Indian economy still is agro based economy and Indian society still remains agrarian society. Contribution of agriculture in GDP has declined but its importance and significance has not declined. But some fundamental challenges are faced by Indian agriculture.
Indian agriculture still remains the gamble of Indian Monsoon. Only 48% of the land has assured irrigation. Rest of the area is rainfed which increases the vulnerability factor for the farmers residing in those areas.
Land used pattern depicts the high cropping intensity i.e. 192 million hectare is under gross cropped area. But agriculture land are suffering from low productivity and high pressure on land.
Fragmentation of land and land holding pattern in India restricts the mechanised farming. More than 86% of the farmers are marginalised farmers i.e. land holding less than 1 hectare. The land holding gets further fragmentised due to population growth rate and unavailability of additional source of income.
Agriculture facing the problem of shortage or inadequacy of input, Availability, affordability and accessibility of the agro technology, microfinance, HYV seeds, irrigation, fertilizer is another problem.
Irrational policies like Minimum support price make farmers to go for limited type of crop which creates imbalances in production and hence affect demand supply.