Who Are Marginal Farmers?

Empowering Marginal Farmers for a Sustainable Future

Discover the challenges faced by India’s marginal farmers and explore how FEED is transforming their lives through innovative solutions and strategic partnerships. 

Understanding Marginal Farmers

Marginal farmers are those who own small plots of land, typically less than one hectare. They face a range of challenges, including limited access to resources and support services. Many live in poverty, are trapped in cycles of debt, and often have to rely on non-farm economic activities and wage labor to sustain their livelihoods.
The Reality of Marginal Farmers

Living on the Margins

Marginal farmers exist in a world of neglect and marginalization. They struggle with poor soil quality, inadequate inputs, and minimal outputs, pushing them further into the fringes of society. Despite making up 72% of the total farmers in India, which represents approximately 100 million individuals, they face an increasingly precarious future.
Challenges Faced by Marginal Farmers

Overcoming Key Challenges

Marginal farmers confront several significant challenges that hinder their ability to thrive:

High Input
Costs

Issue

Small land holdings make it difficult for farmers to source essential inputs, including manpower, machinery, and fertilizers, at competitive rates.

Impact

Since 2007-08, there has been a sharp increase in the cost of cultivation at an annual rate of 13%, further straining their finances.

Difficulty in Availing Credit

Issue

An RBI report indicates that 50% of small and marginal farmers are unable to borrow from formal sources due to unclear land titles.

Impact

Lengthy loan procedures, demands for collateral, and short-term crop loans force farmers to turn to non-institutional lenders, exacerbating their financial woes.

Declining Farm Gate Prices

Issue

Farm gate prices have been declining since the mid-2010s.

Impact

Rising input costs, high financing costs, and reducing nominal farm incomes make agriculture an increasingly unattractive livelihood option.

High Input
Costs

Issue

Small land holdings make it difficult for farmers to source essential inputs, including manpower, machinery, and fertilizers, at competitive rates.

Impact

Since 2007-08, there has been a sharp increase in the cost of cultivation at an annual rate of 13%, further straining their finances.

Difficulty in Availing Credit

Issue

An RBI report indicates that 50% of small and marginal farmers are unable to borrow from formal sources due to unclear land titles.

Impact

Lengthy loan procedures, demands for collateral, and short-term crop loans force farmers to turn to non-institutional lenders, exacerbating their financial woes.

Declining Farm Gate Prices

Issue

Farm gate prices have been declining since the mid-2010s.

Impact

Rising input costs, high financing costs, and reducing nominal farm incomes make agriculture an increasingly unattractive livelihood option.

The Way-Out

Pathways to Improvement

Awareness and Utilisation of Government Provided Facilities

Reasons for Not Selling Produce to Government Procurement Agencies

Extent of Crop Damage Due to
Natural Disasters

Coping Strategies Used by Affected Marginal Farmers

Diversifying the Production Basket

Current Scenario

India has achieved a food surplus, with an all-time high production of food grains in FY19-20 at 320 million tons. However, there remains a significant nutritional deficit of 180 grams per day, primarily due to shortages in fruits, vegetables, milk, and visible fats.

Need for Diversification

Diversifying the food basket is essential to meet the recommended nutritional needs of the population. Implementing policies and initiatives to promote the production of a variety of food items will help bridge this nutritional gap.

Development of Local Economy

Rural Employment Trends

There has been a noticeable shift in employment from rural areas to urban centers, leading to a talent drain that weakens rural economies.

Resilient Rural Economies

Building resilient rural economies is crucial to retaining talent and preventing the migration of youth to cities.

Transforming Rural Centers

Private Investments: Increased investments can transform rural centers into industrial hubs.

Public and Private Resources: Development requires a combination of public and private resources for improved farming techniques, technology development, and streamlined supply chains.

Value-Addition Activities: Investments in value-added activities, such as micro warehouses and logistics optimization, are necessary.

Human Capital Development

Capacity Building Programs

Developing programs that suit the economic needs of rural and peri-urban areas is vital for economic growth.

Skill Development

Encouraging youth to acquire skills that enable them to contribute actively to the local economy is crucial.

Supporting Rural Entrepreneurs

Creating an ecosystem that supports a new breed of rural entrepreneurs is essential.

Integrated Approach

Breaking silos in the current agriculture ecosystem is necessary to prevent lost value. FEED aims to bring together all stakeholders under one roof, providing an integrated solution to maximize value.

The FEED Approach

FEED’s Comprehensive Strategy

Marginal farmers confront several significant challenges that hinder their ability to thrive:

01

Access to Market - Value Chain Development

Objective

Integrate farmers into robust value chains to enhance their market reach and improve income.

Strategies

Develop and strengthen agricultural value chains, establish market linkages to connect farmers with buyers, and promote fair trade practices and transparent transactions.

02

Access to Credit

Objective

Provide financial resources to farmers through innovative financing models.

Strategies

Facilitate access to affordable credit through blended finance models, and partner with financial institutions to offer tailored loan products.

03

Access to Technology - Creating Agri-Entrepreneurs

Objective

Empower farmers with modern technology to enhance productivity and efficiency.

Strategies

Introduce advanced farming techniques and tools, train farmers to use technology effectively, and encourage the development of agri-entrepreneurs who leverage tech solutions.

04

High-Value Crops

Objective

Increase profitability by focusing on high-value crops.

Strategies

Identify and promote high-value crops suitable for local conditions, provide seeds, training, and support for high-value crop cultivation, and connect farmers with markets that demand high-value produce.