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ICRISAT's intervention in the project 'improving management of natural resources for sustainable rainfed agriculture' funded by the Asian Development Bank aims to increase the productivity and sustainability of the medium and high-water holding capacity soils in the intermediate rainfall ecoregion in India, Vietnam, and Thailand. The study examines the productivity of soybean during the 1999 rainy season in one of the benchmark sites in Lateri watershed, Vidisha district, Madhya Pradesh, India. The productivity of the owner-operated farms is marginally higher at 0.72 t ha-1 compared to 0.68 t ha-1 among the share cropper-operated farms. The productivity of evaluated trail farms in Lalatora micro-watershed, which is used as a demonstration micro-watershed for evaluating improved management practice, has been high at 1.1 t ha-1 due to adoption of better input management practices. The profitability for the landlords and share croppers is documented and evidence is presented on the exploitative nature of the share cropping contracts, especially the 20:80 contract. The low productivity has been due to waterlogging which occurred due to heavy rains during the sowing period. The implications of the endemic nature of the low productivity under a liberalized trade regime is analyzed and suggestions are offered to the stakeholders on the future intervention strategies to tackle the problem of rainy season fallow, exploitative land tenancy arrangements, waterlogging, and equity issues.