Economic sustainability of marine fisheries in India: A total factor productivity approach

Abstract

Marine fisheries sector of India has transformed from the status of subsistence fishery to that of multibillion dollar industry with the technological advancements in harvesting and post-harvest operations. Intensive shrimp trawling with multi-day fishing trips, introduction of purse seines in the late eighties and enhancement of overall fishing effort have resulted in declining catch per unit effort of different fishing units. The declining catch rates of high value fishes will have a serious impact on the economic sustainability of marine fisheries sector and livelihood security of fisher folk. The objective of the study was to assess the performance and economic sustainability of marine fish production in India by using total factor productivity growth for the period 2000 to 2010. Total factor productivity is a measure of the productivity of all inputs, or factors of production, in terms of their combined effect on output and is often accounted for by technological change or more efficient methods of producing output. TFP serves as an indicator of the performance of any production system and sustainability of the growth process. Gear wise and species wise catch -effort data and species wise average marine fish prices in different states of India obtained from Central Marine Fisheries Research Institute for the period 2000-10 were used for the analysis. The total factor productivity growth in marine fisheries sector in India was estimated using Divisia-Tornqvist indexing method. Results of the study indicated that 76 percent of the fuel requirement in the fishing industry was in the trawl sector followed by dolnetters (12 per cent), gillnetters (9 per cent) and others (3 per cent). The total diesel consumption in the year 2010 was 1,218 million litres. The average quantum of labour stood at 105 million days during 2000-10 period and nearly 70 percent of which was contributed by the mechanized sector. The input index showed a positive growth of 1.7 percent during 2000 to 2010. The output indices calculated from the quantities and revenue shares of the different resources during 2000 to 2010 period showed a growth rate of 3.4 percent. The total factor productivity showed a positive growth of 1.65 percent during 2000-10 at all India level. The state wise analysis indicated that the total factor productivity growth was positive in the east coast with a growth rate of 8.16 percent whereas in the west coast the total factor productivity growth was negative in the states of Kerala (-3.69%) and Maharashtra (-5.83%). The positive growth in total factor productivity in the east coast indicated economic sustainability of the fishing industry in the short run. Even though there was substantial increase in marine fish prices in the past decade, reduction in catches of high value fishes like crustaceans, high cost of fuel and labour led to reduced economic efficiency of fishing operations in Kerala and Maharashtra. Since marine fisheries in the country is a state subject, appropriate remedial measures are necessary for each maritime state to reduce the fishing pressure.