No matter how the tradeoffs are resolved, the reality of increasing demand for land from fast growing and more productive sectors cannot be ignored. The possibility of declining arable land available for cultivation underscores the importance of increasing productivity if we are to contain food inflationary pressures. 43. There are several other problems.
First, land holding in India is highly fragmented, with marginal holdings (of one hectare or less) accounting for as high as 62 per cent of all operational holdings. The small farm size in a labour surplus agrarian sector leads to intensive use of land, but in the absence of supporting infrastructure and capacity to access modern technology and inputs, productivity remains low.