The reason for farm mechanization
Wages of those employed in agriculture have increased at much more rapid clip in last six years compared with the rate of increase in tractor prices.
Wages of those employed in agriculture have increased at a much more rapid clip in the last six years compared with the rate of increase in tractor prices. This has resulted in a shift from labour-intensive to mechanization, or capital-intensive techniques. While the tendency towards mechanization has been noted for years, the comparison of wage increases with tractor prices illustrates the issue vividly.
Tractor sales have increased sharply in the past few years. According to Kotak Institutional Equities, tractor sales in two fiscal years starting 2011-12 stood at 537,000 and 528,000, respectively, up from 303,000 in 2007-08.
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