In a Punjab village, a multinational company chooses the crop, supplies seeds, inputs and know-how, and promises to buy the whole potato harvest at a price fixed in advance. Which system is this?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Contract farming
Option (1) Sharecropping — Incorrect. Sharecropping is a tenancy in which the cultivator pays the landowner a share of the crop as rent. No company chooses the crop or buys the harvest at a fixed price.
Option (2) Cooperative farming — Incorrect. Cooperative farming means farmers pool their land and resources and share the produce. The farmers make the decisions together, and no outside company fixes the crop or the price.
Option (3) Contract farming — Correct. In contract farming the company picks the crop and provides the seeds, inputs and know-how. In return it guarantees to buy the produce at a fixed price, as with the potato farmers here.
Option (4) Tenant farming — Incorrect. Tenant farming means a cultivator rents land from its owner and pays rent. The tenant still decides what to grow and where to sell it.
NCERT (2026-27): “4.6 Globalisation, Liberalisation, and Rural Society … |