The average income of farmers has increased by 1.3-1.7 times, and in some cases, even two times, between the Financial years 2017-2018 and 2021-2022. This was concluded in a recently conducted research by the State Bank of India (SBI).
As per reports, the study is based on the granular data of crops such as wheat, cotton, groundnut, soybean, sugarcane, cotton and paddy from agriculture-intensive SBI branches. The research work analysed the average growth in income of farmers between FY18 and FY22.
For the same period, farmers witnessed an average increase in non-farm incomes by 1.4-1.8 times. Those who grew cash crops generated more income than non-cash crop farmers.
“This substantiates the trend according to the 77th National Sample Survey that source of farmer income has become increasingly diverse apart from crops,” the study emphasised.
“In principle, we have used a well-spread, well-represented, and probabilistic sample to estimate the change in income from FY18 to FY22 for all segments of farmers, large to small to marginal ones,” it further added.
In Karnataka, the average annual income of cotton farmers doubled from ₹2.67 lakhs in FY 18 to ₹5.63 lakhs in FY22. A similar phenomenon was witnessed in Maharashtra where soybean farmers were able to increase their income by 2x in the last 5 years.
The SBI report pointed out, “Minimum support price (MSP), increasingly aligned with market-linked pricing and increasing by 1.5-2.3 times since 2014, has been pivotal in ensuring passage of better prices to farmers and has led to optimal price discovery, setting ‘floor price benchmark’ for multiple crop varieties (23 as on date), also encouraging farmers to gradually move over to crop varieties that have better yield/value.”
While speaking about the matter, SBI’s group chief economic adviser Soumya Kanti Ghosh said, “The farm sector is currently in the throes of a significant structural shift on the back of a plethora of government policies and has emerged as the known unknown of the India growth story.”
“From a manifold and a statistically significant jump in income (both farm and non-farm, that has even doubled in some cases) to imbibing an entrepreneurial spirit, to a jump in agri exports, the farm sector has been witness to tectonic shifts of late,” he added.
