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Agricultural Mechanization in Bihar
Avinash KishoreDivya Pandey
Why mechanize : Crop intensification
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 20150
5
10
15
20
25
30
35
40
45
Growth of tractors and power tillers in the study districts (2005-15)
Madhubani -All Purnea -All Coochbehar-AllRajshahi -All Rangpur -All
Purnea
Madhubani
Machine density has increased, but the GCA has hovered around 8 million ha (CI = 1.42) in Bihar.
In comparison, CI >1.8 in West Bengal and Bangladesh
Mechanization without intensification in Bihar while intensification even without mechanization in West Bengal
Why mechanize : Yield enhancementAndhra Pradesh
Assam BiharChhatisgarh
Haryana
Himachal Pradesh
Jharkhand
Karnataka
Kerala
Maharashtra
Orissa
Punjab
Tamil Nadu
Uttar Pradesh
Uttarakhand
West Bengal
1020
3040
5060
yiel
dqtlp
erha
0 2000 4000 6000 8000totalmachinecost
For their yield levels, farmers in Bihar use much less animal labor in paddy
Andhra Pradesh
Assam
Bihar
Chhatisgarh
Gujarat
Haryana
Himachal Pradesh
Jharkhand
Karnataka
Kerala
Madhya Pradesh
Maharashtra
Orissa
PunjabTamil NaduUttar Pradesh
UttarakhandWest Bengal
050
100
150
200
10 20 30 40 50 60yieldqtlperha
pairhrsperha Fitted values
Why Mechanize : Induced innovation• Scarcity of labor and rising wage rates
• 2.5 agricultural laborers/ha land (1.59 males)
• 3.93 (cultivators + ag. Laborers)/ha land (2.76 males)
• Rice-wheat cropping system is not labor intensive
• ~1200 hours/ha or 150-200 person-days/ha At most 60-70 days of employment/year
• Bihar has the highest labor availability among all states
• Evident in wage comparisons Jharkhand UP
Orissa
KarnatakaAssa
m HP
Punjab AP0
10
20
30
40
50
60
17181819202023242425
2933353536
48
Wage Rates (Rs./hour) across States
Mechanization levels in Bihar is higher than many states with similar/higher wage rates
Andhra Pradesh
Assam
Bihar
Chhatisgarh
Haryana
Himachal Pradesh
Jharkhand
Karnataka
Kerala
Maharashtra
Orissa
Punjab
Tamil Nadu
Uttar Pradesh
UttarakhandWest Bengal
2000
4000
6000
8000
1000
0
20 30 40 50wage_casual
totalmachinecost Fitted values
Migration induced labor scarcity during key agricultural operations could be a driver of mechanization in the state
2004 2005 2006 2007 2008 2009 2010 2011 20120
2
4
6
8
10
12
14
16
18
20
6.21 6.47 6.76 7.21
9.3210.14
11.83
16.34
18.37
Hourly Wage (Rs)Year
Hrly Wage FHP
Total Hrs
totalwage Yield GVP/ha
Wage share (%)
2004 6.21 504 875 5433 23 11494 47
2005 6.47 478 831 5379 26 12331 44
2006 6.76 531 840 5676 25 13329 43
2007 7.21 632 771 5556 29 18318 30
2008 9.32 726 797 7423 27 19344 38
2009 10.14 856 768 7784 19 16244 48
2010 11.83 968 757 8954 19 18680 48
2011 16.34 830 797 13023 28 22881 57
2012 18.37 977 808 14842 24 23695 63
2.96 1.94 0.92 2.73 1.06 2.06
Then, What is the Issue?
Labor’s Share in total value of paddy (excluding husk) in select states
0.2
.4.6
.8la
bors
hare
2004 2006 2008 2010 2012year
Bihar KeralaPunjab West Bengal
Bihar
Another issue…Size Class % of Total Holdings Avg. Size (ha) Share of total land (%)
Number of Holdings (cr.)
<0.5 ha 74.4 0.16 30.44 1.210.5-1.0 16.6 0.64 26.99 0.271.0-2.0 5.9 1.25 18.56 0.09
2004 2005 2006 2007 2008 2009 2010 2011 2012900
1100
1300
1500
1700
1900
2100
2300
2500
Cost of Machine Hiring (Rs./ha)
From land rent to machine rents• Most farmers cannot and should not buy big
machines
• Machine rental markets are critical to mechanization of ag. Operations
• But machine rental markets appear to be oligopolistic
• Transfer of rents from sub-marginal farmers to the large farmers who also own machines
• Reinforcing existing inequalities in land ownership
District Tractor Rent (Rs./acre)
#/1000acres
Madhubani 1041 35
Purnea 937 55
Malda 716 31
Cooch Behar 585 67
Merely subsidizing new units is not enough
• Existing subsidy and credit policies are not helping : benefit only those with collateral
• Opportunity: create machine service providers in agriculture• Use technology to create competitive rental markets in ag. Equipment
• Bangladesh has much less subsidy on power-tillers than Bihar
• But Bangladeshi farmers get them significantly cheaper: Smaller Chinese power tillers• Lower rents, in spite of higher diesel prices and lower fuel use efficiency• More vibrant rental markets: serves larger area of a larger number of farmers over longer distances; each
renter has more options• More frequent use, even by sub-marginal farmers
• Can Bihar learn from Bangladesh in mechanizing its agriculture?
Thanks!