Centre may legalise farm land leasing

Initiative could improve agriculture efficiency

Centre may legalise farm land leasing

In a bid to enable small and marginal farmers access farm loans, the government is mulling over legalising leasing of farm land, an initiative considered as a major reform to improve agriculture efficiency.

Agriculture Ministry officials told Deccan Herald that the government would soon unveil a draft Model Land Leasing Bill that seeks to legalise lease of farm land thus giving small and marginal farmers access loans from banks and bring them under the crop insurance umbrella. As per the prevailing practices, millions of sharecroppers informally rent farm land for cultivation and pay a certain share of the farm produce to the land owners. The prevailing system is also seen to be hampering agricultural growth, which has already slowed down due to back-to-back droughts.

“The new law could also pave way for contract farming through consolidation of farm holdings,” the official said noting that over generations land holdings have become progressively small and fragmented. As per government data, 85 per cent of the 14 crore farm holds belong to small and marginal farmers.

The new land lease policy is expected to discussed threadbare at a three-day meeting of state agriculture ministers in Gangtok from January 17 which will be inaugurated by Prime Minister Narendra Modi. At present, Telangana, Bihar, Karnataka, Uttar Pradesh and Madhya Pradesh ban land leasing with exceptions granted to land owners among widows, minors, disabled and defence personnel. Kerala too had for long banned tenancy entirely, permitting only recently self help groups to lease lands. A legal sanction to land lease agreements would help lessees access credit and government entitlements such as subsidy on seeds, fertilisers, relief and crop insurance.

A study by  Assocham last year had revealed that the agriculture credit offered by the government was not reaching small and marginal farmers.

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