Role of agricultural diversification in mitigating income risk in Eastern India

Abstract

The study attempts to verify the role of agricultural diversification as a mechanism of coping with income risk. For this purpose, the study estimates the level of agricultural diversification across the eastern Indian states sourcing secondary data on value of output for the period spanning from 1999-00 to 2013-14. Further, income risk at state level also measured through a comprehensive and comparable risk index. It was observed that in eastern Indian states, Chhattisgarh had highest level of risk and Bihar had lowest risk level. Further, factors which can positively influence level of agricultural diversification were segregated and it was observed that, fertilizer usage, percentage of irrigated area, cropping intensity, market access and farm sizes had direct impact on level of diversification for overall agriculture and in cereals, pulses and oilseeds sub-sectors, though in varying degrees. The study also established that level of agricultural diversification reduces risk level while land fragmentation increases risk level.

Drivers of Rural Non-farm Sector Employment in India, 1983–2019

“…Moreover, a relatively stronger coefficient growth of the length of the national highway (0.14) suggests its significance (its forward and backward linkages) on the growth of RNFE in rural India. This argument is also supported by earlier studies like, Binswanger-Mkhize (2013), Venkatesh et al (2015) and Mitra and Tripathi (2021). Moreover, Haggblade et al (2010) argued that rural non-farm sector growth in India is highly constrained by the limited transport and communications infrastructure in rural areas.…”