An Empirical Analysis of Agricultural Income Growth and Its Challenges in Bhojpur, Bihar

Abstract

This empirical research examines agricultural earnings growth trends and points out the most pressing issues that afflict the farming households in the Bhojpur district of Bihar in India. The goals are to study trends in agricultural income and crop production in 2015-16-2023-24 and study the socio-economic factors that hinder the growth of income. A descriptive analytical research design was adopted using secondary data including the Bihar Economic Survey, Agriculture Census, NABARD NAFIS, NSO 77th Round and Directorate of Economics and Statistics. Compound Annual Growth rate (CAGR) analysis, growth rate divergence ratio analysis and Pearson correlation coefficient were used to test three hypotheses. It concludes that the agricultural income CAGR of Bihar (4.32) is significantly lower compared to the national CAGR (7.35), and the level of absolute income difference between 2015-16 and 2021-22 expanded by 151%. In spite of average crop production growth of 6.08% CAGR, the growth in income was at 4.32%, which validates the production-income disconnect. The analysis of cross-state correlation demonstrates that there is a strong negative correlation (r = -0.888, p < 0.01) between marginal landholding proportion and the income of the farm. The research paper concludes that agricultural development in Bhojpur is necessary, which can be achieved by land consolidation, credit growth, diversification of crops, and enhancement of market infrastructure.