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Annual Report

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The National Centre for Agricultural Economics and Policy Research (NCAP) continued its efforts towards
achieving excellence in agricultural economics and policy research in the country. The research studies
of the Centre have enormously helped the Council in participating in agricultural policy debates and
decisions more vigorously. The Centre had 20 scientists (including one ICAR National Professor and
one National Fellow) and 15 other staff in the year 2007-08. The total expenditure of the Centre during
2007-08 (April-March) was Rs 445.95 lakh.
A high-powered Research Advisory Committee guides the Centre on its research programmes, and
a Management Committee administers the functioning of the Centre. Besides, a number of internal
committees like budget committee, store purchase committee, etc. facilitate the decentralized management
of the Centre.
Research studies of topical in nature are conducted at the Centre under five broad themes, viz. technology
policy, sustainable agricultural systems, markets and trade, institutional change, and agricultural growth and
modelling. Each theme area is headed by a senior professional with a support of small team of scientists
working under each theme. Research programmes within and across the themes are so designed as to
accomplish the mandate of the Centre. During the year 2007-08, the Centre has conducted 40 research
studies. Five consultancy projects have also been completed by the Centre during the year. The Centre
has not only maintained but also increased the linkages and collaborations with many institutions in India
and abroad. The Centre organized quite a good number of workshops, seminars, brainstorming sessions,
and policy advocacy programmes. The main research achievements and a glimpse of activities undertaken
during 2007-08 are reported below:
Slow growth in agriculture during the past few years has led to a crisis in Indian agriculture. Accelerating
the growth in agriculture is a major challenge before researchers and policymakers. The Centre has
conducted several studies to analyze the growth performance, instability and risks in agriculture.
= Analysis of growth in agriculture has revealed that agricultural growth performance was satisfactory
before 1995-96, but slowed down afterwards. This has been due to slowdown in the growth of
fertilizer-use, irrigation, cropping intensity, diversification towards high-value crops, and terms of
trade after 1995-96. The study has suggested that stepping up of public investment in agricultural
R&D, development of irrigation facilities, evolving appropriate institutional mechanism, promoting
fertilizer-use, increasing power-supply to agriculture, establishing competitive markets for inputs and
output and developing measures to mitigate risk in farming are the important steps to overcome
the crisis in Indian agriculture.
= In a study on instability in Indian agriculture, it was concluded that Indian agriculture has developed
resilience to absorb shocks due to agro-climatic and other factors. Another study on risk assessment in
India has shown mixed results with respect to yield risk of different crops for the period 1981-2004.
Adoption of measures like increasing irrigation facilities, promoting soil conservation measures, and
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evolving new varieties have been suggested to minimize yield risks. Results at the disaggregated
level in Andhra Pradesh have shown that risks in production and gross returns had reduced for
rice, but increased for groundnut. The study has suggested that region-and crop-specific insurance
mechanisms should be devised to address yield risks.
Meeting food demand of burgeoning population has been at the centre stage of agricultural development.
Imbalances in the demand-supply in foodgrains during the past few years have sparked the prices of staple
foods in India and across the globe. The Centre has undertaken some studies on this important issue.
= Domestic demand for cereals has been projected to be 219 Mt by the year 2012 and 261 Mt by the
year 2020. The demand for pulses by these years would be 16 Mt and 19 Mt, respectively. Thus, the
overall foodgrain demand has been projected as 235 Mt by the year 2012 and 280 Mt by 2020.
= During the past two years (2005-06 and 2006-07), demand-supply imbalance in wheat has created
challenges for both policymakers and researchers. There has been a considerable increase in the prices
of wheat during this period. This has been due to decline in production and poor procurement by
the government. To raise production and procurement of wheat, the government had adopted a
price policy support which yielded desired results. To increase domestic production of wheat, rapid
dissemination of improved technologies would play a significant role.
= The shortage of wheat and its increasing prices have become a major concern not only in India
but world over also. A study has shown that in controlling the prices of wheat in the country, the
stock of foodgrains with the government makes a very significant impact. The behaviour of open
foodgrain market can be largely checked by heavy stock inventory, besides some other factors. The
study has suggested that two million tonnes of additional buffer stock of wheat would enable the
government to intervene in the open market in case the private traders try to tighten the supply
with the intention of raising prices and also to meet the PDS commitments.
Research and development (R&D) has potential to provide long-term solutions to the problems of
agriculture sector. Several R&D related issues like research resource allocation, public-private partnerships,
role of R&D in managing agrarian crisis, agricultural biotechnology, and investment in fishery research
have been studied by the Centre during the year under report.
= Public-private partnership has become an integral part of the agricultural development process.
The policy dialogue initiated by ICAR and decisions arrived at during the past few years are
path-breaking in several ways. The technologies developed through public-private partnerships that
include hybrid rice, zero-tillage, IPM, etc. are beneficial in many ways. To encourage this partnership
further, ICAR provides funding support under its externally-aided programmes. The study has pointed out
that many national R&D companies may not be able to compete with multinationals under the new
IPR regime and would need the support of public system for R&D, even on benefit-cost sharing
basis.
= ICAR in partnership with SAUs has developed numerous improved technologies for various farm
operations. These technologies make farm operations easy, save natural resources, reduce crop losses,
improve shelf-life of farm products and increase food production. A review of such studies has shown
that available stock of technologies has enormous potential to accelerate the pace of agricultural
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growth and farm income. The only need is to establish an appropriate support mechanism for
exploiting the huge untapped potential.
= Government of India has invested huge resources to harness the potential of biotechnology. The
emphasis in crop biotechnology is on tissue culture, tolerance to biotic (insects and diseases) and
abiotic (moisture, salinity) stresses and improving quality and shelf-life of agri-food products.
The presence of private biotech research is limited. Measures to attract private investment in
biotechnological research have been suggested.
= Sustained growth in fisheries production is a testimony to the impact of research resource allocations
to this sector. A study has revealed that allocation of resources to fisheries development has increased
more than 400-fold from I to X Five-Year Plan, which demonstrates the increasing priority attention
of the government to this sector. To sustain growth of the sector, development of technology,
infrastructure and marketing arrangements are critical. Investments on infrastructural development
like construction of mini harbours, landing centres, trawlers and mechanized vessels, supply of nets,
etc. are expected to increase the catch and farm income further.
Intensive cultivation practices in agriculture have posed severe stress on agricultural resources, resulting
in degradation of soil and water quality and rapid consumption of finite resources. The availability of
resources is becoming a major constraint to agricultural development. Therefore, management of natural
resources has become very crucial. The Centre has undertaken some studies on optimization of resourceuse
efficiency in agriculture.
= A study on ‘System of Rice Intensification’ (SRI) in the peninsular India has found it to be more
advantageous over the traditional rice cultivation. The practice has potential to provide a higher rice
yield (2-3-times of country’s average of 2 t/ha) and conserve water (20-40% of the normal practice),
besides providing savings in seeds and fertilizers. This innovative practice can be really effective to
increase rice production if supportive policy interventions are evolved.
= Water being the most critical input in agriculture, a number of water-saving technologies (WSTs)
are being developed. It has been found that WSTs are mainly used for horticultural crops. The
empirical evidence on micro-irrigations is skewed towards drip system, because of its large
application in horticultural crops. The study has suggested that for deciding priorities and provision
of subsidies on WSTs, economic returns from investment and their use in crops should be estimated.
To popularize the use of WSTs, awareness among users should be generated on a wider scale.
= Rainfed agriculture has a high potential in meeting the rising demand for food, provided a workable
strategy is developed. On the technology front, modern technology requiring low external inputs
along with soil-water management practices have been observed to be critical. Effective coordination
of institutions providing services is equally important. Long-term investment in infrastructural
development is also needed. Such an orientation is expected to transform rainfed agriculture from
a subsistence to sustainable commercial venture and would provide food and income security to
farmers relying on rainfed areas for their livelihood.
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= The issue of climate change and its potential impact on agriculture is being widely debated globally.
The copping strategies based on limited sets of variables (especially temperature and moisture) have
been found less effective in dynamic setting. There is a need to integrate socio-economic variables
with bio-physical model for better results. Location-specific appropriate technologies might help
adaption to the changing climatic condition. To reduce risks related to climate change, it is necessary
to formulate appropriate credit and insurance policies suiting to different ecosystems.
Considering the importance of emerging institutions in Indian agriculture, which is dominated by
smallholders, the Centre has conducted studies on institutional arrangements like contract farming, crop
insurance, access to information, seed system, credit delivery, etc.
= Contract farming is expected to improve the socio-economic conditions of a majority of smallholders.
Its success depends on its capability to improve farm profitability and reduce cost on marketing
and transportation. Considering non-farm factors, like regulation in offtake of produce, provision
of inputs, services, and payments would foster a strong relationship between firm and farmers. A
long-term commitment and mutual trust between these partners are essential for the success and
sustainability of contract farming.
= Access to information by farmers is one of the key issues in agricultural development. A study on
sources of information and its flow to farmers, particularly about improved farm technologies has
revealed that access to information sources increases with increase in farm-size. This variation is
more pronounced for the sources like extension workers, TV and primary cooperative society. For
smallholders, progressive farmers and input dealers have been found the major sources of information
for improved technologies.
= Credit is one of the critical inputs and an effective means of rural development. A study at the
Centre has identified the determinants of the choice of a credit outlet. It has been found that
maturity in age, family-size, education level and land-size influence the borrowers’ tendency to
go in for institutional sources of credit. There has been less probability of the weaker sections in
getting institutional credit. The self-employed persons have preference for institutional credit, while
labourers chose non-institutional sources.
= A study on the seed systems being followed in the states of Andhra Pradesh, Haryana, Himachal
Pradesh and Uttar Pradesh has revealed that almost all farmers procure seeds of high-value crops
like cotton, tomato and peas from commercial sources, i.e. private seed dealers, seed corporations
or governmental stores. During 2003-04 and 2004-05, about 60 per cent of the seeds in the case
of paddy, and 40 per cent in the case of groundnut were procured from commercial sources. It is a
positive sign as better quality of seeds would improve crop productivity and raise farm income.
= The public sector plays a major role in the supply of seeds, particularly of open-pollinated varieties
(OPV) grown in unfavourable environments. It is particularly important in the case of ‘orphan’ crops
(e.g., groundnut and potato) with low seed-multiplication rate and high seed requirement. Private
seed companies can play a significant role in augmenting the supply of OPV seeds. The government
has enacted almost all legislations to comply with the provisions of the TRIPS agreement of WTO.
But, the new IPR regime may increase the transaction cost for accessing the plant genetic resources,
which will have implications on plant breeding efforts.
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Indian agriculture still has enormous potential to grow across sectors and regions. Past sources of growth
are plateauing, therefore new sources need to be identified. A few studies have been undertaken at the
Centre on exploring the sources of growth in agriculture.
= Livestock is an integral and complementary sector of Indian agriculture. A study on total factor
productivity (TFP) in the livestock sector has revealed that it had grown at an annual rate of 2.3 per
cent during the period 1971-2004. This growth in TFP has accelerated overtime, from 1.5 per cent
during 1971-81 to 2.6 per cent during 1981-91 and further to 2.9 per cent during 1991-2004.
= Rising global demand for livestock products has offered an opportunity to India to increase livestock
export, especially of bovine meat, whose domestic demand is low. A study on identification of
determinants of export in livestock products has revealed that ratio of domestic production to
consumption plays a significant role in increasing export of bovine meat, poultry, livestock and
mutton. It has been found that devaluation of currency during 1990s and its management during
post-liberalization period played an important role in the export of livestock products. The removal
of quantitative restrictions also played a significant and positive role in its export of eggs, bovine
meat and muttons.
= Indian agriculture is overwhelmingly dominated by smallholders. A study on the role of smallholders
in diversifying towards high-value crops has evinced that gradual diversification is pro-smallholder,
as they contribute largely to the cultivation of vegetables and lesser extent to fruits. It is because of
availability of enough family labour with them. Although, fruit cultivation is also labour-intensive
(as compared to cultivation of staples), it is highly capital-intensive, making it a less attractive for
smallholders who tend to have low-capital endowments.
= The horticulture sector is constrained by poor marketing arrangements and lack of infrastructure.
Recent studies have reported that farmers get less than one-third of the price paid by consumers.
During the survey in Hyderabad, features of both public owned (Rythu Bazar) and private innovative
marketing institutions (by corporate sector) were studied. Data has shown that innovative models
for marketing of fruits and vegetables are more efficient than public-owned markets due to lower
marketing cost.
= With tremendous growth in fisheries, the sector is being referred to as the sunrise sector in India.
A study has reported that during the period 1981-06, the growth in fisheries output has been 4.6
per cent, though largely due to growth in inland fisheries. In the coming decades, aquaculture
would be a major contributor to fish production, as fish farmers are expanding water-bodies area
and following improved practices. However, there are several challenges in fish production that
need attention.
= The emerging problems like reduction in fishing days, decline in income and employment
opportunities, rising food prices, etc. are the threats to livelihood of people living in the coastal
areas. A study conducted by the Centre has suggested adaptation strategies and coping mechanisms
to improve livelihood of people in the coastal areas. It has been found that integration of local
conditions with emerging challenges is necessary for it.
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= A study on economics of rice production has revealed considerable increase in the use of inputs
like fertilizers, machinery, and irrigation in the states of Andhra Pradesh, Haryana, Madhya Pradesh,
Punjab, Uttar Pradesh and West Bengal during 1983-84 to 2004-05. Striking differences are seen in
fertilizer-use for rice production in different states. The study has observed that in spite of increase
in fertilizer application, there still exists considerable scope to enhance application of fertilizer and
machinery for higher yields.
= A study on medicinal and aromatic plants in the state of Uttarakhand has shown that economic
returns are significantly higher from these than commercial crops like sugarcane. However, there are
constraints like inadequate processing, price risks and lack of plant material for large-scale adoption.
The study has observed that farmers’ access to technical know-how and institutional credit on
priority basis could promote establishment of processing units in the rural areas. Also, efforts towards
strengthening of the market information system and management of price risks will go a long way
in promoting the cultivation of medicinal and aromatic plants in Uttarakhand.
= The study on potential of different sources of farmers’ income has revealed that farm households
derive a significant proportion of their income from non-agricultural sources, as against the common
perception that agriculture is the main source of income to farmers. In the year 2003, the wages
and non-farm business activities had accounted for about 20 per cent and 24 per cent of the total
income, respectively. Though, these sources are quite important for raising income of small and
marginal farmers, there is high inequality in their distribution across farm households, because of
their limited access. Only 14 per cent households have reported about earnings from non-farm
business and 46 per cent from wage labour. The study has suggested that for raising farmers’ income,
it is essential to accelerate the pace of diversification of rural economy towards non-farm activities,
empowering farm households in overcoming barriers to their entry into non-farm sector.
= The analysis of income diversification at the disaggregated level and its implication on income
inequality help in policy decisions. To identify the factors determining income inequality, a study
has been conducted in the four eastern states, viz. Bihar, Jharkhand, Orissa and West Bengal of India.
Among the determinants having positive correlation with total income (both farm and non-farm) are
holding-size, age and education of household-head, value of productive assets and livestock, access to
market and credit. Sex of household-head, access to road and farm income (crop and livestock) have
not shown a significant influence on the level of income. In the case of non-farm income, factors
like household-size, age, education and sex of household-head, landholding-size, and access to road
have depicted a significant influence on it. The holding-size has depicted an inverse relationship
with non-farm income, the larger the holding size, the smaller is the non-farm income.
= Estimation of the share of household factors in income inequality in eastern India (mainly the
states of Bihar, Jharkhand, Orissa and West Bengal), has revealed that education of household-head
is the most important factor (having weightage of 8.31%), followed by the value of productive
assets (5.04%), landholding-size (3.7%), age of household-head (3.07%), access to market (1.39%)
and value of livestock (1.33%). In the case of farm income, landholding-size has been found as the
most important variable, followed by value of livestock, age and education of household-head and
access to credit. In the non-farm income category also, education and age of household-head have
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been recorded as the important variables influencing income inequality. The study has highlighted
that to have income equalizing effect of different source of farmers’ income, limiting factors need
to be addressed.
= Food safety issues are a major concern in the export of food commodities from India to the
developed countries. Increasing number of non-tariff measures (mainly SPS and TBTs) is adversely
affecting the country’s food export. During 2006-07 (April-March), the refusal of consignments of
Indian food products by USA and Japan accounted for 54 per cent and 97 per cent, respectively, of
its total export. The major reasons for refusal of Indian consignments have been found as microbial
contamination, filthiness, insanitary conditions, unsafe additives, etc. Thus, a majority of rejections
are attributed to the lack of observance of basic hygiene and existence of microbial contamination.
The study has suggested adhering to the SPS standards to export livestock and realize a higher return
per unit value.
= The specifically-designed poverty alleviation programmes for generating both self-employment and
wage-employment in the rural areas has shown positive results. These programmes are broadly grouped
into (i) increasing farm and labour productivity and income, (ii) transferring cash/ foodgrains to
poor, and (iii) reducing cost and prices through subsidies. The study has suggested that country has
to give more emphasis on a multi-dimensional approach involving improvement in farm productivity,
employment guarantee, development of women and children, health care, infrastructure development,
sanitation, insurance, etc. for reducing poverty in the country. Analysis has shown that while planning
the poverty alleviation programmes, the emphasis has to be given more on social sector than simply
addressing on income poverty. Thus, a well-balanced strategy, taking lessons from the past, could
result in placing the country on a sustainable growth path.
The Centre has given special attention towards the problems and prospects in the North- Eastern Region
(NER) of India, along with tapping of opportunities for the benefits of farmers in the region.
= A study on crop diversification towards high-value crops has revealed high prospects in growing fruits,
vegetables, oilseeds, floriculture, etc. In another study on identification of factors influencing income
and employment from livestock in the NER has shown that availability of labour, occupation of
households, and farm-size have made positive and significant impact on livestock-rearing, indicating
existence of a strong crop-livestock interaction. Availability of irrigation facilities and institutional
credit also influence livestock-rearing in the area.
= In NER, farmers practise mixed-cropping, which can be integrated with water harvesting technologies
for saving runoff water. For growing crops, lower terraces are more useful for rice, whereas maize
and sesamum could be grown in the upper terraces. Similarly, the available terraces (about 35-40%
of the total land area) can be effectively utilized for raising perennial fodder/grasses and legumes,
which would help in checking soil erosion and provide fodder for livestock. There is a need to put
in place the innovative institutional arrangements for marketing of products.
= The threat of avian flu has received significant attention all over the world. In a study at the
Centre, economic loss from avian flu, the most infectious disease of the poultry sector, has
been assessed, after its outbreak in the Manipur state in July 2007. The total loss to producers
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has been estimated to be of Rs 316 lakh, whereas farmers have received only Rs 99 lakh (about
31%) as compensation. Due to incidence of avian flu, increase in the prices of pork and fish has
been registered as 35 per cent and 85 per cent, respectively in Manipur. The study has observed
that the poor compensation would (a) affect the livelihood and sustenance of poultry farmers
and their families, and (b) lead to poor compliance in culling and disinfection operations and
hence, lack of eradication of disease outbreak that would have more serious implications.
= The Centre is handling a mega project on Visioning, Policy Analyssis and Gender (VPAGe) funded
under the National Agricultural Innovation Project. Four workshops have been organized during
the year under the project, including project launcing workshop.
The NCAP website available at http://www.ncap.res.in has been redesigned and regularly updated. The
NCAP publications are now available in the PDF format and can be downloaded. Data revealed that
policy briefs, workshop proceedings and policy papers were the most referred publications during the year.
The website for Networking of Social Scientists, http://www.agrieconet.nic.in, is facilitating research,
resource-sharing and optimization of response time for addressing methodology-related problems.
The ARIS facility at the Centre has been equipped with 512 kbps leased line from ERNET to provide
E-mail and Internet facilities to NCAP staff. The Centre now has its independent mail server which is
being used to its potential.
As a part of the dissemination of research output, the Centre and its staff has published one book, twentyfour
journal articles, twenty-six book chapters, and seven discussion papers during the current year.
The Centre's staff has been involved in a number of professional and policy interactions and projects. It
organized ten workshops and several meetings at NCAP and outside. It also collaborated with a number
of national and international research organizations. These activities could facilitate achieving of greater
impact and wider visibility of the Centre during the year.
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Date 2016-12-01T06:51:18Z
2016-12-01T06:51:18Z
2008-08-01
 
Type Annual Report
 
Identifier Not Available
Not Available
http://krishi.icar.gov.in/jspui/handle/123456789/758
 
Language English
 
Relation 2007-08;
 
Publisher Not Available