Economic Factors

1. Poverty and Indebtedness of Farmers

• A large proportion of Indian farmers, especially small and marginal farmers, live in poverty due to low and uncertain incomes from agriculture.
• The low productivity of their land, limited access to resources, and dependence on informal credit sources often lead to a cycle of poverty and indebtedness among farmers.
• The financial distress experienced by farmers can make it difficult for them to invest in improving their farming practices, access modern inputs, or cope with unexpected losses.
• Farmer indebtedness and poverty are significant barriers to the overall development and transformation of the agricultural sector.

2. Fluctuations in Agricultural Prices

• Indian agriculture is characterized by significant fluctuations in the prices of agricultural commodities, both at the farm gate and in the consumer markets.
• These price fluctuations can be due to various factors, such as changes in weather conditions, supply and demand imbalances, and market speculation.
• The unpredictability of prices poses a risk to farmers, as they may not be able to plan their production and investments effectively.

The Indian agricultural sector faces a range of challenges, including natural factors, technological limitations, institutional constraints, economic pressures, and social barriers. These factors have collectively impeded the transformation and sustainable development of the agricultural landscape in the country.