Dynamics and resource use efficiency of agricultural land sales and rental market in India

In a populous developing country such as India, developmental interventions are often woven around land, as this is the most critical resource in the livelihood support system of rural communities. In such a socio-economic environment, land has multiple uses. It is the most important source of income, a symbol of social status and prestige, and has very high collateral value for resource poor farm families. In these countries, the migration of rural workers to urban centers in search of employment, coupled with universal individual inheritance characteristics of land ownership, perpetuates the fragmentation of land holdings. In the majority of such cases, the point has been reached where land has become uneconomic and non-viable for cultivation. For farmers left with uneconomic land holdings there are only three options available; sell the land, rent it out, or lease land from others. In such scenarios land lease and land market policies assumes critical importance.