Economics and Efficiency of Organic Farming vis-à-vis Conventional Farming in India

Organic farming systems have attracted increasing attention over the last one decade because they are perceived to offer some solutions to the problems currently besetting the agricultural sector. Organic farming has the potential to provide benefits in terms of environmental protection, conservation of non-renewable resources and improved food quality. India is bestowed with lot of potential to produce all varieties of organic products due to its diverse agro-climatic regions. In several parts of the country, the inherited tradition of organic farming is an added advantage. This holds promise for the organic producers to tap the market which is growing steadily in the domestic market related to the export market. In India, the land under certification is around 2.8 million ha. But, there is considerable latent interest among farmers in conversion to organic farming. However, some farmers are reluctant to convert because of the perceived high costs and risks involved in organic farming. Despite the attention which has been paid to organic farming over the last few years, very little accessible information actually exists on the costs and returns of organic farming in India. The empirical evidences of efficiency analysis of organic and conventional farming systems are scarce or even absent. So, the present paper focuses mainly on the issues like economics and efficiency of organic farming vis-�-vis conventional farming in India. Four states namely Gujarat, Maharashtra, Punjab and U.P were purposively selected for the present study. Similarly, four major crops i.e., cotton, sugarcane, paddy and wheat were chosen for comparison. A model based non-parametric Data Envelopment Analysis (DEA) was used for analyzing the efficiency of the farming systems. The crop economics results showed a mixed response. Overall, it is concluded that the unit cost of production is lower in organic farming in case of cotton and sugarcane crops where as the same is lower in conventional farming for paddy and wheat crops. The DEA efficiency analysis conducted on different crops indicated that the efficiency levels are lower in organic farming when compared to conventional farming, relative to their production frontiers. The results conclude that there is ample scope for increasing the efficiency under organic farms.

Efficiency of Indian Banking Industry in the Post-Reform Era

One of the major objectives of Indian banking sector reforms was to encourage operational self-sufficiency, flexibility and competition in the system and to increase the banking standards in India to the international best practices. The second phase of reforms began in 1997 with aim to reorganization measures, human capital development, technological up-gradation, structural development which helped them for achieving universal benchmarks in terms of prudential norms and pre-eminent practices. This paper seeks to determine the impact of various market and regulatory initiatives on efficiency improvements of Indian banks. Efficiency of firm is measured in terms of its relative performance that is, efficiency of a firm relative to the efficiencies of firms in a sample. Data Envelopment Analysis (DEA) has used to identify banks that are on the output frontier given the various inputs at their disposal. The present study is confined only to the Constant-Return-to-Scale (CRS) assumption of decision making units (DMUs). Variable returns to scale (VRS) assumption for estimating the efficiency was not attempted. It was found from the results that national banks, new private banks and foreign banks have showed high efficiency over a period time than remaining banks.

Targeting of Grain Legumes for Income and Nutritional Security in South Asia

Chickpea, Pigeonpea and Groundnut are the most important food legumes in South Asia. They are integral part of semi-arid tropics (SAT) cropping systems and farmers’ livelihoods. Besides enriching soil fertility, food legumes also provide substantial income to the farm households and also contribute significantly towards household nutritional security. Since 2007, ICRISAT along with partners from National Agricultural Research System (NARS) in India and Bangladesh have been implementing ‘Tropical Legumes-II’ project supported by Bill & Melinda Gates Foundation (BMGF) for increasing the production and availability of legumes particularly for small holder farmers’ and poor consumers in South Asia. Specifically, the major objectives of this initiative has been focusing on proper targeting and development of legume improved cultivars, promotion of their adoption, advocacy of proactive public sector policies and finally linking these small holders to markets and value chains. A number of research initiatives have been completed in five major states (Andhra Pradesh, Bihar, Karnataka, Odisha and Tamil Nadu) in India and Barind region of Bangladesh during last eight years (2007-2014) of project phase 1 and phase 2 implementation. These studies have examined and documented the existing situation of legumes cultivation, constraints faced by the farmers, market linkages, potential opportunities for their expansion etc. In close association with the crop improvement scientists, agricultural economists have also assessed the farmers preferred traits for chickpea, pigeonpea and groundnut varieties expressed during the ‘Farmer Preferred Varietal Selection (FPVS)’ demonstrations. Subsequently, the farmer preferred varieties were identified, released formally, multiplied and supplied as seed samples to legume growers in the project intervention sites. Later, studies were also conducted for monitoring early adoption of newly introduced improved cultivars and their performance in the targeted locations. Based on those research findings, these studies have brought out location specific suggestions to accelerate the food legumes productivity and profitability in India and Bangladesh. The summary outcomes of these studies will immensely help the researcher, academicians and policy makers for future designing of legume interventions and developing location specific technologies

Status of Farmer Producers Organizations (FPO) in Andhra Pradesh

A Variety of approaches have emerged over the years to address the problems of small and marginal farmers' agriculture. In order to improve the welfare and living standards of farmers, there is a need to create appropriate ecosystem in the state. Such institutional arrangement/membership-based institutions are found to be the backbone for primary sector. Both Central and State governments are stressing on promoting 'Farmers Producers Organizations (FPOs) as an important strategy for creating an ecosystem for enhancing farmers profit

Marketing and Profitability of crops in Pyawt Ywar Pump Irrigation Project

Rehabilitation of Pyawt Ywar scheme presents an exceptional opportunity to simultaneously redesign or upgrade the infrastructure, improve the irrigation operations and maintenance regime, establish economically viable cropping and management systems, and introduce innovative irrigation approaches that will support new forms of crop production. Livelihoods and Food Security Trust Fund (LIFT) of Myanmar has provided necessary financial support for undertaking this rehabilitation activity to International Water Management Institute and other project stakeholders (ICRISAT, WHH and National Engineering and Planning Services). The present study was undertaken as a part of achieving project output 3: improved market opportunities in the PYPIP area. Assessing the extent of marketable surplus among different crops, mapping of major marketing channels and estimating the price spread, identification of key issues in marketing and potential value-addition opportunities etc. were the major objectives of the current study. Overall, the agricultural marketing system in the country is in primitive stage. Role of local trader or middle men is inevitable in marketing of any commodity. The extent of awareness about commodity prices is very poor among producers because of lack of access to information. Often farmers’ face distress sales due to financial needs and absence of public storage facilities. The extent of marketable surplus among study crops is very high (>80%) and they are highly dependent on markets for their disposal. The commodity-wise standards, processing and value addition etc. were almost absent across commodities. Relatively, the marketing efficiency is high for dry grains when compared with fruits and vegetables. Strengthening of public/private storage facilities and providing pledge loan facilities is the need of the hour to protect the interest of the farmers. Promotion of grain processing and value addition opportunities through involvement of farmer collectives or commodity groups will enhance price realization and incomes of farmers. Finally, Government of Myanmar should focus more on creating price awareness, commodity research and price advocacy to farmers

Nature and magnitude of risk in the semi-arid tropics (SAT) of India - a case of Mahabubnagar District in Andhra Pradesh

Agriculture in the Semi-Arid Tropics (SAT) is almost universally characterized by low farmer investment in agricultural inputs such as fertilizers, pesticides and seeds. Even labor inputs and investments in land improvements and irrigation are usually low compared with other regions of the developing world. Many researchers have carried out research aimed at testing whether these low investment levels are partly or fully caused by the risky nature of agriculture in these areas or by the risky nature of farmers (Binswanger etal, 1979). Risk and risk aversion of farmers is not the only potential source of low investment or “underinvestment”; it could also result from generally low profitability (measured as expected returns) or from credit constraints. To establish that it is risk or risk aversion that lead to underinvestment, empirical knowledge on these questions is required. Risks are inescapable in any agriculture.

Study of Treatment Effects in Village-Level Studies. Working Paper Series no. 33

Village-Level Studies (VLS) are one of the most efficient ways to understand rural farming systems and also help identify the socioeconomic and institutional constraints faced by the farming community. ICRISAT initiated longitudinal VLS in three important and contrasting production regions in India’s semi-arid tropics (SAT) in the mid-1970s. These ‘first generation’ studies continued between 1975 and 1985 and were then discontinued. They were revived during 2001-2002 after a gap of 17 years, and this second round of studies is referred to as ‘second generation’ VLS. The basic aim of these studies is to monitor the same households as they evolve and respond to normal development opportunities, without any deliberate intervention in their lives. Precautions are taken to keep the effect of an outsider’s presence in the village to a minimum so that it will not influence household behavior. Some social science researchers believe that a continuous engagement of VLS sample households may enlarge the horizons of the respondents, rendering them more progressive and knowledgeable than the non-VLS households. They also presume that the presence of a resident investigator in the study village and continuous association with ICRISAT research staff might create some ‘treatment effect’ on VLS households. These hypotheses need to be tested by using indicators of treatment effect. The present study was initiated to ascertain whether the VLS activity has had any effect in terms of improving the welfare of the people in the study villages. The detailed analysis of census and sample household data in both first and second generation VLS led us to conclude that there are no treatment effects occurring due to engagement of households or villages by the VLS research team

Changes in Agriculture and Village Economies

The Village Level Studies of ICRISAT are designed to collect farm level data to assist research in its task of generating new technologies suited to the needs and means of farmers living in the semi-arid tropics. They serve as a vehicle to study the changes in agriculture and village economies. This publication is a comprehensive study of 240 households from six villages, Aurepalle and Dokur in Andhra Pradesh and Kalman, Kanzara, Kinkheda and Shirapur villages in Maharashtra undertaken from 1975 to 1984 and later resumed in 2001-02 with a more representative sample of 446 households. It documents the changes that occurred in agriculture and household economies in these villages over a 26-year period between 1975-78 and 2001-04. The studies while giving a clear picture of farming systems in the rural areas, help in identifying the socioeconomic and institutional constraints faced by the farming community. The studies reveal the slow disappearance of joint families (dominant in 1975-78) and the emergence of nuclear families. They delve deep into the trends pertaining to average family size, literacy levels, household income, consumption standards, dependence on farming as a major occupation, reduced dependence on crop and livestock enterprises for sustenance, nonfarm sources of income, real wages of labor, etc. The studies reveal that households had less land to operate in 2001-04 than in 1975-78 and that cropping patterns have undergone drastic changes with cash crops overtaking food crops in all the VLS villages. Despite moderate increases in productivity, crop and livestock production have become non-remunerative due to steadily increasing production costs and stagnant product prices. The publication finally addresses the policy implications of drastically changed cropping patterns and nonviability of crop and livestock enterprises among other issues, and suggests measures to improve the state of rainfed agriculture in the semi-arid tropics

Targeting and introduction of Groundnut improved cultivars in Odisha state of India

Groundnut is the major oilseed crop in India grown in an area of 4.93 m ha during 2010 (FAOSTAT, 2012). It contributes about 30% to the edible oil basket of the country. The South Asia has more than 7 million ha (31% of world total) under groundnut, roughly 83% of this is in India. The country has lost 4.62 m ha of groundnut area to other competing crops like soybean, maize and Bt. cotton during the last decade at an annual rate of 3.48% mainly because of cheaper imports of other edible oils, which depressed groundnut prices. Though productivity of groundnut was increased by 2.14% during the period, production declined at the rate of 1.14% annually.About 85% of the total groundnut area in the country is sown in the rainy season. Being a rainfed crop, the yield variability across both, growing regions and years is high. The instability measure (CV) was higher in the case of productivity than in the case of area in all the sub-periods (Table-1.1)..