State of Marginal Farmers in India 2025 Report

A recent report, “State of Marginal Farmers in India 2025,” highlights the limited integration of marginal farmers into India’s cooperative framework.
The report was released on Kisan Diwas (December 23) and studied cooperative functioning across six States: Andhra Pradesh, Bihar, Himachal Pradesh, Maharashtra, Tripura, and Uttarakhand.

About Marginal Farmers

Definition: Marginal farmers, who own less than one hectare of land, form the backbone of India’s agrarian economy and constitute 60-70% of India’s agricultural households.
For Marginal Farmers, Primary Agricultural Credit Societies (PACS) serve as the lowest and most accessible tier of the cooperative structure.

Low Cooperative Coverage: Less than 25% of marginal farmers are active members of agricultural cooperatives.
Regional Disparities: Particularly low participation observed in Bihar, Tripura and Himachal Pradesh.

Structural Barriers: Complex and exclusionary membership procedures; long distances to PACS; increased transaction costs; and Limited capital availability within cooperatives.
Social Exclusion: Persistent caste, gender, and class-based exclusion restrict access.
Economic Consequences: Continued dependence on informal credit and markets. Hence, slower income growth and higher vulnerability to climate and market shocks.

Limited Digital Adoption: In Tripura, 77.8% of cooperatives reported no use of digital tools.
In Bihar, 25% of cooperatives reported no use of digital platforms.
Nature of Digitisation: Where present, digital tools remained informational rather than transformational.
Capability Constraints: Low digital literacy, especially among women and elderly farmers, limits impact.

Membership vs. Leadership Divide: Over 2.1 million women are registered as cooperative members, yet only 3,355 serve as directors on cooperative boards nationwide.
Underlying Factors: Restrictive social norms, limited mobility, and time poverty due to unpaid care work.
Outcome: Decision-making power remains concentrated among a predominantly male leadership.

Income and Livelihood Outcomes: 45% of cooperative-linked marginal farmers reported increased household income and only around 21% reported stagnation or decline.
Livelihood Security: 49% of members reported improved livelihood security after joining cooperatives.
Financial Inclusion: 67% of cooperative members accessed credit and financial services through PACS.
Productivity Gains: 42% of marginal farmers linked to cooperatives reported improved crop yields.

Doorstep Cooperatives: Introduce mobile PACS units and satellite service points at the hamlet level to overcome distance barriers, especially in hilly and tribal regions.
Simplified Entry: Replace multi-layered membership procedures with Aadhaar-linked, time-bound enrolment norms and automatic inclusion of PM-KISAN beneficiaries.
Capital Rebalancing: Mandate minimum capital allocation for marginal-farmer lending within PACS, backed by NABARD refinancing tied to inclusion outcomes, not loan volumes.
Women’s Governance Quota: Reserve board-level positions for women members in PACS and link leadership diversity to eligibility for central digitisation and infrastructure grants.
Service Hub Model: Scale PACS as multi-service rural hubs integrating credit, procurement, PDS, insurance and extension services rather than limiting them to credit delivery.