SMALL FARMERS DEVELOPMENT

AGENCY - 1971
RURAL PLANNING & DEVELOPMENT
Submitted by: K. Rajesh 2150400028

Background

In a rapidly expanding economy, the disadvantaged rural groups are siphoned off
in the allied alternative occupations either in the urban or in the rural areas.

In most cases it results in rural-urban migration. Such a process unburdens

agriculture of its excess human labour and helps improve the economic
conditions of the disadvantaged groups.

In the Indian economy, a breakthrough of a revolutionary character has been

achieved in farm production in the recent past. The disadvantaged groups have
also got a share in the new production potential.

However, the breakthrough was not the result of a planned strategy, nor is
there an assurance of its repetition in the future. With this background the solution
to the problems of rural poor will be explored.

Definitions
The present definition specifies 5 acres of dry land as
the cut-off point for identifying small farmers.
2.5 acres of dry land for identifying marginal farmers.

Small Farmers Development Agency (SFDA)

In 1969, The RBI had appointed an All-India Rural Credit Review Committee in 1969.
The chairman of this committee was B. Venkatappiah.

This committee recommended establishment of Small Farmers Development Agency

(SFDA). This scheme was started in 1971-72 in select districts.

It was financed by central as well as state government and a provision of subsidy

was made for the farmers from 25% (nontribal farmers) to 50% (tribal farmers).

The SFDA was the first programme in our country in which there was a proper linkage
of the central Government, State Government and Financial Institutions.

Later in 1980, this programme was merged with Integrated Rural Development
programme (IRDP).
Source: http://www.gktoday.in/sfda-and-mafalda/

Need for SFDA

The core philosophy of the SFDA was
To investigate and identify the problems of small farmers and ensure
that various services reach to them.
To ensure that the farmers secure loans from cooperative banks. To
ensure that the farmers have access to other assistances such as
cooperative banks, improved seeds, fertilizers and other inputs.

Aim and Objectives

The Small Farmers Development Agencies (SFDA) programme, aimed at the target group
of small and marginal farmers and agricultural labourers, has been in operation since 1971
covering 1818 blocks in the country.

The objective of the Programme was to assist persons specifically identified from this
target group in raising their income level. This was to be achieved by helping them,
on the one hand, to adopt improved agricultural technology and acquiring means of
increasing agricultural production like minor irrigation sources, and
on the other hand, to diversify their farm economy through subsidiary activities like
animal husbandry, dairying, horticulture etc.

The Agencies were to make particular efforts to ensure that the needed inputs and
credit were made available to these persons by respective credit agencies.

Enrolling them as members of the credit cooperatives was one of the operational
objects of the programme so that they could draw necessary assistance from them.

Functions

The cultivators' main requirements relate to (1) knowhow, (2) inputs, and
(3) credit.
The agency primarily functions as a coordinator between participants, credit
institutions, development departments and extension agencies.
The functions of the agency begin with identifying the participants according
to the definition of small and marginal farmers and agricultural labourers.
Suitable programmes for improved agriculture and subsidiary occupations
are drawn up by the agency. The agency does not give credit and advance
loans.
It extends assistance to individual participants and cooperative institutions,
etc., in pursuance of the programmes drawn up for the area.
To the small farmers the agency allows a subsidy of 26% and to the
marginal farmers and agricultural labourers 33-1/3% on capital investment
under such programmes as soil and water conservation measures, land
levelling and shaping.

Organizational Structure

A separate agency is constituted in each area with special funds and staff
at its disposal. The agency is set up as a society registered under the
Registration of Societies Act.
Deputy Commissioner/ District Development Officer is the Chairman of
the Agency. Its members include the district level officials of the various
developmental departments, representatives of the cooperative institutions,
and the commercial bank (land bank) .
A representative of the state government is also included as a member. A
representative of the Government of India is associated with it as a permanent
invitee.
An additional non-official from the participants belonging to the scheduled
castes is also associated as a special invitee. Local MLAs and MPs are also
associated with the implementation of the programmes.
The Chairman of the Agency may nominate an Executive Committee (or Action
Committee) consisting of 4 or 5 members to look into the various programmes
intensively and take necessary decisions.

Role of Cooperatives in SFDA and

the Risk elements

SFDA is credit oriented development programme, its success mainly depends

upon the presence of sound credit institutions in the area.

Credit institutions including the land development banks are expected to play the
crucial role of extending the long-term, medium-term credits to the small farmers.

The financial targets in Karnataka district could not be implemented due to shortage
of funds. The financial targets of the SFDA in Mysore district was of 63.5 million
during the fourth plan whereas the achievement was only to the extent of 15.4 million.
It is only 25 %.

They should be provided with financial assistance in order for the better
implementation of the programme.

Status of SFDA

Up to March, 1980 the Agencies had identified 16.7 million persons from the
target group for assistance. Of these, 8 million beneficiaries including 1.3 million
belonging to the scheduled castes and scheduled tribes, have been assisted.

6.1 million or 75 per cent of these beneficiaries have been helped in acquiring
access to improved agricultural practices through subsidised supply of inputs,
improved implements and field demonstrations.

Bulk of the remaining I.9 million beneficiaries have been covered under the
more substantive asset development programme like acquisition of milch
cattle, sheep, poultry, piggery etc. (0.9 million), minor irrigation (0.9 million), and
other categories including forestry and village industries (0.1 million).

Integrated Rural Development Programme

The concept of an Integrated Rural Development Programme was

first proposed in the Central budget of 1976-77, and a beginning was
made.

This programme was intended to' assist the rural population to

derive economic benefits from the developmental assets of each
area.

The programme with some modifications was introduced on an

expanded scale in 1978-79, beginning with 2300 blocks, of which
2000 were under coterminus coverage with SFDA, DPAP and CAD
programmes.

Constraints to Formulation and

Organization of Economic Activities

While inadequacy of the SFDA staff in number and required skills and
knowledge to formulate and implement schemes or projects was unanimously
stressed in the Seminar deliberations, three rather interrelated but critical constraints
were:

1. Lack of superiority of the SFDA's structure as it functioned over the existing

government agencies. This was mainly due to SFDA's inadequate powers in
comparison with its responsibilities implied in the catalyst's role.
2. The problem of coordination and integration of various government and other
agencies which affect achieving viability of projects or schemes.
3. Constraints stemming from the low risk -taking capability of small farmers.

Limitations and Suggestions

The agency reports the progress of the programmes monthly to the

Government of India. The progress and programmes are reviewed by
Government of India officers during their field visits.

The Reserve Bank of India had undertaken 13 field studies each year on
selected SFDAs and MFALs projects with base year 1972-73 and 1973-74,
respectively.

The Agro-Economic Research Centres of the Directorate of Economics and

Statistics have also carried out studies of selected SFDA/MFAL projects.
Some of the shortcomings are briefly presented here.

1. Identification:
Identification of the participants is the vital work of the SFDA. It
is, however, seen that in the absence of proper test check
benefits under SFDAs have leaked to some bigger farmers
also.
The leakage is, however, not significant. But even if
insignificant, its wide and adverse publicity gives the
programme a bad name.
Therefore, it is necessary that the agency should follow the
instructions meticulously.

2. Model Cropping Pattern:

The agency is expected to draw programmes for the small
and marginal farmers in its area .
As it may not be possible to draw up programmes for each
and every farmer, it has been suggested that model
cropping patterns for different size of holdings may be
drawn up by the agency, keeping in view the agro-climatic
conditions and other factors in the project areas.
However, this has not been done. It is desirable that this
should be given priority.

3. Demonstration Plots;
The agency is allowed to organize up to 2,000 demonstrations in the
fields of small/marginal farmers costing up to Rs. 200 per plot of not
more than 0.50 acre each.
This programme has been taken up in a scattered manner and no
attempt has been made to analyse the results in many areas. The
demonstration plots should be laid in such a manner that they have the
maximum spread-effect.
The results of the yield should also be analysed and given due publicity.