Crop diversification, agricultural transition and farm income growth : evidence from Eastern India

This paper examines the role of crop diversification in agricultural transition towards high-value crops as well as farm income growth in Odisha, Eastern India. The empirical analysis reveals some crucial facts: first, a stagnant and relatively low level of crop diversification in Odisha agriculture. Second, there is an insignificant agricultural transition due to the negative area substitution effect for most of the crops, along with a weak expansion effect over the last two decades from 1995-2018. Third, a declining contribution of productivity growth coupled with an insignificant contribution of crop diversification to the farm income growth over the years. Hence, we conclude no or an insignificant agricultural transition from traditional to high-value modern agriculture in Eastern India, causing unsustainable farm income growth. This calls for an urgent need to promote a mixed cropping pattern and colossal investment to encourage the farmers to transition towards high-value crops, stimulating farm income growth. Furthermore, massive efforts are required to make farmers aware of the advantages of diversification.