This policy paper discusses the creation of Special Agricultural Zones (SAZs) in India as a way to improve farmer incomes and address issues in the agricultural sector. It proposes organizing agricultural areas into clusters based on criteria like crops, farming practices, infrastructure, and ecology. SAZs would focus interventions like extension services, subsidies, tax benefits, and relaxed land and investment rules to promote higher value crops. The benefits cited include protecting farmland, improving water use, boosting exports and investments, and facilitating research and skills development. International examples from countries like Japan, China, and Sri Lanka are referenced. It is argued that SAZs could effectively and efficiently target interventions while benefiting farmers equitably. Cooperation with state

1. Policy Paper Presentation
06.07.2016
Institute of Secretariat Training and Management, New
Delhi
Special Agricultural zones
A Cluster based approach to improve
Farmers’ Incomes
Vijay Rajmohan, Director (Extension), DAC&FW
&
G.Srinivasan, O.S.Ashok, B.M.Sharma, V.S.Yadav, Deputy
Secretaries to Government of India.
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2. Overview
 49% of population and 70% of rural households
dependent on Agriculture.
 Real incomes of farmers stagnating vis-a-vis
increased prices of other commodities.
 Productivity low compared to developed as well as
some of the developing countries.
 Not getting investments resulting in little job
creation.
 Government plans to double the income of farmers
by 2022.
2

3. Importance of Agriculture
Source: The Hindu, 2015
Source: Priya
Pandey
3

4. Comparative Sector-wise Contribution in
GDP- India with other Countries
4
Source: Extension

5. GDP & Sector-wise Employment
Trends (UPS) during 2011-12
0
10
20
30
40
50
60
Agriculture Industry Services
15.5
27.22
54.91
47.1
24.4
28.5
Share to Total GDP
Employment trends
(%)
Source:
Employment: NSSO different round reports & CSO (Economic Survey 2014-15, Service Sector,
Pg. 113);
GDP – CSO, 31.10.2014 Data book for PC, 22.12.2014 Pg. 3.5 Source: Extension
Division, DAC

6. Sector-wise Employment Trends (UPS)
0
10
20
30
40
50
60
70
1993-94 2004-05 2011-12
61.1
54.5
47.1
16
19.5
24.422.9
26 28.5
Agriculture
Industry
Services
*UPS = Usual Principal StatusSource: NSSO different round reports & CSO
(Economic Survey 2014-15, Service Sector, Pg. No. 113)
6 Source: Extension
Division, DAC

7. Trends in Workforce Engaged as
Cultivator & Agril. Labourers(Millions)
0
20
40
60
80
100
120
140
1 2 3 4
100
120
130
110
65
90
100
140
Cultivators
Agril. Labourers
1981 1991 2001
7 Source: Extension
Division, DAC

8. Existing Policy Framework
 Central and State Governments providing initiatives for
improving agriculture and allied industries.
 Service Tax, Income Tax deductions allowed for
agriculture related services.
 Customs Duty exemption for importing certain
Agriculture related machinery and storage, processing
facilities.
 Excise benefits available for machinery in food
processing, vegetables & fruits, milk and milk products.
 Grants and subsidy schemes in areas of Agriculture,
Horticulture, Animal Husbandry and Fisheries.
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9. Constraints in existing policy
framework
 Average income of farm household very low -
estimated at Rs 6,426 per month.
 Half of wheat and rice grown for self consumption.
 Majority of produce sold to private traders and not
getting government fixed prices.
 Small farmers rely on moneylenders for their loans.
 Unless income of farmers increased, their condition
will not improve.
 Farming losing status
9

10. Household Income from
Farming
10
Source: The Hindu, 2015

11. The Solution: Special Agricultural
Zones
 A cluster based approach in which Agricultural
areas are grouped based on identified criteria
 Criteria: Crops, Farm practices, Infrastructure,
Natural resources, Ecological zones etc,.
 Focus interventions : Extension activities,
Subsidies, Exemptions from local laws, Tax
concessions, Relaxed land leasing norms,
Investment procedures.
 Change in Trend of crops: From traditional to high
value crops.
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12. High Value Crops Catching-up
45.33
28.17
26.5
38.45
32.85
28.7
0
5
10
15
20
25
30
35
40
45
50
Agriculture Horticulture AHDF
200
0
(As a percentage of Agriculture
GDP)
12 Source: Extension
Division, DAC

13. Special Agricultural Zones - the
benefits
 Protection of cultivable Lands, ensure Soil fertility
 Ensure optimum utilization of water resources
 Improving Exports through improved quality of
products
 Would help creation of Agro based Industries.
 To bring in Investments-domestic and foreign.
 Focus on research, extension & skill development
interventions feasible.
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14. Experiences: India and
International
 Uttarakhand – the first State to try the concept.
 Sikkim a role model of a SAZ for organic farming.
 Japan, China, Taiwan, South Korea experimented
with special zones for Agriculture.
 Sri Lanka has created a 3,000 acre Special
Agricultural Zone in its eastern province.
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15. Conclusion..
 Effectiveness: Focussed interventions through
special/uniform clusters.
 Efficiency: Uniformity, ease of reach to improve
efficiency of Government interventions. Economies
of scale. Branding of products. Attracting
investments & technologies.
 Equity: Farmers in the clusters to benefit,
irrespective of socio-economic backgrounds.
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16. Conclusion
 Feasibility: Co-opting State and Local Governments
would improve the viability of the approach. No
additional funds, the existing funds of various
Central and State Ministries and funds of the local
bodies would be pooled and utilized in a focused
manner.
 Flexibility: Scaling up/ increasing the clusters to
cover the entire country in due course of time.
 Sustainability: Sustainable due to nil land
acquisition, nil additional fund allocation, special
attention to inputs, efficient use of water,
encouragement to Organic farming, improved
quality, brand value & marketing.
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17. Thank You!
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