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Pattern and Consequences of Intensive Agricultural Growth in Punjab

Pattern and Consequences of Intensive Agricultural Growth in Punjab. R.S. Sidhu. Issues.

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Pattern and Consequences of Intensive Agricultural Growth in Punjab

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  1. Pattern and Consequences of Intensive Agricultural Growth in Punjab R.S. Sidhu

  2. Issues • Agriculture growth in Punjab is ‘most often cited’ success story. It has been made possible by new technology, development of infrastructure and institutional support. But recently the growth has shown signs of deceleration. This paper therefore deals with the following issues. • What is the pattern of growth? • What are the determinants? • What are the constraints to future growth? • What are the policy options to accelerate growth?

  3. Fig. 1: Crop Value Output of Punjab (at 2001 prices) 30000 2 y = -10.126x + 769.43x + 11154 2 R = 0.9157 0.34% 25000 3.70% Per cropped hectare (Rs) 20000 0.83% 3.70% 15000 5.16% 2 y = -7.1863x + 640.76x + 4409.7 2 R = 0.9565 5.94% Total value output (Rs crores) 10000 5000 0 1967-68 1970-71 1971-72 1972-73 1973-74 1974-75 1975-76 1976-77 1977-78 1978-79 1979-80 1980-81 1981-82 1982-83 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02

  4. Gross value of crop output at 2001-02 prices (Rs. crore) Source: Singh and Sidhu, 2004

  5. Source: Singh and Sidhu, 2004

  6. Agricultural Growth: 1967-81 5.64% 1981-91 5.16% 1991-2001 0.83% Source: Singh and Sidhu, 2004

  7. Average use of inputs for wheat and rice in Punjab (Per ha)

  8. Role of Agricultural Technology Development Note: Fruits include 21 fruit crops and vegetables 25 vegetables

  9. Role of Technology Development: Growth and Variability in Productivity

  10. Role of Price Policy Two issues are important • Movement in the relative prices • Variability in prices

  11. Index of Income and Yield for Paddy 200.0 150.0 Index (%) 100.0 50.0 0.0 1981-82 1982-83 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 Yield Income/TC Income/GR Role of Price Policy in Profitability MSP Increase: 9.52% MSP Increase: 14.88%

  12. Index of Income and Yield for Wheat 300.0 250.0 200.0 Index (%) 150.0 100.0 50.0 0.0 1981-82 1982-83 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 Yield Income/TC Income/GR Role of Price Policy in Profitability MSP Increase: 7.31% MSP Increase: 7.31% MSP Increase: 17.11% MSP Increase: 17.11%

  13. Realisation of cost and level of subsidy on power supply to agriculture

  14. Constraints to Growth • Technology fatigue • Agrarian structure • Rise in fixed costs • Minimum support prices versus International prices • Lack in value addition • Depleting groundwater resources • Declining fertility status of soils

  15. Deceleration/Stagnation in Productivity Growth

  16. Land –man ratio in the farming sector of Punjab

  17. Trends in machinery cost for wheat and paddy in Punjab (In Rs/ha)

  18. Compound growth rates of production for wheat and rice (In per cent per annum)

  19. Increase in proportionate area of the central zone under water table depth of more than 10 meter In per cent

  20. Ground Water Status in Punjab

  21. Rise/ fall in Water table • Sangrur (Barnala) 43  • Patiala 33  • Jalandhar 22  • Amritsar 18  • Kapurthala 17  • Faridkot 13  • Ludhiana 13  • Ropar 08  • Hoshiarpur-1 02  • Gurdaspur 02  • Hoshiarpur-2 05  • Mansa 09  • Ferozpur 17  • Bathinda 21 

  22. N, P, K Status of Punjab Soils, 1981 through 2002(In per cent samples deficient)

  23. Average water table depth in some central districts (in meters)

  24. Average water table depth (m) in different zones

  25. Lack of Value Addition • Only Primary processing for rice and wheat in the state • Less than 2% of fruits and vegetables are processed due to -lack of vertical integration of the market -higher marketing charges -less developed marketing infrastructure to handle the perishables -damand issue • About 26% of the milk production is processed in the organised sector

  26. Policy Options • Promoting high value enterprises like dairying, fruits and vegetables, poultry, etc. • Promoting value addition and processing • Vertical integration of the market • Rationalisation of the taxes and other charges • Rational input and output pricing policies • Improving water use efficiency

  27. Thank You

  28. Decomposition of Agricultural Growth in PunjabAverage annual Growth rates (%)

  29. Contribution of different crops to land productivity (yield+crop shift effects) growth (%)

  30. Share of different crops/enterprises and other activities in the research budget of the University Source: The World Bank, 2003

  31. N, P, K Status of Punjab Soils(in per cent blocks)

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