Agriculture Policy

Punjab Farmers Earn Less Per Hectare Than Those of Andhra, West Bengal and Tamil Nadu

An agriculture scientist in a wheat field in Ludhiana. Photo by Vivian Fernandes

Farmers of Andhra Pradesh create more value per hectare than those of Punjab, write economist Ashok Gulati and researcher Bidisha Chanda in an article in the Indian Express. By dividing a state’s agricultural GDP with its total area cultivated, they arrive at agricultural value created per hectare of net sown area. According to Gulati and Chanda, Punjab ranks 13th on this score even though it has among the highest yields in wheat and rice. Andhra earned Rs 6.43 lakh per hectare in 2020-21 compared to Punjab’s Rs 3.71 lakh per ha. West Bengal at Rs 5.19 lakh per ha and Tamil Nadu at Rs 5.14 lakh per ha were also getting more than Punjab. Even when cropping intensivty is accounted for, that is the value produced by multiple crops during a year from one hectare, also known as gross cropped area (GCA), Andhra (Rs 5.30 lakh per ha), West Bengal (Rs 2.67 per ha) and Tamil Nadu (Rs 3.97 per ha) do better than Punjab (Rs 1.92 lakh per ha).

The reason, according to the authors is because 84 percent of Punjab’s GCA is under wheat and rice, which are not as paying as fisheries and horticulture. Twenty-four percent of Andhra’s agricultural gross value added (GVA) is from fisheries. The state contributes 30 percent of the country’s fish output. Tamil Nadu excels in the cultivation of mangoes and bananas. West Bengal cultivates vegetables on 15 percent of its GCA of 1.5 million ha.

Punjab needs to shift 1.5 million ha out of 4.5 million ha under rice to pulses, oilseeds, maize and fruits and vegetables for the sustainability of its agriculture. It should focus more on dairying which accounted for 28 percent of its gross value agri-output in 2019-20. Punjab should produce value added items from milk both for the domestic and export markets to improve its earnings per hectare of cultivated area, they say. To enable farmers to make the shift, they should be paid Rs 25,000 per ha when they switch from paddy to other crops as this is the savings from avoided use of electricity (provided free) and fertilisrs (highly subsidised).

(Top photo of an agriculture scientist at a wheat field in Ludhiana, by Vivian Fernandes)

Related posts
Agriculture Policy

Any Crop Combination That Doesn't Include Paddy is Not the Most Profitable

Even if there is assured procurement at minimum support prices (MSP) of other crops, any combination…
Read more
Agriculture Policy

MSP Can Cover Comprehensive Cost, but Margin Cannot be 50 Percent, Say C Rangarajan and S Mahendra Dev

In the context of farmers demanding minimum support prices (MSP) as a legal guarantee, economists C…
Read more
Agriculture Policy

Raising MSP to Levels Demanded By Protesting Farmers Will Feed Inflation, Cause Shift in Cropping Patterns, Two Economists Say

If minimum support prices (MSP) were to be 50 percent above comprehensive or C2 cost, as the…
Read more

Leave a Reply

Your email address will not be published. Required fields are marked *