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Economic Liberalisation and Indian Agriculture: A Statewise Analysis

Economic Liberalisation and Indian Agriculture: A Statewise Analysis

This study of the performance of agriculture at the state level in India during the post-reform period (1990-93 to 2003-06) and the immediate pre-reform period (1980-83 to 1990-93) shows that the post-reform period has been characterised by deceleration in the growth rate of crop yields as well as total agricultural output in most states. By ending discrimination against tradable agriculture, economic reforms were expected to improve the terms of trade in favour of agriculture and promote its growth. The paper also discusses the cropping pattern changes that have taken place in area allocation as well as in terms of value of output. The slowdown in the process of cropping pattern change means that most government efforts to diversify agriculture have failed to take off.

REVIEW OF AGRICULTURE

Economic Liberalisation and Indian Agriculture: A Statewise Analysis

G S Bhalla, Gurmail Singh

This study of the performance of agriculture at the state level in India during the post-reform period (1990-93 to 2003-06) and the immediate pre-reform period (1980-83 to 1990-93) shows that the post-reform period has been characterised by deceleration in the growth rate of crop yields as well as total agricultural output in most states. By ending discrimination against tradable agriculture, economic reforms were expected to improve the terms of trade in favour of agriculture and promote its growth. The paper also discusses the cropping pattern changes that have taken place in area allocation as well as in terms of value of output. The slowdown in the process of cropping pattern change means that most government efforts to diversify agriculture have failed to take off.

This article constitutes a part of the Jawaharlal Nehru Planning Commission Project, “Agricultural Growth in India – A District-Level Analysis”. The authors would like to thank an anonymous referee for comments on an earlier version of this paper.

G S Bhalla (gsbhalla@mail.jnu.ac.in) is professor emeritus at the Jawaharlal Nehru University, New Delhi and Gurmail Singh (gurmail@pu.ac.in) is with the Punjab University, Chandigarh.

T
he initiation of economic reforms in India in 1991 brought about major changes in the macroeconomic policy framework of the planned economy that existed in India during 1950-51 to 1990-91. Although no direct reference was made to a griculture, it was argued that the new macroeconomic policy framework, in particular, changes in exchange and trade policy, d evaluation of the currency, gradual dismantling of the industrial l icensing system and reduction in industrial protection would benefit tradable agriculture by ending discrimination against it and by turning the terms of trade in its favour. This, in turn, was supposed to promote exports leading to rapid agricultural growth.

But despite these changes in the macroeconomic policy framework and trade liberalisation, the agricultural sector in India neither experienced any significant growth subsequent to the initiation of economic reforms in 1991 nor did it derive the expected benefits from trade liberalisation. As a matter of fact, when compared with the immediate pre-liberalisation period (1980-83 to 1990-93), agricultural growth in India recorded a visible deceleration during the post-liberalisation period (1990-93 to 2003-06). The reasons for this deceleration need to be carefully analysed.

Quite a few researchers have tried to study the impact of economic liberalisation on Indian agriculture at the national level.1 The present study analyses the impact of economic reforms on the levels and growth of land yields and agricultural output at the state and regional levels. The main components of agricultural output – area growth, yield growth and cropping pattern changes – are also analysed with a view to identifying the chief sources of growth in each period. The relationship, if any, between the levels and growth of agricultural output and the use of modern inputs like irrigation, fertilisers, etc, is also examined.

Cropwise data on area and output of 44 reporting crops2 for 17 major states have been obtained from the government of India (GoI) publication.3

For all crops, the triennium averages of area and output have been worked out for all states for 1962-65, 1970-73, 1980-83, 1990-93 and 2003-06. The value of crop output has been o btained by using all-India prices for the triennium ending 1993. Land yield or land productivity has been obtained by dividing the value of crop output as obtained above by the area under 44 crops. I ntensity of cultivation is defined as gross cropped area (GCA) d ivided by net sown area.

Growth rates are annual compound growth rates. For analysis, all states have been clubbed into the following four regions:

(1) The north-western region comprising Haryana, Himachal Pradesh, Jammu and Kashmir (J&K), Punjab and Uttar Pradesh;

december 26, 2009 vol xliv no 52

(2) the eastern region comprising Assam, Bihar, Orissa and West Bengal; (3) the central region comprising Gujarat, Madhya Pradesh, Maharashtra and Rajasthan; and (4) the southern region comprising Andhra Pradesh, Karnataka, Kerala and Tamil Nadu.

The article is divided into six sections. Section 1 analyses the growth performance of agricultural output at the state and regional levels during 1962-65 to 2003-06 and three sub-periods, namely, 1962-65 to 1980-83 (the initial period of Green Revolution), from 1980-83 to 1990-93 (maturing of Green Revolution), and the post-reform period from 1990-93 to 2003-06. Section 2 is devoted to a discussion of regional patterns of yield levels and growth. This is followed by a discussion about changes in GCA and its contribution to output growth in Section 3. Section 4 contains a brief discussion of the association between output levels and growth with the level of use of modern agricultural inputs. Section 5 is an analysis of cropping patterns changes over the study period. Finally, Section 6 summarises the paper with some policy suggestions.

1 Growth Rate of Crop Output

The new Borlaug seed-fertiliser technology introduced in the mid-1960s made a major impact on raising yield and output levels of some crops and of aggregate crop output in India. In the beginning, the new technology was confined to wheat in the irrigated north-western region of India. But over time, it covered rice and some other crops and its geographical coverage extended from the north-western region to many other parts of the country. By 2003-06, despite considerable interstate variation, most states in India were able to share the gains of the new technology. The

Table 1: State and Regionwise Level and Growth of Value Output

(1962-65, 1970-73, 1980-83, 1990-93 and 2003-06) (44 crops)

deepening and extension of new technology led to significant growth of agricultural output.

Taking the entire period from 1962-65 to 2003-06, the total agricultural output (value of 44 crops at 1990-93 constant prices) increased at an annual growth rate of 2.36% (Table 1). During this period, the highest output growth rate, 2.85% per annum (pa), was recorded by the north-western region followed by the central and the southern regions and the lowest growth rate of only 1.76% pa was registered by the highly populated eastern region.

1.1 Initial Period of Green Revolution (1962-65 to 1980-83)

The new seed-fertiliser technology, introduced in the irrigated states in the north-west during the mid-1960s, gradually spread to new areas. During 1962-65 to 1980-83, all the states in the north-western region, in particular Punjab and Haryana, registered high growth rates of agricultural output. In the eastern region, except for Assam, the growth performance of other states was rather modest with Bihar recording a very low growth rate of 0.27% pa. Crop output in the dry rainfed states in the central region was hardly influenced by new technology and agricultural production in that region was characterised by sharp weatherinduced year to year fluctuations (Table 1). In the southern region, all states, except Tamil Nadu, were able to register medium growth rates of output.

1.2 Maturing of Green Revolution (1980-83 to 1990-93)

The period from 1980-83 to 1990-93 marks a turning point in India’s agricultural development. At the all-India level, the growth rate of crop output accelerated from 2.24% pa during 1962-65 to 1980-83 to 3.37% pa during 1980-83 to 1990-93. An interesting feature of the 1980s

was that agricultural growth permeated to all

Sl Average Value of Output (in Rs Million) Annual Compound Growth Rate (%) No State 1962-65 1970-73 1980-83 1990-93 2003-06 1980-83/ 1990-93/ 2003-06/ 2003-06/ regions in India. In the north-western region, 1962-65 1980-83 1990-93 1962-65

while there took place a slight slowdown of

1 Haryana 16,303 23,445 31,556 51,576 69,278 3.74 5.04 2.30 3.59

growth in Punjab, during the period 1980-83 to

2 Himachal Pradesh 2,488 3,233 3,557 4,663 5,315 2.01 2.74 1.01 1.87

1990-93, as compared with the earlier period,

3 J and K 2,428 3,690 5,192 5,278 5,772 4.31 0.17 0.69 2.13

there was a significant acceleration in the growth

4 Punjab 22,079 36,898 58,654 88,635 1,09,510 5.58 4.22 1.64 3.98

rate of output in Haryana and in Uttar Pradesh.

5 Uttar Pradesh 93,628 1,14,461 1,50,373 2,03,292 2,43,514 2.67 3.06 1.40 2.36

An important development was the accelera

North-West Region 1,36,926 1,81,727 2,49,331 3,53,444 4,33,389 3.39 3.55 1.58 2.85 6 Assam 15,039 17,419 22,964 29,154 31,798 2.38 2.42 0.67 1.84 tion of growth in the eastern region. In West

7 Bihar 39,332 42,993 41,276 50,648 52,413 0.27 2.07 0.26 0.70 Bengal, the growth rate increased to 5.98% pa

8 Orissa 24,391 26,389 34,268 45,436 41,660 1.91 2.86 -0.67 1.31 during 1980-83 to 1990-93 compared with a

9 West Bengal 32,536 39,230 41,980 75,035 1,02,047 1.43 5.98 2.39 2.83growth rate of 1.43% pa during 1962-65 to

Eastern Region 1,11,298 1,26,032 1,40,488 2,00,274 2,27,919 1.30 3.61 1.00 1.76 1980-83. Bihar and Orissa also recorded an ac

10 Gujarat 33,174 38,209 51,959 56,842 1,11,692 2.52 0.90 5.33 3.01 celeration in their output growth rates during 11 Madhya Pradesh 48,073 56,214 63,846 99,386 1,37,294 1.59 4.52 2.52 2.59

this period, but there was only a marginal in

12 Maharashtra 52,069 38,698 73,149 88,453 1,16,293 1.91 1.92 2.13 1.98

crease in output growth rate in Assam.

13 Rajasthan 24,153 33,788 38,276 68,932 1,03,960 2.59 6.06 3.21 3.62

The acceleration of the growth in the highly

Central Region 1,57,469 1,66,909 2,27,231 3,13,613 4,69,240 2.06 3.27 3.15 2.70

populated but hitherto agriculturally stagnant

14 Andhra Pradesh 49,878 53,718 76,565 1,06,962 1,34,279 2.41 3.40 1.76 2.44

states of eastern India was a development of

15 Karanataka 33,176 40,854 51,372 73,573 83,424 2.46 3.66 0.97 2.27

major significance because rapid agricultural

16 Kerala 25,169 34,678 31,651 37,736 33,978 1.28 1.77 -0.80 0.73

growth in this region is likely to benefit to large

17 Tamil Nadu 47,007 58,441 55,208 82,184 67,869 0.90 4.06 -1.46 0.90

workforce d ependent on a griculture, thereby

Southern Region 1,55,230 1,87,691 2,14,796 3,00,455 3,19,549 1.82 3.41 0.48 1.78

making a significant dent on rural poverty.

All-India 5,65,643 6,66,706 8,43,474 11,74,471 14,69,719 2.24 3.37 1.74 2.36

The central region also recorded an accelerated

Coefficient of Variations (%) 54.19 51.07 118.59 43.95 Source: Calculated from MoA&C (various years). growth during this period although, for individual

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december 26, 2009 vol xliv no 52 35

Figure 1: Statewise Growth of Agricultural Output(44 Major Crops)

Figure 2: Statewise Levels of Agricultural Productivity(44 Major Crops)

1962-65 to 1980-83

1962-65 to 1980-83 1980-83 to 1990-93

1962-65

1970-73

1962-65 to 2003-06

1990-93 to 2003-06

0 1,000 Kilometress

Kilometres

Growth Rate (% pa)

Growth Rate (% p a)

>= 3.50

1.50 -3.50

< 1.50

NN
ot availableot Available

< 1.50

> = 3.50

1.50 = 3.50

states there was a mixed picture. While growth rate accelerated significantly in Rajasthan and Madhya Pradesh, growth rates recorded a sharp deceleration in Gujarat primarily as a result of persistent drought during the late 1980s.

Among the southern states, the growth rate accelerated significantly during this period. But the most interesting development was the unprecedented rate of growth of 4.06% recorded by Tamil Nadu during 1980-83 to 1990-93 compared with a paltry growth rate of 0.90% pa registered during 1962-65 to 1980-83. Whereas Andhra Pradesh and Karnataka recorded a significant acceleration in their growth rates during 1980-83 to 1990-93 compared with the earlier period 1962-65 to 1980-83, Kerala registered only a slight acceleration in its growth rate.

1.3 Post-Liberalisation Period (1990-93 to 2003-06)

Agricultural growth during 1990-93 to 2003-06 reflects the impact of economic reforms on agricultural performance. The most important feature of this period is that agricultural growth decelerated sharply at the all-India level and in all regions. At the all-India level, the output growth decelerated to 1.74% pa during 1990-93 to 2003-06 compared with a growth rate of 3.37% pa during 1980-83 to 1990-93. At the regional level, during the same period, the growth rate of agricultural output decelerated from 3.55% to 1.58% pa in the north-western region, from 3.61% to 1.00% pa in the eastern region, from 3.27% to 3.15% pa in the central region and from 3.41% to only 0.48% pa in the southern region.

All states except Gujarat, and to some extent, Maharashtra registered a sharp decline in their output growth rates in the

1980-83 1990-93

2003-06

Kilometres Value of output per hectare in Rs > = 10200 6520 -10200 <6250 Data not available

post-reform period. Gujarat was an exception because this state registered a very high output growth rate of 5.33% pa during the post-reform period compared with a growth rate of only 0.90% pa during the immediate pre-reform period. This remarkable performance was primarily because of the very rapid spread of Bt cotton in the state during the last triennium (Figure 1).

The main reason for the deceleration of growth during the post-reform period was a visible deceleration in investment in irrigation and other rural infrastructure.

2 Changes in Land Yields (1962-65 to 1980-83)

One of the key contributions to output growth in recent years has been the increases in levels and growth of crop yields. However, during the period 1962-65, prior to the advent of the green revolution at the all-India level, the average yields levels were quite low although there were large regional variations (Figure 2).

Since the levels and growth rates of yields were low, the area growth was the major source of growth of output in India during the pre-green revolution period. For example, during 1949-50 to 1964-65, the contribution of area growth to output growth was 50.16%, while that of yield growth was only 38.41% (DES 2008). The introduction of new technology during the mid-1960s resulted in raising the yield levels of major crops, particularly wheat and rice, thereby making the yield growth the dominant source of growth of output. Thus during 1962 to 2003-06, the yield growth accounted for 85.2% of growth of output, while the contribution of area growth was only 14.41%.

During 1962-65 to 1980-83, the north-western states that had pioneered the green revolution registered significant increases in

Table 2: State and Regionwise Level and Growth of Crop Yield (1962-65, 1970-73, 1980-83, 1990-93 and 2003-06) growth rate decelerated to 1.52% pa from 3.17%

Sl Value of Output (Rs Per Hectare of GCA) Annual Compound Growth Rate (%)

pa in the earlier period.

No State 1962-65 1970-73 1980-83 1990-93 2003-06 1980-83/ 1990-93/ 2003-06/ 2003-06/ 1962-65 1980-83 1990-93 1962-65 All regions recorded a deceleration in their

1 Haryana 3,927 5,090 6,229 9,682 11,569 2.60 4.51 1.38 2.67 yield growth rates of during 1990-93 to 2003-06 2 Himachal Pradesh 3,048 3,734 3,918 5,187 6,176 1.40 2.85 1.35 1.74

compared with 1980-83 to 1990-93 (Table 2).

3 J and K 2,987 4,481 5,759 5,432 5,985 3.71 -0.58 0.75 1.71

Most of the states also recorded a deceleration

4 Punjab 5,396 7,476 9,708 13,215 15,373 3.32 3.13 1.17 2.59

in their yield growth rates, the only exception

5 Uttar Pradesh 3,970 4,590 5,805 8,355 9,894 2.13 3.71 1.31 2.25

being Gujarat which recorded a high yield

North-West Region 4,093 5,025 6,423 9,244 10,958 2.53 3.71 1.32 2.43

growth rate of 4.55% during 1990-93 to

6 Assam 5,728 6,241 6,907 7,998 8,989 1.05 1.48 0.90 1.11 7 Bihar 3,680 4,010 4,049 5,278 5,670 0.53 2.69 0.55 1.06 2003-06 compared with a yield growth of

8 Orissa 4,114 4,073 4,375 5,740 6,690 0.34 2.75 1.19 1.19 1.55% recorded by it during the previous pe

9 West Bengal 5,075 5,615 5,944 9,507 12,142 0.88 4.81 1.90 2.15riod. As noted earlier, this was primarily be Eastern Region 4,338 4,671 4,944 6,894 8,314 0.73 3.38 1.45 1.60 cause of the introduction and rapid spread of 10 Gujarat 3,673 4,327 5,693 6,640 11,836 2.47 1.55 4.55 2.90

high value Bt cotton in the state. Gujarat seems

11 Madhya Pradesh 2,603 2,836 3,070 4,406 5,640 0.92 3.68 1.92 1.90

to have reaped the benefits of a cotton revolu

12 Maharashtra 2,899 2,344 3,795 4,490 5,960 1.51 1.70 2.20 1.77

tion in the post-reform period.

13 Rajasthan 1,740 2,217 2,335 3,809 5,095 1.65 5.02 2.26 2.65

Since the yield growth rates are now the pre

Central Region 2,654 2,763 3,464 4,551 6,367 1.49 2.77 2.62 2.16

dominant source of growth of agricultural out

14 Andhra Pradesh 4,065 4,363 6,276 8,728 11,537 2.44 3.35 2.17 2.58

15 Karanataka 3,208 4,267 4,990 6,342 6,994 2.49 2.43 0.76 1.92 put, a steep deceleration in the growth rates of

16 Kerala 11,376 12,958 12,334 14,655 13,858 0.45 1.74 -0.43 0.48 yields in most parts of India should be a matter

17 Tamil Nadu 6,690 7,900 8,756 13,037 13,117 1.51 4.06 0.05 1.66of great concern for the policymakers. A major Southern Region 4,873 5,873 6,848 9,178 10,244 1.91 2.97 0.85 1.83

reason seems to be the decline in public invest

All-India 3,738 4,257 5,090 6,957 8,460 1.73 3.17 1.52 2.01

ment in irrigation and non-availability of yield-

Coefficient of Variations (%) 50.13 50.19 42.75 42.59 36.98 57..93 49..87 78..28 35.41

raising cost-reducing new technology.

Source: As in Table 1.

the yield levels and growth (Table 2). As compared with a yield growth rate of 1.73% pa at the all-India level, the north-western region recorded a growth rate of 2.53% pa. The growth of yield was 1.91% in the southern region, 1.49% in the central region and only 0.73% pa in the eastern region.

It is also clear that since yield growth rates were the main source of output growth, yield growth rates in various states were highly associated with their output growth rates in all periods (Tables 1 and 2).

2.1 1980-83 to 1990-93

Along with agricultural output, the growth rates of yields accelerated significantly during 1980-83 to 1990-93 as compared with the period 1962-65 to 1980-83 not only at the all-India level, but in most states and regions.

In particular, the eastern region recorded a very high yield growth rate of 3.38% compared with only 0.57% pa achieved during the earlier period. West Bengal achieved an unprecedented yield growth rate of 4.81% pa during 1980-83 to 1990-93. Similarly, during 1980-83 to 1990-93, all the states in the southern region and all the states in the central region, with the exception of G ujarat, recorded an acceleration in their yield growth rates.

The coefficient of variation (CV) of yield

levels brings out that over the period 1962-65 to 2003-06, there has been a tendency for regional disparity in yield levels to come down (Table 3 and Figure 2). But despite this decline, it is important to underline that the disparities continue to be very high and are a product of more rigid climatic, structural and institutional factors like variations in rainfall and irrigation, and those in the level of infrastructural and technological investments in various regions.

3 Net Sown Area and GCA (Area under 44 Crops)
3.1 Net Sown Area

In India, there are competing demands on area available for cultivation from increase in rural habitations, forestation, urbanisation and industrialisation. Consequently, net sown area in the country has registered a rapid deceleration in its growth over time.

During 1962-65 to 1980-83, net area sown rose at a rate of 0.15% pa at the all-India level – its growth rate decelerated to 0.11% pa during 1980-83 to 1990-93 and further to -0.05% pa d uring 1990-93 to 2003-06. All the regions except the central r egion recorded a deceleration in their net sown area during

Table 3: Regionwise Level and Growth of Net Sown Area (1962-65 to 1980-83, 1980-83 to 1990-93 and 1990-93 to 2003-06) (44 crops)

2.2 Post-Liberalisation Period During the post-liberalisation period (1990-93 to 2003-06), the growth rates of both agricultural output and of land yields slowed down as compared with the pre-liberalisation period. At the all-India level, while the output growth rate decelerated to 1.74% pa from 3.37% pa, the yield Regions North-West Region Eastern Region Central Region Southern Region All-IndiaSource: As in Table 1. Average Net Sown Area (000 Hectares) 1962-65 1970-73 1980-83 1990-93 2003-06 25,860 26,031 26,356 26,306 26,516 22,041 21,687 22,287 21,935 21,262 58,139 60,150 61,918 63,149 63,978 30,021 29,958 28,877 29,423 27,851 1,36,981 1,39,044 1,40,716 1,42,289 1,41,279 Annual Compound Growth Rate (%) 1980-83/ 1990-93/ 2003-06/ 2003-06/ 1962-65 1980-83 1990-93 1962-65 0.11 -0.02 0.06 0.06 0.06 -0.16 -0.24 -0.09 0.35 0.20 0.10 0.23 -0.22 0.19 -0.42 -0.18 0.15 0.11 -0.05 0.08
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this period. Thus, except for the central region, net sown area has Madhya Pradesh and Rajasthan in the central region and Karnaceased to be a source of growth of agricultural output in most taka in the southern region. parts of India. Finally, during 1990-93 to 2003-06, GCA recorded a paltry

growth rate of 0.22% pa, but net sown area actually declined,

3.2 Total Cropped Area r ecording a growth rate of (-) 0.05% pa. During this period, at the Notwithstanding the fact that yield growth has become the dom-regional level, among the north-western states, Punjab and inant contributor to growth of output after the advent of green H aryana continued to record a medium growth in GCA, while in revolution, growth of GCA continues to be an important source of the eastern region only West Bengal recorded a medium growth growth of output in some states and regions of India (Table 4). of GCA and in the central region, Gujarat, Madhya Pradesh and

Table 4: State and Regionwise Level and Growth of Gross Cropped Area (1962-65 to 1980-83, 1980-83 to Rajasthan recorded a fairly high growth in 1990-93 and 1990-93 to 2003-06) (44 crops)

their GCA. As growth of net sown area had

Average Area (000 Hectares) Annual Compound Growth Rate (%)

ceased to be an important factor, most of the

State 1962-65 1970-73 1980-83 1990-93 2003-06 1980-83/ 1990-93/ 2003-06/ 2003-06/ 1962-65 1980-83 1990-93 1962-65 increase in GCA at the all-India and state levels

1 Haryana 4,151 4,606 5,066 5,327 5,988 1.11 0.50 0.90 0.90

was because of increase in cropping intensity

2 Himachal Pradesh 816 866 908 899 861 0.59 -0.10 -0.33 0.13

(Table 5, p 39).

3 J and K 813 824 902 972 964 0.58 0.75 -0.06 0.42

4 Punjab 4,092 4,935 6,042 6,707 7,124 2.19 1.05 0.46 1.36

4 Inputs and Agricultural Output

5 Uttar Pradesh 23,583 24,937 25,903 24,331 24,612 0.52 -0.62 0.09 0.10

The essence of the new seed-technology, in fact,

North-West Region 33,455 36,168 38,821 38,236 39,549 0.83 -0.15 0.26 0.41 6 Assam 2,625 2,791 3,325 3,645 3,538 1.32 0.92 -0.23 0.73

is that the new high yield variety (HYV) seeds

Bihar 10,689 10,722 10,195 9,597 9,244 -0.26 -0.60 -0.29 -0.35 are highly amenable to the use of modern in

8 Orissa 5,928 6,480 7,833 7,916 6,227 1.56 0.11 -1.83 0.12 puts like fertilisers in irrigated conditions and

9 West Bengal 6,412 6,987 7,063 7,893 8,405 0.54 1.12 0.48 0.66result in achieving much higher yield levels. Eastern Region 25,655 26,980 28,416 29,050 27,413 0.57 0.22 -0.45 0.16

Table 5 brings out the clear association be

10 Gujarat 9,032 8,831 9,126 8,561 9,437 0.06 -0.64 0.75 0.11

tween the levels of land productivity and use of

11 Madhya Pradesh 18,465 19,823 20,799 22,554 24,342 0.66 0.81 0.59 0.68

modern inputs. Thus all the high productivity

12 Maharashtra 17,964 16,512 19,277 19,700 19,512 0.39 0.22 -0.07 0.20

states like Punjab and Haryana in the north

13 Rajasthan 13,878 15,240 16,394 18,095 20,406 0.93 0.99 0.93 0.94

western region, Kerala, Tamil Nadu and Andhra

Central Region 59,338 60,406 65,596 68,911 73,697 0.56 0.49 0.52 0.53 14 Andhra Pradesh 12,270 12,312 12,199 12,256 11,639 -0.03 0.05 -0.40 -0.13

Pradesh in the southern region, West Bengal in

15 Karanataka 10,343 9,574 10,295 11,602 11,928 -0.03 1.20 0.21 0.35 the eastern region and Gujarat in the central re

16 Kerala 2,213 2,676 2,566 2,575 2,452 0.83 0.03 -0.38 0.25 gion had been using large doses of modern in

17 Tamil Nadu 7,026 7,398 6,305 6,304 5,174 -0.60 0.00 -1.51 -0.74puts during all the periods of the study. Southern Region 31,852 31,960 31,366 32,736 31,193 -0.09 0.43 -0.37 -0.05

On the other hand, during all periods, the

All-India 1,51,315 1,56,622 1,65,698 1,68,817 1,73,718 0.51 0.19 0.22 0.34

use of modern inputs continued to be at abys-

Source: As in Table 1.

The area under crops can grow either through increases in net area sown or through increases in intensity of cultivation. Since a limit has been reached with regard to the possibility of increasing net sown area on a substantial scale, the only method of increasing GCA is through increased intensity of cultivation brought about through irrigation and through the introduction of short duration crops.

During 1962-65 to 1980-83, cropped area r ecorded a growth of 0.51% pa at the all-India level. Whereas, its growth rate was 0.83% pa in the north-western region, and 0.57% and 0.56% pa, respectively in the eastern and central regions, the growth rate of cropped area was negative in the southern region. Cropped area registered a rapid growth in Punjab, Haryana and some other north-western states primarily because in addition to some increase in net sown area, the introduction of short duration crops r esulted in substantial increases in the intensity of cultivation in these states.

During 1980-83 to 1990-93, there was a deceleration in the growth rate of cropped area to 0.19% compared with 0.51% during 1962-65 to 1980-83. The only states where the growth rate in cropped area was reasonably high were Punjab, Haryana, J and K in the north-western region, Assam and West Bengal in the east,

mally low in the very low yield states of Rajasthan, Madhya Pradesh, Maharashtra, and Orissa. Thus, compared with 412 kg per hectare of fertiliser used in Punjab during 2003-06, the use of fertilisers was just 58 kg, 61 kg, 80 kg and 94 kg per hectare in Rajasthan, Orissa, Madhya Pradesh and M aharashtra, respectively (Table 5). This situation holds for other inputs as well.

The role of inputs in raising yields is confirmed by the fairly high correlation between quantum and intensity of inputs used and yield levels across states. For instance, during 2003-06, the “Pearson coefficient of correlation”(r) between state level yields and use of fertiliers, pumpsets and irrigation turned out to be 0.70, 0.69 and 0.50, respectively. Furthermore, the association between the levels of yields and use of inputs has got strengthened overtime. For instance, the correlation between yield levels and pumpsets improved from 0.32 during 1962-65 to 0.69 during 2003-06, that for tractors from 0.14 to 0.40 and for irrigation from 0.31 to 0.50, over the same period.

One also sees an association between the growth rates of output and the use of modern inputs at the all-India level and in various states of India although in the case of output growth the relationship is not as strong as for yield levels. During 1980-83 to 1990-93, when the growth rate of agricultural output accelerated

december 26, 2009 vol xliv no 52

significantly, at the all-India level, per hectare consumption of fertilisers more than doubled as compared with the period 1962-65 to 1980-83. Again, there was a substantial increase in the percentage of GCA under irrigation from 29% during 1980-83 to 36% during 1990-93.

Finally, the deceleration in the growth rates of output and yield during the post-liberalisation period, as compared with the preliberalisation period is also reflected in decelerated growth in the use of almost all inputs. For example, compared with more than 100% growth in fertiliser consumption per hectare during 1980-83 to 1990-93, its growth rate was just 50% over the period 1990-93 to 2003-06. Similarly, pumpsets increased only by 41% in the later period compared with an increase of 61% during the earlier period.

Table 5 also brings out that in India, the inter-state disparity in the use of modern inputs is declining over time. Over the 1962-65 to 2003-06, the coefficient of variations among states declined from 398 to 152 for tractors used, from 733 to 62 for number of tubewells, from 531 to 118 for fertiliser consumption, and from 251 to 88 for irrigation intensity.

One of the important questions that has been raised is whether it is sustainable in the long run to maintain the tempo of agricultural growth through increasingly higher use of costly and heavily subsidised inputs that not only impose a high fiscal burden, but also lead to soil and environmental degradation.

5 Cropping Pattern Changes4

In India, area allocation among various crops has shown a measure of structural rigidity that reflects the traditional character of Indian agriculture, wherein foodgrain has remained the predominant crop accounting for two-thirds to three-fourths of the

Table 5: Statewise Use of Various Input (1962-65, 1980-83, 1990-93 and 2003-06)

gross cropped area since the early 1950s. This also reflects the impact of the prevalent demand structure. However, within the foodgrain sector, substantial changes have taken place.

Policymakers in India have been stressing the need for crop diversification to higher value crops as major strategy of agricultural development. This is because, with a rise in per capita income, whereas the demand for foodgrain is likely to grow at a slow rate, that for oilseeds, fibres, sugarcane, livestock and horticulture products is projected to grow at a much faster rate. The planners feel that such diversification not only offers opportunities for raising farm incomes significantly, these are also likely to put less pressure on natural resources.

Most of the foodgrain crops that account for a major share of total cultivated area, in particular coarse cereals, and to some extent, pulses, have remained low yield low value crops for a very long time. The introduction of new seed fertiliser technology during the mid-1960s resulted in substantially raising the yield levels of some of the major foodgrain crops like wheat and rice (Table 6, p 40). This combined with a positive price climate resulted in increasing area allocation to these crops. The new technology was able to impact on the yield levels of non-foodgrain crops like oilseeds, fibre crops, sugar cane and fruit and vegetables after some time lag thereby resulting in significant cropping pattern changes over time.

5.1 Initial Phase of Green Revolution

During the 18 years from 1962-65 to 1980-83, the process of cropping pattern changes was slow and halting. Foodgrains, which accounted for 74.7% of the GCA in 1962-65, still claimed 73.0% of area during 1980-83. Again, the share of foodgrains in the total value of crop output (at 190-93 constant prices) also came down only marginally from 57.6% during 1962-65 to 57.4% during 1980-83.

Sr States Tractors (Nos/0000Hc) Pumpsets (Nos/000Hc) Fertiliser Consumption (Kg/Hc) % of Total Cropped Area Irrigated Cropping Intensisty (%)
No 1962 1982 1992 2003 1962 1982 1992 2003 1962 1980 1990 2003 1962-65 1980-83 1990-93 2003-06 1962-65 1980-83 1990-93 2003-06
1 Haryana 7 170 444 549 2 71 143 155 2 71 175 307 31 62 76 84 131 153 164 181
2 Himachal Pradesh 0 16 45 130 0 3 4 20 1 33 62 87 17 17 18 19 162 166 170 179
3 J and K 2 11 18 70 0 1 5 28 2 36 65 119 36 40 41 41 125 137 146 147
4 Punjab 24 254 508 704 8 158 170 170 8 209 318 412 58 87 95 97 129 158 180 189
5 Uttar Pradesh 5 82 201 397 1 64 132 191 4 75 129 205 27 47 62 70 128 143 148 150
North-West Region 8 118 274 451 2 77 133 175 4 93 160 245 32 56 67 75 129 147 156 161
6 Assam 3 1 3 5 0 1 2 0 0 5 16 89 20 17 15 5 119 128 142 139
7 Bihar 2 18 19 130 1 47 89 117 3 24 77 108 18 34 43 48 141 133 133 133
8 Orissa 1 2 4 28 0 3 6 19 1 14 33 61 16 22 26 30 121 141 152 150
9 West Bengal 2 3 12 34 1 37 54 119 5 49 136 226 23 25 54 52 118 132 160 176
Eastern Region 2 8 11 62 1 27 46 76 3 26 74 123 19 27 30 39 128 134 146 149
10 Gujarat 3 29 70 150 9 59 67 92 4 41 75 120 8 23 29 37 105 113 114 114
11 Madhya Pradesh 1 13 24 130 1 22 47 107 1 14 50 80 6 12 21 28 113 116 121 130
12 Maharashtra 1 12 50 60 7 33 66 62 2 27 69 94 7 13 15 17 105 109 117 128
13 Rajasthan 3 35 90 184 1 28 54 88 1 10 30 58 13 21 27 32 107 117 118 126
Central Region 2 21 55 128 4 32 57 88 2 21 55 86 8 16 22 27 108 114 118 126
14 Andhra Pradesh 2 19 52 85 5 62 101 148 10 56 137 185 29 36 40 39 111 115 120 122
15 Karnataka 2 20 37 60 4 30 58 79 3 37 82 118 9 13 23 25 104 108 115 119
16 Kerala 2 6 9 10 4 45 88 196 15 49 111 98 20 13 12 15 122 132 135 137
17 Tamil Nadu 4 26 52 102 32 211 212 210 12 80 136 153 45 49 48 50 119 119 121 115
Southern Region 2 20 44 73 10 78 106 137 8 54 116 149 26 29 33 34 111 114 119 121
All-India 3 37 86 167 5 49 79 111 4 44 91 136 19 29 36 41 115 124 130 135
Coefficient of variations (%) 398 544 636 152 554 259 128 62 531 347 143 118 251 175 111 88 13 15 18 19
Source: As in Table 1.
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But a significant diversification took place within the foodgrain segment during 1962-65 to 1980-83. At the all-India level, whereas the area under high yielding wheat increased from 8.6% during 1962-65 to 13.0% of GCA by 1980-83, area under coarse cereals and pulses recorded a notable decline (Table 7, p 41).

The change was most marked in the north-western region where the share of area under wheat increased from 20.1% in 1962-65 to 33.9% in 1980-83 and the share of area under rice to total cropped area in the region increased from 15.4% to 19.0%. On the other hand, the share of area under coarse cereals and pulses registered a sharp decline. The shift from low value coarse cereals and pulses to high value wheat and rice resulted in increasing the share of foodgrains in the total value of output from 62.2% during 1962-65 to 68.74% during 1980-83.

5.2 Maturing of the Green Revolution

The cropping pattern changes became more pronounced during 1980-83 to 1990-93 when a notable acceleration took place in the yield levels and the growth rates of output of many crops across all states and regions of India as compared with the earlier p eriod, 1962-65 to 1980-83.

At the all-India level, the proportion of area under foodgrains which had remained almost unchanged during 1962 to 1980-83, registered a sharp decline from 73.0% of total area in 1980-83 to 67.3% of GCA during 1990-93. It is the first time since 1962 that area under foodgrains declined in absolute terms from 126.97 million hectares during 1980-83 to 124.29 million hectares during 1990-93. The shift away from foodgrains occurred mainly from area under coarse cereals.

During 1980-83 to 1990-93, the main area shift that took place was from coarse cereals towards oilseeds. At all-India level, the

Table 6: All-India Compound Annual Growth Rates of Area, Production and Yield of Major Crops (1962-65 to 2003-06)

Sl States 1962-65 to 1980-83 1980-83 to 1990-93 1990-93 to 2003-06 1962-65 to 2003-06 No Area Production Yield Area Production Yield Area Production Yield Area Production Yield

1 Rice 0.55 1.91 1.36 0.65 3.72 3.05 0.06 1.33 1.27 0.42 2.16 1.74

2 Wheat 2.93 7.33 4.26 0.58 3.73 3.13 0.76 1.73 0.97 1.66 4.63 2.92

3 Coarse cereals -0.34 1.01 1.35 -1.91 0.77 2.73 -1.11 0.69 1.82 -0.97 0.85 1.84

4 Pulses -0.25 0.06 0.31 1.41 1.32 -0.09 -1.13 0.49 1.64 -0.13 0.50 0.63

5 Foodgrains 0.42 2.27 1.84 0.01 2.94 2.92 -0.34 1.26 1.60 0.08 2.11 2.03

6 Groundnut -0.03 0.38 0.41 1.60 2.84 1.21 -1.99 -0.09 1.94 -0.26 0.82 1.09

7 Rapeseed and mustard 1.71 3.53 1.79 1.14 8.72 4.39 0.60 2.54 1.92 1.95 4.45 2.46

8 Nine oil seeds 0.89 1.58 0.69 3.11 5.56 2.38 0.54 2.28 1.73 1.31 2.76 1.43

8 Fibre crops -0.21 1.27 1.48 -0.61 3.14 3.78 0.60 3.31 2.69 -0.05 2.36 2.42

9 Cotton -0.13 1.46 1.59 -0.48 3.33 3.82 0.80 3.54 2.72 0.08 2.57 2.49

10 Sugar cane 1.47 2.88 1.39 1.88 3.15 1.25 0.52 0.30 -0.22 1.27 2.12 0.84

11 Plantation crops 2.19 3.99 1.77 1.94 3.82 1.85 2.32 3.14 0.80 2.17 3.68 1.48

12 Condiments and spices 2.25 1.65 -0.57 1.13 3.93 2.77 0.72 4.22 3.47 1.49 3.02 1.50

13 Remaining crops 1.49 2.98 1.46 2.23 6.26 3.94 2.98 2.24 -0.72 2.14 3.53 1.36

Non- foodgrains 0.81 2.21 1.39 0.75 3.98 3.21 1.73 2.36 0.62 1.08 2.69 0.62

All Crops 0.50 2.25 1.73 0.59 3.82 3.21 0.25 1.74 1.48 0.46 2.48 2.01

Source: As in Table 1.

During 1962-65 to 1980-83, the cropping pattern changes in regions other than the north-western regions were not that significant. In the eastern region, the share of area under rice declined and the share of area under wheat and oilseeds increased significantly. In the central region, the share of area under coarse cereals declined during 1962-65 to 1980-83, but the share of area under high value remaining crops increased from 7.7% in 1962-65 to 10.1% in 1980-83. The value share of “remaining crops” went up from 9.8% during 1962-65 to 12.7% during 1980-83. Despite some decline in the share of coarse cereals, it is noteworthy that nearly one-third to one half of the total GCA in the central states is under low value and low yield coarse cereals and pulses.

In the southern region, there was a substantial decline in the share of area under coarse cereals and foodgrains and some increase in the share of area under pulses, cotton, sugar cane, plantations and “remaining crops”. As in many states in the central region, Andhra Pradesh and Karnataka in the southern region also had large shares of their area under coarse cereals and pulses. Although rice dominated the cropping pattern in Tamil Nadu, a sizeable proportion (22.4%) of its cropped area was under coarse cereals even by 1980-83.

share of area under coarse cereals in GCA declined rapidly from 23.9% during 1980-83 to 18.6% of during 1990-93. On the other hand, the crop area under oilseeds increased by about eight million hectares and the share of oilseeds in GCA increased from 10.4% in 1980-83 to 13.3% in 1990-93.

During 1980-83 to 1990-93, there was a decline in the share of coarse cereals in all regions. In the central and southern regions, the decline in the share of coarse cereals went to an increase in the share of oilseeds. In the north-western region, the share u nder coarse cereals declined but the main gainers were rice, wheat and remaining crops.

5.3 Post-Reform Period

The process of diversification in cropping pattern from foodgrains to non-foodgrains which began during 1980-83 to 1990, continued in 1900-93 to 2003-06 albeit at a slower rate and the share of foodgrains in GCA declined from 67.3% in 1990-93 to 63.7% by 2003-06.

The economic reforms initiated during the early 1990s were expected to hasten the process of crop diversification from low value foodgrains to high value non-foodgrain crops. However,

december 26, 2009 vol xliv no 52

during the post-reform period, the yield growth rates of most of the important crops including wheat and rice, oilseeds, sugar cane decelerated considerably compared with the pre-reform p eriod 1980-83 to 1990-93 (Table 6). Consequently, during the post-reform period, the pace of cropping pattern changes towards higher value crops slowed down as compared with the pre-reform period 1980-83 to 1990-93.

During 1990-93 to 2003-06, like during 1980-83 to 1990-93, the shift has occurred mainly from the area under coarse cereals and from some other crops like pulses. However, unlike the earlier period 1980-83 to 1990-93, when oil seeds were the main gainers, during 1990-93 to 2003-06, although share of oilseeds has also increased marginally, it is the remaining crops which are the biggest beneficiaries. Some other crops like cotton and sugar cane have also marginally increased their share in area during this period. But the share of pulses has declined.

Contrary to the all-India pattern, where share of area under foodgrains has declined sharply, in the north-western region, the share of area under foodgrains has marginally increased (Table 7). In this region, area shifts away

Table 7: State and Regionwise Share of Various Crops in Total Gross Cropped Area (1962-65 to 2003-06) (%)

from pulses and coarse cereals p rivate sector companies, this programme has been able to increase the share of area and value of output of remaining crops only marginally. The programme has failed to bring about any substantial changes in the cropping pattern in the state. Policymakers need to analyse the main reasons for this failure.

Unlike the north-western region, there took place a steep decline in the area under foodgrains in both the eastern and central regions. In the eastern region, the share of area under foodgrains declined from 76.56% in 1990-93 to 72.3% in 2003-06 and in the central region from 64.0% to 57.9%. The share of area under foodgrains also registered a small decline in the southern region.

In the central region the decline in the share of coarse cereals and foodgrains was compensated by a substantial increase in the share of area under cotton, oilseeds and remaining crops. The most remarkable shift was in Gujarat where area under cotton increased from 10.0% during 1990-93 to as much as 16.2% by 2003-06 (Table 7).

In Tamil Nadu, the share of area under coarse cereals and pulses has gone down, while there is a big increase in the share of

Region Triennium Rice Wheat Coarse Pulses All Food-Oil Fibres Cotton Sugar Planta-Cardamom Remaininggets diverted mainly to wheat Cereals grains Seeds Cane tion and Spices Crops

and rice.

Punjab 1962-65 5.3 30.8 11.4 16.8 64.3 4.3 10.0 9.8 2.3 0.0 0.5 18.6

For example, in Punjab the 1980-83 18.9 44.1 7.2 4.4 74.6 3.3 10.4 10.3 1.4 0.0 0.2 10.3

share of area under foodgrains 1990-93 27.3 43.4 3.2 1.6 75.4 2.3 9.1 9.1 1.4 0.0 0.0 11.8

in total GCA increased from 2003-06 32.8 43.2 2.3 0.5 78.8 1.1 6.3 6.3 1.2 0.0 0.1 12.5

North-Western 1962-65 15.4 20.1 23.3 21.1 79.8 12.3 2.5 2.2 4.6 0.0 0.2 0.6 1980-83 19.0 33.9 16.1 10.8 79.7 10.7 2.9 2.8 4.7 0.0 0.1 1.8

75.4% in 1990-93 to 78.8% by

2003-06. Because of high

1990-93 20.9 35.2 11.8 8.9 76.9 6.3 3.0 2.9 5.2 0.0 0.1 8.4

yields combined with subsi

2003-06 23.0 37.3 9.6 7.2 77.1 4.6 2.5 2.5 5.6 0.1 0.2 9.8

dised inputs and a remunera-

Eastern 1962-65 57.0 2.6 6.7 14.2 80.5 3.0 3.8 0.1 0.9 0.9 0.3 10.6

tive price regime, wheat and

1980-83 55.7 7.1 7.2 11.9 81.9 5.5 3.2 0.0 0.8 1.0 0.6 7.0

rice are highly profitable crops

1990-93 54.9 7.3 4.5 9.8 76.5 6.3 2.8 0.0 0.7 1.0 0.8 11.9

in Punjab. Because of this, in

2003-06 54.3 8.0 3.7 6.2 72.3 4.5 2.8 0.1 2.2 1.3 1.0 16.1 Punjab, the share of area under Gujarat 1962-65 5.4 4.1 32.7 5.0 47.2 23.0 17.2 17.2 0.3 0.0 0.2 12.2

rice increased from 27.3% in 1980-83 4.5 6.2 26.2 6.0 42.8 23.7 14.2 14.1 0.8 0.0 0.1 18.4

1990-93 to 32.8% by 2003-06. 1990-93 5.3 5.4 20.7 8.5 39.9 26.4 10.0 10.0 1.1 0.0 0.2 22.4

Similarly, the share of wheat 2003-06 6.0 7.1 14.7 6.9 34.8 26.7 16.2 16.2 1.7 0.0 0.7 19.9 increased from 30.8% in

Central 1962-65 10.0 9.1 36.1 15.8 70.9 11.4 9.0 8.8 0.4 0.0 0.6 7.7

1962-65 to 43.2% by 2003-06. 1980-83 9.9 9.9 33.5 16.6 70.0 11.2 7.5 7.4 0.6 0.0 0.6 10.1
The rapid increase in the 1990-93 9.9 9.3 28.4 16.4 64.0 17.6 6.4 6.3 0.8 0.0 0.6 10.6
share of rice in the total 2003-06 9.5 9.6 22.3 16.4 57.9 20.7 7.1 7.0 0.8 0.0 0.8 12.7
cropped area in Punjab oc- Kerala 1962-65 1980-83 32.6 27.7 0.0 0.0 0.5 0.2 1.8 1.1 34.9 29.0 1.1 0.9 0.3 0.2 0.3 0.2 0.4 0.3 8.7 11.9 6.0 6.2 48.6 51.5
curred in spite of an ambitious 1990-93 18.0 0.0 0.3 0.8 19.1 0.8 0.3 0.3 0.2 17.7 8.1 53.7
programme of diversification 2003-06 9.7 0.0 0.1 0.1 9.9 0.1 0.1 0.1 0.1 20.4 9.6 59.6
of area away from paddy Tamil Nadu 1962-65 36.6 0.0 28.4 5.6 70.6 14.9 5.6 5.5 1.0 0.7 1.6 5.6
launched by the state govern 1980-83 33.9 0.0 22.4 9.4 65.8 16.5 3.4 3.4 2.9 1.3 2.2 7.9
ment during the 1990s. The 1990-93 29.8 0.0 15.9 11.6 57.3 18.6 3.7 3.7 3.3 1.3 1.7 14.0
argument was that the exten 2003-06 37.1 0.0 14.8 9.9 61.8 12.6 2.2 2.2 4.5 1.7 2.1 15.0
sive cultivation of highly water- Southern 1962-65 23.9 1.0 35.2 9.2 69.4 11.7 5.9 5.5 0.8 1.0 2.0 9.2
intensive rice had led to deple 1980-83 23.6 1.0 28.4 10.8 63.9 13.2 5.4 5.0 1.6 1.7 2.6 11.7
tion of underground water, de 1990-93 21.9 0.6 20.1 11.7 54.4 20.7 4.8 4.5 2.0 2.2 2.5 13.4
terioration in soil fertility and had a highly adverse impact on All India 2003-06 1962-65 1980-83 21.2 22.8 22.8 0.8 8.6 13.0 18.5 28.0 23.9 13.5 15.3 13.2 53.9 74.7 73.0 18.4 9.8 10.4 4.9 6.1 5.3 4.7 5.1 4.6 2.1 1.5 1.8 2.9 0.4 0.5 2.6 0.6 0.9 15.2 6.98.2
the ecological balance in the 1990-93 23.0 13.0 18.6 14.4 68.9 13.3 4.7 4.1 2.0 0.6 0.9 9.6
state. Despite the involvement 2003-06 22.4 13.9 15.5 12.0 63.8 13.8 4.9 4.4 2.1 0.8 1.0 13.6
of some of the important Source: As in Table 1.
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Table 8: State and Regionwise Share of Various Crops in Total Value of Output (1962-65 to 2003-05) (%) in the central region that have
Region Triennium Rice Wheat Coarse Cereals Pulses All Foodgrains Oil Seeds Fibres Cotton Sugar Cane Planta-Cardamom tion and Spices RemainingCrops registered a notable increase in their share of area under
Punjab 1962-65 1980-83 4.8 24.1 24.9 42.5 5.8 3.4 14.8 1.7 49.4 72.4 5.6 17.2 2.2 10.0 17.1 10.0 5.9 3.6 0.0 0.0 2.0 0.5 19.911.2 oilseeds.
1990-93 29.4 39.9 1.4 0.6 71.3 1.9 11.7 11.7 2.8 0.0 0.2 12.3 The slowdown in diversifica
2003-06 35.5 38.4 1.1 0.2 75.2 0.7 8.6 8.6 1.9 0.0 0.5 12.9 tion towards oilseeds and in
North-Western 1962-65 12.8 15.3 11.0 23.1 62.2 11.0 4.8 4.6 18.1 0.0 0.7 3.1 oilseeds production comes at a
1980-83 19.4 34.4 6.4 8.5 68.7 6.9 4.2 4.2 14.4 0.0 0.5 5.4 time when the demand for edi
1990-93 21.6 33.5 4.6 5.5 65.1 5.2 4.9 4.9 13.4 0.0 0.2 11.1 ble oils is increasing very rap
2003-06 23.3 34.2 3.7 3.7 64.8 3.9 4.1 4.1 12.7 0.1 0.9 13.5 idly consequent to rapid rise in
Eastern 19626-5 55.8 1.3 3.1 11.1 71.3 2.4 4.2 0.1 3.6 3.9 1.6 13.1 per capita incomes in the coun
1980-83 48.4 6.7 3.2 8.5 66.7 5.9 3.6 0.0 3.0 5.2 2.4 13.2 try. This has resulted in increas-
Central 1990-93 2003-06 1962-65 49.4 49.5 13.0 6.2 5.2 7.4 2.3 2.2 19.3 5.6 2.9 15.5 63.5 59.7 55.1 5.9 3.7 17.1 3.0 3.2 11.2 0.0 0.1 11.1 2.3 1.2 3.9 4.3 4.4 0.0 2.7 3.5 2.8 18.324.4 9.8 ing India’s dependence on imported edible oils.
1980-83 11.9 11.5 16.8 14.3 54.5 16.1 8.7 8.6 6.2 0.0 1.8 12.7 But oilseeds in India are
1990-93 10.8 11.3 13.8 12.5 48.3 23.1 6.7 6.7 6.0 0.0 1.8 14.1 u nable to compete internation
2003-06 8.7 9.9 9.4 10.3 38.3 27.9 10.0 10.0 3.7 0.0 2.7 17.4 ally. Although individual oilseeds
Karnataka 1962-65 19.4 0.9 20.9 6.6 47.9 15.8 6.8 6.7 7.6 3.2 3.8 14.9 like rapeseeds and mustard
1980-83 17.5 1.1 17.7 6.7 43.0 12.1 5.2 5.2 10.7 5.9 3.6 19.5 and groundnut used to have a
1990-93 15.5 0.6 15.0 5.1 36.2 19.3 5.4 5.4 12.4 5.9 3.1 17.6 captive domestic market, this is
2003-06 19.6 0.6 16.9 6.5 43.7 14.8 3.2 3.2 7.9 7.7 4.4 18.3 fast giving way to imported
Kerala 1962-65 17.1 0.0 0.1 0.4 17.7 0.7 0.2 0.2 0.7 5.4 4.2 71.2 Palmolive oil which is much
1980-83 15.9 0.0 0.0 0.4 16.3 0.4 0.1 0.1 0.7 11.2 5.4 66.0 cheaper. The reduction in cus
1990-93 10.7 0.0 0.0 0.3 11.0 0.2 0.2 0.2 0.5 16.7 6.1 65.2 tom duties on both refined and
2003-06 7.2 0.0 0.0 0.1 7.3 0.1 0.1 0.1 0.3 36.3 12.1 43.8 crude edible oils in 2008 has
Southern 1962-65 29.5 0.2 11.6 3.2 44.5 14.4 3.5 3.3 5.7 2.2 6.3 23.4
1980-83 29.4 0.3 9.5 3.6 42.8 11.6 3.6 3.5 8.4 4.0 5.8 23.7 tended to cushion the prices
1990-93 26.0 0.1 6.4 3.4 36.0 16.0 4.0 3.9 7.9 4.5 6.1 25.5 in the I ndian market, much to
2003-6 25.3 0.2 7.8 4.5 37.8 11.5 4.4 4.3 7.2 7.0 11.7 20.3 the detriment of the interests
All-India 1962-65 26.7 6.0 11.9 13.0 57.6 11.8 6.2 5.2 7.7 1.4 3.0 12.4 of oilseeds producers in the
1980-83 25.0 14.2 9.5 8.7 57.4 10.4 5.1 4.5 8.5 1.9 2.7 14.0 c entral states.

1990-93 24.8 14.1 7.0 6.8 52.7 12.3 4.8 4.3 8.0 1.9 2.7 17.6Edible oil import is a typical 2003-06 23.5 14.1 6.1 5.8 49.6 13.2 5.9 5.4 6.6 2.3 3.7 18.8

case where policymakers have

Total value of output obtained by inflating the value output of 44 crops to the total GCA. Source : As in Table 1.

area under rice and the share of foodgrains in total cropped area has gone up (Table 7).

Kerala has a unique cropping pattern, where only 9.9% of the gross cropped area is devoted to foodgrains as against a national average of 63.8%. About 90% of Kerala’s area is under high value plantation crops like condiments and spices and remaining crops. Because of the preponderance of high value crops in the state, Kerala along with Punjab has the highest levels of crop productivity in the country (Table 7).

To sum up, in India as a whole, during 1980-83 to 1990-93, there was a big diversion of area under coarse cereals towards oilseeds. Oilseed cultivation got a boost due to favourable prices and the programmes of the Technology Mission on Oil Seeds launched in 1986. Consequently, the area under oil seeds increased rapidly and the share of oilseeds in GCA increased from 10.4% during 1980-83 to 13.3% during 1990-93.

The post-reform period is characterised by a setback to the process of diversification of area from coarse cereals to oil seeds. At the all-India level the share of area under oilseeds increased only marginally from 13.3% in 1990-93 to 13.8% in 2003-06 as compared with an increase from 10.4% during 1980-83 to 13.4% during 1990-93. During 1990-93 to 2003-06, it is only the states to face the problem of a trade

off between better prices for the producers and low prices for the consumers.

5.4 Relative Crop Shares in Value of Output5

Major changes in area allocation to different crops are also reflected in changes in the share of various crops in the total value of output during 1962-65 to 2003-06. As expected, the degree of shifts in value of output is much higher than those for area shifts for high value crops and vice versa for low value crops.

During the earlier period 1962-65 to 1980-83, at the all-India level, the share of foodgrains in the total value of output had remained almost constant at about 57%. However, during 1980-83 to 1990-93, along with a decline in the share of area under foodgrains to GCA from 73.0% to 68.9%, the share of foodgrains in the total value of output declined from 57.4% in 1980-83 to 52.7% in 1990-93. There was also a substantial decline in the share of coarse cereals and pulses in the tool value of output.

On the other hand, during 1980-83 to 1990-93, the share of oil seeds in the total value of output increased from 10.4% to 12.3% while that of remaining crops increased from 14% in 1980-83 to 17.6% in 1990-93, and that of condiments and spices, plantation and fibre crops remained almost constant.

december 26, 2009 vol xliv no 52

5.5 Post-Reform Period

The pattern of declining share of area under, and the value of output of foodgrains in, total GCA and the total value of output continued during the period 1990-93 to 2003-06 also. Thus, while the share of area under foodgrains to total GCA declined from 73.0% during 1990-93 to 68.9% during 2003-06, the share of foodgrains in total value of output declined from 52.7% to 49.6% (Table 8, p 42).

At the all-India level, there was only a marginal increase in the share of oilseeds in total value of output from 12.3% during 1990-93 to 13.2% during 2003-06. It is only in the central region that the share of oilseeds in total value of output has substantially increased during the post-reform period 1990-93 to 2003-06 compared with the earlier period. In the rest of the three regions, the share of oilseeds in the value of output has declined.

Again during this period, there was an increase in the share of fibre crops in the total value of output and some increase in the share of plantation crops, cardamom and spices and remaining crops, but there was a decline in the share of sugar cane in total value of output (Table 8).

Kerala registered a spectacular increase in its share of value of output of plantation crops in total value of output from 16.7% in 1990-93 to 36.3% during 2003-06 (Table 8). As condiments and spices are important export crops, trade liberalisation has created a favourable market situation that induced farmers to increase the area and production of these crops. On the other hand, unrestricted imports of cheap spices (black pepper) from Sri Lanka and some east Asian countries have posed some problems for the cultivators.

Punjab and Karnataka also registered a substantial increase in their share of foodgrains to total value of output during this p eriod. In both these states, the shift to foodgrains has mainly occurred from oil seeds, cotton and sugar cane. Interestingly, as in other states, the share in the total value of remaining crops has also increased in these states during this period (Table 8).

To sum up, there was a significant change in cropping patterns during 1990-93 to 2003-06, both in terms of area allocation and share in total value of output. The most important change was a significant decline in the share of area under coarse cereals and an increase in the share of area under higher value crops brought about because of changes in relative prices and productivity. During 1980-83 to 1990-93, shifts occurred mainly towards oilseeds, and to some extent, towards remaining crops. But during the postreform period 1990-93 to 2003-06, whereas the diversification of area as well as value of output towards plantation and condiments and spices, and towards remaining crops have continued, the diversification towards oilseeds has slowed down considerably.

However, there is a diversification of area as well as of value of output towards plantation and condiments and spices, and towards remaining crops (that includes other fruit and vegetables). But in the north-western region, despite an ambitious programme of diversification away from rice and foodgrains, the share of rice and total foodgrains in total cropped area has actually increased and the share of foodgrains in total value of output has remained constant. In short, economic reforms and trade liberalisation have failed to hasten the process of diversification in agriculture.

Economic & Political Weekly

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december 26, 2009 vol xliv no 52

But, despite this slowdown at the all-India level, most of the states in the central region registered an increase in their share of area under as well as value of output of oilseeds as well as cotton. On the face of it, diversification away from coarse cereals to high value oilseeds, cotton and remaining crops should be a desirable development. However, in dryland agriculture, this shift also exposes the cultivators to much greater weather-borne risks. These risks are further exacerbated because of increased vulnerability to world commodity price volatility following trade liberalisation. These risks pose a serious problem for the livelihood of cotton and oilseed farmers.

6 Summary and Conclusion

A state-level analysis of levels and growth of agricultural output during 1962-65 to 2003-06 has brought out the outstanding characteristics of agricultural development in India during the postgreen revolution period beginning in the mid-1960s. To begin with, the new technology was instrumental in raising the yield and output levels of wheat and was confined to irrigated states in the north-western region of India. This resulted in raising crop yields and promoting growth of agricultural output in most of the north-western states. The rapid growth of output in these states also resulted in raising agricultural worker productivity in these states. However, the spread of new technology remained confined to irrigated states only.

The new technology matured during the period 1980-83 to 1990-93 when it spread widely to more areas and encompassed more crops. The result was a notable increase in the levels and growth rates of yields and output as well as in agricultural worker productivity in most states and regions of India during 1980-83 to 1990-93.

Thus during 1980-83 to 1990-93, the crop output recorded an unprecedented annual growth rate of 3.40% compared with a growth rate of 2.24% during 1962-65 to 1980-83. Yet another important improvement during 1980-83 to 1990-93 was significant changes in the cropping pattern with a visible increase in crop diversification away from coarse cereals towards more valuable oilseeds crops in the rainfed states of central India, and towards rice and wheat in the north-western and eastern states.

But the post-reform period 1990-93 to 2003-06 is characterised by a serious retrogression both in the matter of levels and growth rates of yield and output in most states and regions and a slowdown in diversification towards oilseeds.

There are different reasons for slowdown of growth of yield and output in different regions. However, the decline in public investment in irrigation and water management, and in scientific research has adversely affected the profitability of farmers in all parts of India.

In the north-western region, it is an excessive use of inputs and a decreasing input use efficiency that has eroded profitability as well as adversely affecting its resource base like water table and soil quality. The decline in public investment in irrigation, water management and flood control has specially affected the r esource-poor eastern region.

Although there took place a slowdown in diversification t owards oilseeds at the all-India level, the states in the central region have diversified in favour of cotton and oilseeds as also towards remaining crops, despite weather-induced uncertainties. Although this has helped in raising the output and income levels of resource-poor farmers in these regions, it has also exposed them to much greater weather-borne and price fluctuation risks. These risks are further exacerbated because of increased vulnerability to world commodity price volatility following trade liberalisation. These risks pose a serious problem for the livelihoods of cotton and oilseed farmers driving some of them to utter desperation leading to suicides.

The Indian economy has registered a visible acceleration in its gross domestic product growth rate as well as of per capita income since the initiation of economic reforms in 1991. It should be a matter of great concern for the policymakers that in this optimistic scenario, the agricultural sector should face a deceleration its growth rates of aggregate yield and output and the process of agricultural diversification should slow down. A more serious matter is that agricultural workers who constitute 58% of the total workforce should be facing deceleration in their productivity and income levels as well as distress during the post-reform period.

It is beyond the scope of this article to undertake a comprehensive analysis of the main reasons for the failure of economic l iberalisation to improve the state of agriculture in India. But, it is hoped that the state and regionwise analysis of agricultural growth during the pre- and post-liberalisation period undertaken above would provide a backdrop to scholars and policymakers to undertake an in-depth analysis of the reasons for slowdown in agriculture in the post-reform period.

Notes

1 See, for example, Bhalla (2004); Chand (2002).

2 In this study, the statistics for cottonseed have been subsumed under cotton (kapas). Hence, the total numbers of crops covered in terms of Economic and

Statistical Advisor’s (ESA) list are 44.

3 MoAC (various issues).

4 It may be noted that the discussion in this section is based on the share of area under different crops in the GCA of each state and not in area under 44 crops. The difference between area under 44 crops and the GCA is covered under the head “remaining crops” (Row 13, Table 6).

5 Total value output here means the total value of output of the GCA. Total value output= (value output of 44 crops/area under 44 crops)* GCA.

References

Bhalla, G S (2004): Globalisation and Indian Agriculture, State of the Indian Farmer: A Millennium Study, Volume 19, Academic Publishers.

Chand, Ramesh (2002): Trade Liberalisation, WTO and Indian Agriculture: Experience and Prospects (New Delhi: Mittal Publications).

MoAC (various years): Area and Production of Principal Crops in India, Ministry of Agriculture and Cooperation, Government of India, New Delhi.

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