Augmenting Income of Farmers in India

This policy brief looks at the level and composition of agri-households' incomes, and analyses the factors that can augment their incomes. Regression results of SAS unit level data shows that farmers with livestock have 86.2 percent higher incomes than those without any livestock. Further, evidence suggests that farmers who allocate a greater share of their gross cropped area (GCA) to horticulture crops experience significantly higher incomes than those with minimal diversification. Farmers with less than 6 percent of their land under horticulture, the national average, serve as the baseline. In comparison to that, those who have higher area under horticulture (6–23 percent of GCA) earn approximately 25 percent higher incomes. Income gains continue to rise with greater diversification towards horticulture: farmers with 23-40 percent of their area under horticulture earn 44 percent more, while those exceeding 40 per cent report an average income increase of 56 percent compared to the baseline. This upward trend highlights how diversifying into high-value horticulture crops can substantially boost farm incomes.