ABSTRACT

The agricultural sector has been suffering from a crisis of low growth and low productivity since the 1990s, which have accentuated in the early 2000s. The compound annual growth rate of agriculture and the allied sector during 2000-1 to 2004-5 was 2.02 per cent, the lowest annual growth recorded in the sector since 1980-1 (Mathur et al. 2006). Chand et al. (2007) also show this decline in agriculture, putting the dates slightly earlier, starting from 1997 to 1998. They also show the widespread decline in the sector, covering all sub-sectors. This crisis in the agrarian sector has many deleterious consequences such as farmer indebtedness and farmer suicides. However, it is evident that the effect of the crisis will not be restricted to the households who depend on farm outputs alone. The effect, depending on the interlinkages of the farm sector with various other sectors and markets can be wider and have a cascading effect on the economy. This chapter focuses on one such example catalysed by the agrarian crisis in the rural labour market.