Regional Disparity in Agricultural Development:: Research Plan Proposal
Regional Disparity in Agricultural Development:: Research Plan Proposal
Regional Disparity in Agricultural Development:: Research Plan Proposal
Department of Economics
The IIS University, Jaipur
Submitted by
Sapna Newar
Enrollment No: ICG/2013/16419
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TABLE OF CONTENTS
Introduction…………………………………………………. 3
Literature Review…………………………………………… 4
Objectives………………………………………………….... 17
Hypotheses…………………………………………………... 17
Methodology………………………………………………… 18
Bibliography……………………………………………….... 22
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Regional Disparity in Agricultural Development:
Introduction
For the overall development of a country like India, growth of agriculture sector is
a prerequisite. As the development of this sector not only helps the large section of
population dependant on it, but also affects the other sectors through forward and
backward linkages. There are very few studies conducted to measure inter-district
disparities in agriculture sector for the state of Rajasthan. Most of the studies
conducted earlier, have taken state as a unit for measuring disparities. In India
where some of the states are larger than many nations, there is need to conduct the
study at disaggregate level. Rajasthan which is largest state of the country, these
kinds of studies will help in identifying the factors responsible for disparities at
regional level and thereof will help in developing policies accordingly. The present
study is an attempt to analyse inter-district disparities in development of
agriculture sector in the state of Rajasthan. Shown in studies conducted earlier,
inter-district disparities in agriculture sector in the state have widened. Widening
inter-district disparities in the state is not only resulting in its low growth, but also
increasing dissatisfaction among the farmers of the less developed regions. The
main objective of the present study is to account for the reasons of disparities at
state and district level and to suggest the policy measures to achieve the target of
‘Inclusive Growth’.
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Review of Literature
There have been various studies in the field of agriculture. A few select studies
pertaining to prospects and challenges in the agriculture sector have been reviewed
here.
Rangarajan (1982) in his study analyzed the linkages between agriculture sector
and Industrial sector in India. Three types of linkages, namely demand,
production, saving and investment were discussed. The results of the report stated
that one percent increase in agricultural output increases the industrial production
by 0.5% and national income by 0.7%. The findings of the study corroborates the
experiences of Indian economy in the 1980s and 1990s.The trend growth rate of
3.2% in agricultural production during the 1980s contributed to the growth in
industrial production in the 1990s.
Eicher & Staalz (1998) in their book had taken in to account the recent
developments in agriculture across the countries in the world. Lessons taken in the
field of agriculture and rural development since 1950s in these countries have been
discussed. Three questions related to development of agriculture in middle and low
income countries have been addressed by authors. The questions were related to
role of agriculture in national development strategies and how can the agrarian
transformation be accelerated and how poverty can be reduced and more jobs can
be generated by rural economic development. Constraints imposed by some factors
like market failures, food insecurity, fiscally sustainable organizations,
environmental degradation, income and asset inequality, rural poverty, the
changing roles of the public and private sector in research, and input and output
marketing systems has also been discussed. In order to restructure their basic
economic institutions how different countries in the world fight with these
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constraints and for this purpose four case studies (China, Indonesia, Colombia, and
Sub-Saharan Africa) have been examined in this book.
Chand &Chauhan (1999) in their policy paper had shown regional disparities in
term of per hectare agriculture productivity and income among various states since
1980-81.The study had witnessed widening gap between developed and
underdeveloped, and, poor and rich states. Disparities in terms of per hectare
productivity and per rural person NSDP in agriculture among major states (16
states) for different year had been calculated through co-efficient of variation.
Results of the study showed that regional disparities in agriculture productivity
have increased from 36% during 1980-81 to 1984-85 to 40% during the later half
of 1980s and further increased to 43% during 1990s. Similar trend with higher
magnitude had been shown in per person NSDP. Inequality in land man ratio was
the reason stated in paper for these disparities and the study suggested that there is
need for more vigorous efforts on technological, institutional and infrastructural
fronts to raise productivity and to accelerate growth in agriculture sector.
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in the level of development at state level were found. Infrastructural facilities were
found to have positive association with the development of state.
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Map based on sectoral plans prepared for districts were required to remove inter-
district inequalities. A number of measures had been suggested to reduce inter-
district inequalities. A model had been suggested based on the assumption that 60
per cent of the fund allocation would be allotted for meeting out the committed
expenditure and state level programmes and remaining 40 per cent could be made
available to the district. The study also suggested other measures to reduce inter-
regional inequalities prevalent in various sectors of the economy.
Pardey, Julian & Roley (2006) in their book analyzed the importance of R&D in
agriculture in developing countries. The world's agricultural economy was
transformed remarkably during the 20th century and in this increasingly
interdependent world, both rich and poor countries have depended on agricultural
research conducted in the private and public laboratories of these few countries,
even if they have not contributed to financing the activity. The book thrown light
on the fact that Brazil, China and India -the three largest developing countries in
the world are making transition, but yet the investment in agricultural research and
development in these countries fall short of the requirement and to overcome this
chronic problem of underinvestment in agriculture research and development these
countries need to increase investment in these sectors. The book had also shown
that rich countries are now no longer interested in simple productivity
enhancement rather as income increases dietary patterns and other priorities
change, so the research agendas of the rich countries also shifted from emphasis on
enhancing the production of staple foods to an increasing emphasis on enhancing
certain attributes of food (such as growing demand for processed and so-called
functional foods) and on food production systems (such as organic farming,
humane livestock production systems, localized food sources, and "fair trade"
coffee). Food-security concerns are still pervasive in the poor countries. Certain
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suggestions have been documented to change pattern of investments in agricultural
R&D in less-developed countries.
Shenggen, Gulati & Thorat (2007) in their book reviewed the trends in
government subsidies and investments expenditure on Indian agriculture by
government and had shown the impact of these expenditures on agricultural growth
and poverty reduction in India. The authors had suggested several reform options
with regard to re-prioritizing government spending and improving institutions and
governance. The major findings of the book were that to make small farmers adopt
new technologies initial subsidies in credit, fertilizer, and irrigation are crucial,
because of the reason that small farms are often losers in the initial adoption stage
of a new technology reason being that the agricultural products prices are typically
being pushed down by greater supply of products from large farms which adopted
the new technology. But results had also shown that continued subsidies had led to
inefficiency in the overall economy. The book had also shown the three most
important areas - agricultural research, education, and rural roads of effective
public spending which had helped in promoting agricultural growth and poverty
reduction during all periods. The results of the study had shown that investment in
agricultural research, education, and infrastructure had large growth impact and a
large poverty reduction impact. Expenditure on agricultural input and output
subsidies was proved to be financially unsustainable, environmentally unfriendly
and unproductive which had contributed to increase inequality among rural Indian
states. The book suggested that the government should cut subsidies of fertilizer,
power, irrigation, and credit to provide a long-term solution to poverty reduction
and to sustain long-term growth in agricultural production. Investments should be
increased in agricultural research and development, rural infrastructure, and
education.
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EPW Report (2008) discussed the prevailing disparities at state, inter-state and
intra-state level and challenges imposed on agriculture sector in terms availability
of finance. State-wise analysis revealed that a substantial proportion of farmers
wanted to leave farming profession as now it is no longer profitable. Inter-regional
disparities had further widened and ground level credit shares of central or eastern
region had either declined or stagnated, in spite of increase in state income share of
almost all underdeveloped regions between 1993-94/1995-96 averages and 2002-
03/2004-05 averages. A number of measures have been suggested to meet the
target of ‘Financial Inclusion’.
Bhalla & Singh (2009) in their research article had thrown light on the changes in
Indian agriculture in terms of crop yields and total agriculture output in post
economic liberalization period(1990-93 to 2003-06) and compared it with pre-
reform period(1980-83 to 1990-93).To support the study the authors had studied
detailed data for 281 districts of India and provided district-wise analysis on
agricultural growth in India from the beginning of liberalization to the period of
slowdown in agriculture and rising farmer distress. The results of the study shows
that there was deceleration in the growth rate in crop yields as well as total
agriculture output in most of the states in India in post-reform period .The authors
had used the econometric techniques and statistical measures to analyze significant
issues related to agriculture in India. The paper discussed changes in cropping
pattern that have taken place in area allocation as well as in terms of value of
output. The results of the study had shown that slowdown in the process of
cropping pattern change meant that most government efforts to diversify
agriculture have failed to take off.
Reddy (2010) in his paper examined how regional disparities in A.P. had increased
since its inception and had suggested policy intervention to reduce these
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disparities. The author had used Gini-concentration ratio’s (GCRs) to calculate
agricultural production of two crops paddy and legume at district level and gross
irrigated area (GIA). Results had shown the Gini Ratio increased for GIA showing
that the benefits from land improvement/irrigation were increasingly concentrated
in a few districts. The author suggested that different districts of the state are
geographically not similar so there is need for different policy interventions
accordingly.
Bhalla & Singh (2010) carried out this study with a view to analyse the regional
patterns of levels and growth of agricultural output, productivity per agriculture
worker at district, state and regional levels. This report had used techniques like
cumulative frequency, Lorenz curve and econometric model to analyse the
disparities. This study was conducted to analyse the impact of new seed-cum-
fertilizer technology from 1990-93 to 2003-06 with special emphasis on 1991 since
if followed the introduction of economic reforms in India. The results of the study
had shown that prior to liberlisation Indian agriculture was protected from the
world competition and a huge amount of subsidies and various tariff concessions
were provided to promote private investment. After liberlisation in 1991,though no
direct reference was made to agriculture sector, but changes in macroeconomic
policy, exchange rate and trade policy, devaluation of the currency, reduction of
tariffs and reform of public enterprises put the agriculture sector in a tight corner.
The net effect thus was agriculture sector had negative protection and was
discriminated against.
The study covered 17 major states, 46 crops, 288 composite district units by
combing 420 districts. The study concluded inter-district disparities increased
during 60s, come down during 70s, 80s and a rapid reduction during 90s. Based on
the technique of regression analysis, the study had shown that inter-district
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differentials in agriculture development are statistically significant. Increasing
land productivity to compensate the declining farm family income due to
squeezing of their land holding size was provided as a solution.
Hariharan and Saravanan (2010) in their article had analysed the inter-state
variations in the growth of agricultural output in India under the WTO regime.
This article was based on times series data (total 22 years) and a comparison was
made in different states (31 states) of India prior and after implementation of AOA.
Regression coefficients of the simple linear regression model had been used. The
results had shown that agriculture sector in India had not gain much from the
reform process and globalization policies. Compound growth rates of agriculture
output in different states had shown decline from first period (1984-85 to 1994-95,
11 years prior to establishment of WTO) to second period (1995-96 to 2005-06, 11
years after the establishment of WTO).With respect to Rajasthan this paper had
shown that CGR for agriculture output has declined from 6.39 in first period to
0.60 in second period.
Birtha, Singh & Kumar (2011) in their paper have investigated the accelerated
economic growth among major India states during the period of economic
liberalization (1980/81–2004/05) and also analyzed the factors that enhanced
economic growth in these states and lead these states towards an identical steady
state. Results indicated that there was absolute divergence in income levels across
states. The paper suggested that investment in physical infrastructure and human
capital alone were not sufficient, rather investment it these sectors should be
accompanied by a reduction in employment pressure on agriculture by improving
labour market linkages of agriculture with non-agricultural sectors to enhance
economic growth, and by promoting growth-enhancing labour-intensive
agricultural technologies.
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Chand & Raju(2011) had studied instability and regional variation in Indian
agriculture in their policy paper. The major reason found for persistence of
regional disparities in agriculture and farm income were uneven effect of
modifications in technologies and formulation of some government policies. To
support their study they used mean, standard deviation and coefficient of variation.
This instability in yield of foodgrains had exceeded 20 per cent in Rajasthan,
Gujarat, Maharashtra and Orissa in both the periods. Access to irrigation was
found to be the main factor for inter-state variations in instability in area,
production and yield. The results of the study found that impact of new crop
technologies and policies adopted during different periods since 1951 to reduce
variations in production and resulting risk had been lacking. The paper suggested
that there was a need for addressing risks in farm income by devising area-specific
insurance and some other suitable mechanisms.
Raman& Kumari (2012) in their paper analyzed district and regional level
disparity in agriculture development in the state of Uttar Pradesh using 13
agricultural development indicators with the help of UNDP based methodology.
Relative variations and changes in ranks of different districts have been computed
through composite index for two cross-section years 1990-91 and 2008-09. Results
of the paper had shown existence of high and persistent inter-state disparity in
agriculture in the state over the years. Development of agriculture in western
region followed by central region remained polarised and there was least
development in Bundelkhand region over the periods of 1990-91 to 2008-
09.Moreover the paper evidenced that maximum number of districts located in
western and central have scored best record where agriculture was commercialised,
technology was also advanced. Three suggestions had been provided in this paper
for the problem of inter-state disparities – to develop region specific policies, to
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develop a mechanism that ensures credit and subsidy to the neediest regions, and
need to identify the agro-climatic zones that have problems. The paper also
suggested that to make development process truly inclusive a more determined,
effort on the part of the policy makers was needed.
Andrabi and Khan(2013) The main objective of this paper was to account for the
differences in the level of agricultural development at district level. The authors
had used ‘Z-score’ technique, selected seven variables of agricultural development
and ranked the districts according to their level of development. CSS-Composite
Standard Scores were aggregated to find the disparity in agriculture development
in Kashmir valley.
Kumar & Jain(2013) in their study threw light on trends in growth and instability
in Indian agriculture at district level. The paper calculated average crop
productivity different category of districts- very low, low, average, high, very high.
The paper suggested that large scale stabilization measures like insurance should
be promoted to mitigate the consequences of persisting instability. Moreover, the
paper emphasized the importance of modern technology and prudent management
of rainfall water.
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requirements of different districts according to their level of development and thus
meeting the objective of reducing disparities at state level.
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Shafiqullah (2013) in his analyzed the spatial patterns of disparities and the levels
of agricultural developments in the state of Uttar Pradesh. The results of the study
had shown that agricultural development in the north-eastern and southern districts
had given signs of backwardness in the light of selected variables and the western
and central plain districts had given the impression of being in a higher side of4the
scale of development. The article recommended that there was tremendous scope
for development in the agricultural sector in this state. Sufficient land was
available in the state which could be brought under cultivation and by increasing
irrigation facilities, gross crop area could have been increased considerably. The
study suggested that districts having low level of regional development should be
given top priority so that they could come up at par with developed areas, and the
concept of planning with social justice may be fulfilled.
Ghosh (2013) in his book offered extensive information and in-depth analysis of
issues related to agriculture, industry and service sector in India. This book has
evaluated the performance of agricultural production and the impact of agricultural
reforms on spatial integration of food grain markets. This book has also focused on
issues related to regional disparities during post-reform and pre-reform period. In
field of agriculture this book raised the issue of inequality in income originated
from agriculture sector in India. Advanced econometric methods have been used to
approach the various issues pertaining to India.
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Objectives
Hypotheses
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Data and Methodology
Coverage: The proposed study will cover all the 33 districts of the state of
Rajasthan. The study will attempt to analyze the extent of variations among
different districts of Rajasthan from 1980 to 2010.
Data: The study is based on secondary data primarily drawn from the ‘Statistical
Abstract of Rajasthan’ and ‘District Outlines’ published annually by the
Directorate of Economics and Statistics (DES), Government of Rajasthan, Jaipur.
The other sources are Census reports, reports on Economic Census, and annual
publications by DES on Agricultural Statistics.
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The indicators selected to represent the level of ‘Agriculture Infrastructure
Development’ are:
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The indicators selected to represent ‘Government Expenditure on Agricultural
Development’ are
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Chapter Scheme
1. Introduction
2. Rajasthan and Its Districts: A Profile
3. Agricultural Productivity in Rajasthan: A District Wise Analysis
4. Agricultural Infrastructure Development in Rajasthan: A District
Wise
Analysis
5. Government Expenditure on Agricultural Development in Rajasthan :
A District Wise Analysis
6. Overall Agricultural Development in Rajasthan: A District Wise Analysis
7. Regional Disparities in Agricultural Development of Rajasthan: An Inter-
District Analysis
8. Government Policies and Measure: A Critical Analysis
9. Suggestions and Conclusions
Bibliography
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Bibliography
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Regional Development, 1-203.
Birthal, P., Singh, H., & Kumar, S. (2011). Agriculture, Economic Growth and
Regional Disparities in India. Journal of International Development, 23, 119–131.
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EPW Research Foundation (2008). Agricultural Credit in India: Changing Profile
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Joshi, M. (1999). Green Revolution and its impacts. New Delhi, A.P.H Publising
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Narain,P.,Shanna,S.&Bhatia,V.(2002). Dimensions of Regional Disparities in
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Thakur, A., & Chauhan, S.(2010). Inter-Regional Disparities in India. Inter-state
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