delay their implementation
    Answer

    B. Protect them from court challenge

    The Ninth Schedule shielded many land laws from judicial review at the time.

  5. Land and agriculture in India are subjects in the

    1. State List
    2. Union List
    3. Concurrent List
    4. Residuary List
    Answer

    A. State List

    Agriculture and land rights are State List subjects.

  6. The New Agricultural Strategy that began the Green Revolution was adopted in

    1. 1951
    2. 1975
    3. 1991
    4. 1966-67
    Answer

    D. 1966-67

    HYV seeds, fertiliser and irrigation were pushed from 1966-67.

  7. Which pair of crops mainly benefited in the first phase of the Green Revolution?

    1. Tea and coffee
    2. Pulses and oilseeds
    3. Cotton and jute
    4. Wheat and rice
    Answer

    D. Wheat and rice

    HYV technology first succeeded in wheat and then rice.

  8. Which of the following is a negative effect of the Green Revolution?

    1. Higher dependence on imports of wheat
    2. Regional inequality and groundwater depletion
    3. Decline in fertiliser use
    4. Fall in wheat output
    Answer

    B. Regional inequality and groundwater depletion

    The benefits were concentrated in irrigated regions and led to water stress.

  9. Operation Flood is associated with

    1. Oilseed production
    2. Fruit production
    3. Milk production
    4. Fish production
    Answer

    C. Milk production

    Operation Flood is the White Revolution led by NDDB under Verghese Kurien.

  10. The Blue Revolution is related to

    1. Fisheries
    2. Horticulture
    3. Oilseeds
    4. Fertiliser
    Answer

    A. Fisheries

    The Blue Revolution refers to growth in fish and aquaculture production.

  11. The Golden Revolution is linked with

    1. Milk
    2. Wheat
    3. Horticulture
    4. Sugarcane
    Answer

    C. Horticulture

    It stands for rapid growth in fruits, vegetables and related crops.

  12. Cropping intensity is the ratio of

    1. Gross cropped area to net sown area
    2. Net sown area to total area
    3. Irrigated area to rainfed area
    4. Fallow land to forest area
    Answer

    A. Gross cropped area to net sown area

    Cropping intensity = gross cropped area / net sown area.

  13. Which of the following is a rabi crop?

    1. Maize
    2. Wheat
    3. Cotton
    4. Rice
    Answer

    B. Wheat

    Wheat is sown in winter and harvested in spring, so it is a rabi crop.

  14. Which of the following is a kharif crop?

    1. Gram
    2. Barley
    3. Mustard
    4. Groundnut
    Answer

    D. Groundnut

    Groundnut is sown with the monsoon.

  15. NABARD was established in

    1. 1991
    2. 1975
    3. 1982
    4. 1969
    Answer

    C. 1982

    NABARD began in 1982 on the Shivaraman Committee recommendation.

  16. Regional Rural Banks were set up in

    1. 1975
    2. 1998
    3. 1969
    4. 1955
    Answer

    A. 1975

    RRBs were created in 1975 to serve small and marginal farmers.

  17. The Kisan Credit Card scheme mainly provides

    1. Long-term infrastructure loans
    2. Crop insurance premium only
    3. Free fertiliser
    4. Flexible short-term credit for crops
    Answer

    D. Flexible short-term credit for crops

    KCC gives timely, flexible production credit to farmers.

  18. Crop insurance under Pradhan Mantri Fasal Bima Yojana started in

    1. 2005
    2. 2016
    3. 2010
    4. 2020
    Answer

    B. 2016

    PMFBY was launched in 2016.

  19. MSP is announced by

    1. The Reserve Bank of India
    2. The Central Government on advice of CACP
    3. NABARD
    4. State agriculture departments
    Answer

    B. The Central Government on advice of CACP

    CACP recommends and the Union Cabinet approves MSP.

  20. The Commission for Agricultural Costs and Prices was first created in 1965 under the name

    1. Kisan Prices Board
    2. Food Pricing Board
    3. Farm Cost Council
    4. Agricultural Prices Commission
    Answer

    D. Agricultural Prices Commission

    It was renamed CACP in 1985.

  21. The agency mainly responsible for procurement and buffer stocks of food grain is

    1. FCI
    2. NAFED
    3. NDDB
    4. NABARD
    Answer

    A. FCI

    The Food Corporation of India, set up in 1965, procures and stores grain.

  22. The cost concept that includes rent and interest on owned land and capital is

    1. A2+FL
    2. B1
    3. C2
    4. A2
    Answer

    C. C2

    C2 adds imputed rent and interest on owned assets to A2+FL.

  23. The Swaminathan Commission recommended MSP at least what percentage above the weighted average C2?

    1. 50 per cent
    2. 10 per cent
    3. 25 per cent
    4. 75 per cent
    Answer

    A. 50 per cent

    It recommended MSP of at least 50 per cent above comprehensive cost.

  24. The Commission chaired by M.S. Swaminathan was named

    1. Agricultural Reforms Commission
    2. Land Policy Board
    3. Green Revolution Committee
    4. National Commission on Farmers
    Answer

    D. National Commission on Farmers

    It was the National Commission on Farmers (2004-2006).

  25. The three central farm laws of 2020 were

    1. Repealed in 2021
    2. Retained with minor changes
    3. Struck down by the Constitution Amendment
    4. Applied only to AP
    Answer

    A. Repealed in 2021

    Parliament repealed the three laws in 2021.

  26. Sikkim is known for

    1. Largest rice producer
    2. First fully organic state
    3. Largest cotton producer
    4. First state with canal irrigation
    Answer

    B. First fully organic state

    Sikkim was declared the first fully organic state.

  27. Zero Budget Natural Farming was popularised by

    1. Norman Borlaug
    2. M.S. Swaminathan
    3. Subhash Palekar
    4. Verghese Kurien
    Answer

    C. Subhash Palekar

    Subhash Palekar promoted inputs made from cow dung and urine and mulching.

  28. Which crop is Guntur especially known for?

    1. Jute
    2. Rubber
    3. Chilli
    4. Tea
    Answer

    C. Chilli

    Guntur is a major chilli market and growing region.

  29. The drought-prone Rayalaseema region mainly grows

    1. Jute
    2. Rain-fed groundnut and pulses
    3. Deltaic paddy
    4. Tea
    Answer

    B. Rain-fed groundnut and pulses

    Low rain and dry soils make groundnut and pulses typical there.

  30. The delta canal system of Andhra Pradesh mainly supports

    1. Apple orchards
    2. Tea cultivation
    3. Wheat
    4. Paddy cultivation
    Answer

    D. Paddy cultivation

    Godavari and Krishna delta irrigation supports rice.

  31. Consider the statements: 1. Tenancy reform aimed at security of tenure and fair rent. 2. Land ceiling laws were fully successful in giving land to the landless. Which is/are correct?

    1. 1 only
    2. 2 only
    3. Both 1 and 2
    4. Neither 1 nor 2
    Answer

    A. 1 only

    Ceiling laws had loopholes and gave limited surplus land.

  32. Consider the statements: 1. HYV seeds were scale-neutral but needed inputs. 2. The Green Revolution first spread to eastern India. Which is/are correct?

    1. 1 only
    2. 2 only
    3. Both 1 and 2
    4. Neither 1 nor 2
    Answer

    A. 1 only

    It first spread to Punjab, Haryana and western Uttar Pradesh.

  33. Consider the statements: 1. NABARD is the apex institution for rural credit. 2. NABARD regulates monetary policy. Which is/are correct?

    1. 1 only
    2. 2 only
    3. Both 1 and 2
    4. Neither 1 nor 2
    Answer

    A. 1 only

    Monetary policy is the RBI's job.

  34. Consider the statements: 1. MSP is legally guaranteed for every crop in India. 2. MSP is announced before sowing for a number of crops. Which is/are correct?

    1. 1 only
    2. 2 only
    3. Both 1 and 2
    4. Neither 1 nor 2
    Answer

    B. 2 only

    MSP is a policy announcement; effective procurement is mostly for rice and wheat.

  35. Consider the statements: 1. A2+FL includes the value of family labour. 2. C2 is a narrower cost concept than A2. Which is/are correct?

    1. 1 only
    2. 2 only
    3. Both 1 and 2
    4. Neither 1 nor 2
    Answer

    A. 1 only

    C2 is the widest of the three.

  36. Consider the statements: 1. APMCs are established under state laws. 2. e-NAM replaces all physical mandis by law. Which is/are correct?

    1. 1 only
    2. 2 only
    3. Both 1 and 2
    4. Neither 1 nor 2
    Answer

    A. 1 only

    e-NAM links mandis online; it does not abolish them.

  37. Consider the statements: 1. Natural farming avoids purchased chemical inputs. 2. Organic farming allows heavy use of synthetic fertiliser. Which is/are correct?

    1. 1 only
    2. 2 only
    3. Both 1 and 2
    4. Neither 1 nor 2
    Answer

    A. 1 only

    Organic farming avoids synthetic inputs too.

  38. Match the following: 1. White Revolution - (i) Fisheries 2. Blue Revolution - (ii) Milk 3. Yellow Revolution - (iii) Oilseeds Which match is correct?

    1. 1-iii, 2-i, 3-ii
    2. 1-i, 2-ii, 3-iii
    3. 1-ii, 2-iii, 3-i
    4. 1-ii, 2-i, 3-iii
    Answer

    D. 1-ii, 2-i, 3-iii

    White is milk, blue is fish, yellow is oilseeds.

  39. Match the following: 1. Bhoodan - (i) Voluntary land gift 2. Ceiling laws - (ii) Surplus land redistribution 3. Consolidation - (iii) Compact plots Which match is correct?

    1. 1-iii, 2-ii, 3-i
    2. 1-i, 2-iii, 3-ii
    3. 1-i, 2-ii, 3-iii
    4. 1-ii, 2-i, 3-iii
    Answer

    C. 1-i, 2-ii, 3-iii

    Each term matches its definition correctly.

  40. A farmer borrows for crop cultivation from a bank and pays on time, getting an interest concession. This is an example of

    1. Loan waiver
    2. Price deficiency payment
    3. Direct benefit transfer
    4. Interest subvention
    Answer

    D. Interest subvention

    Interest subvention reduces the effective rate for timely repayment.

  41. A state wants to reduce groundwater stress while keeping farm income. Which approach best fits?

    1. Stop procurement
    2. Shift from paddy to pulses, millets and horticulture with assured markets
    3. Ban all crops in kharif
    4. Expand free power for borewells
    Answer

    B. Shift from paddy to pulses, millets and horticulture with assured markets

    Crop diversification reduces water use if markets support it.

  42. Farmers selling together through an organisation to improve bargaining power are part of a

    1. Joint Land Ceiling Board
    2. Commodity exchange
    3. Farmer Producer Organisation
    4. Mandi tax board
    Answer

    C. Farmer Producer Organisation

    FPOs aggregate small farmers for inputs and markets.

  43. Which scheme gives direct cash income support to eligible farmer families in instalments?

    1. PMFBY
    2. PM-KISAN
    3. e-NAM
    4. PKVY
    Answer

    B. PM-KISAN

    PM-KISAN transfers income support directly into bank accounts.

  44. Which scheme promotes cluster-based organic farming in India?

    1. Kisan Credit Card
    2. Operation Flood
    3. Paramparagat Krishi Vikas Yojana
    4. National Food Security Act
    Answer

    C. Paramparagat Krishi Vikas Yojana

    PKVY, started in 2015, supports clusters of organic farmers.

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