Learning Objective
- Overview
- Organisation of Production
- Farming in Palampur
- Non-Farm Activities in Palampur
Overview
An introduction to some basic concepts related to production through a hypothetical village called Palampur, where farming is the main activity. The village also has several other activities, such as small-scale manufacturing, dairy, transport, etc., carried out on a limited scale.
Introduction
Palampur is fairly connected with a well-developed system of roads, transport, electricity, irrigation, schools and health centres. The story of Palampur takes us through the different types of production activities in the village. In India, farming is the main production activity across villages.
Organisation of Production
- Land and Natural Resources: These include things like water, forests, and minerals. They’re the foundation for production.
- Labour: People working—whether in farming, factories, or services—are crucial for making goods and providing services.
- Physical Capital: Tools, machines, buildings, and raw materials are like the gears that help production run smoothly.
- Knowledge and Enterprise: This is where creativity and know-how come in. Combining land, labour, and physical capital effectively leads to productive output.
Farming in Palampur
Land is fixed
For Palampur, village farming is their main product, and the well-being of these people is related to production on the farms. But there is a basic constraint in raising farm production. The land area under cultivation is practically fixed.
Is there a way one can grow more from the same land?
- Multiple Cropping: Farmers can grow more than one crop on the same piece of land. For example, in Palampur, Kharif crops like jowar and bajra are followed by potatoes, wheat, and sugarcane in different seasons.
- Irrigation: Well-developed irrigation systems allow farmers to cultivate crops throughout the year, even during dry seasons. Electricity has transformed irrigation practices.
- Modern Farming: The Green Revolution introduced high-yielding varieties (HYVs) of seeds for wheat and rice cultivation, leading to higher yields.
Will the land sustain?
Modern farming methods have overused the natural resource base. Due to the increased use of chemical fertilisers, the soil lost its fertility. Natural resources like soil fertility and groundwater are destroyed, and it is very difficult to restore them.
How is land distributed between the farmers of Palampur?
- Landless Families: Around one-third of the 450 families in Palampur do not own any land.
- Small Land Plots: Approximately 240 families cultivate small plots of land, each less than 2 hectares in size.
- Medium and Large Farmers: Palampur has 60 families of medium and large farmers who cultivate more than 2 hectares of land.
Who will provide the labour?
- “Farmers either work on their own land or hire laborers. These laborers come from landless families or small-plot cultivators. Unlike farmers, laborers don’t own the crops they cultivate.
- They receive wages—either cash or crops—for their work. Sometimes, meals are provided. Wages vary by region, crop, and type of farm activity. Laborers can be employed daily or for specific tasks like harvesting.”
Capital needed in farming
Modern farming methods require a great deal of capital.
- Most small farmers borrow money from large farmers or village moneylenders or traders who supply various inputs for cultivation. The rate of interest on such loans is very high.
- The medium and large farmers have their own savings from farming. They are thus able to arrange for the capital needed.
Sale of surplus farm products
The wheat the farmers produce from the land is retained in part for their family consumption, and they sell the surplus wheat. Only the medium and large farmers supply wheat to the market.
Non-Farm Activities in Palampur
25 per cent of the people working in Palampur are engaged in activities other than agriculture.
Dairy — the other common activity
Other than agriculture, some people are engaged in dairy, and the milk is sold in the nearby village.
An example of small-scale manufacturing in Palampur
People are engaged in small-scale manufacturing, which is carried out at home or in the fields. This manufacturing involves very simple production methods.
The shopkeepers of Palampur
Traders of Palampur buy various goods from wholesale markets in the cities and sell them in the village. General stores in the village sell a wide range of items like rice, wheat, sugar, tea, oil, biscuits, soap, toothpaste, batteries, candles, notebooks, pens, pencils, and even some types of cloth.
Transport: a fast-developing sector
Transport services include rickshaws, tongas, jeeps, tractors, truck drivers, traditional bullock carts and bogeys. They transport people and goods from one place to another and, in return, get paid for it.
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