Implication of Changing Agrarian Regime on Rural Non-farm Economy

Abstract

The study analyses the implication of changing agrarian regime in India on rural non-farm economy. So far as agricultural growth and/or development are concerned, we can observe four major phases of transition in India, such as, initiation of land reform, period of green revolution, introduction of contract farming and the subsequent diversification of cropping pattern towards high value crops; and finally, the recent upsurge in agricultural land conversion for industrial/infrastructural/urbanisation purposes. Though the impact of changing agrarian situation in India has been debated in the context of agrarian distress, its impact on rural non-farm (RNF) sector which is an integral part of the rural economy is somewhat overlooked. Using farm–non-farm indicators across six agriculturally diversified states of India, we argue that more equitable distribution of land with the introduction of land reforms fosters growth in RNF economy; whereas, green revolution and crop diversification towards high value crops results in concentration of land leading to delinked production between marginal–small farmers and RNF sector. Finally, the policy of large-scale industrialisation at the cost of agricultural land conversion induces a contraction of RNF economy.