There are many factors responsible for the low productivity in Indian agriculture. The important among these are as follows:
(i) Demographic Pressure:
India is a thickly populated country. According to 2001 Census, 72.2 per cent people live in rural areas. The burden of increasing population falls on land. Over-crowding on land has led to sub-division and fragmentation of land holdings, decline in per capita availability of land and, underemployment and disguised unemployment. The marginal productivity of labour in such circumstances falls to zero or in some cases is negative.
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(ii) Small Size of Holdings:
Expert studies in agriculture put the average size of holding at only 1.80 hectares. Not only the agricultural holdings are small but they are scattered too. Since most of the agricultural holdings in India are not economically viable units, it is very difficult to employ the improved agricultural practices.
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(iii) Discouraging Rural Scenario:
The conditions prevailing in the rural economy of India are not conducive for improving agricultural productivity. Indian farmers are illiterate, superstitious, and conservative and bound by dogmatism, fatalism and obsolete social customs. Farmers, generally, employ traditional techniques of production.
(iv) Institutional Factors:
The agrarian structure, which was obtained from the colonial rule, depended solely on a few rich landlords and zamindars that used to wield considerable influence on the village life. Though the zamindari system has been abolished, the absentee landlordism still prevails.
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Various tenancy legislations which have been contemplated during the last half century have failed to ensure the ownership of land to the actual tiller. In the absence of ownership, peasants have had no incentive to improve the productivity of land.
(v) Lack of Inputs:
Agricultural output and the productivity of land and labour depend to a large extent upon the availability and nature of inputs. Indian farmer is poor and with his meagre financial resource he is not in a position to employ high yielding variety (11YV) seeds, fertilizers, irrigation facilities, farm equipment, etc.
(vi) Poor Techniques of Cultivation:
Most of the Indian farmers are illiterate, ignorant and superstitious, hither the farmers do not have adequate knowledge of the modern techniques of production or they fail to employ these techniques on account of their poor finance. Most of the farmers still practice traditional and outdated techniques of production which have adverse effect on agricultural productivity.
In the recent past, there has been considerable improvement in the availability of IIYV seeds, fertilizers, crushers, threshers, harrows, hoes, tractors, pumping sets, etc., but only the rich farmers have been able to use the modern techniques.
(vii) Lack of Non-farm Services:
Indian agriculture has suffered a great deal on account of the inadequacy of non-farm services such as credit and marketing facilities. Either these services are non-existent or they are very expensive and beyond the reach of average Indian farmer. In spite of the establishment of the institutional credit agencies, most of the farmers still depend upon moneylenders who resort to all kinds of malpractices to cheat the illiterate farmers.
Likewise, in the absence of marketing facilities the farmers are subjected to exploitation by middlemen and moneylenders. A large part of the total produce gets spoiled on account of the non-availability of storage facilities.
Other non-farm services pertaining to the spread and propagation of modern techniques, their demonstration and application are not only inadequate but also inequitably distributed.