Economic Evaluation of Dairy Farming in Rural India

Abstract

Livestock farming in India is part of a composite farming system characterised by crop–livestock interactions (Singh 2004; Kumar and van Dam 2013). The by-products from several of the crops (crop residues, hay and straw) are used as input for dairy production, in addition to other inputs for which they have to directly incur costs (cattle feed, veterinary medicines, and artifi cial insemination). Animal dung and urine are used as inputs (bio-fertilisers and biopesticides) by farmers for improving soil fertility. To arrive at the economics of livestock farming, it is important to have realistic estimates of the cost of producing bio-fertilisers and the economic value of biopesticides. Many times, paddy straw and wheat hay, pod of groundnut and shell of different types of bean are used as dry fodder and feed for the animals. In such cases, part of the cost of production of these crops will have to be allocated to the byproducts based on what proportion of the market value of the total produce these by-products account for. When farmers have to purchase these inputs from the market, the estimation of cost of production becomes simple and straightforward. Often, inputs such as green fodder have to be cultivated, in which case the cost of cultivation becomes the cost of that input. The article is silent on many of these aspects, and instead, aggregate input costs and gross revenue fi gures are presented. The extent to which crop byproducts from one’s own farm account for daily livestock input is an effect of the intensity of dairying. In some parts of western India (especially Gujarat), dairy farming is intensive with farmers growing irrigated fodder crops such as alfalfa. It is semi-intensive in northern India,