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TN – agglomerate land holdings without alienating ownership

For over 25 years, IE has been pointing to the poor record of Tamil Nadu in agriculture. Until the break of the green revolution, Tamil Nadu was a major producer of food grains. The sector used to account for over a third of the state’s gross domestic product. Over these 40 years, this has been declining; more steeply in recent years and agriculture is estimated to have accounted for just 8.81 per cent SGDP last year. There has not been a corresponding decline in the number of persons depen

dent on farming:these  accounted for 45 per cent of total employment. This explains the poor impact of the high economic growth contributed by the services and industry sectors on the living standards of rural Tamil Nadu.

A few factors are unique to Tamil Nadu. Rapid urbanisation has resulted in the migration of large numbers from villages to cities. Relentless diversion of agricultural land for other uses and fragmentation of land holdings have been making agriculture unviable. In the state the average size of land holdings has shrunk to 0.80 hectare, even lower than the national average of 1.16 hectares.  The high price of land contributed by massive acquisition by the business, professional and political classes have rendered agriculture unremunerative. For instance, in Padappai, in the outskirts of Chennai, land prices had shot up in four decades, from around Rs 5000 to Rs 3 crore an acre. Such spurt can be witnessed, though to a lesser degree, across the state, rendering farming hopelessly unviable. After years of being surplus, the state has been experiencing shortfalls in its requirements of rice, maize, pulses and oil seeds. Productivity levels have not increased to keep pace with the drastic reduction in arable land area.

Sadly, successive state governments have failed to address this serious problem. An immediate requirement is to agglomerate the fragmented land holdings. Punjab and Rajasthan have amended their APMC acts to provide for leasing land over 15 years without alienating ownership. This will pave the way for the corporate sector and private individuals to take to agriculture and apply science, technology and management that will help raise productivity to high levels. This will bring twin advantage of using the hundreds of agricultural graduates, engineers and scientists in farming and in improving rural prosperity. This in turn will reduce the mindless urbanisation taking place in the state.


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