Agriculturists in India are developing their work mainly through improvements in their traditional areas, with new seeds, chemical fertilisers and pesticides, mechanised modes for managing cultivation and sometimes even new products. Some agriculturists also depend substantially on subsidies for fertilisers and for food procurement by the government.

Most of the government purchase and the bulk of the fertiliser and food subsidies are for the production of paddy and wheat.  In 2023-24 the value of output of these two principal crops was Rs 7.5 trillion and the budget cost of fertiliser and food subsidy was Rs 4 trillion. Over 800 million persons receive these food grains free of cost from the central government.

If one looks at the growth area in agriculture in the 12 years between 2011-12 and 2023-24, production of paddy and wheat rose by just 27 percent. Fruit and vegetable production rose by 52 percent and milk production by 85 percent even though they did not have any substantial support by way of subsidies or minimum support price procurement by the government. The true growth areas in agriculture are out of direct central government support and depend largely on producer enterprise.

The most interesting example of  producer managed growth is the substantial increase in milk production which has been boosted by the effectiveness of milk producer cooperatives. The earliest instance was in Gujarat when the milk producers in Anand set up a cooperative named after their district Kaira and labelled their product as Amul which is the abbreviation of Anand Milk Union Limited! It developed as a response to the heavy dependence of the milk suppliers on purchases by the sellers of Polson milk in Bombay. Tribhuvandas Patel lead the initiative and Verghese Kurien came in as the executive head. Their initiative has culminated in the Gujarat Cooperative Milk Marketing Federation which is perhaps the largest food products marketing company in India and is owned by 3.6 million milk producers.

This focus on production control was the basis for the management of the National Dairy Development Board set up in 1965 by Verghese Kurien and supported by the then PM Lal Bahadur Shastri who saw the merit in relying on producer-controlled cooperatives. Kurien was particularly strict about keeping bureaucrats at a distance from programme control. Operation Flood which brought in support of funds and milk supply, came in 1970 and enabled the country wide cooperatives to dominate the urban market through institutions like the Mother Dairy.

This sector controlled by producer and not dependent on government procurement and minimum support prices has boomed faster than the agricultural sectors like paddy and wheat production that have been dependent on government support. In 2023-24 the value of output of cereals (mainly paddy and wheat) was about Rs 8.5 trillion. while the value of the largely cooperative controlled milk group was Rs. 12.2 trillion.

The role of the producer and cooperative controlled sector may be relevant for an emerging option that would be a substantial income source for farmers and also contribute significantly to our long-term challenge of coping with climate change. It basically involves electricity supply from farm fields.

Electricity pricing for agriculture is heavily subsidized, with farmers typically paying a fraction—or nothing—of the average cost of supply. One way of reducing these losses is to see how power use in rural areas can be met by local sources. In fact, it is also possible to make agricultural areas a source of solar power that will contribute to the management of climate change.  An option that has been designed called agrivoltaics (Agri-PV) basically involves installing solar power at an elevated level above areas sown with agricultural products which can cope with the partial shading of sun power.  It may be a partial answer to the difficulty in securing large areas of land, mainly in rural areas, for standard solar power units.

The central government has a programme, elaborately entitled but more easily referred to as KUSUM[1], which is aimed mainly at promoting the use of captive solar power for use in pump sets. This has to compete with the substantial subsidy or even free use of electricity provided to rural areas by the state level distribution companies.  But KUSUM also covers the possibility of support for Agri-PV projects which combine the use of land for agriculture and for photovoltaic establishment to generate solar power for sale. This presents an interesting possibility of raising the returns from the ownership of agricultural land with the dual use of the land for agriculture and for solar power generation for use and sale. 

A recent project implemented by ICRIER[2] does an interesting analysis of Agri-PV and evaluates two implementations of this dual use of land for agriculture and solar power generation, one in Madhya Pradesh and the other in Rajasthan. What it does bring out is the substantial increase that the dual land use makes for the farmer's income.

The other point that comes across is the substantial level of investment required to set up the solar power capacity-it was Rs 18.5 crores in the 15 acre land plot in Madhya Pradesh and Rs 2 crores in the 3 acre land plot in Rajasthan. Because of this high investment cost, relying  largely on individual land owners will limit the impact.

Some improvement may come from commercial developers who will share income with  the land owner. But substantial transformation can come mainly from community based groups, organised as cooperatives or producer based companies, who can combine small and medium land owners for implementing the dual use of land in Agri-PV. Do note that the average per capita ownership of agricultural lands in India is just 1.08 hectares and hence relying on individual land owners will greatly limit the impact of Agri-PV.

At present the promotion of Agri-PV is essentially from the central sector scheme KUSUM run by bureaucrats. Given the high investment cost it may generally involve community or sub-community level cooperation.  I would suggest that application system for Agri-PV should be run by an organisation which directly involves the producers and not be left to bureaucrats.  The application will be very variable in different ecological zones as agriculture development conditions vary greatly by local conditions. Moreover, the Agri-PV system requires judgements about crops which can tolerate the reduction in solar exposure which can only be assessed by farmers at a local level and not by bureaucrats.

The example of the cooperative institutional arrangement that is responsible for the boom that we have had in milk production and sale may provide an answer not just to the Agri-PV case but to the promotion of other product areas like fruits and vegetables, which are often produced by small land owners. The essential point is that we should rely more on producer-control organisations like  cooperatives or producer companies rather than on schemes controlled by bureaucrats for the modernization and higher production in agriculture.

[1] Pradhan Mantri Kisan Urja Suraksha evam Utthan Mahabhiyan

[2] Ashok Gulati and associates, Harvesting Sun and Soil: India's Agri-PV Future, ICRIER, 2026