India is called an agricultural country. About 70% of the population is dependent on agriculture. Even after this the farmers of the country have no way of knowing the value of cultivable land. Farmers are often embroiled in legal disputes over land acquisition and sometimes they cannot get a fair price for the land. But now the farmers have got rid of this problem. IIM Ahmedabad has launched India’s first agricultural land price index.
The fair price of farmers’ land
According to information received, for the first time in the country, the Indian Center of Management (IIM) Ahmedabad’s Mishra Center for Financial Markets and Economy has prepared the Indian Agricultural Land Price Index (ISLPI). This index will tell farmers the real value of their land. The index was launched on Thursday.
Prepared by IIM and Sforms India
The index will serve as a reliable source and measure land prices in rural and semi-urban areas. Data-based support in this index is provided by Aspharms India, a private firm working on land prices. This indicates a potential conversion of farmland into real estate.
Farmers do not get fair prices
Prashant Das, Project Lead and Associate Professor of Real Estate Finance at IIM, said of ISLPI that at present the compensation received by farmers in exchange for agricultural land is very low. Farmers are getting 0.5 to 2 per cent return on their produce. In such a scenario, this index would be very helpful for the sale of arable land to farmers.
The index will work this way
Four main factors are considered in the index to indicate the value of farmers’ land. These factors include distance from the nearest city, distance from the nearest airport, and the possibility of an international airport. If the land has an irrigation facility, its value will increase by 15 per cent, while if the land has the possibility of an international airport, it will improve by 20 per cent. Similarly, staying away from the town will have an effect of 0.5 per cent per kilometer by distance.