With more and more agricultural households supplementing their incomes through other sources, a new report has called for rethinking rural development strategies and bring in more reforms in the farm sector to support farmers and farmer households.
“PRICE’s ICE 360° surveys support this, revealing that while 42.4% of rural households earn some income from agriculture, only 20.7% are fully dependent on it. This shift underscores the need to rethink rural development strategies,” said the report titled ‘Reimagining Annadata Households and Their Livelihoods Beyond the Farm’ by People Research on India’s Consumer Economy (PRICE).
The report found that while many rural households report agriculture as a source of income, a smaller percentage is entirely dependent on farming. According to the PRICE ICE 360° Survey, approximately 42.4% of Indian households or 140 million households in 2024-25 have agriculture and allied activities as a source of income. However, only 20.7% (68.4 million households) are classified as ‘full-time/regular’ agricultural households, meaning their primary source of livelihood is farming.
“This stark difference indicates that a significant number of households derive part of their income from non-farm activities, with agriculture playing a supplementary role in their overall economic structure,” it said. The report is authored by Rajesh Shukla, Adite Banerjie and Tanvi Menaria of PRICE.
The report also highlights that farming alone is no longer sufficient to sustain rural livelihoods and 33% of the income of agricultural households is in fact derived from non-farming activities. These include non-agricultural self-employment (7.1%), salaries from jobs outside of agriculture (3.4%), and remittances (2.6%), it said, adding that this trend toward non-farm income highlights the increasing importance of economic diversification for the survival and stability of agricultural households.
The report notes that the average full-time agricultural household in India is projected to earn Rs 7.31 lakh annually by 2024-25, with a substantial portion of their income—67.1%— coming from farming activities. This includes Rs 4.90 lakh earned directly from farming and Rs 54,000 (7.4%) from allied agricultural activities such as dairy, livestock, or other subsidiary agricultural enterprises. “However, farming alone is no longer sufficient to sustain rural livelihoods,” it underlines.
It has suggested several reforms in the farm sector to support farmers and farmer households. These include measures like broadening the definition of Annadata households to include tenant farmers, sharecroppers, and landless agricultural workers, which would ensure they are included in welfare schemes such as PM-Kisan and formal financial inclusion initiatives. It has also called for promoting non-farm employment by fostering rural entrepreneurship and skill development to create alternative income opportunities for these households. Expanding agricultural productivity and enhancing financial inclusion are some of the other measures the report has advocated to enable Annadata households to contribute effectively to India’s transformation into a Viksit Bharat.
