crisis of agriculture in uttar pradesh: investigating ... 2.pdfdrawn to a problem only when it...

13Amity Journal of Agribusiness

Volume 2 Issue 1 2017 AJAB

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Amity Journal of Agribusiness2(1), (13-27)

©2017 ADMAA

Crisis of Agriculture in Uttar Pradesh: Investigating Acuteness & Antecedents

Rakesh Raman & Khursheed Ahmad KhanBanaras Hindu University, Varanasi, India

IntroductionThe Indian economy is at cross roads. As the truly post-independence born generation takes

the reign of the country, it finds itself confronting an economy that has imperious services sector which is unfortunately threatening to have ‘Daffodilian (ephemeral)’ existence, frail manufacturing, and failed agriculture. Unlike the Western countries, agriculture here has not gradually prepared platform for manufacturing to take-off. In most states of the nation where

AbstractLast couple of decades has been the most difficult, troublesome and testing for the Indian agriculture

and the indigent peasantry. Though agriculture in India was never fortune’s favoured offspring and peasantry has always been synonymous with subsistence, yet the situation has never been of acute crisis as it is now. What is worrisome is that the crisis was earlier limited to a handful of states like Andhra Pradesh, Maharashtra, Kerala etc. It is now spreading its tentacles in Northern states of Punjab, Haryana, Uttar Pradesh etc. The study investigates how the menace is unfolding in Uttar Pradesh and attempts to draw parallel between crises of agriculture in the state with that prevailing in states where it has reached the apogee. The paper measures crisis of agriculture in UP at the district and zonal level for triennium ending 2004 and 2011 choosing appropriate indicators and attempts to assign weight to different factors that explain the crisis. The effort gives some interesting results- first, despite the popular belief that things are not bad for UP agriculture, the fact is that there exists low intensity crisis here with the intensity varying in different zones and districts. Second, although crisis is an all UP phenomenon yet, the position of agriculture and peasantry is very difficult in Bundelkhand region of the state and gradually yet consistently Eastern UP is moving on the same path. Third, with time the crisis is becoming worse and the pace of deterioration is picking up. Fourth, the crisis in the state is explained not just by factors common to the agricultural sector but to the farmer. The findings call for appropriate interventions on the part of the policy makers to bring the cart back on track and argue that for a predominantly agricultural state like Uttar Pradesh; such a policy is not a choice but compulsion.

Key Words- Crisis of Agriculture, Viability, Indebtedness, Uttar Pradesh (UP), Farming Community

JEL Classification: Q1

Paper Classification: Research Paper

14 Amity Journal of Agribusiness

Volume 2 Issue 1 2017AJAB

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few years back agriculture was the mainstay of population and supplied essential raw materials to manufacturing and contributed significantly to NSDP, it, rather preposterously has lost its dominant position and has slumped into a stage of desperation. In most agricultural states the countryside is under severe stress and rural population is beset with the problem of gainful employment and struggling to get even the bare minimum of life (Gupta, 2005). Patnaik (2003) has rightly compared the present crisis with that existing in pre war years or the time after independence. With manufacturing sector not picking up and growth of services sector limited to few pockets the transition of agriculture from a stage of domination to desperation is destabilising the economy and making life hell for the rural populace especially in those states where agriculture continues to be the main stay of population.

The appearance of agricultural crisis in India is not limited to some advanced states like Maharashtra, Kerala etc. where farmers have shifted to cost intensive and risky cash crops; even the state that were the flag bearers during the green revolution days using relatively advanced techniques and having comparatively developed agriculture and the states lying in the fertile North Gangetic region have seen high degree of farmers’ indebtedness, falling productivity, frequent crop failures and even farmer suicides. The most worrying situation is of states like Uttar Pradesh, Bihar, and Orissa etc. where the pace of industrialization is very slow and the services sector growth is banking primarily on construction and financial sector and as such the dependence of population on agriculture is very high; crisis of agriculture is going to virtually cripple such states. It is rather unfortunate that the attention of experts and government is drawn to a problem only when it reaches its zenith and controlling it requires Herculean effort. It is crucial that problem is identified when it is in nascent stage and its different dimensions are critically analysed and corrective measures are taken.

As far as Uttar Pradesh is concerned, the crisis of agriculture here is in primary stage. It is a crisis in a nascent stage reflected by a near plateauing of total agricultural output and per hectare productivity, growing incidence of indebtedness of farmers, insufficient returns to cultivation and agriculture becoming an unviable occupation. It is imperative that we attempt to explore, quantify and highlight this crisis and try and understand the factors that have led to its emergence and perpetuation. The paper attempts to do precisely this. It attempts two things. The first objective is to quantify and measure the extent of crisis of agriculture in UP and different districts of the state and second, to capture the factors that are responsible for the present state of affairs and are also playing role in intensification of the crisis. The intention is to draw forth the point that the agricultural sector in the state is facing stumbling blocks, is degenerating with early signs of crisis gradually becoming clearly visible and then understand the extent to which the crisis is the outcome of factors that could have been controlled through appropriate policy initiatives. The paper is organized in four parts. First part provides a very brief discussion of the debate relating to the nature of crisis of agriculture, second part talks about the tools and methodology of computing composite index of crisis of agriculture and then develops the index for different regions and districts of UP to draw forth the point that the agriculture sector in UP is witnessing the early sign of distress, third part attempts to identify the factors that provide an explanation of the crisis and the last section i.e. fourth part comes up with some specific suggestions that are essential to revert the trend and resurrect the agricultural sector and peasantry.

Conceptualising Crisis of AgricultureThough the literature has no ambiguity as regards the fact that Indian agriculture is facing

crisis like situation, it is unclear about nature of this crisis. The present crisis of agriculture has been approached from two different angles. The government and a section of scholars feel that it is



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primarily crisis of the agricultural sector proper caused by perhaps over dependence on water and cost intensive technology of production, a shift in cropping pattern and fall in private investment resulting from the growth and evolution of the economy for which service sector has emerged as engine of growth. The ecological changes have further added to the woes of agriculture. The transition has caused stagnation and even decline in output and yield of crops. This approach of crisis accepts that the fast decline in the growth rate of agriculture and stagnation in agricultural production are important features of the present crisis. Chand et al (2007) and Sidhu (2002), Chand and Parappurathu (2011) argue that the most important indicator of crisis is deceleration of agricultural growth combined with increasing input use inefficiency. They argue that the deceleration of growth started from mid 1990s onwards and a decline in agricultural sector was visible till the year 2000. Bhalla & Singh (2009) too support this view and argue that during the post reform period there has been deceleration in crop yield and output. The approach attempts to measure crisis based on indicators such as stagnation in yield of food and non-food crops and plateauing out of production, fall in per-capita food availability of food grains, fall in cropping intensity etc. Pillai (2007), Reddy and Mishra (2007), Barah & Sirohi (2011), all explain that the growth of agriculture in terms of both gross product and output has visibly decelerated during the post–reform period compared to the 1980s. Deshpande (2002), Galab et. all (2009), and a host of other researchers have explained the performance of agriculture sector at the state level and examined how the growth rate of production of important food crops, which are critical to common people, drastically slowed down over the years, particularly after 2000s.

A very important feature of crisis of agriculture seen in literature is fall in per capita availability of food grains. The growth rate in production of food grains during the previous couple of decades has been less than that of the population causing per capita availability of food grain to fall. Patnaik (2003) has given emphasis on food availability and food grain absorption arguing that deflationary policy in the neo-liberal era has caused the terms of trade to move against agriculture. Agriculture has ceased to be a viable occupation and is seen only as a refuge for those who are left with no options because of meager resources at their disposal. The withdrawal of state has exposed the marginal and small farmers to market vagaries turning them into either landless labourers or forcing them to switch to high risk commercial crops, the combined effect of both of which is fall in availability and absorption of food grains and intensification of crisis.

The alternative explanation of the present crisis has been given in terms of agrarian crisis, i.e. claiming that it is crisis of certain agrarian classes, arising out of the relationship of these classes with other classes, in the context of the neo-liberal policies. The view accuses the withdrawing state in the neo-liberal era and the negative growth of agrarian economy (Shiva, 2006) as the prime reason. This is the Marxist interpretation of crisis as suggested by Patnaik (2004: Web), and others. This view blames the neo-liberal policy that paved way for the nation treading along the capitalist path of development and exposed the poor farmers to the uncertainty of global market as the destroyer in chief. The crisis is also due to the way the global capitalism has brought in or introduced new methodology to link the peasants/small farmers with the larger market. It thus defined agrarian crisis as situation when agriculture becomes unviable and lacklustre for the bulk of the peasantry, terms of trade for peasant agriculture moves against them, the imposition of an income deflation upon the working population as a whole takes place, reduced food absorption by all results, a shift from food to cash crops even in the face of the adverse terms of trade shift happens and the indebtedness of farmers increases significantly and rapidly. The squeezing of agricultural land in peri-urban areas because of expanse of urban centres also takes place and marginalisation of farmers and fall in private investment in agriculture becomes a common thing Patnaik, (2003).



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Fall in profitability of agriculture is treated as the most crucial dimension of crisis. Without using temporal data on cost of cultivation, some recent studies have observed that there is stagnation in real income of small and marginal farmers in the face of increase in real cost making agriculture unviable (Kalamkar and Narayanamoorthy, 2003; Deshpande and Arora, 2010; Sainath, 2010). The problem of un-viability of agriculture is more small and marginal farmers. Mishra(2000) has also focused on un-vaibility of agricultural activity. According to him, overall income from cultivation is inadequate and not sufficient to meet all basic requirements. The study of Ramasamy and Kumar (2007) highlights the profitability of cotton growers in different Indian states. They have examined that the net income was reported to be negative in Gujarat, Tamil Nadu, Madhya Pradesh and Punjab, while it was very low in other important cotton producing regions. The rising cost and uncertain price, on the one hand and increasing cost of credit on the other have resulted in growing indebtedness of the farmers. The diminishing presence of institutional credit in agriculture has been the chief reason for increasing indebtedness. Farmers’ indebtedness has been treated as a distress phenomenon by most researchers (Reddy and Mishra 2009, Deshpande and Arora, 2010). The study of Assadi (1998), Revathi (1998), and Mishra (2006) have probed that indebtedness has been one of the major factor responsible for farmer’s suicide.

A succinct review of the two major lines of thought on the issue is sufficient to provide us a clear idea of the problem. The primary cause of contention is whether the present crisis is the crisis of agriculture as a sector or that of the farmers. A deeper inspection of the two lines of argument suggests that both views more or less identify the same set of factors as reflecting crisis. The real point of debate is the primacy of class relations & peasant concern in the leftist approach and equal importance being given to both agriculture sector and peasants in the first approach. While the Marxist approach emphatically argues that so long as agriculture is unviable, increasing output won’t be possible and if possible won’t solve the problem of farmers and therefore won’t be sustainable, the other approach attempts to establish that the present problem can be effectively handled only through tackling the problem of the agricultural sector as such. If agriculture as a sector is cured of its ailments, it would not only provide a solid foundation to the rural economy but also handle the problem of food security and give a base for the manufacturing sector to take off.

Though there is no denial of the fact that the agricultural policies in the nation over the years have created a conflict between agriculture and farmers especially the small and marginal ones and made agriculture an unviable occupation for bulk of them, yet it would be wrong to say that just by addressing the concern of small and marginal farmers the present crisis can be effectively handled and the agricultural sector can be put back on track. For a nation like ours with more than 1.2 billion people, the growing demand for food makes technological revolution mandatory. Further, the economic reforms that the nation started in 1990s are irreversible in nature and there is no question of completely going back on neo-liberalism. Though monopoly capitalism by its very nature is pitted against the peasantry, experiences in some other nations show that agriculture has witnessed a robust growth and the farming community has prospered even when the nation has adopted the so called ‘neo-liberal’ policies and government has treaded along the capitalist path. Working blindly in favour of peasantry would compel us to adopt steps that might go against interest of poor and vulnerable urban population. The present crisis is therefore not just a crisis of peasantry or agrarian crisis; it is part of a broader crisis that engulfs the entire agricultural sector. We prefer to call it Crisis of Agriculture. We end up the conceptual issue of the crisis by concluding that the present crisis is the crisis of the agriculture that has two facets, crisis of the agricultural sector and crisis of the peasants who are dependent on it, it is neither the first nor the second but a combination of two.



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Measurement of Crisis of Agriculture in Uttar PradeshMeasurement of crisis of agriculture defined in the manner above is not an easy task. It

requires information on a number of factors such as land conditions, yield (productivity) of food and non-food crops, cropping intensity, per-capita production, viability/profitability of cultivation and a host of other factors. Availability of data is a major concern and constraint. We have adopted some important indicators to measure crisis index (Table-1).

Table-1: List of Crisis Indicators of Agriculture

S.N. Indicators of Crisis of Agriculture (District & State Level) Notation Impact on Crisis

1 Average Loan Per Household (In Rs.) AL +

2 Yield Y -

3 Per Head Production (Kg) PHP -

4 Percentage of Net Sown Area to Total Agricultural Land NAS -

5 Profit of Production(Per Quintal) PP -

6 Cropping Intensity CI -

Additional Indicators Used for State Level Crisis Index

7 Suicide Mortality Rate (Male Farmers) SMRM +

8 Suicide Mortality Rate (Female Farmers) SMRF +

Source:Authors’Computation

The district and state level data of crisis indicators have been taken from the Directorate of Economics & Statistics, Government of Uttar Pradesh and Ministry of Agriculture, Government of India. In order to minimise fluctuation in agricultural data, triennium ending (TE) data has been taken. Each indicator has been first normalized for the calculation of crisis index. Minimum and maximum values (goalposts) have been set in order to normalize data.

Crisis Index =

In1, In2....... are normalised values of respective indicators.

Based on the total span and equal spread (class interval) we have classified the 14 states in five categories of very, high, moderate, low and very low (Table-2).



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Table-2: Crisis Index of Agriculture for Major Indian States

Category State Crisis Index Rank Category State Crisis Index Rank

Group-‘A’Very High >

0.650

Tamil Nadu 0.746 1 Group ‘C’ Moderate

0.448 - 0.548

Bihar 0.475 10

Kerala 0.717 2

Karnataka 0.673 3

Andhra Pradesh 0.672 4 West Bengal 0.468 11

Maharashtra 0.668 5 Group ‘D’Low

0.347 - 0.447

Uttar Pradesh 0.439 12

Group ‘B’High

0.549 - 0.649

Rajasthan 0.575 6

Orissa 0.556 7 Group ‘E’Very Low

0.346 & Below

Haryana 0.341 13

Madhya Pradesh 0.556 8 Punjab 0.232 14

Gujarat 0.549 9


Space constraint does not permit us to attempt a detailed analysis of the variation of crisis index across states and analyse the characteristic features of them separately. Table was used only to draw forth the relative position of UP in terms of crisis of agriculture among states in India. Brief account of the crisis in different states of India was provided. The states coming in first category belong to southern region of India. These states are highly developed and the agriculture sector of these states are highly associated with the global market and influenced by market externalities. These mostly grow commercial crops like coconut, coffee, cotton, onion, etc. The study of Mitra and Shroff (2007) explains the crisis in global context especially for cotton growers. They claim that the liberalisation measure adopted by the government during the 1990s that opened the agricultural sector and exposed the poor cotton farmers to the vagaries of international trade ultimately resulted in losses to them forcing many of them to commit suicide. The suicide rate obviously has been higher among the cotton growing farmers. South Indian states are not only suicide prone but debt rich also, which is the early sign of the crisis. A number of other factors could be identified as responsible for crisis in Southern states. These include- frequent conditions of drought and failure of rainfall in Karnataka, loss of crops due to inferior quality of inputs and their non-availability on time, problem related to adoption of new technology without proper knowledge, training and state support, sudden attack of pests and diseases and associated economic costs for meeting this exigency. Taken together these tend to shatter the cost calculus of the farmer and pull down the net expected returns. Fall in yield or productivity due to different reasons batters farmers’ expectations about the income flow and leaves them under financial stress. Prices crash due to bulk arrivals in the market or other extraneous factors which again affects the expectations of farmers thereby mounting their credit burden, creating debt trap and consequent financial non-viability.



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Vidarbha region of Maharashtra too has become hot spot of farmers’ suicide. The region in which about 10 percent of the state’s population resides, is known for cotton cultivation. The study of Mishra (2006) reveals that the failure of the Monopoly Cotton Procurement Scheme and the diminishing role of formal credit institutions in the state are the root cause of present agrarian crisis. He found that the suicide is the result of multiple factors (ranging between two to nine) acting upon one another in a highly complex way. The two most common factors have been farmers’ indebtedness (86 percent) and deterioration in economic condition of farmers (74 percent).

As far as the North Indian states are concerned, these have been the beneficiaries of the Green Revolution but technological fatigue, ecological problem and failure of government policies have created a panic situation. Indebtedness of farmers and unviability of agricultural activity have increased during the past couple of years. In a combined study Sidhu. et, all. (2011) found that agriculture in Punjab has been in a sort of crisis situation since 1997. Fall in income and increase in farm investments have been the two most important factors, which caused an economic squeeze in farming households in this belt. In recent years, many farmers in the south and southwest region of the state of Punjab have committed suicide. The states of UP and Bihar are relatively better off but here too some early signs of crisis are discernible. Table-3 summarise the crisis situation in different states of India. The state-wise comparative study shows that the condition of agriculture in UP is relatively not that bad. But in absolute perspective the agrarian condition is not satisfactory as well.

Table-3: Different Categories of States according to their Crisis Index & Nature

Category States Prominent Indicators of Crisis

Main Causes of Crisis Crop Combination

C a t e g o r y -1

Kerala & Tamil Nadu

Indebtedness & Suicide Trade Liberalization & Neoliberal policy

Export-Oriented Perennial Crops

Category-2 Maharashtra & Andhra Pradesh

Indebtedness & Suicide Neoliberal policy, Market Imperfection & Crop failure

Cotton, Tur & Soyabean

Category-3 Karnataka Indebtedness & Suicide Neoliberal policy Market Imperfection & Crop failure

Corse cereal

C a t e g o r y -4

Punjab, Haryana & U. P.

Unviability, Indebtedness & Decline Foodgrains Production and Productivity

Technological Fatigue, Market Imperfection & Caste structure

Sugarcane, Wheat, Corse Cereal & Pluses

Category-5 Rest of the Indian States

Unviability, Indebtedness & Decline Foodgrains Production and Productivity

Technological Fatigue, Market Imperfection & Caste structure, etc.

Not specific


District wise Crisis of Agriculture Index for Uttar PradeshThe paper attempts to compute inter-district and inter-region crisis of agriculture index for

UP and measure disparity across units in two time periods- triennium ending 2004 (TE04) and 2011 (TE11). The crisis index for 69 districts of UP has been computed for these periods. For this purpose, goal posts from within the state based on the value of variables between 2001 and 2011 were fixed (beginning year for TE04 and end year for TE11 respectively). Table-4 provides the summary findings and shows the crisis index scores for TE04 and TE11 and also computes the score difference i.e. difference between the crisis index score of a district for TE11 and TE04. A positive value shows that the score for the district in TE11 has been greater than that in TE04.



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Table-4: District-wise Crisis Index Scores (Arranged on the Basis of Crisis Index of TE04 & TE11)

Districts Crisis Index Score

Score Difference

(TE11)- (TE04)

Districts Crisis Index Score Score Difference

(TE11)- (TE04)

TE11 TE04 TE 11 TE04

Sonebhadra 0.733 0.491 0.243 Firozabad 0.41 0.375 0.035

Lucknow 0.626 0.503 0.124 Saravasti 0.407 0.395 0.012

Mirzapur 0.585 0.471 0.114 Kannauj 0.403 0.363 0.04

Chitrakoot 0.551 0.462 0.089 Mahamaya Nagar 0.401 0.31 0.092

Mahoba 0.544 0.461 0.083 Farrukhabad 0.4 0.396 0.004

Pratapgarh 0.52 0.465 0.055 Ghazipur 0.4 0.381 0.019

Jhansi 0.511 0.462 0.049 Jyotiba Phule Nagar 0.398 0.363 0.035

Kanpur Nagar 0.503 0.435 0.068 Sitapur 0.398 0.385 0.013

Banda 0.501 0.454 0.047 Deoria 0.394 0.374 0.02

St.Ravidas Nagar 0.492 0.454 0.038 Jaunpur 0.394 0.406 -0.012

Jalaun 0.485 0.384 0.101 Mathura 0.387 0.295 0.092

Kushinagar 0.484 0.357 0.128 Unnao 0.382 0.392 -0.01

Agra 0.482 0.404 0.078 Moradabad 0.378 0.295 0.084

G. B. Nagar 0.479 0.443 0.036 St. Kabir Nagar 0.378 0.343 0.034

Allahabad 0.478 0.479 -0.002 Gonda 0.376 0.387 -0.011

Faizabad 0.477 0.408 0.069 Baghpat 0.374 0.299 0.075

Meerut 0.472 0.339 0.133 Hardoi 0.371 0.356 0.015

Kaushambi 0.468 0.471 -0.002 Azamgarh 0.369 0.389 -0.02

Bijnor 0.465 0.407 0.059 Barely 0.368 0.321 0.047

Hamirpur 0.459 0.428 0.03 Siddharth Nagar 0.362 0.378 -0.016

Ballia 0.457 0.415 0.042 Chandauli 0.359 0.318 0.041

Basti 0.452 0.393 0.059 Maharajganj 0.346 0.271 0.074

Varanasi 0.451 0.458 -0.007 Barabanki 0.345 0.333 0.011

Ghaziabad 0.448 0.352 0.096 Ambedkar Nagar 0.339 0.334 0.005

Raebareli 0.442 0.418 0.024 Etah 0.333 0.343 -0.011

Lalitpur 0.441 0.493 -0.052 Buland Shahar 0.331 0.24 0.091

Balrampur 0.441 0.436 0.005 Etawah 0.325 0.304 0.021

Saharanpur 0.44 0.357 0.083 Aligarh 0.324 0.284 0.039

Muzaffar Nagar 0.427 0.343 0.084 Budaun 0.284 0.306 -0.021

Gorakhpur 0.422 0.423 -0.001 Rampur 0.273 0.218 0.055

Sultanpur 0.418 0.404 0.013 Shahjahanpur 0.265 0.234 0.031

Fatehpur 0.417 0.403 0.014 Auraiya 0.263 0.31 -0.048

Behraich 0.416 0.353 0.063 Mainpuri 0.249 0.305 -0.055

Mau 0.416 0.387 0.029 Pilibhit 0.247 0.185 0.062

Lakhimpur Kheri 0.414 0.351 0.063




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[The districts for which information is given in bold are one in which the value of Crisis of Agriculture Index has fallen betweenTE2004 and TE 2011. For Other districts crisis index score has increased.]

In order to understand the relative position of different districts in the state, five categories of districts on the basis of the crisis score were demarcated. Equal interval has been kept between different classes after finding the gap between the largest and smallest values. The five classes demarcated are as follows- Very High Crisis Zone (> 0.439), High Crisis Zone (0.376 – 0.438), Moderate Crisis Zone (0.312 – 0.375), Low Crisis Zone (0.249 – 0.311) and Very Low Crisis Zone (< 0.248)

There are few very interesting findings First, while as compared to state level analysis where it was found that Uttar Pradesh is in

better position, at district level the situation seems different. Uttar Pradesh is a huge state and the situation varies across districts with very high crisis index in some districts as compared to others. For example all seven districts of Bundelkhand region show very high crisis intensity in TE11. Unpredictable climatic conditions such as heavy rain fall and drought, insufficient irrigation facility and low soil fertility are responsible for agricultural backwardness in Bundelkhand region. The slow pace of evolution of rural non farm sector and near absence of supplementary employment opportunities further aggravates the region’s vulnerability. A number of districts of Eastern region also show high crisis. Marginalization of farmers and low access to modern technology are main causes of concern for unviability of agriculture in eastern part. Table-6 clearly shows that crisis index and deterioration is the highest in the Bundelkhand region, followed by the Eastern region.

Second, the crisis of agriculture in the state has witnessed an increasing trend. Between TE04 and TE11 eight new districts have come under the very high crisis zone. Thus in TE11 about 40 per cent of districts in state reported very high intensity of crisis and only one district (Pilibhit) had very low intensity of crisis. Clearly the last column of Table-5 is becoming top heavy showing high concentration of districts in very high and high crisis segment. This is indeed a very danger sign showing consistent intensification of crisis of agriculture in the state.

Table-5: Classification of Districts on the basis of Crisis of Agriculture Index

Index Score

Crisis index (TE04) Crisis index (TE11)

Region Districts Region Districts

Very High 0.439and above

W = 1 C = 1 B = 5 E = 7 T=14

Sonebhadra, Lucknow, Gautam Budha Nagar, Sant Ravidas Nagar, Lalitpur, Allahabad, Mirzapur, Kaushambi, Pratapgarh, Jhansi, Chitrakoot, Mahoba, Varanasi, Banda

W= 6 C = 3 B = 7 E = 1 2 T=28

Sonebhadra, Lucknow, Gautam B. Nagar, Sant R. Nagar, Lalitpur, Allahabad, Mirzapur, Kaushambi, Pratapgarh, Jhansi, Chitrakoot, Mahoba, Varanasi, Banda, Kanpur Nagar, Jalaun, Kushinagar, Agra, Faizabad, Meerut, Bijnor, Hamirpur, Ballia, Basti, Ghaziabad, Raebareli, Balrampur, Saharanpur

High 0.376 To 0.438

W = 3 C = 5 B = 2 E = 1 3 T=23

Balrampur, Kanpur Nagar, Hamirpur, Gorakhpur, Raebareli, Ballia, Faizabad, Bijnor, Jaunpur, Sultanpur, Agra, Fatehpur, Farrukhabad, Saravasti, Basti, Unnao, Azamgarh, Mau, Gonda, Sitapur, Jalaun, Ghazipur, Siddarth Nagar

W= 8 C = 4 B = 0 E = 1 0 T=22

Muzaffar Nagar, Gorakhpur, Jaunpur, Sultanpur, Fatehpur, Farrukhabad, Saravasti, Unnao, Mau, Gonda, Sitapur, Ghazipur, Behraich, Kheri, Firozabad, Mahamaya Nagar, Kannauj, J. P. Nagar, Deoria, Mathura, Moradabad, SantKabir Nagar,



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Moderate 0.312 to 0 .375

W = 9 C = 3 B = 0 E = 6 T=18

Firozabad, Deoria, Kannauj, J. P. Nagar, Kushinagar, Saharanpur, Hardoi, Behraich, Ghaziabad, Kheri, Sant Kabir Nagar, Etah, Muzaffar Nagar, Meerut, Ambedkar Nagar, Barabanki, Barely, Chandauli

W= 6 C = 2 B = 0 E = 5 T=13

Hardoi, Etah, Ambedkar Nagar, Barabanki, Barely, Chandauli, Azamgarh, Siddharth Nagar, Baghpat, Etawah, Aligarh, Buland Shahar, Maharajganj

Low 0.249 to 0.311

W = 9 C= 0 B = 0 E = 1 T=10

Auraiya, Mahamaya Nagar, Budaun, Mainpuri, Etawah, Baghpat, Mathura, Moradabad, Aligarh, Maharajganj

W= 5 C = 0 B = 0 E = 0 T=5

Auraiya, Budaun, Mainpuri, Shahjahanpur, Rampur

Very Low Below 0.248

W= 4 T=4

Buland Shahar, Shahjahanpur, Rampur, Pilibhit

W = 1 T=1

Pilibhit

Source:Authors’Computation(W=Western,C=Central,E=Eastern&B=BundelkhandRegion)

Third, the region wise comparative analysis clearly indicates that the intensity of crisis is very high in Bundelkhand region (0.498). There are a number of factors responsible for the poor position of Bundelkhand-

a. Lack of proper irrigation facility is a major issue in Bundelkhand. Climate change has seen very frequent occurrence of drought or insufficient rains and decrease in winter water precipitation in the region. This coupled with a tendency to shift to crops and cropping techniques that require more water has resulted in water table going further down and cost of irrigation going up.

b. Bundelkhand is the typical case of over dependence on agriculture. The region that hardly has any industry reflects a very high dependence of population on agriculture and very high incidence of poverty. Farmers are extremely poor with grossly insufficient resources to till their land. A large part of land owned by them remains fallow either because there is no irrigation available on them or farmers not having resources to till them. There has been persistent decrease in the area cultivated in the Kharif season. It has gone down from 33 percent in 1977-78, to 26 percent in 1993-94 and stays close to 20 percent now. Most of the farmers are unable to take more than one crop in their land and if that crop fails they are ruined and pauperized. Even in the land that is tilled once the quality of seeds used is poor and the minimum inputs that are required to maintain productivity are not used. Thus even in years in which nature supports farmers are not able to get sufficient output and surplus that can work as cushion for them during bad years.

c. A very significant reason for crisis is rather hazy land rights. Land that in the official records are shown as common property resource or owned by the weaker sections of the population has been captured and being ploughed by big landowners. The allotment of land to landless families has remained only on papers. Poor farmers are either not aware of their rights or are being forcibly denied of the same.

d. Another important reason is lack of alternative source of livelihood in the region. While in the Western region of the state some industrialisation has taken place, the Eastern region has some districts that are tourist hub of the state. The presence of alternative employment opportunities provide relatively high investible funds to the farmers making them able to buy basic inputs, it also help and support them in bad years. Unfortunately in Bundelkhand there is hardly any alternative source of income in rural areas.

Fourth, a noteworthy point, however, is that the rate of growth in crisis of agriculture (i.e. the rate of increase in crisis index) is significantly high in the Western region (14.91per cent) followed by Bundelkhand (10.91 per cent) and Eastern region (9.23 per cent). During the last



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decade or so, the mode of production has shifted from feudalist to capitalist in Western region of UP and farmers have shifted to more capital intensive techniques. This has increased the cost of production which in the face of increased incidences of crop failure and stagnant prices and absence of price support from the government has resulted in severe deterioration in the condition of farmers. Due to market imperfection, farmers do not receive remunerative prices for their produce and ultimately, they fall in the debt trap. The debt burden is comparatively high in Western region of UP.

Fifth, district and regional level crisis analysis clearly shows that the tentacle of the crisis has spread to all districts of Uttar Pradesh and within the span of 8 years the magnitude of crisis in Uttar Pradesh has increased at a very high rate (more than 10 per cent). During the period under consideration a number of districts have moved from low and moderate crisis position to high and very high crisis zone. Table-5 reveals that (i) the number of districts falling in the very high crisis segment that was only fourteen in TE04 has doubled in TE11. (ii) Even in the most developed Western region the number of high crisis district has gone up from one in TE04 to six in TE11.

Table-6: Index of Crisis of Agriculture in Different Regions of Uttar Pradesh

Regions Crisis index score (TE11)

Crisis index score (TE04)

Rate of change in crisis index

Rank Based on Score Difference

Western 0.370 (4) 0.322 (4) 14.91 2

Central 0.433 (3) 0.397 (3) 9.07 4

Bundelkhand 0.498 (1) 0.449 (1) 10.91 1

Eastern 0.438 (2) 0.401 (2) 9.23 3


Identification of Factors explaining Crisis of AgricultureA simple linear regression has been used to determine which individual economic indicators

have more weight (influence) in the construction of the composite index. This is not a predictor regression. Here the coefficients are not used to predict the dependent variable i.e. crisis. These are used just to explain the role of particular constituent of crisis in determination of crisis index. Here beta values are estimates resulting from an analysis carried out on independent variables that have been standardized. The predictor regression is given by-

Crisis Index = α + β1 PP + β2 Y + β3 CI + β4 PHP + β5 NAS + β6 AL + ut

Here notations used are as per details in Table-1

The regression result (Table-7) shows that farmers’ indebtedness has the highest weight with a coefficient value of 0.413, followed by per head food production (used as a proxy of food grain availability) with 0.412 which implies that these indicators play a major role in determination of crisis at district as well as regional levels.

Table-7: Model Summary of Regression Analysis

Model α β1 β2 β3 β4 β5 β6

Value of Un-standardized Coefficients

0.418 -0.026* -0.028* -0.028* -0.035* -0.027* 0.036*

Standardized Coefficients -0.301 -0.328 -0.331 -0.412 -0.319 0.413

Source:Authors’Computation*Significantat1percent



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High indebtedness creates a virtual trap for the farmers. It reduces cropping intensity (for want of resources), makes appropriate technology inaccessible, forces farmers to sell their crop at throw away price just after harvest thereby reducing profitability and forces farmers to take extreme steps like relinquishing farming or even committing suicide. Indebtedness has increased in the neo-liberal era because of withdrawal of government and public sector banks from provision of cheap loans to farmers.

Crop density with the value of -0.331 and yield with - 0.328 obtained third and fourth position, respectively, whereas profitability is not far behind in the determination of crisis. With agriculture becoming an unviable activity, farmers’ capacity to invest and take more number of crops has decreased. High cost of cultivation and frequent crop failure drain out farmers with limited resources that they have at their disposal. Since rural non-farm sector has not picked up, farmers are unable to supplement their agricultural income by income from non-agricultural sources. They are therefore forced to have only one or two crop from their land thereby reducing cropping density and income from farming. In the similar vein yield has stagnated over a period of time. The cropping intensity in the U.P. is severely constrained also by the skewed distribution of resources and fragmentation of land holdings. Due to high demographic pressure and lack of alternative livelihood opportunities in the rural areas the per capita net sown area has declined to uneconomical level.

Declining yield is another factor that has intensified crisis of agriculture. Literature provides many explanations to declining yield. Low yield results in low income and makes farming unviable. Low yield coupled with lack of subsidiary occupation in rural areas is responsible for low per capita availability of food grains also. The falling profitability of agriculture also acts as a significant component of crisis. In the ambiguous path of capitalist development, getting remunerative price for agricultural produce has become a herculean task for farming communities. The nature of the problem depends upon the mode of surplus extraction and class relation of the agrarian economy which prevails at village level. During the reform period the gap between cost of production and return on cultivation has increased due to withdrawal of government support from agricultural activity. Thus, the unviability of agriculture is the outcome of those policies which have been taken in favour of large farmers and the magnitude of unviability has further intensified in the era of globalization.

A hurried perusal of the factors explaining crisis of agriculture shows that there are problems with the way agricultural sector has evolved over a period of time and agricultural policies have been formulated in India. The factors that significantly explain crisis have to be handled effectively by the government, if the sector has to be rescued.

The Interventions: Putting the Cart on TrackCrisis of agriculture has emerged as a big debatable issue among the policy makers and

scholars. During the last couple of years, government has taken a number of steps including improving rural infrastructure, promoting financial inclusion through micro-finance, provision of agricultural credits in order to reduce dependency on money lenders, increasing expenditure on irrigation projects etc., to overcome the crisis situation. Although, the state as well as central government is claiming that they are taking substantial and effective efforts to control the crisis, yet unfortunately, these efforts do not put any serious impact on crisis. The present crisis can be significantly attributed to the neglect of the concern of farmers especially the peasants and as such any effort to resurrect the agricultural sector and giving a booster dose to agriculture would fail unless and until efforts are made to address farmer’s concern. Thus, a multi-pronged strategy is



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necessary to handle the problems of crisis. Any government policy must focus on minimizing cost of production and optimizing market price.

Assured and remunerative price for agricultural product is the main issue. State should intervene to resolve the problem of sale of agricultural product. The debate on determination of Minimum Support Price should be sorted out friendly with the farmers groups. Thus, in the fixation of MSP, members of farmer and social groups should be involved at micro level and MSP must be calculated at district level because inputs of cultivation are mostly affected by local factors like labour wage, transportation, etc.

At the block or village level, market imperfection emerges as a main bottleneck in earning a remunerative price of the agricultural product. Sale and purchase of crops (Wheat, Paddy, Green pea, Sugar cane, etc.) through the commission agents should be replaced by state procurement agencies. During the reform period, the price of agricultural product especially for commercial crops and its final product has drastically declined and farmers have not been able to receive fair price of their products. Therefore, a market risk mitigation fund should be established at block as well as district levels to minimise violent fluctuations in product price. Sugarcane (the main commercial crop of Uttar Pradesh that covers more than 70 percent of net sown area in western region) growing farmers do not receive sufficient return from their cultivation because they are selling their crop at a low price in a monopoly market. The sugar mill owners are exploiting the farmers. The state should break up the tendency of monopoly and put a check on corruption.

The employment elasticity of the agricultural sector has decreased and this is something on expected lines. The need of the hour is to create supplementary employment opportunities in rural areas through development of rural non-farm sector. Growth of rural non-farm sector especially rural manufacturing and more specifically agro-based industries could be of great help. This would not only provide employment to farmers but at the same time provide readymade market for the agricultural produce thereby giving farmers their due. The profit of the non farm sector can also be pooled back to agriculture. There is need for redistribution of gains and allocation of risks among input dealers, output dealers and the farmers and the government must insure that the small and marginal farmers get higher gain at lower risk. There is a need for putting in place appropriate regulatory system.

ConclusionThe economies of India and Uttar Pradesh are agrarian in nature. For sustainable development

and desirable growth, government should take appropriate actions to contain crisis of agriculture. Policy makers should understand that agriculture and farming community are inter-connected with each other and the farmer works as the chief actor in agrarian economy. Thus, without farmer (specially marginal and small) centric policy, any effort to resurrect agriculture will meet with limited success. Assisting the farmers and making agriculture viable for bulk of them is a precondition for resurrecting growth of agriculture and bridging rural-urban divide.

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Authors’ ProfileRakesh Raman is currently working in Department of Economics, Banaras Hindu University, Varanasi,

India as Professor of Economics. He teaches courses on macroeconomics, economic growth and research methodology to post graduate students and has over 25 years of experience of teaching in colleges in Arunachal Pradesh, Madhya Pradesh, Bihar, Bhutan & Uttar Pradesh. He has done research projects sponsored by UNFPA, ICSSR , NUEPA and UGC and has three books and over 30 research publications to his credit. His areas of research interest are agricultural economics, informal sector and primary education.

Khursheed Ahmad Khan is working as Assistant Professor, Samastipur College, Samastipur, Bihar, India. He has published a number of papers in National and International level journals. He is proficient in Census & Survey Data Processing (CSPro) Software, SPSS and has worked as a field investigator for many projects, sponsored by UGC and ICSSR.

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