Farm Mechanisation in India: The growing role of Custom Hiring Centres

India’s agriculture sector stands at a critical juncture.

With over 86% of farmers operating on holdings smaller than two hectares, the cost of owning modern farm machinery remains prohibitive for most. At the same time, timely field operations, precision inputs, and residue management have become non-negotiable for productivity and environmental sustainability.

This is where Custom Hiring Centres (CHCs) also known as Farm Machinery Service Centres have emerged as one of the most practical and scalable solutions.

What Are Custom Hiring Centres?

A Custom Hiring Centre is a professionally managed facility that provides farmers access to agricultural machinery on a pay-per-use basis. Equipment ranging from tractors, rotavators, laser land levellers, and zero-till seed drills to combine harvesters, balers, and drone sprayers is made available for hourly, daily, or per-acre rental. These centres are typically established by individual entrepreneurs, farmer producer organisations (FPOs), cooperatives, primary agricultural credit societies (PACS), or public-private partnerships.

The model is supported by the Sub-Mission on Agricultural Mechanization (SMAM), launched in 2014–15 and strengthened in 2021 with an allocation of over ₹6,000 crore till 2025–26. Under SMAM, financial assistance of 40–80% is extended for establishing CHCs, depending on the region and category of beneficiary.

The Clear Advantages->

1. Economic Viability for Smallholders

Studies indicate that mechanisation through CHCs can reduce cultivation costs by 15– 25% and increase yields by 10–30% through timely operations. For a farmer with 1–2 hectares, renting a combine harvester at ₹1,800–2,500 per hour is far more feasible than purchasing one at ₹20–30 lakh.

2. Environmental Benefits

Availability of happy seeders, super straw-management systems, and zero-till drills has significantly reduced stubble burning in Punjab, Haryana, and western Uttar Pradesh. The Central Pollution Control Board noted a visible decline in farm-fire incidents in subsidised CHC clusters.

3. Rural Employment and Entrepreneurship

Each standard CHC (10–15 machines) generates direct employment for 8–12 skilled youth (operators, mechanics, and managers) and indirect jobs in logistics and maintenance. Women-led CHCs in Tamil Nadu, Odisha, and Maharashtra are proving that the model can also advance gender inclusion.

4. Technology Diffusion

CHCs act as demonstration hubs, exposing farmers to precision tools such as GPS-enabled levellers and drone services that they would otherwise never experience.

Challenges That Need Addressing

Despite the promise, several bottlenecks persist:

1.Uneven Geographic Spread: While Punjab and Haryana have over 15,000 CHCs, the eastern and hilly states (Bihar, Jharkhand, Northeast, and hill regions of Uttarakhand and Himachal Pradesh) remain severely under-served due to terrain and poor road connectivity.

2.Peak-Season Bottlenecks: Demand surges during sowing and harvesting windows often lead to waiting periods of 5–15 days and informal price hikes.

3.Quality of Service: Inadequate training of operators and deferred maintenance result in machine breakdowns at critical times, eroding farmer trust.

4.Labour Displacement Concerns: Mechanisation of operations such as transplanting and harvesting can reduce demand for manual labour, an issue particularly sensitive in labour-surplus states.

5.Financial Sustainability: Many centres struggle to recover costs after the subsidy phase ends, especially when utilisation rates fall below 500–600 hours per machine per year.

Emerging Solutions and Best Practices

Several states and organisations are showing the way forward:

1. Digital booking platforms (e.g., the Custom Hiring App by the Ministry and state-specific apps like “Kisan Rath” in Telangana and “Tractor Seva” in Madhya Pradesh) are reducing waiting times and improving transparency.

2.Hub-and-spoke models, where a large mother CHC is supported by smaller village-level service points, are being piloted in Gujarat and Karnataka.

3. Solar-powered and multi-purpose CHCs in off-grid areas of Odisha and Chhattisgarh are lowering operational costs.

4.Tie-ups with drone startups and precision-agri companies are bringing next-generation services within reach of small farmers.

The Road Ahead

The government’s target of establishing 22,000 CHCs by 2025–26 is ambitious yet achievable if accompanied by:

1.Region-specific machinery packages (mini-tillers for hills, paddy transplanters for eastern India).

2.Mandatory operator training and certification.

3.Performance-linked continuation of subsidies.

4. Integration with crop insurance and minimum support price systems to incentivise timely mechanised operations.

Custom Hiring Centres are not a silver bullet, but they represent the most pragmatic bridge between capital-intensive mechanisation and India’s smallholder-dominated reality. When designed and managed well, they deliver higher incomes for farmers, decent jobs for rural youth, and a lighter environmental footprint.

For Indian agriculture to remain competitive and sustainable in the coming decades, scaling and refining the CHC ecosystem is no longer optional it is essential.

Let us know in the comments if you have visited or operated a Custom Hiring Centre. What has been your experience? Your insights help the entire community learn and grow.

---

Visit agrijoy.in for more such updates.

Don't forget to share this story on WhatsApp, LinkedIn, and X.

Ready to embark on your hydroponic journey? Start today with Agri Joy—your partner in sustainable, Joyful farming!