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Profitability of Agriculture in Bundelkhand

Indian agriculture is characterised by marginal and small land holdings and no concerted effort has been made in India to increase productivity of such holdings. The conventional belief, which seeps through all government thinking, is that this effort is not even possible. The Planning Commission's 2007 Uttar Pradesh Development Report states blasely: ' …There is no check on the declining holding size which are gradually becoming unviable'  [Vol II, p 45], as if the latter part of the statement is as true and self-evident.

This thinking would be one of the reasons for gross underinvestment in agriculture by the central government and state governments, especially in the early, euphoric phase of economic liberalisation. In Uttar Pradesh, per capita outlay on agriculture has been lowest among all states. As noted by Uttar Pradesh Development Report [Vol II, p 45], investment in agriculture has declined even in absolute terms over successive Five-Year-Plan periods; the fall between the Eighth Five Year Plan and the Sixth Five Year Plan was 37%.

In such circumstances any talk of profitability of agriculture in an area already characterised by low productivity makes no sense except for large farmers in well-irrigated areas. All other farmers in Bundelkhand are essentially engaged in subsistence farming, which is highly dependant on a good rainfall. Rainfall has to be good both in terms of volume of rain as well as spread of rain over a period of three to four months - a rarity in  Bundelkhand ( see Rainfall in Bundelkhand).

Since the 1990s, profitability of agriculture has also been seriously affected by rising input costs (fertilisers, seeds, diesel), and while use of high-value inputs is low in Bundelkhand (see Use of Fertilisers in Bundelkhand and Use of High Yielding Seed Varieties), the impact is still felt.

Some idea of the prevailing economics can be gauged from figures collected by for the crop of 2003 in Chandaur village of Naraini block of Banda district, a fairly well irrigated area [Vijayvergiya, p 6]. That year, the wheat output in the village was around 320 kg per bigha (2.25 bighas=1 acre in Bundelkhand), or 1720 kg per hectare (1 hectare=2.47 acres), which was close to the average yield in the district (see figure for Banda in Table 3 in Yields in Bundelkhand). The minimum government procurement price for wheat in 2003-04 was Rs 630 per metric quintal (1 metric quintal =100 kg). Hence, we can assume that per bigha income from wheat in Chandaur would have been Rs 2016.

Mustard was also grown. The yield per bigha was 10 kg. The minimum support price for this commodity that year was Rs 1600 a quintal. Hence, per bigha income from mustard can be assumed to be Rs 160. There was also income from sale of husk - around Rs 250 per bigha. Hence total income per bigha would have been around Rs 3866.

Looking at the input costs, the prevailing figures per bigha were as follows:
Fertilisers (1 bag diammonium phosphate + 1 bag urea): Rs 550 + Rs 520
Seeds (25 kg)= Rs 275
Rent of diesel engine for pumping up tubewell water @ Rs 20/hour and use for 15 hours = Rs 300
Diesel cost @ Rs 25 litres and use of 25 litres = Rs 625
Labour cost (ploughing + cutting + threshing) = Rs 500 + Rs 175 + Rs 165

The total input costs thus worked out to Rs 3110 and the net profit per bigha would hence have been Rs 756. The majority of Bundelkhand farmers have less than 10 bighas, and cultivate only in one season; so annual family income from agriculture, for the majority of farmers, in a well-irrigated area, in a year of good monsoon, at assured procurement prices, and assuming there were no disturbances such as a heat wave before harvesting, would have been only Rs 6000-Rs 10,000, taking into account other variables like quality of soil and use of unpaid household labour.

(We are of course assuming that households sell off the entire produce from land, keeping back nothing for own consumption. Such a situation is only a theoretical possibility. The average income would have thus to be scaled down. On the other hand, some households would earn additional income through avenues like sale of milk, goat, eggs or chicken.)

Thus, apart from landless households, the majority of households with small and marginal holding have to rely on additional income from labour, by working for large farmers, at road and other government or private construction sites, or in other employment avenues such as quarries. When adequate such opportunities are not available in and around the village for all households, migration becomes inevitable.

Most vulnerable to poor agriculture productivity in Bundelkhand are marginalised groups like scheduled tribes (see Survival Practices of Marginalised Groups)

Reference:

  • Vijayvergiya Sanjay, Oxfam India Trust,  Drought and Livelihood in Bundelkhand: A Report, Lucknow, June 2004

| Agriculture in Bundelkhand | Use of Fertilisers | Use of HYV Seeds | Major and Minor Crops | Production | Yields | Profitability | Survival Practices | Jatropha Cultivation | Suicides |

 
Agriculture
> Agriculture in Bundelkhand
> Use of Fertilisers
> Use of HYV Seeds
> Major and Minor Crops
> Production
> Yields
> Profitability
> Survival Practices
> Jatropha Cultivation
> Suicides