A poor state with richest farmers in the country

Curious case of Meghalaya

By Sumarbin Umdor

The citizens of our beleaguered state of Meghalaya are not used to receiving good news about their beloved state, particularly in the developmental front. The recently released India Today State of the State Survey, 2021 ranked Meghalaya at the bottom in the overall ranking of 10 small states. A month earlier, NITI Aayog’s National Multi-dimensional Poverty Index (NMPI) baseline report covering multiple parameters of health, education and standards of living had placed Meghalaya as the poorest among small states and fourth from the bottom in the list of all states and Union territories (UTs). As per this measurement, about one third of the population of Meghalaya are multi-dimensionally poor. In the middle of last year, the Ministry of Education, Government of India (GoI) had released the Performance Grading Index (PGI) 2019-20 on status of school education according to which Meghalaya was the worst performer among the 36 states and UTs. The latest in the series of national ranking of states and UTs along socio-economic parameters is the Health Index Ranking of States 2021. It offers some good news as Meghalaya’s ranking has marginally improved over last year’s performance and it has also recorded maximum annual incremental in overall performance. However, even in this sector the State has much catching up to do.
Amidst these gloomy findings comes a startling revelation that the farmers of Meghalaya are the richest in the country with an average monthly household nominal income of Rs. 29,348, surpassing even the farmers of Punjab (Rs. 26,701) who are otherwise considered to be the wealthiest among farmers in the country. The findings are based on the 77th round of National Sample Survey conducted during January to December, 2019 and reported in the recently released report titled ‘Situational Assessment of Agricultural Households and Land and Livestock Holdings of Households in Rural India, 2019’.
As per the survey, an agricultural household is defined as one with multiple sources of income but having at least one member engaged in agriculture and receiving more than Rs. 4000 as value of produce from agricultural activities. For Meghalaya, the monthly household income of farmers is reported to be about three times that of the all-India average, more than eight times that of farmers of Bihar (with lowest income), and more than double of most of the neighbouring states in the north-eastern region (NER). Further, nearly 75 percent of the income of farmers of the State came directly from crop production while for the rest of the country the share of income from agricultural production was only 37 percent.
The same survey carried out in the 70th round of NSS, 2013 had reported the monthly household income of farmers in Meghalaya at Rs. 11.792, which was the fifth highest among states and UTs and way below the monthly household income of farmers of Punjab which was the highest at Rs. 18,059. However, in the span of 6 years the nominal income of farmers in Meghalaya has more than doubled, recording a whopping inflation adjusted increase of 114 percent which is an astonishing feat that belies the conditions of the agricultural sector. It also contradicts with the other reports on the social and economic status of the state in and around the same period as summarized in the first paragraph of this write-up.
Besides income, the Situational Assessment of Agricultural Survey 2019 has also collected other information about the conditions of the farmers which requires a closer scrutiny in order to understand the situation under which farmers operate. According to the survey estimates, 74 percent of the nearly 5000 rural households in Meghalaya are agricultural households. 90 percent of these households are small and marginal farmers with land holding of 2 hectares and less. The State is next only to Mizoram in terms of highest percentage of households depending on jhum cultivation. It also reported the lowest percentage of agricultural households that had accessed the technical advice for crop production. The survey further revealed that farmer households in Meghalaya had the lowest access to credit in terms of average amount of outstanding loans (Rs 2237 against Rs. 74121 all India) and percentage of indebtedness (9 percent against 50 percent all India level of indebtedness).
However, battling all these odds, farmer households of Meghalaya having very small land holdings with many depending on subsistence farming practice of jhum, with very little investment due to lack of access to credit, not being able to plant multiple crops because of lack of irrigation, and without any price support from the government are somehow able to earn the highest monthly income of Rs. 29, 348 or about Rs. 965 per day that too mainly from crop production. This is the apparent conclusion that one would draw from the Situational Assessment of Agricultural Survey 2019.
Besides the average monthly income of agricultural households for all size class of land possessed, the report also provides income figures according to each size class of land possessed (in hectares) in the following seven class intervals: <.01, .01 to .40, .04 to 1.0, 1.1 to 2.0, 2.1 to 4.0, 4.01 to 10, and finally 10+. For Meghalaya, the average household income of small and marginal farmers (2 hectares and less) is about Rs. 19,848 which is much closer to the corresponding income level of farmers of same class intervals of Punjab (Rs. 18,645) and Haryana (Rs.18,353). However, the gap in the income level of farmers of Meghalaya and the rest of the country widens sharply at the higher size classes (above 2 hectares). At class intervals of 4.01 to 10.0 and 10.0 plus hectares the income of farmer households of the State is seven and eleven times that of his counterparts in Punjab.
Given the realities of the agriculture sector in the State, these figures are hard to accept and much harder to explain. It is therefore expected that people should raise doubts on the findings of the survey. However, to reject these findings one must have convincing arguments pointing out the lacunae in the survey, more so as the study has been conducted by the National Sample Survey Organisation (NSSO) which has the experience and expertise in designing and collecting national socio-economic surveys and enjoys high credibility among researchers and policy makers.
Even then, there are some indications on challenges with such surveys in the NER. One, the issue of sufficient sample size to generate reliable estimates for the small states of the region has been raised by some scholars in the past. The Government of India (GoI) appointed committee headed by Prof Atul Sharma in 2010 had recommended increasing sample size for NSSO survey in the NER. Other issues particular to the region are the lack of trained investigators and the poor response from informants. As one survey official observed, “many a times, the informant outrightly tells the investigator to write whatever they feel out of either lack of time or as he cannot recollect at all or due to lack of faith in the outcome of the survey as the surveys do not directly provide any benefits to the people.” Maybe this is what happened during the collection of information on income of farmers in Meghalaya.
(The writer teaches economics in NEHU)

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