The Story of Village Palampur 

A story of a hypothetical village having about 450 families. It is 3km away from Raiganj which is a big village. Shahpur is the nearest town to the village. The village is well connected by roads with the neighbouring villages and towns. Most of the houses are electrified. It has two primary schools and one high school. There is a government primary health centre and a primary dispensary. 

Main Production Activities :

1. Farming is the main production activity in the village Palampur. Most of the people are dependent on farming for their livelihood. 

2. Non-farming activities such as dairy, small-scale manufacturing (e.g., activities of weavers and potters, etc.), transport, etc., are carried out on a limited scale. 

Factors of Production :

1. Land, labour and capital are the basic requirements for the production of goods and services which are popularly known as factors of production. 

2. Land includes all free resources in nature, e.g., soil, water, forests, minerals, etc. 

3. Labour means human effort.

4. Physical capital is the third requirement for production. 

5. Physical capital includes tools, machines, building, etc. is called fixed capital.    

6. Raw materials such as seeds for the farmer, yarn for the weaver and some money is always required for the production. Raw materials and money in hand called working capital. 

7. Need of knowledge and enterprise to be able to put together land, labour, physical capital to produce an output which is called as human capital. 

Farming in Palampur : 

1. Land is Fixed  - About 75% of the population are depended on farming in Palampur. Land area under cultivation is fixed. There has been no expansion in land area under cultivation since 1960. 

2. Change in the Method of Cultivation -

a). During the rainy season (kharif) farmers grow jowar and bajra followed by cultivation of potato between October and December. In the winter season (rabi), farmers grow wheat and a part of the land area is also devoted to sugarcane which is harvested once every year. 

b). Due to well developed irrigation, farmers can grow three different crops . Electricity transformed the system of irrigation. 

c). Multiple cropping means to grow more than one crop on a piece of land. Another way for higher yield is modern farming. 

d). In the later 1960s, the green revolution introduced high yielding varieties of seeds to farmers for the cultivation of wheat and rice. Farmers of Punjabi Haryana and Western Uttar Pradesh were the first to try out the modern farming methods in India. 

3.  Sustainability of Land -

a). Modern farming methods have overused the natural resources base. Due to increased use of chemical fertilizers, the soil lost its fertility. 

b). Natural resources like soil fertility and groundwater are destroyed and it is very difficult to restore them. 

4. Distribution of land :

a). About 1/3rd of the 450 families are landless in Palampur. About 250 families cultivate small plots of land less than 2 hectares in size and the remaining 60 families cultivate more than 2 hectares of land. 

b). And only a few of the large farmers cultivate 10 hectares or more than 10 hectares of land. 

5. Labour : 

a). Some farmers worked on their own land and some worked on another land for which they receive wages. Wages can be in cash or kind. 

b). Wages vary from region to region and crop to crop and one farm activity to another activity. 

6. Capital :

a). Huge capital is required in the method of modern farming. Small farmers have a lack of capital so they borrow money from large landowners or money lenders at higher interest rates. There are three types types of capital which are mostly used in any organization are working capital, fixed capital, and human capital.

7. Sale of Surplus Farm Products : 

a). Farmers retain a part of produce for self-consumption and sell the surplus in the nearby market. The farm produce which is sold in the market is called market surplus. 

b). Small farmers have little surplus output. It is the medium and large farmers only who have substantial surplus produce for selling in the market.

Non-Farm activities in Palampur : 

About 25% of the people working in Palampur are engaged in activities other than agriculture are:

1. Dairy: Some people are engaged in dairy and the milk sold to nearby big villages.

2. Small-scale manufacturing: Manufacturing involves very simple production methods like production of jaggery.

3. Shopkeepers: Traders of Palampur buy various goods from wholesale markets in the cities and they sell them in the village like toothpaste, pens, clothes etc.

4. Transport: Transport services include rickshaws, tractors, traditional bullock carts etc.

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