Telangana’s paddy paradox: Record production with dwindling returns

Telangana tops India in rice production between 2015 and 2024, but farmers struggle with shrinking profits, rising cultivation costs, and delayed payments. Experts urge diversification as the dominance of paddy cultivation becomes unsustainable, especially for small and marginal farmers

Hyderabad: Telangana has emerged as a powerhouse in paddy production, achieving the top position nationally in rice output between 2015-16 and 2023-24. Thanks to State-sponsored support schemes and abundant irrigation facilities, paddy production scaled up from 68.17 lakh tonnes in 2014-15 to 270.88 lakh tonnes in 2023-24.

However, the growers’ side of this growth story is concerning. For many farmers, the bounty of the fields is no longer yielding remunerative returns. The margin between crop investment and annual returns is shrinking. The average crop investment ranges up to Rs 25,000 per acre, while net returns rarely exceed Rs 35,000 per acre.

---

In the event of monsoon failures, pest outbreaks, or delays in fertilizer supplies, such as the current shortage of urea, farmers face high costs, mounting debts, and financial strain, contributing to the tragic rise in farmer suicides. The widening gap between escalating investments and shrinking profits is pushing this paddy-dominant region toward a precarious situation.

Stocks procured from farmers are piling up due to marketing issues, even at the government level. Delays in payments of promised incentives and the cumbersome process of classifying fine varieties have left farmers across Telangana struggling to receive their due. The costs associated with cultivation, from seeds and fertilizers to pesticides and labour, continue to rise steeply.

Instability in market prices and inconsistencies in the procurement process add further uncertainty for farmers. Though the government has pledged to procure paddy at the minimum support price, delays in the procurement process are eroding farmer confidence. The area under paddy cultivation (both Kharif and Rabi seasons) has grown phenomenally, from approximately 35 lakh acres in 2014-15 to 157.10 lakh acres in 2023-24.

A substantial increase is expected this year as well. However, the dominance of paddy in Telangana continues to be a paradox of production without prosperity, says KVNL Narasimha Rao, a farmer from the NSP Left Canal command area near Kodad with 60 acres of ancestral land. “We need to continue farming, as we cannot leave the land fallow”, he lamented.

Farm mechanisation may reduce investment costs to some extent for large farmers, but small and marginal farmers face a different reality. There is a shortage of farm labourers, with local workers charging Rs 600 to Rs 700 per day. Large farmers often hire workers from Odisha, Bihar, and Jharkhand at Rs 350 to Rs 450 per day.

Experts and farmer associations are increasingly advocating for crop diversification as a potential solution to mitigate the risks associated with paddy’s volatile market and high cultivation costs. However, districts like Karimnagar, with marked improvements in irrigation facilities, continue to favor paddy cultivation.

---

Farmers’ struggles continue

• Telangana leads India in rice production due to State support during BRS regime
• Farmers’ earnings dwindle with cultivation costs rising to Rs 25,000 per acre
• Delays in procurement undermining farmers’ trust, financial stability
• Paddy area expanded from 35 lakh acres in 2014-15 to 157.10 lakh acres in 2023-24