TRADITIONAL AND SRI METHODS OF PADDY CULTIVATION A COMPARATIVE ECONOMIC ANALYSIS

Thesis submitted to the University of Agricultural Sciences, Dharwad in partial f ulfillment of the requirements for the Degree of

M ASTER OF SCIENCE (AGRICULTURE) in

AGRICULTURAL ECONOMICS

By SIVANAG AR AJU P.

DEP ARTMENT OF AGRICULTURAL ECONOMICS COLLEGE OF AGRICULTURAL, DH ARWAD UNIVERSITY OF AGRICULTUR AL SCIENCES, DHARWAD 580005

JULY, 2006

ADVISORY COMMITTEE

Dharwad
JULY, 2006

(H. BAS AV AR AJ A) MAJOR ADVISOR

Approved by: Chairman : ______________________ (H. BAS AV ARAJ A) Members : 1.____________________ (L.B. KUNNAL) 2.____________________ (P.A. KATARAKI) 3.____________________ (V.V. ANGADI) 4.____________________ (S.B. MAHAJANASHETTI)

CONTENTS
Chapter No. I. INTRODUCTION

Title

II.

REVIEW OF LITERATURE

III.

METHODOLOGY

IV.

RESULTS

V.

DISCUSSION

VI.

SUMMARY AND POLICY IMPLICATIONS

VII.

REFERENCES

LIST OF TABLES

Table No. 3.1. 3.2. 3.3. 3.4. 4.1. 4.2 4.3. 4.4. 4.5. 4.6. 4.7. 4.8. 4.9. 4.10. 4.11. 4.12. 4.13. 4.14. 4.15. 4.16. 4.17.

Title General information of Guntur and Prakasam districts Land utilization pattern in Guntur and Prakasam districts Paddy cultivation in the study area List of selected villages General characteristics of sample farmers Asset position of the sample farmers Cropping pattern of the sample farmers Particulars of raising nursery for paddy cultivation per hectare input use pattern in traditional and SRI method of paddy cultivation Method-wise paddy output Method-wise cost and returns in paddy cultivation (Rs/ha) Estimated production function for Traditional and SRI method of paddy cultivation MVP to MFC ratios of resources in Traditional and SRI method of paddy production Distribution of farmers according to technical efficiency ratings Actual and frontier use of resources and output production per farm Technical, allocative and economic efficiency in paddy (%) Estimated production function with intercept and slope dummies Decomposition of productivity difference between the SRI paddy yield and the traditional paddy yield Adoption level of SRI paddy farmers Reasons for practicing SRI method Constraints for SRI method

LIST OF FIGURES
Figure No. 1. Title Map of Andhra Pradeh showing the selected districts Guntur and Prakasam Schematic representation of sampling design Nursery cost for traditional paddy and SRI paddy Breakup of cost of cultivation in traditional and SRI methods Method-wise paddy output Cost and returns in traditional and SRI method of paddy cultivation Technical, allocative and economic efficiency in traditional and SRI method of paddy

2. 3. 4. 5. 6. 7.

LIST OF PLATES
Plate No. 1a. 1b. 1c. 1d. 2a. 2b. Nursery bed preparation Transplanting of younger aged seedlings on the marked land Intermittant wetting and drying in SRI paddy field Manual operation of conoweeder Strong and well developed roots in SRI method SRI paddy plants with productive tillers Title

LIST OF APPENDICES
Appendix No. I. II III. Schedule Estimated traditional paddy and SRI paddy production function Geometric mean levels of inputs and output per hectare Title

I. INTRODUCTION
Rice commends recognition, as a supreme commodity to mankind, because rice is truly life, culture, a tradition and a means of livelihood to millions. It is an important staple food providing 66-70 per cent body calorie intake to the consumers. The United Nations General Assembly, in a resolution declared the year of 2004 as the International Year of Rice, which has tremendous significance to food security. It very eloquently upheld the need to heighten awareness for the role of rice in alleviating poverty and malnutrition (Barah and Pandey, 2005). Rice is the staple food for about 50 per cent of the worlds population that resides in Asia, where 90 per cent of the worlds rice is grown and consumed. In Asia, India has the largest area under rice (41.66 million ha) accounting for 29.4 per cent of the global rice area. Of the total harvested area, about 46 per cent is irrigated with 28 per cent rainfed lowland, 12 per cent rainfed upland and 14 per cent flood prone. Rice is one of the largest traded commodities in the world with a total quantity traded touching 16.4 million tonnes. The southeast countries account for about 40 per cent of the rice trade in the world (Mangal Rai, 2004). The world paddy production was 614.65 million tonnes in 2004-05, covering an area of 153.51 million ha with an average yield of 3.87 tonnes per ha. Developing countries contributed about 90 per cent of the total world rice production. India ranked first in area under paddy (41.66 million ha) and second in terms of production (85.31 million tonnes) during 2004-05 and it stood next only to China in the world with respect to rice production. But, the yield levels in India were low at 2.05 tonnes per ha compared to other major rice producing countries viz., Japan (6.52 t/ha), China (6.24 t/ha) and Indonesia (4.25 t/ha). About 67 per cent of the area under paddy in India is under HYVs. India so far has witnessed 2 per cent growth in population while the growth in rice production was 3 per cent. Growth rate of rice output during the last two decades has remained well above the population growth rate, which has made the country not only self reliant in food grains but also generated surplus for export. Rice is consumed both in urban and rural areas and its consumption is growing due to high-income elasticity of demand. To meet the growing demand, a rapid increase in paddy production is needed. But, there is little scope to increase the area; hence increase in production and productivity with an improvement in efficiency of production act as a technological break through to meet the growing demand. The green revolution of 1960s was oriented towards high input usage particularly fertilizers, irrigation and plant protection chemicals. As a result of excessive use of these inputs the cost of cultivation has escalated. This is more so in irrigated crops like paddy. The spectacular increase in production of paddy was restricted to irrigated belts of the country. The skewed distribution of green revolution results and increased costs of cultivation have given alarming signals to the future needs of food security. At this juncture the System of Rice Intensification (SRI Rice cultivation) came into light. SRI, the system of rice intensification is a system of production of rice. SRI is considered to be a disembodied technological break through in paddy cultivation. SRI involves the application of certain management practices, which together provide better growing conditions for rice plants, particularly in the root zone, than those for plants grown under traditional practices. This system seems to be promising to overcome the shortage of water in irrigated rice. SRI was developed in Madagascar in the early 1980s by Father Henride Laulanie, a Jesuit Priest, who spent over 30 years in that country working with farmers. In 1990, Association Tefy Saina (ATS) was formed as a Malagassy NGO to promote SRI. Four years later, the Cornell International Institute for Food, Agriculture and Development (CIIFAD), began cooperating with Tefy saina to introduce SRI around the Ranomafana National Park in eastern Madagascar supported by the US Agency for International Development (USAID). It has since been tested in China, India, Indonesia,

Philippines, Sri Lanka and Bangladesh with positive results. In Sri Lanka, SRI cultivation was practiced in 18 districts with encouraging results of doubling the yields. It was in practice in Cambodia, Indonesia, Laos, Myanmar, Philippines, Thailand, Vietnam, Bangladesh, China, India, Nepal, Sri Lanka, Gambia, Madagascar, Mozambique, Sierra Leone, Ghana, Benin, Barbados, Brazil, Cuba, Guyana, Peru and USA. In this method synergic interaction leads to much higher yields. It offers increased land, labour and water productivity. In fact, it is a less water consuming method of rice cultivation, which is suitable to poor farmers who have relatively more labour than land and capital. Under SRI method of Rice cultivation, root development was more and healthy, tillering was almost double and the crop does not lodge. The grain weight was more and less incidence of pests and diseases were observed. This technology uses less quantity of inputs like water, fertilizers, pesticides etc. SRI method differs from normal method of rice cultivation as given below. 1. Nursery management: Raised seed bed should be prepared by mixing FYM in the soil either on polythene cover, banana sheaths etc. or on soil itself. a. Seed rate: Five kgs of seed per hectare is sufficient as against 50 - 62.5 kg per hectare in traditional method of rice cultivation. b. Age of the seedlings: Transplanting should be done with 8-12 days aged seedlings with two small leaves as against 25 days and above in traditional method of rice cultivation. 2. Transplanting: Seedlings should be removed carefully from the nursery without disturbing the roots of the plant along with mud and single seedling should be transplanted per spot in the main field. Water in the main field should be drained before transplanting. 3. Wide spacing: Wider spacing of 25 cm 25 cm in square pattern should be maintained for better aeration and for easy intercultural operations as against 50to66 hills per m2 in traditional method. 4. Weeding: Naturally weed growth is more in these fields because there is no stagnated water. Weeding should be done with rotary weeder/conoweeder for at least four times with an interval of 10 days starting from tenth day after planting. It churns the soil and the weeds are incorporated in the soil, which in turn serves as organic manure. It helps in increased soil aeration and soil health. 5. Water management: The soil should be kept moist but not saturated by providing alternative wettings and drying. 6. Manures and fertilizers: Application of more of organic manures i.e., 10 tones per ha should be used and reduce the quantity of chemical fertilizers. Technology that heralded the process of green revolution during 1970s and 1980s started showing signs of deceleration during 1990s. In the 1970s, agricultural production growth was comparatively low, growing at an average annual rate of 1.95 per cent. In the 1980s, it grew at 3.82 per cent per annum. Since 1990, production growth showed only 2.09 per cent per annum (Fan, 2000). Technological stagnation is supported by an increasing evidence of stagnating levels of productivity growth of crops even in many potential areas as the trend in productivity is not consistently upward in many states of India. The growth has been flat and has started declining in some of the progressive states and reversing the trend will not be easy. This is due to differential levels of adoption of new technologies, varying degrees of water control, imbalances in infrastructure development and a host of other factors. Differential levels of adoption of modern varieties are also one of the causes for stagnation in yield levels. Adoption of modern varieties of major crops even now met with only partial success (Hossain, 1990; Azam, 1995 and Hossain, 1996) as the area under high yielding varieties (HYVs) is still low. About 40 per cent of the cropped areas in the country are under HYVs in 1996-97 and it increased from 21 per cent in 1970. The area under HYVs of crops ranged

Plate 1a. Nursery bed preparation

Plate 1b. Transplanting of younger aged seedlings on the marked land

Plate 1c. Intermittant wetting and drying in SRI paddy field

Plate 1d. Manual operation of conoweed between 2 per cent and 69 per cent across the states and this differential adoption rate accentuates the income disparities among the region. The lackadaisical pace of growth was witnessed even in rice. India is still amongst the countries with the lowest rice yields, 30 to 40 per cent of the potential yield is yet to be tapped with the available high yielding varieties sown on highly productive irrigated soils. After a long period of technological breakthrough and adoption, yield gap still exists in many of the states. In the country, more than 50 per cent of the potential yield even in the case of rice is not realized yet. Non-price prerequisite for sustaining the agricultural production, namely the technology receded in the later periods and its bearing on the profitability of crops is also reflected in the output-input ratios of the many crops. The surplus production of rice and wheat could not be exported profitably as the ruling prices in the international markets remained far below the cost of procurement. Consequently with mounting stocks, the prices of the commodities in the domestic market fell far below the cost of production. In the case of paddy a proportionate increase in the cost of production was more than the increase in income and as a result, the benefit-cost ratio declined to 1.41 during 2000-01 from 2.45 per cent in 1973-74 (Fan, 2002). Farmers may have been able to maintain yields of modern varieties through the application of higher amounts of non-land inputs, which means a declining trend in TFP and profitability in farming. Without impressive growth in the productivity of crops, the farmers are forced to extend cultivation to marginal lands due to low profitability and this aggravates the production of sustaining the natural resource base. Therefore, potential for increasing production of crops through adoption of wide range of modern technologies has remained unexploited in many parts of the country because of unfavourable output-input prices (Ramasamy, 2004). Efficiency is an important source of productivity growth especially in developing agricultural economies, where resources are meager and opportunities for developing and adopting better technologies have lately started dwindling. Such economies can benefit a great deal from inefficiency studies, which show that it is still possible to raise productivity by improving efficiency, a usually neglected source of productivity, without increasing the resource base or developing new technologies. Estimates on the extent of inefficiency can also help to decide whether to improve efficiency or to develop new technologies to raise agricultural productivity. Measurement of efficiency includes Technical Efficiency (TE), Allocative Efficiency (AE) and Economic Efficiency (EE). Technical efficiency is the ability of a producer to achieve maximum possible output with the available resources, while allocative efficiency refers to the ability to contrive an optimal allocation of given resources. Economic efficiency is the product of technical and allocative efficiencies (Farell, 1957).

It is generally, believed that farmers in developing agriculture fail to exploit fully the potential of a technology and/or make allocative errors with the result that yields show wide variation, usually reflecting a corresponding variation in the management capacities of the farmers. This shows that considerable scope exists for raising productivity and income of the farmers by improving their efficiency. The factors responsible for inefficiencies need to be identified and addressed properly for achieving a higher production in paddy. The launching of HYV programme in India has enhanced the importance of the study of efficiency in crop production. The concept of efficiency is vital to policy makers both at micro and macro levels. It aids in policy recommendations related to land distribution, land ceilings, agricultural education and extension services. Studies on efficiency in paddy cultivation focus on the possibility of increasing the yield while conserving the resources. In Andhra Pradesh, Acharya N. G. Ranga Agricultural University (ANGRAU) sent the Director of Research and Director of Extension to Sri Lanka in January 2003, with the Sri Lanka Department of Agriculture hosting the team and with CIIFAD covering local area of the visit. After observations with SRI farmers in Sri Lanka, these Directors decided and promoted SRI cultivation in Andhra Pradesh state. The on farm demonstrations conducted during kharif in Andhra Pradesh during 2003-04 using SRI method of paddy cultivation resulted in increased yields of about 2.5 t/ha over traditional method of paddy cultivation. Later, during rabi season, farmers on their own cultivated paddy in large areas, using SRI method and obtained higher yields and income. In 2004-05, there was tremendous motivation for SRI cultivation method by the farmers of Andhra Pradesh. Andhra Pradesh state government has allocated Rs. 4 crore for popularizing SRI method among farming communities and extended free power regime to SRI paddy farmers. Andhra Pradesh lies between 12041' and 220N latitude and 770 and 84040'E longitude with a total geographical area of 275.06 lakh ha of which 101.18 lakh ha is the net cultivable area (36.78 %). Of the cultivable area of the state, about 55.04 per cent is covered by food grains. Andhra Pradesh stands fourth in the rice area (30.86 lakh ha), fourth in the production (9.601 million tones) with the productivity of 3.11 tones per ha (Anon., 2006). Rice in the state is grown under varied agro-climatic conditions. The coastal region comprising Srikakulam, Vizayanagaram, Vishakapatnam, East Godavari, West Godavari, Krishna, Guntur, Prakasham and Nellore districts accounts for nearly 65 per cent of the rice area in the state. Andhra Pradesh is the second state next only to Tamil Nadu, which adopted the SRI method of rice cultivation in India. The state government and the ANGRAU with other government and non-government organizations have started promoting SRI methods in various districts of Andhra Pradesh.

SPECIFIC OBJECTIVES OF THE STUDY

1. To compare and contrast the cost and returns of paddy cultivation in traditional and SRI methods. 2. To decompose the contribution of resources to the productivity differences between traditional and SRI method of paddy cultivation. 3. To study the technical and allocative efficiency in paddy cultivation under traditional and SRI methods. 4. To suggest appropriate policies for improving resource productivity in paddy cultivation.

HYPOTHESES
1. SRI method of paddy cultivation is profitable when compared to traditional method. 2. The techniques of production followed in SRI method contributes to the productivity differences. 3. Farmers adopting SRI method are technically efficient.

PRESENTATION OF THE STUDY

The entire study has been divided into six chapters. Chapter I deals with the introduction to the topic specifying objectives of the study. Chapter II deals with the review of literature on earlier studies that are having relation to the objectives of the present study. Chapter III is devoted to the description of the study area, sampling frame, the nature and sources of data, the tools and technique of analysis adopted for evaluating the objectives. The terms and concepts used in study are also outlined. Chapter IV presents results under appropriate heads. Chapter V consists of discussion on the results of the study. Chapter VI summaries the overall results, draws conclusions and outlines the policies emerging from the study.

II. REVIEW OF LITERATURE

In this chapter, an attempt has been made to review the past literature pertaining to the present study. By considering the growing importance of SRI rice, the studies conducted on SRI rice both in India and other parts of the world were reviewed. The efficiency issue in agricultural production is an important aspect from the point of view of agricultural development in developing countries. The understanding of these issues would provide direction for the study. The major studies dealing with various issues with which the present study is concerned are discussed under the following heads. 2.1 2.2 2.3 2.4 Economics of rice cultivation Technical and allocative efficiency in rice cultivation Factors contributing to yield differences SRI method of rice cultivation.

2.1

ECONOMICS OF RICE CULTIVATION

Gupta et al. (1985) examined the economics of paddy cultivation on different size groups of Haryana. It was observed that use of human labour generally declined with increase in farm size while that of mechanical labour increased. The share of fixed costs in the total cost of cultivation was higher on large farms than that on small farms. Use of yield augmenting inputs and yield per hectare increased with the increase in farm size and so did the return over variable costs. Pergade (1986) studied economics of rice cultivation in different land situations for both local and HYV. The cost of production (per quintal) in upland region for local and HYV rice was Rs. 130 and Rs. 88.81 respectively. The cost of production in midland region for local variety during rabi and kharif seasons was Rs. 143.81 and Rs. 134.42 respectively. For HYV's the same trend was observed but the difference in cost between the two seasons was much more in case of low land paddy. The cost of production was highest in summer in the case of local variety because of high total cost. In the case of HYV, the cost was less in kharif, which was due to the low cost of inputs. The gross income received from local variety in upland was higher than the income received from other two types of land and returns were higher in rabi (Rs. 1,420.85) than that in kharif (Rs. 1,305). Thiruvenkatachari et al. (1991) analysed the economics of groundnut production in rainfed area (Tamil Nadu). The study showed that costA contributed 61.05 per cent to the total cost (cost C) in case of marginal farmers, where as it was 77.27 per cent in the case of big farmers. The net returns over cost C was Rs. 1674, Rs. 2371 and Rs.2313 in the case of marginal, small and big farmers respectively. It was reported that groundnut production was profitable under rainfed areas of Tamil Nadu. Nagaraj (1993) analysed the economics of cropping system In Tungabhadra project command area. He reported that cost of cultivation (cost C) for paddy was higher for middle reach (Rs. 12,605) when compared to that for head reach (Rs. 12,138) farmers. The gross returns and the net returns were Rs. 26,170 and Rs. 14,031 for head reach and Rs. 24,291 and Rs. 13,685 for middle reach respectively. Whereas the returns for rupee of expenditure in paddy production was Rs. 2.16 for head reach and Rs. 1.93 for middle reach farmers. Reddy (1994) compared the costs and returns for sunflower in three zones i.e. Central Dry Zone (CDZ), North Eastern Dry Zone (NEDZ) and Northern Dry Zone (NDZ) of Karnataka. The cost of cultivation was high in CDZ (Rs. 4893.26) when compared to NDZ (Rs. 2829.21) and NEDZ (Rs. 2151.93) because of increased use of inputs and high rental value of land. The return per rupee expenditure was also high in the case of CDZ (0.63) when compared to NDZ (0.35) and NEDZ (0.40). Seed cost, human and bullock labour and rental value of land formed major components of the total cost in all the zones. Farmers in all the zones used more seeds per hectare than the recommended quantities. However, the use of FYM and fertilizer was less than the recommended levels in all the zones. Thimmappa (1994) indicated that the cost of cultivation increased with an increase in

farm size in the case of upland crops. A positive relationship between farm income and farm size was observed. In the case of cotton a positive relationship was observed between costs (cost A, cost B and cost C) and the size of the holding and the gross returns also increased with increase in the farm size. In the case of groundnut, cost C was lower for small farms and was invariably higher in the case of large farms. Mohandas and Thomas (1997) studied the economics of rice production in Kuttanad area of Kerala. They reported that cost of cultivation of paddy for state was Rs. 13,108.05 for marginal farmers (Class I), Rs. 13,309.72 for small farmers (Class II) and Rs. 13,858.13 for large farmers (Class III). Rental value of own land recorded the highest expenditure in Class I and Class II which accounted for 24.19 per cent (Rs. 3,171.30) and 22.38 per cent (Rs. 3,112) respectively. However, the item of highest expenditure was fertilizer in Class III which came to 22.39 per cent (Rs. 3,100.75) of the total cost. Gross returns was highest for marginal farmer (Rs. 15,857 .45) followed by small farmers (Rs. 15,560) and large farmers (Rs. 15,387.50). The net returns and input-output ratio was also found to be highest in marginal farmers (Rs. 2748.95 and Rs. 1.21) followed by small farmers (Rs. 2250.28 and 1.17) and large farmers (Rs. 1529.37 Rs. 1.11). Govardhan (1998) examined the economics of cropping system in left bank canal command area of Tungabhadra project. The cost of cultivation per hectare was higher in mid reach (Rs. 30499.31) an in other reaches (Rs. 27591.86 for head reach and Rs. 27374.93 for tail reach). The gross returns were higher in mid reach of (Rs. 63403.48). The net returns over cost C were Rs. 36,937.09 for head reach, Rs. 36,904.17 for mid reach and Rs. 35,813.34 for tail reach. A decreasing tendency of B:C ratio was noticed as one moved from head reach to tail reach (Rs. 2.34 for head reach, Rs. 2.21 for mid reach and RS. 2.20 for tail reach). Yerriswamy (1999) studied the economics of selected agricultural system in Tungabhadra project area, Karnataka. He reported that cost of cultivation for kharif paddy was Rs. 20,475 for Ancient Irrigated Agricultural System (AlAS), Rs. 24,242.04 for Highly Intensive Agricultural System (HIAS) and Rs. 21,381.17 for Semi Intensive Agricultural System (SIAS). Whereas in rabi/summer the cost of cultivation was Rs. 18,222.97 for AlAS and Rs. 23,143. 35 for HIAS which were lower compared to kharif paddy. The gross returns were found to be higher in HIAS for rabi/summer (Rs. 44,845.54) and it was Rs. 41,063.75 for AlAS which were higher than kharif crop. The benefit cost ratio in HIAS rabi/summer paddy was Rs. 2.25 and it was Rs. 1.81 for HIAS. Suresh (2001) examined the performance of organic farming in Shimoga district of Karnataka. He reported that the cost of paddy cultivation on organic farm was slightly less (Rs. 8,509.52 per acre) when compared to that on inorganic farms (Rs. 8784 per acre). The gross returns were highest in organic farms (Rs. 17, 601.00), while it was Rs. 14,226 per acre for inorganic farming. The net return and B : C ratio were found to be higher in organic farming (Rs. 9,091 per acre and Rs. 2.06) than those for inorganic farming (Rs. 5,441 and 1.61). Narasimham et al. (2003) estimated the cost and returns of paddy in Ynam region of Union territory of Pondicherry. They found that the cost of production of paddy per hectare was highest among all the size groups. The total costs per hectare were high in large farms in both crop I (kharif) and crop II (rabi) with Rs. 18,094.26 and Rs. 19,071.29, respectively. Rental value on own land in the cost of production of crop II was more than crop I in all size groups. Gross returns per hectare was the highest on large farms followed by medium and small farms in both crop I and crop II. Net returns also showed direct relation with the farm size. Tamizheniyan et al (2003) compared the cost of cultivation of IPM demonstration rice plots and non-IPM and rice fields of Tiruvarur district of Tamil Nadu. The per hectare cost of cultivation of IPM fields was Rs. 25,482 with returns of Rs. 41,181 whereas per hectare cost of cultivation of non-IPM farms was Rs. 26,547.47 with returns of Rs. 37,848.36. Nasurudeen and Mahesh (2004) compared the economics of rice cultivation in Karaikal region of Pondicherry (UT). They found that total cost per hectare was Rs. 15,040 and Rs. 19735 for direct sown paddy and transplanted paddy, respectively. The yield level

was found to be more in the case of transplanted paddy (4185 kg/ha) than that in the direct sown paddy (3590 kg/ha). However, net returns were more for direct sown paddy (Rs. 6500/ha) than for the transplanted paddy (Rs. 5375/ha). In spite of the low yield level direct sown paddy proved to be more profitable as it reduced the requirement of resource and cost of cultivation. Pouchepparadjou et al. (2005) examined the economics of paddy cultivation of IPM adopted and non-adopted farms of Union Territory of Pondicherry. It was observed that the IPM adopted farms generated net returns worth of Rs. 5,208 per acre as against Rs. 4,147 per acre net returns of non-adopted farms, which was 26 per cent higher than the nonadopted farms. Radha and Chowdry (2005) studied the cost of seed production as well as commercial production of cotton and compared the costs and returns of seed production and commercial production of cotton in Kurnool district of Andhra Pradesh. The cost of cultivation was very high in seed production of cotton (Rs. 74,412/acre) compared to commercial production of cotton (Rs. 26,461/acre). Human labour, manures and fertilizers cost, plant protection chemical cost and rent for leased in land formed major components of total cost in seed production of cotton whereas human labour, plant protection chemicals cost, manures and fertilizers cost and rent for leased in land formed major components of total cost in commercial production of cotton.

2.2

TECHNICAL AND ALLOCATIVE EFFICIENCY OF PADDY PRODUCTION

Kontos and Young (1983) in their study estimated a frontier production function using cross section data on 83 Greek farms. The results obtained indicated that the mean technical efficiency of the sample forms was 57 per cent, with almost 40 per cent of the sample farms recording less than 50 per cent efficiency and approximately 70 per cent of the farms operated below 60 per cent efficiency level. The study concluded that there was a considerable scope for increasing efficiency of resource use. In other words the existing level of total output could be produced with less factor usage (43% fever on average). Russel and Young (1983) estimated a frontier production function. Timmer's and Kopp's measures of technical efficiency were estimated for a sample of 56 farms in North West England. It was indicated that the two measures of technical efficiency showed similar results. It was further revealed that 36 per cent of the farms were 75 per cent efficient, 75 per cent of the farms were 64 per cent efficient and the efficiency level for the entire sample was 36 per cent. Kalirajan and Shand (1986) investigated the technical efficiency of rice farmers inside and outside the Kemburu Irrigation Project area in Malaysia during 1980. Given the specifications of translog stochastic frontier function for the output of the rice farmers, the Cobb-Douglas model was not an adequate representation of the data. Maximum likelihood method was used for estimation of the parameters of the model and the frontiers for the two groups of farmers were significantly different. It was reported that the individual technical efficiency ranged from about 0.40 to 0.90. The efficiencies for those outside the Kemub Irrigation Project were slightly more. They conducted that the introduction of new technology did not necessarily result in significantly increased technical efficiencies over those of traditional farmers.

An analysis of yield gap in paddy and ragi (irrigated) in Mandya District by Jayaram (1988) using frontier production function showed that technical efficiency was higher in paddy compared to ragi. Technical efficiency for large and small farmers in cultivation of paddy was 97.61. per cent and 97.54 per cent and for ragi it was 94.60 per cent and 92.98 per cent respectively. The input use efficiency was high among large farmers (83%) compared to small farmers (70%) in the case of paddy. However in cultivation of ragi the large and small farms had an input use inefficiency ranging between four per cent and seven per cent. Kumar and Bisaliah (1991) assessed the technical and allocative efficiency of Small

Contact Farmers (SCF) and Large Contact Farmers (LCF) under New Agricultural Extension Project in Karnataka. The results showed that the LCF (91.6% to 92.4%) were operating at a higher frontier than the SCF (87.9% to 90.0%) which resulted in marginally lower technical inefficiency in the LCF group than in SCF. It was reported that the SCF performed better than LCF in input use. The over use of inputs was around 60 per cent in the case of SCF and 75 per cent in the case of LCF. The labour was used at sub optimal level in SCF group, while plant nutrients and capital used by LCF group was as per the allocative efficiency. Rao (1991) computed technical efficiency in sunflower cultivation in Raichur district using Timmer's and Kopp's measure. Irrigated farms achieved 40 per cent technical efficiency both in kharif and rabi. Rainfed farms achieved 43 per cent in kharif and 27 per cent technical efficiency in rabi. Kopp's measure indicated that the actual usage of inputs was 114 per cent to 128 per cent in excess of the required level. The per cent excess inputs use varied from 47 per cent in kharif /rainfed to 67 per cent in rabi and summer irrigated farms. Technical efficiency of subsidised credit under IRDP was examined by Prasad et al. (1991) in arid region of Central India. The results revealed that credit contributed very little to increase the family farm income. Besides, it was reported that the level of credit use efficiency was low. The level of output efficiency in relation to the maximum realizable potential was averaged to 35 per cent which contributed to high level of default in the repayment of the IRDP loans in arid regions of Central India. Jayaram et al. (1992) estimated technical efficiency of rice cultivation and reported higher technical efficiency among large farmer (97.6%) than small farmers (87.54%). It was inferred that the farmer achieved relatively higher levels of physical efficiency in growing rice. On the contrary, the input use among large and small farmer was inefficient. The inefficient use of resources particularly in the case of small farmer indicated non-judicious use of resources such as fertilizer and irrigation. Kautala (1993) assessed the mean technical efficiency of wheat crop grown in reclaimed soil in Haryana and it was 0.76. This implied that the actual output of wheat on an average was 24 per cent less than the frontier output. It was stated that under perfect technically efficient production plan of wheat, farmers would be able to increase the output of wheat by 24 per cent. Hence, it was concluded that farmers could increase the present level of output by increasing technical efficiency at the existing level of inputs without any additional cost. Prasad (1993) in his study indicated the existence of high degree of technical efficiency in groundnut production in Eastern Dry Zone (EDZ). Northern Dry Zone (NDZ), Central Dry Zone (CDZ) and Southern Dry Zone (SDZ). The technical efficiencies were 99 per cent, 88 per cent, 96 per cent and 86 per cent respectively. A moderate degree (66%) of technical efficiency was noticed in North Eastern Dry Zone (NEDZ). Allocative efficiency was fairly low (20 to 30%) in all the zones. Economic efficiency was fairly low in SDZ (13%) and NDZ (24%) because of low allocative efficiency. The results revealed that output attainable was high compared to output achieved. Shanmugam and Palinisami (1993) used frontier production function approach to study the economic efficiency in rice in Srivilliputhur tank in Kamarajnagar district of Tamil Nadu. The results showed that the output loss due to technical inefficiency (26%) was higher than the output loss due to allocative inefficiency (5%). The study indicated that the rice output of "average farmer" could be increased by 26 per cent by adopting the technology followed by the "best practice" farmers. The economic inefficiency revealed that the production could be raised by 29.7 per cent if the technology gaps between "average farmer" and "best practice" farmers were narrowed. Banik (1994) estimated technical efficiency for a sample of 99 farms in a village of Bangladesh. The results showed that 88 farms out of 99 farms achieved a technical efficiency of 71 per cent or above. Thirteen farms showed technical efficiency of 91 per cent to 100 per cent. It was reported that ten out of the thirteen farms belonged to small farm category. It was also observed that tenant farms were technically more efficient than owners farms. Kalirajan and Shand (1994) used frontier production function for studying the efficiency of cotton growers in Madurai district of Tamil Nadu. They developed a method for

estimating farm specific economic efficiency forgone due to technical and allocative risk. The mean economic efficiency of the cotton growers with technical and allocative risk was 68.3 per cent. On an average about 20 to 25 per cent of economic efficiency was lost by the farmers owing to their perceived technical risk and 6 to 7 per cent was lost due to their perceived allocative risk. Thus the study suggested that elimination of both risks had the potential to raise output and profits for a large majority of cotton growers in Madhurai. Parik (1994) used translog frontier production function and examined characteristics of some of the most efficient and least efficient farms with the objective of ascertaining the reasons for inefficiency in North West Frontier Province of Pakistan. He found that farm assets, wealth, contact with extension workers were important factors in the case of efficient farmers, while in inefficient farmers, family size was small, fragmentation was high and there were no contacts with extension personnel. An analysis of technical efficiency through socioeconomic factors suggested that younger farmers with easier access to credit, more education and large assets were more likely to operate the farms efficiently. Shanmugam (1994) estimated economic efficiency of rice production in Ramanathapuram of Tamil Nadu. Technical efficiency indicated the existence of 18 per cent potential for farmers to raise yield at the existing level of resources and technology. Allocative inefficiency was highest in dry areas because of inadequate water supply during critical stages. Allocative inefficiency was lowest for labour. Economic efficiency indicated the scope to raise output by 38 per cent if the production gap between "progressive and average" farms were narrowed through rational allocation of resources. Coclli (1995) reviewed the recent development in the estimation of frontier function and measurement of efficiency. The study also discussed the applicability of these methods in agricultural economics. Frontier production, cost and profit functions were discussed. The two primary methods of frontier estimation, namely economic and linear programming methods were compared. The study concluded that none of the methods of measuring efficiency relative to an estimated frontier was perfect. However, these methods provide substantially better measure of efficiency than simple partial measures, such as output per unit of labour or land. Nilotpal and Krishnamoorthy (1995) in their study worked out technical, allocative and economic efficiencies for different zones in order to estimate differences among zones. The average technical efficiency ranged from 0.74 in BV (Barak Valley) zone to 0.88 in CBV zone (Central Brahmaputra Valley). Allocative efficiency was higher in CBV zone (0.72), which has a relatively dynamic farming system. It was followed by LBV zone (Lower Brahmaputra Valley) with an allocative efficiency of 0.693. Similarly, Upper Brahmaputra Valley (UBV), North Bank Plain (NBP) and Barak Valley (BY) zones had allocative efficiency of 0.66, 0.68 and 0.64 (upper Brahmaputra valley) (North Bank Plain) (Barak Valley) respectively. It was also observed that there was no statistical difference in allocative efficiency of between CBV and LBV zones. Radam and Latiff (1995) studied the technical efficiency for a cross section data of North West Selangon IADP paddy farm and found that the production of paddy in these farms was technically inefficient and the farms could have produced 74 per cent more output than what they have actually produced had they operated with over all technical efficiency. It was reported that the output could have increased upto 101 per cent if optimal efficiency was achieved. Panda (1996) estimated technical efficiency and allocative efficiency among cocoon farmers in Dharmapuri district. They were 86.28 per cent and 87.77 per cent respectively. The technical and allocative efficiencies in Dindigal Anna district were 76.65 per cent and 74.99 per cent respectively. He concluded that the production could be increased through an increased use of disease free laying, better silk germplasm and efficient use of labours. Singh and Nareshkumar (1998) studied the technical efficiency in rice cultivation in Punjab. The analysis of technical efficiency in rice cultivation showed that there was considerable variation in efficiency across regions and size categories of farmers in Hoshirpur district and Sangrur district. The main reason for high technical efficiency was observed to be timely transplanting and application of irrigation, fertilizers and pesticides in appropriate

dosages. Badal and Singh (2001) studied the resource productivity and allocative efficiency in maize production in Bihar. The primary data were collected from 180 farmers from 12 villages of 3 districts of Bihar. The study concluded that resource use efficiency for different inputs varied widely across the crops and there was scope to reallocate the resources in order to achieve optimal allocation of inputs. High Yielding Varieties (HYVs) and rabi maize offered a greater scope for input use for an enhanced productivity compared to any other crop of the region. The use of human labour which was available in abundance could be increased in HYV maize farms in both rabi and khanf as well as on wheat farms for increased profits. Gummagolmath (2000) studied dimensions of soil salinity and water logging in Tungabhadra project command area. His study revealed that the proportion of paddy farms achieving high efficiency on normal soil was more as compared to that on degraded soils. Most of farms on problematic soils were grouped under low efficiency category (58%). About 33 per cent of the farms on normal soils, 28 per cent of farms on moderately saline soils and 25 per cent farms on water logged soils were in the medium technical efficiency category. The average efficiency achieved by the farm on normal soils was high (86%) while it was 64 per cent on water logged soils and 62 per cent on moderately saline soils. Mentesnot (2000) reported that the average level of technical efficiency in sorghum production in North Karnataka was high in the case of hybrid jowar farm than that in traditional variety farm. The minimum estimated technical efficiency was 45.30 per cent and the maximum was 99.98 per cent with a mean technical efficiency level of 77.42 per cent. The technical efficiency for traditional sorghum variety ranged from 0.36 to 0.99. Finally he conducted that farmers adopting new technology attained 0.94 technical efficiency whereas for non adopters, the technical efficiency was 0.79. Mythili and Shanmugam (2000) studied the technical inefficiency of individual farmers using data from 234 rice farms in Tamil Nadu. The maximum likelihood method was used to estimate the frontier function. The technical efficiency varied widely (ranging from 46.5% to 96.7%) across sample farms and was time invariant. The mean technical efficiency was computed at 82 per cent, which indicated that on an average, the realized output could be increased by 18 per cent without any additional resources. Suresh (2001) conducted research on performance of organic farming in Shimoga district of Karnataka. His study revealed an average level of technical efficiency of 0.89 for organic farmers and 0.85 for inorganic farmers. The results suggested that farmers could increase output and thereby, gross income through better use of available resources. Ramarao et al. (2003) analyzed the technical efficiency of rice farms of West Godavari district of Andhra Pradesh. The average level of technical efficiency was estimated to be about 85 per cent indicating that it was possible to improve yield by 15 per cent by following the efficient crop management practices. Shanmugam (2003) studied the technical efficiency of rice farms in Tamil Nadu .The estimated efficiency of kharif season rice was 82 per cent and that of samba season rice was 82 per cent. The estimated mean technical efficiencies of kharif season rice and samba season rice were 82 and 82 per cent, respectively. This study revealed that there was considerable scope for improvement in the productivity of the sample farms. Kumar et al. (2004) assessed the technical efficiency in shrimp farming in India. The average technical efficiency in shrimp farming was 69 per cent. This suggested that there was considerable scope to raise shrimp production at the existing level of input use and technology. About a quarter of the farms were found to be operated below 60 per cent of their potential. Large farmers appear to be more efficient probably because of their greater capital investment capacity. Prabodh and Yanagida (2004) estimated the technical efficiency of small holding paddy farms in Sri Lanka by using stochastic frontier production methodology. They found that the mean technical efficiency of paddy farms was 0.74 (ranging from 0.34 0.95). Factors such as farm size, inorganic fertilizer and method of planting showed significant effect on paddy yield. The major factors influencing technical inefficiency were farmers age,

education, experience and extension assistance. Education and extension assistance were the factors identified as mechanisms to improve the technical efficiency of paddy farms. Reddy and Sen (2004) while studying the technical inefficiency of rice farms of Andhra Pradesh using the frontier production function found that technical inefficiency of the rice farms ranged between 6.67 and 66.42 per cent with an average of 25.55 per cent. The study indicated that there was scope to increase physical production of rice by 25.55 per cent with the judicious use of existing resources and technology. Kumar et al. (2005) estimated efficiency levels of irrigated rice farms of Uttaranchal using Data Envelopment Analysis (DEA) approach. The average level of the overall technical efficiency for irrigated rice farms growing local variety was 75 per cent. The estimated average technical efficiency of farms where improved rice technology had been adopted was 92 per cent. This study suggested that the technical efficiency of rice farms growing local variety could be increased by using the new improved varieties of rice. Pouchepparadjou et al. (2005) analyzed the technical efficiency of IPM adopted and non-adopted rice farms of Pondichery. They found that non-adopted farms were operating at high technical efficiency (0.37), allocative efficiency (0.88) and economic efficiency (0.32) as compared to the technical efficiency of 0.35, allocative efficiency of0.27 and economic efficiency of 0.09 for IPM adopted farms. These results clearly showed that IPM adopted farms have greater potential to boost output through the use of best practice technologies of IPM. Singh (2005) studied the economic efficiency under risk in fish production in South Tripura district. The mean economic efficiency under risk had been estimated at 34.11 per cent. The economic inefficiency due to technical risk (risk arises from inadequate knowledge about best practice techniques) and allocative risk (risk arises from markets or prices) had been found to be 20.86 per cent and 45.03 per cent, respectively.

2.3

FACTORS CONTRIBUTING TO YIELD DIFFERENCE

Using the output decomposition model many researchers have attempted to quantify the contribution of various sources like difference in technique of production or cultural practices and sub-optimal (differences in the) use of inputs to the productivity difference. Empirical studies attempted to isolate influence of input growth (movement along a production function) and technical change (shift of a production function) have been reviewed under. Bisaliah (1977) decomposed the yield difference between the two wheat production technologies in Punjab into it's constituent sources. He found that technique of production contributed 15 per cent of the total change in output (40.50%). The increased use of inputs under Mexican wheat contributed about 25.5 per cent to the total difference in output. Among the different inputs the contribution of fertilizer, capital and labour was 15 per cent, 8 per cent and 2 per cent, respectively. Kunnal (1978) while studying the impact of new technology in jowar output growth in Hubli taluk of Karnataka state using decomposition model estimated the total difference in output at 72 per cent. Of this total difference in output, the improved production practices followed under new technology contributed to the extent of 33 per cent and remaining portion was attributed to the increased use of inputs under new technology vis-a-vis traditional technology. Alshi (1981) studied the impact of technical change on output in cotton economy in Akola district of Maharashtra state. The per hectare production of American cotton and hybrid cotton was 43 per cent and 306 per cent higher than that of desi cotton. The superior cotton cultivation practices followed on American and hybrid cotton farms accounted for 27.77 per cent and 110.57 per cent, respectively to the total difference in cotton output. The sub-optimal use of the production inputs on desi cotton farms compared to their counterparts on other two categories of farms was responsible for 16.14 per cent (American cotton) and 199.87 per cent (hybrid cotton) of lower output. Among all the inputs the sub-optimal use of capital turned out to be the important source of productivity difference.

Using the multiple regression technique Sarup and Pandey (1981) studied the factors responsible for yield gap in wheat. The percentage of area under high yielding varieties of wheat, the percentage of irrigated area and nutrients applied per gross cropped area (kg/ha) were taken as independent variables with the index of potential realization as dependent variable. The highlight of the study was that the percentage of area under high yielding varieties and the application of nutrients have significantly influenced the realization of potential yield on the farmers' field. Indusekharan (1982) using the decomposition analysis estimated the contribution of different inputs like labour, chemical inputs and capital to the cotton productivity in respect of Intensive Cotton District Programme (ICDP) farm. The analysis revealed that about 12.5 per cent of the total increase in cotton output was accounted by these three inputs. Gundurao et al. (1985) fitted the Cobb-Douglas type of production function to the field level data while decomposing the yield difference between local and improved varieties of ragi grown in Bangalore district. The improved variety produced about 45 per cent more output than the local variety. Among the different sources, contributing to yield difference, new technology (improved variety) accounted for the highest share (32%) followed by the capital (15%) and the adoption of transplanting method (14%). Subramanya (1986) reported a significant contribution of difference in input use levels to the yield gaps between the demonstration plots and the farmers' fields. The decomposition analysis of output difference between demonstration plots and the HYV of ragi farms revealed that the superior technique of production followed on the demonstration plots and sub-optimal use of inputs on the farmers' field contributed to the extent of 60 per cent and 13 per cent, respectively. The respective figures for the farmers plots growing local variety of ragi and demonstration plots were 71 per cent and 41 per cent. Basavaraja (1988) while studying yield gaps in cotton crop used the decomposition analysis to assess the contribution of various sources to the yield gap between the farmers' field and the demonstration plots. The decomposition analysis revealed that the difference between the potential farm yield and the actual yield ranged from 53.38 per cent on Dharwad large farms to 58.51 per cent on Raichur small farms. The contribution from the difference in input use to the yield gap ranged from 14 per cent (Raichur) to 54.55 per cent (Dharwad) on large farms. This suggested that a large percentage of untapped potential farm yield could be exploited by using higher doses of inputs particularly on Dharwad farms. The contribution of techniques of production to the productivity difference was negligible (-1.17%) on Dharwad large farms and it contributed to the extent of 43.17 per cent on Raichur large farms. Hiremath (1989) employed the Cobb-Douglas production function through restricted UOP profit function with constant returns to scale. The structural break was observed in A-2 and A-119 bidi tobacco varieties (new technology) over S-20 (old technology). The total estimated output difference of A-2 over S-20 was 105 per cent, of which, the contribution of superior cultural practices and increased use of inputs on A-2 farms was 72 per cent and 33 per cent, respectively. Similarly, the total yield difference between A-119 and S-20 farms was estimated at 154 per cent. The faulty cultural practices and sub-optimal use of inputs on S-20 farms contributed to the extent of 90 per cent and 64 per cent, respectively. Among all the inputs, the sub-optimal use of fertilizer and labour turned out to be the major contributing factors under both the technologies. Chowdary et al. (1993) studied yield gaps in groundnut crop in Ananthapur district of Andhra Pradesh. The reasons for yield gap were analysed through experimental data. The contribution of optimum time of sowing to the productivity was as high as 64.5 per cent of the maximum farm potential. By application of a balanced fertilizer of N and P at the optimum level, the yield could be increased by 53 per cent. Placement of fertilizer through ferti1izercum-seed drill or through an attachment to the country seed drill increased the groundnut yield by 18 per cent. The high yielding varieties contributed to the extent of 34 per cent. Forty per cent of the increased yield was obtained by taking plant protection measures. The optimum seed rate of 125 kgs per hectare increased the yield to the extent of about 17 per cent. A clean cultivation was responsible for increasing the yield by 15 per cent. Deoghare (1993) used the UOP profit function with constant returns to scale to study

the impact of technical change in cotton on yield levels in Maharashtra state. He considered LRA-5166, H-4, AHH-468 cotton hybrids (new technology) and AKH-4 (old technology) for the study. The new varieties (LRA-5166, H-4 and AHH-468) produced 69.52 per cent, 60.37 per cent and 103.97 per cent more output than old variety (AKH-4). Among the various constituent sources the contribution of faulty cultural practices followed on AKH-4 cotton farms was more (40.24%) in case of LRA-5166 cotton, where as relatively higher contribution was observed from difference in input use levels to the yield difference on H-4 (38.37%) and AHH-468 (52.08%) farms. Thakur and Sinha (1994) examined the impact of technical change in rice production in northern and southern regions of Bihar. The technological bias rice production was found to be land and labour saving as well as fertilizer and capital using in northern region. Whereas it was labour, fertilizer and capital using and land saving in southern region. The authors observed that the contribution of a new rice production technology was more pronounced in southern region as compared to the northern region of the state. The total difference in rice output with the introduction of new technology was 43.47 per cent and 47.77 per cent higher in northern and southern regions, respectively. Patil et al. (1997) analysed the constituent sources of yield gaps in groundnut production in Dharwad district of Karnataka state. Multistage random sampling was used to collect data from 120 sample farmers. The decomposition analysis of productivity difference indicated about 28.69 per cent of yield gap between the potential farms and the sample farms. The contribution of techniques of production to the yield gap was comparatively less (3.42). This meant that there was a limited scope for exploiting the untapped farm potential through better techniques of production. The difference in input use was found to contribute more (25.82%) to the productivity difference. There was a vast scope for exploiting the greater yield levels on the farmers' field by increasing the use of inputs. The sub-optimal use of human labour contributed for the highest share (14.36%) among all the inputs. However, the contribution of plant protection chemicals was negative. This implied that reduction in the expenditure on this input would result in a higher output on the farmers field. Badal and Singh (2001) studied the impact of technological change in maize production in Bihar by using decomposition analysis. The total differences in the productivities per hectare between traditional varieties and high yielding varieties (HYVs) of maize were estimated to be 69 per cent in kharif and 80 per cent in rabi. Thirty per cent of total yield increase was attributed to HYVs technology in kharif maize production and the rest (39 %) was attributed to higher input use level on HYVs maize farms.

Gaddi et al. (2002) while studying yield gaps in cotton crop in Dharwad and Bellary districts of Karnataka used the decomposition analysis to assess the contribution of various sources to the yield gap between the farmers field and the demonstration plots. The decomposition analysis revealed that the difference between the potential farm yield and the actual yield ranged from 42.97 per cent on small farms to 40.97 per cent on large farms (the contribution from difference in input use to the yield gap was 18.39 per cent on small farms to the 10.01 per cent on large farms). The differences in techniques of production between the farmers field and the demonstration plots turned out to be major (24.59 on small farms and 30.96 on large farms) contributor to the yield gap while the input use differences contributed about 18.39 per cent on small farms to 10.01 per cent on large farms. This suggested that there was more scope to raise the cotton productivity by improving the techniques of production rather than by raising the input levels. Pouchepparadjou et al. (2005), while studying the effect of IPM on the output of paddy using decomposition analysis noticed that the contribution of technology to the output on IPM adopted farms was around 53 per cent. This result was significant and suggested that IPM technology was an embodied technological change and required the use of a complete package of practices. Only if this was done, the farmer would receive higher yields. Radha and Chowdry (2005) while comparing the economics of seed production and commercial production of cotton in Kurnool district of Andhra Pradesh found that the output

differences between them was 16.40 per cent. Major item contributing to the yield differences was observed to be technical change (64.5%).

2.4 "SRI" METHOD OF RICE CULTIVATION

"SRI" system of Rice intensification was a method of raising rice that produces substantially higher yields with the planting of far fewer seedlings and the use of fewer inputs than either traditional methods (i.e., water) or more "modern" methods (chemical fertilizer or agrochemicals). It involves using different practices for plant, soil, water and nutrient management. This system of Rice intensification has been successfully used in a number of countries. Hatta (1967) revealed that rice plant could survive in saturated soil but could not thrive under hypoxic condition. Magdoft and Bouldin (1970) stated that soil aeration might contribute to greater biological nitrogen fixation by mixing aerobic and anaerobic soil horizons. Puard et al. (1989) have shown that rice is not 'naturally' an aquatic plant. Kirk and Bouldin (1991) reported that the uptake of N by rice roots was independent of the concentration on N at the roots surface. Nemoto et al. (1995) reported that increased occurrence of 4th phylochron depends upon temperature. Tillering and rooting was reduced if transplanting occurs after 4th th phylochron. This might vary from 8 - 12 atmost 15 day. Cassman et al. (1998) reported that the uptake of N by irrigated rice plant was very 'inefficient' often in the range of on 20 - 30%. Ramasamy et al. (1997) studied the role of cytokinins, growth harmone regulating the cell division in plants. The high yields with "SRI" method were attributable in general terms to the shortened phyllocrans - the greater number of growth cycles completed before anthesis which reflects an accelerated rate of cell division and accelerated biological clock. Ying et al. (1998) observed positive correlation between number of fertile tillers per plant and number of grains per panicle in "SRI" practice. Joelibarison (1998) conducted pull test regarding root growth of "SRI" cultivated plants with normal cultivated plants. He observed that under "SRI" conditions single rice plant requires 53 kgs of force when compared with normal conditional rice plant clump of 3 plants which required 28 kg of force. Bonlieu (1999) found a positive correlation between number of panicles and grains per panicle with "SRI" method of rice cultivation and showed that an average increase in yield was associated with large number of weedings. Hirsch (2000) revealed that the combination of plant soils, water and nutrients management practices used in "SRI" promoted a) measurably greater root growth b) corresponding observable increase in tillering, with c) resulting in greater grain filling and d) often higher grain weight yields in "SRI" method (8 t/ha) in Madagascar, where the national average was 2 tonnes. Aziz and Hasan (2000) observed 15 per cent increase in grain weight in "SRI" in Bangladesh. Laguna (2002) reported that SRI was proved to be an effective water saving technique which incurred (50%) less seed costs and costs on other inputs. Weeding was easier since the seedlings were distanced further apart. Stoop et al. (2002) reported that the SRI helped resource limited farmers to realize yields upto 15 t/ha on poor soils with no use of external inputs and with greatly reduced rates of irrigation in madagascar. Uphoff and Fernandes (2002) compiled the main findings and comments reported

from SRI adopted countries. Specific advantages mentioned were increased yield levels of 4 8 tonnes per hectare, increased returns to labour and environmental benefits, while saving most of the resources. But, requirement of more labour and seedling mortality were reported to be the constraints for SRI method. Anthofer (2004) studied the performance of SRI cultivation in Cambodia and found that SRI increased yield level from 1629 kg per ha to 2289 kg per ha (41%), while increasing both land and labour productivity and lowering the expenditure on seeds and fertilizers. The per hectare gross margin of SRI was $120 as against $209 in conventional method (74% more). Economic risk was also less in SRI to achieve same desired per hectare gross margin than that in conventional method. Barret et al. (2004) analyzed the performance of System of Rice Intensification (SRI) in Madagascar. The results showed that SRI method increased factor productivity by 37.4 per cent, while an additional 49.5 per cent increase was attributable to skillful use of the method. Kumar and Shivay (2004) reported the benefits associated with the SRI. Greater root growth, increased tillering, increased grain filling, saving in inputs like less water requirement, less seed rate etc. and increased factor productivity and profitability were some of the benefits. Rekha (2004) compared the SRI method of cultivation with the traditional method of cultivation of Njavara, a medicinal rice variety grown in Kerala and found that the yield was increased by three folds under the SRI compared to the yield obtained under traditional method with the net profit of Rs. 80,000 per hectare. Yang and Suon (2004) reported that SRI method had required 46 per cent lesser seed rate and 50 per cent lesser expenditure on chemical fertilizers, while decreasing 71 per cent labour requirement and increasing 41 130 per cent yield as against traditional method. Rajendra (2005) studied the performance of SRI of (early rice) Bansahan variety in Magan district, Nepal. The per hectare yield of SRI was 8.5 tonnes as against 4 tonnes of traditional method. He observed that SRI required less seed rate (5 10 kg) and small quantities of water to achieve the mentioned yield level. Reddy et al. (2005), while comparing the economics of normal rice (transplanted) and SRI method rice found that the total operations cost of SRI method of rice (Rs. 9456.29/acre) was higher than the total operational cost of normal rice (Rs. 8235.72/acre). However, net returns per acre was high in the case of SRI method of rice (Rs. 7805/acre) than the normal rice (Rs. 5915/acre). The major attributing factor for the high operational cost in SRI method of rice was human labour. The study revealed that the higher total operational costs were compensating the yield advantage of SRI method of rice. Nevertheless, SRI method of rice reduced the water requirement, which was not accountable in the free-regime of power supply to agriculture. After thorough review of the above findings, it could be revealed that rice plant can survive in saturated soil but cannot thrive under hypoxic condition, the weeding with rotary weeder could mix aerobic and anaerobic soil horizons, flooded conditions results in root die back, large and healthy root growth increased biological nitrogen fixation more tillering and more yield were found in "SRI" method of Rice cultivation.

III. METHODOLOGY
This chapter deals with the description of the study area, the sampling design followed, the nature and sources of data and analytical techniques employed. At the end of this chapter, important terms and concepts used in the study are defined to facilitate a clear understanding. The methodology is presented under the following major heads. 3.1 3.2 3.3 3.4 3.5 Description of the study area Sampling design Nature and sources of data Analytical techniques employed Definition of terms and concepts used

3.1

DESCRIPTION OF THE STUDY AREA

The present study was undertaken in Prakasam and Guntur districts of Andhra Pradesh. SRI method of rice cultivation was widely practiced in these two districts. Therefore, these two districts were purposively selected for the present study. These districts come under Krishna-Godavari Agro-climatic Zone(K-G Zone) of Andhra Pradesh.

3.1.1 Salient features of Prakasam district

The district lies between 15 -30 and 16 N latitude and 79 and 80 E longitude with a geographical area of 17.6 lakh ha and it is bound on the North by Guntur district, on the West by Kurnool and Kadapa districts, on the South by Nellore district and on the East by Bay of Bengal. According to 2001 census, the population of the district was 30.55 lakh with a literacy rate of 58 per cent. Urban and Rural population of the district are 4.67 and 25.88 lakhs, respectively. Working population comprises 18.94 lakh. Average annual rainfall is 840 mm with minimum temperature of 21.50C and maximum being 390C. There are 45 markets, 293 bank branches and 987 rice mills in the district. Land holding pattern comprises of 1.51 lakh marginal holdings, 3.47 lakh of smallholdings and 3.01 lakh of large holdings. The district has 4.42 lakh ha of forest land, 1.50 lakh ha of barren and uncultivable land, 1.46 lakh ha of land put to non-agricultural uses, 0.64 lakh ha of culturable waste, 0.65 lakh ha of permanent pasture and other grazing lands, 0.1 lakh ha of miscellaneous tree crops not included in net area sown, 1.42 lakh ha of current fallows, 1.04 lakh ha of other fallow lands, 0.02 lakh ha of area under fish ponds, 5.84 lakh ha of net area sown, 6.47 lakh ha of total cropped area and 0.63 lakh ha of area sown more than once. Net irrigated area of the district is 59,967 ha. The major soils of the district are black, red and coastal sand. The major crops grown in the district are rice, cotton, tobacco, maize, chickpea and sorghum.
0 0

3.1.2 Salient features of Guntur district

The district lies between 15 18' and 16 50' N latitude and 70 10' and 80 55' E longitude. It is bounded by Krishna district in the North. Krishna and Nalgonda districts in West, Prakasam district in the south, Bay of Bengal in the East. According to 2001 census, the total population of the district was 44.65 lakh with a literacy rate of 59 per cent with a total geographical area of 11.4 lakh ha. Urban population (12.85 lakhs) is less than rural population (31.79 lakhs). Working class of the district is 21.9 lakhs. There are 52 markets, 378 bank branches and 1215 rice mills in the district. The district receives 851 mm of rainfall on an 0 0 average annually with 21 C of minimum temperature and 39.5 C of maximum temperature. Land holding distribution is dominated by large holdings (3.92 lakh) followed by small holdings (3.67 lakh) and marginal holdings (1.6 lakh). This district comprises 1.61 lakh ha of forests, 0.35 lakh ha of barren and uncultivable land, 1.5 lakh hectares of land put to non-agricultural uses, 0.36 lakh hectare of culturable waste, 0.24 lakh ha of permanent pasture and other
0 0 0 0

Table 3.1: General information of Guntur and Prakasam districts Sl. No. 1. 2. Area Population Total Urban Rural 3. 4. 5. 6. Literacy rate Working population Normal rainfall Temperature Minimum Maximum 7. Major crops Rice Cotton Jowar Bajra Groundnut Tobacco % No. mm
0

Item

Unit Lakh ha No.

Guntur 11.328

Prakasam 17.626

4465144 1285760 3179384 55 2190299 851

3054941 466709 2588232 58 1894356 840

C 21 39.5 Rice Cotton Tobacco Maize Chickpea Groundnut 21.5 39

8. 9. 10. 11.

Markets Banks Rice mills Land holding Marginal Small Large

No. No. No. No.

52 378 1215

45 293 987

160173 367291 392451

151216 347426 301887

Source : Chief Planning Officers, Guntur and Ongole

Table 3. 2: Land utilization pattern in Guntur and Prakasam districts (Area in hectares) Category Forest land Barren and uncultivable land Land put to non-agriculture uses Culturable waste Permanent pastures and other grazing lands Miscellaneous tree crops not included in net are sown Current fallows Other fallow lands Net area sown Area under fish ponds Total geographical area Total cropped area Area sown more than once Source: Chief Planning Officers, Guntur and Ongole Table 3.3: Paddy cultivation in the study area Revenue division District a. b. 2. a. b. Mandal Mandal District Mandal Mandal Guntur 161940 34470 150124 35898 24278 40469 Prakasam 442499 150887 146779 64894 65763 10343

60446 30765 587231 7201 1132823 766883 179652

142215 103867 584561 2253 1714061 647597 63036

Sl. No. 1.

Name Prakasam S. N. Padu Karamchedu Guntur Ponnuru Piduguralla

Paddy area (ha) 110000 5960 9100 288879 13434 6177

Source: Joint Director of Agriculture, Prakasam district Joint Director of Agriculture, Guntur district

grazing lands, 0.40 lakh ha of miscellaneous tree crops not included in net area sown, 0.60 lakh ha of current fallows, 0.30 lakh ha of other fallow lands, 5.87 lakh ha of net area sown, 0.07 lakh hectare of area under fish ponds, 7.66 lakh ha of total cropped area and 1.79 lakh ha of area sown more than once. It has predominantly black cotton soil, with annual normal rainfall of about 989.1 mm. The district enjoys irrigation from the Krishna river. The major crops of the district are paddy, cotton, sorghum, chilli, tobacco, blackgram and turmeric.

3.2

SAMPLING DESIGN

The study was based on the input-output data obtained from sample farmers in Prakasam and Guntur districts. For selection of farmers, multi-stage sampling design was employed. In this procedure, at first stage, two major paddy growing districts following both traditional and SRI method of rice cultivation were purposively selected. From each district, two major paddy growing mandals following both the methods of rice cultivation were selected at second stage. Then at third stage, three major paddy growing villages following traditional and SRI methods of rice cultivation were selected from each mandal. In the final stage, ten farmers were randomly selected from each village comprising five farmers for SRI method and five farmers for traditional method of rice cultivation. Thus, the total sample size was 120.

3.3

NATURE AND SOURCES OF DATA

For evaluating the specific objectives of the study, necessary primary data were obtained from the sample farmers through personal interview with the help of pre-tested and well structured schedule (Appendix I). The data so collected pertained to the kharif season of the agricultural year 2005-06. The data relating to general information about the sample farmers, their assets position, cropping pattern, details on various inputs used in paddy cultivation like chemical fertilizers, plant protection chemicals, seed materials and labour and cultivation practices such as land preparation, transplanting, irrigation, intercultivation and harvesting along with labour requirement were collected. The adoption levels of the recommended methods of SRI method of paddy cultivation, its advantages and the constraints for it were also elicited.

3.4

ANALYTICAL TECHNIQUES EMPLOYED

For the purpose of achieving the objectives of the study, the data collected were subjected to the statistical analysis. For this purpose, tabular and production function analyses were employed.

3.4.1 Tabular analysis

The technique of tabular presentation was used to assess the cost, returns and profits of paddy crop in the study area. The percentage and averages were computed and compared to draw meaningful inferences. The farm management cost concept approach is widely used in India for evaluating crop profitability in production. The cost concepts in brief, are Cost A1, Cost A2, Cost-B and Cost-C. The different cost items that are included under each cost concept are detailed below with their imputational procedures.

Fig. 1. Map of Andhra Pradesh showing the selected study districts Guntur and Prakasham

Table 3. 4: List of selected villages

Sl. No. 1.

District Prakasam

Mandal S. N. Padu

Village Santanuthalapadu Madduluru Vemulapadu

Karamchedu

Karamchedu Swarna Keshavarapadu

2.

Guntur

Ponnuru

Jarlupadu Nidubrolu Chadalvada

Piduguralla

Piduguralla Jangarapadu Jakkampadu

Fig. 2: Schematic representation of sampling design

Cost-A1 : It includes the value of Casual hired labour Attached labour Imputed value of owned bullock labour Hired machine labour Imputed value of owned machine labour Seeds Manures and fertilizers Plant protection chemicals Irrigation charges Interest on working capital Depreciation Land revenue Cost-A2 : Cost A1 + rent paid for leased in land, if any Cost-B : Cost A2 + imputed rental value of owned land + interest on owned fixed capital. Cost-C: Cost B + imputed value of family labor In the present study, the rent paid for leased in land was zero, as none of the sample farmers took land on lease basis. Hence, cost Al and cost A2 are similar and are simply called as cost-A.

3.4.3 Production function analysis

To capture the ability of the farmer to achieve the maximum realizable crop output with given level of inputs under the existing situation and given technology, careful examination of farm specific technical efficiency and input specific allocative efficiency of the farms is necessary. Cobb-Douglas production function was used to study the technical and allocative efficiency. The Cobb-Douglas production function is the most widely used form of production functions for fitting agricultural production data, because of its mathematical properties like ease of interpretation and computational simplicity. In the present study the Cobb-Douglas production function in the log form was defined as follows. Ln Y = In b0 + b1 In X1 + b2 In X2 + b3 In X3 + b4 In X4 + b5 In X5 + b6 ln X6+lnu -------------- (1)

Where, Y = Output in quintal/farm X1 = Seeds in kgs/ farm X2 = Human labour in mandays/ farm X3 = Fertilizer in kg/ farm X4 = Farm yard manure in t/ farm X5 = Plant protection chemical and Miscellaneous expenditure in Rs/ farm X6 = Land in hectares

u = Error term The CD function was estimated by using OLS method assuming the error term (u) to be randomly and normally distributed. In this case about half of the observations will lie above and about half below the OLS estimated function. Thus average production function estimated through OLS does not distinguish between technically efficient and technically inefficient farms. It ignores the problem of technical efficiency by assuming that all the techniques of production are identical across farms and as such it assumes that each farmer is technically efficient, which is untrue. Timmer (1971) modified the procedure in a number of ways and evolved an out put based measure of technical efficiency.

The Cobb-Douglas (CD) function was transformed into a deterministic frontier function by imposing a constraint on error terms to be positive. The deterministic frontier was defined as n bi ui Y = Xi e ; u < 0 ----------------(2) i=0 Where, Y Xi ui = Output = Inputs = Error term

The production function was estimated using corrected ordinary least square for transforming it to deterministic frontier production function. As a first step, ordinary least square was applied to the CD function to yield best, linear and unbiased estimates of bi coefficients. The intercept estimate (b0) was then corrected by shifting the function until no residual is positive and one becomes zero. This has been done by adding the largest positive error term to the intercept. The new production function with the shift in the intercept is the deterministic frontier production function and it gives the maximum output obtainable from given level of input and it would be of the form. n In Y* = A+ bi 1nXi + u i=1 u < 0 -----------------(3)

The Timmer measure of technical efficiency (TE) is the ratio of actual output to the potential output on the deterministic frontier production function.

Timmers measure of TE = Where, Yi = Actual output of ith farm

Yi Yi*

-----------------(4)

Yi* = Maximum output obtainable on ith farm Yi* is estimated by substituting i farmer's level resources into the estimated deterministic frontier production function. Kopp (1981) suggested an alternative approach within the Farrell framework. Here the measure of technical efficiency compared the actual level (Xi) of input used to the level (Xi*) at which it should be used, by farm 'i', to obtain the same output Y, but at the efficient level. This level of input (Xi*) to realize the same output Y is calculated as follows. If, 1n Y = b0* + b1 1nX1 + b21nX2 + ..+ e
th

Let R1 =

X1 X2

, R2 =

X1 X2

,Rn-1 =

Xn X2

Then, lnX2 =

lny - b0 - b1lnR1- bnlnRn-1 n bi i=1 -------------------(5)

1nX1*, 1nX3*. 1nXn* is calculated in a similar fashion. X1*, X2*, X3*, X4*,Xn* indicate the frontier values of the corresponding input use. Then, the technical efficiency of the ith farm would be. X2* TEi = X2 = Xn* X1* ------- = ------------------(6) Xn X1

Using Kopp measure of technical efficiency the frontier usage of input was worked out and compared with the actual usage of inputs to know the savings in input use had the farm operated at higher efficiency level. The Allocative Efficiency (AE) in the use of variable inputs is worked as the ratio of, Y* Yi**

AEi = Where,

------------------(7)

Yi** = Output at the optimum level of all inputs on ith farm Yi* = Maximum output obtained on ith farm Farm specific optimum input level (Xi*) is calculated by equating marginal product of an input with its input-output price ratio. A simple manipulation of first order condition of output constrained profit maximization equation gives optimum values of inputs (Xi*) as below. Pi 1/1-bi -------------------(8) Z
bi

Xi* = Where,

Z = Pi/Pb0bi Xi

n-1 i-1

Pi = Per unit price of input (i) P = Price of output per unit In order to determine optimal use of a resource, keeping the use of other resources constant, MVP and opportunity cost (factor cost) of that resources were compared. The marginal product (MP) was estimated from the parameters of Cobb-Douglas production function and the geometric mean levels of the output and input. The MVP of each resource was calculated. The formulae used to compute MVP is, Y MVP (Xi) = bi Py -------------------(9) Xi Where, bi = Elasticity of production of i input
th

Y Xi Py

= Geometric mean of output = Geometric mean of i input = Price of the product

th

The criterion for determining optimality of resource use was, MVP/MFC > 1 under utilization of resource MVP/MFC = 1 optimal use of resource MVP/MFC < 1 excess use of resources Finally, Economic Efficiency (EE) was estimated as the product of technical efficiency and allocative efficiency. EE = TE AE ---------------------(10)

3.5.6 Decomposition analysis

The output decomposition model as developed by Bisaliah (1977) was used for investigating the contribution of various constituent sources to the productivity difference between the SRI method and the traditional method of rice cultivation. For any two production functions, the total change in the productivity could be brought out by shifts in the production parameters that defined the production function itself and by the changes in the input use levels. Therefore, the production functions were considered as the convenient econometric tools for decomposing the productivity difference between the two methods of cultivation. Two separate production functions, one for SRI method of cultivation and another for traditional method were fitted as follows. In logarithm form, Cobb-Douglas production function for SRI method of paddy is; LnYs = lnbs0 + bs1 lnXs1 + bs2 lnXs2 + bs3 lnXs3 + bs4 lnXs4 + bs5 lnXs5 + bs6 lnXs6 + Us -------------------(11) Logarithm form of Cobb-Douglas production function for traditional method of paddy is; lnYT = ln bT0 + bT1 lnXT1 + bT2 lnXT2 + bT3 lnXT3 + bT4 lnXT4 + bT5 lnXT5 + bT6 lnXT6 + UT ----------------------(12) Taking differences between (11) and (12) and adding some terms and subtracting the same terms. lnYs - lnYT = (ln bS0 ln bT0) + (bS1 lnXS1 bT1 lnXT1 + bS1lnXS1 bS1lnXS1) + (bS2 lnXS2 bT2 lnXT2 + bS2 lnXS2 bS2 lnXS2) + (bS3 lnXS3 bT3 lnXT3 + bS3 lnXS3 bS3 lnXS3) + (bS4 lnXS4 bT4 lnXT4 + bS4 lnXS4 bS4 lnXS4) + (bS5 lnXS5 bT5 lnXT5 + bS5 lnXS5 bS5 lnXS5) + (bS6 lnXS6 bT6 lnXT6 + bS6 lnXS6 bS6 lnXS6) + (U2 U1) ---------------------------- (13) By using logarithm rule equation (13) becomes; ln (YS/YT) = { ln [bS0/ bT0) } +{ (bS1 bT1) lnXS1 + (bS2 bT2) lnXS2 + (bS3 bT3) lnXS3 + (bS4 bT4) lnXS4 + (bS5 bT5) lnXS5 + (bS6 bT6) lnXS6 } + { bS1 ln (XS1/XT1) + bS2 ln (XS2/XT2) + bS3 ln (XS3/XT3) + bS4 ln (XS4/XT4) + bS5 ln (XS5/XT5) + bS6 ln (XS6/XT6) }+ [(U2 U1)] ------ (14) This is the decomposition model for decomposing the productivity difference between the SRI method and the traditional method of rice cultivation. This equation involves decomposing the logarithm of ratio of per hectare productivity of SRI and traditional method of rice cultivations (LHS). This is approximately a measure of percentage change in per hectare output between the SRI cultivation and traditional cultivation. The summation of first and the second terms on the right hand side of the decomposition model together represented the productivity difference between the SRI method and traditional method, attributable to the difference in the cultural practices. The third

term provided the productivity difference between the SRI cultivation and traditional cultivation attributable to the differences in the input use. Dummy variable Technique To examine whether the parameters of the production function of SRI method were different from those of the traditional method Dummy variable technique was used. The following dummy variable model introducing intercept and slope dummy was specified. Ln Q = ln b0 + b1 In X1 + b2 In X2 + b3 In X3 + b4 In X4 + b5 In X5 + b6 ln X6 + cD +d1 (DlnX1)+d2 (DlnX2)+ d3 (DlnX3) + d4 (DlnX4)+d5 (DlnX5) + d6 (D lnX6)+ lnu --------------------------(15) Dummy values: D = 1 If it is SRI method D = 0 if it is traditional method

3.5

DEFINITION OF TERMS AND CONCEPTS USED

3.5.1 Technical efficiency

Hazarika and Subramanian (1999) defined technical efficiency as the production of maximum output from a set of given resources.

3.5.2 Allocative efficiency

Farell (1957) defined allocative efficiency as the ability of a farm to maximize profit by equating the marginal revenue product of inputs to their respective marginal costs.

3.5.3 Human labour

Human labour was estimated in terms of eight hours of work per day. The women labour days were converted into man days on the criterion that one women day is equal to 0.60 man day on the basis of wage rate equivalent. The prevailing wage rates in the study area were Rs. 50 per male labour and Rs. 30 per female labour.

3.5.4 Bullock labour

Bullock labour is defined in bullock pair days, both owned and hired were charged at the prevailing rate paid per day (8 hours) in the study area.

3.5.5 Machine labour

The cost of machine labour both owned and hired was calculated at the different rates for the different type of operations prevailed in the study area.

3.5.6 Seeds
The cost of the seed was calculated at the local market price for the farm produced seeds and actual expenditure incurred in the case of purchased seeds

3.5.7 Farm Yard Manure (FYM)

The quantity of FYM used in the cultivation of paddy was measured in terms of tractor load. The cost was imputed at the market price in the village including cost of transportation and other incidental charges if any.

3.5.8 Fertilizers and plant protection chemicals

Cost of fertilizers and plant protection chemicals were based on the actual prices paid by the sample farmers including the cost of transportation and other incidental charges if any.

3.5.9 Irrigation charge

Per crop irrigation charges as fixed by the government was taken for computing irrigation charge.

3.5.10 Land revenue

Land revenue was charged at the rates levied by the government

3.5.11 Rental value of land

It was imputed by taking the prevailing rents in the study area per acre per annum.

3.5.12 Interest on working capital

Interest on working capital was calculated at the rate at which banks were advancing short-term loans. The prime lending rates during the agriculture year were 8.00 per cent for crop loan of paddy. It was charged for a period of six months for paddy crops.

3.5.13 Interest on fixed capital

Interest charges on fixed capital was calculated at the rate of 11 per cent per annum as it was the rate of interest charged on long-term loans by commercial banks. This interest was worked out on the values of fixed assets, after deducting depreciation for the year. It was apportioned on the basis of the area of land under each crop grown by the farmer during the study period.

3.5.14 Depreciation
The depreciation was calculated by the straight line method. The charges on account of minor repairs of implements and machinery during the year were added to the depreciation charges. It was apportioned on the basis of area of land under each crop grown during the year.

3.5.15 Total cost of cultivation

Cost of cultivation included variable costs and fixed costs. Variable costs included the cost of human labour, bullock labour, machine labour, seeds, farmyard manure, plant protection chemicals, irrigation charge and interest on working capital. Fixed costs comprised depreciation, land revenue, rental value of land and interest on fixed capital.

3.5.16 Gross return

The gross returns was computed by multiplying the quantity of main product and byproduct obtained with respective prices received.

IV. RESULTS
This study is conducted in Prakasam and Guntur districts of Andhra Pradesh. The necessary data were collected from the sample farmers spread over four mandals of the above-mentioned districts. The data were subjected to various statistical tools to draw meaningful conclusions. The main results of the study are presented in this chapter under the following heads. 4.1 4.2 4.3 4.4 4.5 4.6 4.7 General characteristics of sample farmers Nursery cost in traditional and SRI methods of paddy cultivation Costs and returns structure in traditional method and SRI method of Paddy production Technical and allocative efficiency in traditional and SRI methods of paddy production Structural break and nature of technological change between the traditional and SRI method of paddy production Sources contributing to the yield differences between traditional and SRI methods of paddy production Adoption levels and constraints in SRI method of paddy cultivation.

4.1

GENERAL CHARACTERISTICS OF SAMPLE FARMERS

An understanding of general characteristics of sample farmers is expected to provide birds eye view of the general features prevailing in the study area. Therefore, an attempt has been made in the study to analyse some of the important characteristics of the sample farmers. The general characteristics of the respondents are presented in Table 4.1, Table 4.2 and Table 4.3. The average age of the farmers growing paddy in traditional method was around 41 years whereas the average age of the farmers growing SRI paddy was around 37 years. The average family size of the traditional paddy farmers was 7, consisting 4 male and 3 female members, respectively but in the case of SRI paddy farmers, the average family size was 6 with 4 male and 2 female members. Half of the traditional paddy farmers were found to be illiterates whereas none of the SRI paddy farmers were illiterate and majority of them were having secondary or higher education. The average land holding of traditional paddy farmers and SRI paddy farmers was 3.53 and 5.00 hectares, respectively. The livestock composition of both traditional paddy farmers and SRI paddy farmers was dominated by higher number of buffaloes. SRI paddy farmers comparatively had more number of livestock than traditional farmers. The machinery status of farmers of both the methods was dominated by power sprayer. SRI paddy farmers machinery status was higher than that of traditional paddy farmers. However, it was observed that SRI paddy farmers were having tools like line marker and conoweeder in addition to the general implements. Crops grown by traditional paddy farmers were paddy, cotton, chilli, maize and turmeric during kharif season and paddy, tobacco, turmeric, sorghum, chickpea, blackgram and maize for other seasons (rabi or summer) as compared to paddy, SRI paddy, cotton, sugarcane, chilli, turmeric, maize and sorghum for kharif season and paddy, SRI paddy, tobacco, sugarcane, turmeric, maize, sorghum, chickpea and blackgram for other seasons (rabi/summer) for SRI paddy farmers. It was observed that SRI paddy farmers were growing more number of crops per year. The proportion of paddy area to net sown area was 44.68 per cent for farmers of traditional method and 44.36 per cent for farmers of SRI method.

Table 4.1: General characteristics of sample farmers Sl. No. 1. 2. a. b. 3. a. b. c. d. e. Traditional method 40.51 6.65 4.12 2.53

Particulars Age (years) Family size (No.) Male Female Education status (No.) Illiterate Primary Secondary Pre-university University

SRI method 36.63 5.95 3.66 2.28

30 17 7 4 2

0 13 26 15 6

Table 4.2: Asset position of the sample farmers Sl. No. 1. a. b. 2. a. b. c. d. e. 3. a. b. c. d. Items Land holding (ha) Irrigated Unirrigated Livestock position (No.) Bullock pair Cows Buffaloes Sheep/goat Poultry birds Machinery (No.) Tractor Power sprayer Pump set Bore well 0.075 0.495 0.07 0.053 0.087 0.85 0.093 0.087 0.40 0.70 1.70 1.08 1.53 0.50 1.39 2.85 1.60 2.16 Traditional method 3.53 2.86 0.67 SRI method 5.00 3.99 1.21

Table 4.3: Cropping pattern of the sample farmers Area in ha. Total Area Season Crops Traditional Kharif Paddy Cotton Chilli Maize Sorghum Turmeric Sugarcane 1.55 0.84 0.64 0.22 0.00 0.28 0.00 SRI 2.05 0.65 0.58 0.43 0.28 0.32 0.69

Rabi/summer

Paddy Chickpea Tobacco Maize Sorghum Turmeric Blackgram

1.56 0.15 0.48 0.24 0.16 0.45 0.39

2.08 0.20 0.65 0.31 0.23 0.50 0.34

Paddy area to net area sown (%) Area under SRI

44.68 -

44.36 0.64

4.2 NURSERY COST IN TRADITIONAL AND SRI METHODS OF PADDY PRODUCTION

As there was difference in nursery management between traditional and SRI methods, resource use pattern and the expenditure made on the various inputs were analyzed and the same are presented in Table 4.4 & Fig. 3. Traditional paddy farmers have used 73.63 kg of seed, 18.34 kg of fertilizer, 200.51 ml of PPC and 2.78 mandays of human labour as against 5.31 kg of seed, 172.46 kg of FYM, 20.73 ml of PPC and 1.15 mandays of human labour used by SRI paddy farmers. The major expenditure item of nursery cost was expenditure made on seeds in traditional paddy (Rs. 921.63) and SRI paddy (69.48). The expenditure made on FYM in traditional nursery management was zero but the expenditure made on fertilizers in SRI nursery management was zero. The expenditure made on PPC (Rs. 87.23) and labour (Rs. 139) in traditional nursery management was higher than those in SRI nursery management (Rs. 8.21 and Rs. 57.5, respectively). The total nursery cost in traditional method (Rs. 1374.36) was clearly higher than the total nursery cost in SRI method (Rs. 178.29). The share of seed was around 67 per cent contributing largely to the higher total nursery cost in traditional method. In SRI method also the expenditure on seeds accounted to a major share (38.97%). In both the methods, the share of PPC in total nursery cost was lowest (6.34% and 4.60% in traditional and SRI methods, respectively).

4.3

COSTS AND RETURNS STRUCTURE IN TRADITIONAL AND SRI METHODS OF PADDY PRODUCTION

The profitability aspect of both the methods of paddy cultivation in the study area has been analysed by computing per hectare cost and returns. The pattern of inputs used in both the methods of paddy cultivation for sample farmers is depicted in Table 4.5. A glance at the table indicated that farmers of traditional paddy were found to use more of seeds (73.63 kg), N fertilizer (156.46 kg), P fertilizer (68.43 kg), K fertilizer (82.95 kg) and plant protection chemicals (1939.8 ml) as against 5.31 kg of seeds, 141 kg of N fertilizer, 62.68 kg of P fertilizer, 80.19 kg of K fertilizer and 798.21 ml of plant protection chemicals by SRI paddy farmers. However, SRI paddy farmers used 185.66 mandays of human labour, 8.4 pair days of bullock labour, 86.75 hours of machine labour and 8.4 tonnes of farmyard manure, which were more against 141.39 mandays of human labour, 4.29 pair days of bullock labour, 84.61 hours of machine labour used by traditional paddy farmers. Irrigation charges, rental value of land and interest on fixed capital were found to be more for traditional paddy farmers, whereas interest on working capital and depreciation were found to be more for SRI paddy farmers. The per hectare cost of cultivation (Rs. 28088.63) for SRI paddy was more when compared to that (Rs. 26655.51) of traditional paddy. The share of human labour in total cost was 26.52 per cent (Rs. 7069) for traditional paddy farmers and 33.05 per cent (Rs. 9283) for SRI paddy farmers. The expenditure made on machine labour was 16.61 per cent and 16.21 per cent, respectively for traditional paddy farmers and SRI paddy farmers. The next important item of expenditure in both the methods of paddy cultivation was the expenditure made on fertilizers, which worked out to be 13.99 per cent and 12.28 per cent, respectively for traditional and SRI paddy farmers. The rental value of land was the major expenditure contributing to the fixed cost (12.97% and 12.06%, respectively for traditional paddy farmers and SRI paddy farmers). The share of variable cost was 84.46 per cent (Rs. 22513) to the total cost in traditional paddy and 84.89 per cent (Rs. 23846) in SRI paddy cultivation. The variable cost was found to be less by about Rs. 1333 in traditional method, when compared to that in SRI method. The share of fixed cost was 15.54 per cent (Rs. 4143) and 15.11 per cent (Rs. 4243) for traditional and SRI paddy farmers, respectively (Fig.4). The per hectare paddy output obtained in both the methods is presented in Table 4.6 & Fig.5. The yield per hectare realized in traditional method was 6.07 tonnes. The paddy yield realized by SRI paddy farmers was 8.51 tonnes per hectare. There was a glaring difference between the two methods in the paddy straw yield. Traditional paddy farmers obtained 4.96 tonnes per hectare and SRI paddy farmers realized 5.82 tonnes per hectare.

Table 4.4: Particulars of raising nursery for paddy cultivation Traditional method Particulars Quantity Seed (kg) 73.63 Value (Rs.) 921.63 (67.05) 0.00 (0.00) 91.61 (6.66) Quantity 5.31 Value (Rs.) 69.48 (38.97) SRI method

Sl. No.

1.

2.

FYM (kg)

0.00

172.46

43.10 24.17)

3.

N (kg)

8.43

0.00

0.00 (0.00) 0.00 (0.00) 0.00 (0.00) 8.21 (4.60)

4. 5. 6.

P (kg) K (kg) Plant protection chemicals (ml) Labour (mandays)

4.47 5.44 200.51

89.42 (6.50) 45.47 (3.30) 87.23 (6.34)

0.00 0.00 20.73

7.

2.78

139.00 (10.11) 1374.36

1.15

57.5 (32.25)

Total

178.29

Note : 1. Figures in parentheses are percentage to the total 2.Area of nursery plot is 13.14 cents for traditional method and 2.64 cent for SRI method per hectare. 3.Nursery duration : 26.5 days for traditional and 10.7 days for SRI

Traditional paddy

Labour (mandays) 10% Plant protection chemicals (ml) 6% Fertilizer 16%

Seed (kg) 68%

SRI paddy

Labour (mandays) 32%

Seed (kg) 39%

Plant protection chemicals (ml) 5%

FYM 24%

Fig.3: Nursery cost for traditional paddy and SRI paddy

Table 4.5: Per hectare input use pattern in traditional and SRI method of paddy cultivation Sl. Particulars No. A. Variable costs 1. Seeds 2. Fertilizers N P K 3. Farmyard manure 4. Plant protection chemical 5. Human labour 6. Bullock labour 7. Machine labour 8. Interest on working capital @ 8% 9. Irrigation charges Sub total B. Fixed costs 12.51 (0.05) 3457.95 (12.97) 290.41 (1.09) 381.75 (1.43) 4142.62 (15.54) 26655.51 12.5 (0.04) 3387.75 (12.06) 468.59 (1.67) 374.02 (1.33) 4242.86 15.11) 28088.63 Kg Kg Kg Tonnes Ml Mandays Pairdays Machine hours 156.46 68.43 82.95 4.334 1939.8 141.39 4.29 84.61 1712.2 (6.42) 1365.47 (5.12) 663.88 (2.45) 1078.19 (4.04) 2552.06 (9.57) 7069.5 (26.52) 553.69 (2.08) 4426.15 (16.61) 1667.62 (6.26) 514.47 (1.93) 22512.89 (81.46) 141.00 62.68 80.19 9.24 798.21 185.66 8.4 86.75 1532.64 (5.46) 1253.18 (4.46) 651.91 (2.36) 2338.93 (8.33) 1052.75 (3.75) 9283.00 (33.05) 1080.15 (3.85) 4554.45 (16.21) 1766.35 (6.29) 250.95 (0.89) 23845.77 (84.89) Units Paddy Quantity Value 73.63 921.63 (3.46) SRI Quantity 5.31 Value 69.48 (0.25)

Kg

1. Land revenue 2. Rental value of land 3. Depreciation 4. Interest on fixed capital @ 11% Sub total Total cost of cultivation

Note : Figures in parentheses are percentage to the total cost

Traditional paddy

Fixed cost 16% Irrigation charges 2% Interest on w orking capital @ 8% 6% Machine labour 17% Bullock labour 2% Human labour 26% Seeds 3% Fertilizers 14% Farmyard manure 4% Plant protection chemical 10%

SRI paddy

Fixed cost 15% Irrigation charges 1% Interest on w orking capital @ 8% 6% Machine labour 16% Bullock labour 4% Human labour 34%

Seeds 0%

Fertilizers 12%

Farmyard manure 8% Plant protection chemical 4%

Fig. 4: Breakup of cost of cultivation in traditional and SRI methods

Table 4.6: Method-wise paddy output Particulars (t/ha) Traditional method 6.07 4.96 SRI method

Main product Byproduct

8.51 5.82

Table 4.7: Method-wise cost and returns in paddy cultivation (Rs/ha)

Particulars

Traditional method

SRI method

Cost A Cost B Cost C Gross returns Net returns over Cost A Cost B Cost C B:C ratio

22534.78 26374.48 26655.51 41493.58

23958.26 27797.96 28088.63 56965.90

18958.80 15119.10 14838.07 1.56

33007.64 29167.94 28877.27 2.02

Main product

Byproduct

9 8 7 6 tonnes 5 4 3 2 1 0 Traditional paddy Particulars SRI paddy

Fig. 5: Method-wise paddy output

Fig. 5: Method-wise paddy output

Traditional paddy 60000

SRI paddy

50000 Cost of cultivation (Rs./ha)

40000

30000

20000

10000

0 Total cost Gross returns Particulars Net returns

Fig. 6: Cost and returns in traditional and SRI method of paddy cultivation

Fig. 6: Cost and returns in traditional and SRI method of paddy cultivation

The method-wise cost and return structure in paddy cultivation in study area is given in Table 4.7 and Fig. 6. The per hectare cost A, cost B and cost C for SRI method were more when compared to that in traditional method. For example, Cost C was more by about Rs. 1433 for SRI when compared to that in traditional method. The per hectare gross returns realized for traditional paddy farmers and SRI paddy farmers, respectively were Rs. 41494 and Rs. 56966. The net returns (returns over Cost C) were Rs. 14838 for traditional method and Rs. 28799 for SRI method. The net returns over Cost A and Cost B were also higher in SRI method when compared to those in traditional method. The returns per rupee spent was around Rs. 1.56 in traditional method and itwas2.02 in SRI method.

4.4

TECHNICAL AND ALLOCATIVE EFFICIENCY IN TRADITIONAL AND SRI METHODS OF PADDY PRODUCTION

One of the major objectives of the study was to analyze technical, allocative and economic efficiency in traditional and SRI methods of paddy in the study area. For this purpose, the popularly used Cobb-Douglas production function was fitted. The production parameters of the estimated Cobb-Douglas production function are presented in Table 4.8. 2 The coefficient of multiple determination (R ) was 0.83 for estimated production function of traditional method and it was 0.85 for SRI method. The high and significant F values indicated that the Cobb-Douglas production function was adequate in explaining 83 per cent of the variation in output in traditional method and 85 per cent of the variation in SRI method due to variations in the resources included in the model. The constant returns to scale was noticed in both the methods since sum of elasticity coefficients was nearly one. An examination of production parameters of Cobb-Douglas function for traditional method indicated that paddy output was positively and significantly conditioned by all variable inputs except land for which the positive relation was no doubt observed but was statistically not established. The elasticity coefficients in the case of SRI method indicated that the paddy output was significantly and positively influenced by all resources except land. Paddy output was negatively influenced by land but the relationship was statistically not established. To analyse the scope for intensification of resources in both methods, the marginal value products (MVP) of resources are compared with the respective marginal factor cost (MFC). The MVP and MFC ratios for different resources for both the methods are furnished in Table 4.9. The MVP-MFC ratios for traditional methods indicated that there was a scope for increased use of seeds in the short-run keeping the use of other resources at a constant level. This was also true for variable resources like fertilizer and FYM as MVP-MFC ratio for these resources was more than one. Nevertheless, MVP-MFC ratio for labour, expenditure made on PPC and miscellaneous items and land use were less than one and positive indicating that profit could be optimized by using less quantity of labour and bringing down the area under paddy. The SRI methods farmers could maximize their profit by using more quantities of seeds, labour, fertilizer, FYM and expenditure on PPC and miscellaneous items as the MVP-MFC ratio for all these resources was more than one. However, MVP-MFC ratio for land was negative indicating that SRI paddy farmers could increase their profit by reducing the area under paddy. The technical efficiency in traditional and SRI method was worked out by using Timmer method. The distribution of sample farmers according to different technical efficiency ratings along with average technical efficiency for both the methods are presented in Table 4.10.The average technical efficiency for traditional paddy and SRI paddy farmers was 0.798 and 0.734, respectively. About 30 per cent of traditional paddy farmers and 36.66 per cent of SRI paddy farmers were found to operate at technical efficiency rating between 0.71 and 0.75. Only 3.33 per cent of traditional paddy farmers and 1.66 per cent of SRI paddy farmers were operating at technical efficiency rating above 0.9. The amounts of various resources that would have been required for the farmers to produce existing level of output at the highest level of technical efficiency were worked out and these levels of inputs are called as frontier level of input use. The frontier level of input

Table 4.8: Estimated production function for Traditional and SRI method of paddy cultivation Sl. No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Intercept Seeds Labour Fertilizer Farmyard manure PPC + miscellaneous Land bi R
2

Particulars

Tradititonalmeth od 0.943 0.3349* (0.193) 0.1319** (0.034) 0.2841** (0.098) 0.0312* (0.019) 0.1593 (0.075) 0.0091 (0.065) 0.95 0.83 34.30**

SRI method 1.249 0.1098* (0.0094) 0.2778** (0.125) 0.2327** (0.087) 0.1989** (0.053) 0.2136** (0.048) -0.0280 (0.0392) 1.01 0.85 42.14**

F value

Note : Figures in parentheses are standard errors ** Significant at 1% level * Significant at 5% level Table 4.9: MVP to MFC ratios of resources in Traditional and SRI method of paddy production Traditional method Inputs MVP Seeds (kg) Labour (mandays) Fertilizer (kg) FYM (tonnes) PPC + Miscellaneous expenditure (Rs.) Land (hectares) 168.69 34.54 34.20 272.75 0.749 MFC 12.50 50.00 12.11 248.43 1.00 Ratio 1.30 0.69 2.82 1.10 0.749 MVP 1073.66 77.69 42.68 1183.90 1.65 MFC 13.08 50.00 12.1 253.13 1.00 Ratio 82.08 1.55 3.52 4.67 1.65 SRI method

217.38

3457.95

0.06

-2333.62

3457.95

-0.67

Table 4.10: Distribution of farmers according to technical efficiency ratings Traditional paddy 15 (25.00) 18 (30.00) 12 (20.00) 9 (15.00) 4 (6.66) 2 (3.33) 79.80

Sl. No. 1. 2. 3. 4. 5. 6.

Per cent Technical efficiency rating <70% 71% 75% 76% 80% 81% 85% 86% 90% 90% and above Average technical efficiency

SRI paddy 18 (3.00) 22 (36.66) 10 (16.66) 8 (13.33) 1 (1.66) 1 (1.66) 73.40

Note: Figures in parentheses indicate percent to total Table 4.11: Actual and frontier use of resources and output production per farm Traditional method Inputs Actual Seeds (kgs) 113.95 Frontier 99.47 Savings (%) 14.48 (12.71) 49.81 (22.73) 159.52 (33.47) 1.82 (27.18) 1538.7 (20.58) Actual 3.30 SRI method Frontier 3.14 Savings (%) 0.16 (5.08) 30.44 (26.32) 52.46 (32.41) 0.83 (14.65) 783.13 (18.78)

Labour (mandays)

219.15

169.34

115.66

85.22

Fertilizers (kgs)

476.62

317.10

176.38

123.92

FYM (t)

6.72

4.90

5.73

4.90

PPC + miscellaneous cost (Rs.) Land (ha)

7476.68

5937.98

4170.05

3386.92

1.55

0.98

0.57 (36.77) 25.30*

0.623

0.41

0.213 (34.18) 36.23*

Output (q)

94.08

117.88

53.02

72.22

Note: Figures in parentheses indicate percentage savings * per cent excess output over existing output

use was compared with actual levels of input use to get an idea as to the amounts of various inputs that could have been saved if all the farmers were to operate at highest technical efficiency level. The actual and frontier use of different resources for both the methods is presented in Table 4.11. It could be seen from the table that farmers growing paddy in traditional method could save 12.71 per cent of seeds, 8.59 per cent of labour, 33.47 per cent of fertilizer, 27.18 per cent of FYM, 20.58 per cent of expenditure made on PPC and miscellaneous items and 36.77 per cent of land, if they enhance their efficiency to the highest level of technical efficiency. In other words, traditional paddy farmers could produce 76.06 quintals of paddy equivalent output against present 60.7 quintals by using the existing level of inputs had they operated at highest level of technical efficiency. The quantities of various resources that could have been saved by SRI paddy farmers by improving their technical efficiency were 5.08 per cent in seeds, 20.32 per cent in labour, 32.41 per cent in fertilizer, 14.65 per cent in FYM, 18.78 per cent in expenditure made on PPC and miscellaneous items and 34.18 per cent in land. The SRI paddy farmers by improving their technical efficiency would be able to produce 115.96 quintals of paddy against 85.12 quintals by using existing quantities of different inputs. The average allocative efficiency and economic efficiency of traditional paddy farmers and SRI paddy farmers are presented in Table 4.12 and Fig. 7. It could be seen from the table that allocative efficiency (0.526) of traditional paddy farmers was less than the allocative efficiency of SRI paddy farmers (0.683). In both the methods farmers were operating at less allocative efficiency than the technical efficiency. In other worlds, allocative inefficiency was higher than the technical inefficiency in both the methods of paddy production. The average economic efficiency for traditional paddy farmers and SRI paddy farmers was 0.419 and 0.50, respectively. Though the technical efficiency of SRI paddy farmers was marginally less than the technical efficiency of traditional paddy farmers, the economic efficiency was more for SRI paddy farmers comparatively because of high allocative efficiency level of SRI paddy farmers compared to that of traditional paddy farmers.

Table 4.12: Technical, allocative and economic efficiency in paddy (%) Traditional method 79.80 52.60 41.90

Sl. No. 1. 2. 3.

Particulars Technical efficiency Allocative efficiency Economic efficiency

SRI method 73.40 68.30 50.00

Technical efficiency 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 Traditional paddy Particulars

Allocative efficiency

Economic efficiency

SRI paddy

Fig. 7: Technical, allocative and economic efficiency in traditional and SRI method of paddy

Fig. 7: Technical, allocative and economic efficiency in traditional and SRI method of paddy

4.5

STRUCTURAL BREAK AND NATURE OF TECHNOLOGICAL CHANGE BETWEEN THE TRADITIONAL AND SRI METHOD OF PADDY PRODUCTION

In order to test the existence of structural break in the production relationship between the two methods of paddy production the Cobb-Douglas production function was estimated with both the intercept and slope dummies. The regression estimates are presented in the Table 4.13. The estimated equation was a good fit as indicated by the significant F-ratio (71.84). It could also be noticed that none of the slope dummies were significant with the only exception of the dummy variables for FYM and seed. In other words, the hypothesis of homogeneity in the regression coefficients of FYM and seed between the two production functions was rejected whereas the same hypothesis was accepted in the case of all other inputs. The intercept dummy was significant.

4.6

SOURCES CONTRIBUTING TO THE YIELD DIFFERENCES BETWEEN TRADITIONAL AND SRI METHODS OF PADDY PRODUCTION

Using the decomposition analysis, the productivity difference between the SRI paddy and traditional paddy (yield gap) was decomposed into its constituent sources and the results are presented in Table 4.14. The significant intercept and slope dummies provided the required justification for decomposition analysis. The estimated production function for both the methods (Appendix-II) and geometric mean levels of input and output (Appendix-III) are presented. The total productivity difference between the SRI paddy and traditional paddy was estimated to be 33.72 per cent. Among the various sources responsible for total productivity difference, the difference in technology contribution was more and to the extent of 31.61 per cent. The contribution of difference in input use levels to the total productivity difference was 2.1 per cent. The different inputs contributing to the productivity difference between SRI method and traditional method were FYM (15.19%) and human labour (7.65%) contributed positively whereas seed (-17.83%), expenditure on PPC and miscellaneous items (-2.01%) and fertilizer (-0.90%) contributed negatively. The contribution to the productivity difference between SRI and traditional methods due to all inputs was 2.1 per cent.

4.7

ADOPTION LEVELS AND CONSTRAINTS IN SRI METHOD OF PADDY CULTIVATION

Adoption levels of sample farmers in following suggested practices of SRI method are presented in table 4.15. Complete application of suggested practice is considered as complete adoption level and any deviation from the suggested practice is considered as partial adoption level. Nursery area 2.5 cents for 1 ha paddy cultivation: majority (81.67%) of the sample farmers adopted suggested nursery area and 18.33 percent of farmers adopted it partially. Seed rate 5kg/ha: Among the sample farmers 43.33 percent of them applied the suggested seed rate where as the remaining 56.67 percent of them used different levels of seed rate. Transplanting 8-12 days aged seedlings: The sample farmers constituting 68.33 per cent to the total followed the suggested transplanting time of seedlings whereas the remaining 31.67 percent of them did not follow the suggested transplanting time.

Table 4.13: Estimated production function with intercept and slope dummies Sl. No. 1. 3. 4. 5. 6. 7. 8. 9. Intercept Seeds Human Labour Fertilizer Farmyard manure PPC + miscellaneous expenditure Land Dummy (a)Intercept (b) Seeds (c) Human labour (d) Fertilizer (e) FYM (f) PPC+miscellaneous xpenditure (g) Land R
2

Particulars

Regression coefficients 0.5053 0.0680 0.2827** 0.1200 0.2028** 0.1857** -0.0274

Standard error 0.2129 0.0453 0.0617 0.0913 0.0517 0.0457 0.0236

0.2653* 0.237** 0.1147 0.0347 -0.1304** 0.0359 0.0185 0.89 71.84**

0.0795 0.0508 0.0912 0.0610 0.0483 0.0124 0.2162

F-value Note : Figures in parentheses are standard errors ** Significant at 1% level * Significant at 5% level

Table 4.14: Decomposition of productivity difference between the SRI paddy yield and the traditional paddy yield Sl. No. I. II. 1. 2. a. b. c. d. e. Source of productivity difference Total difference in output Source of contribution Technology Input use gaps Seed Human labour Fertilizer FYM Expenditure on PPC and miscellaneous items Due to all inputs -17.83 7.65 -0.90 15.19 2.01 31.61 Percentage contribution 33.72

III

2.1

Table 4.15: Adoption level of SRI paddy farmers N=60 Adoption level Suggested practices in SRI method Complete Nursery area 2.5 cents (for 1 ha) Seed rate 5 kg/ha Transplanting 8-12 days aged seedlings Careful transplanting of soil and roots intacted seedlings Wider spacing (25 25 cm or 30 30 cm ) Weed management Water management Organic manure application (10 t/ha)
2 2

Sl. No.

Partial 11 (18.33) 34 (56.67) 26 (43.33) 15 (25.00)

1. 2. 3. 4.

49 (81.67) 26 (43.33) 34 (56.67) 45 (75.00)

5. 6. 7. 8.

60 (100.00) 40 (66.67) 25 (41.67) 22 (36.67)

0 (0.00) 20 (33.33) 35 (58.33) 38 (63.33)

Figures in parentheses indicate percent to total number of farmers

Careful transplanting of seedlings soil and roots intacted: majority of the sample farmers (75.00%) followed suggested transplanting method where as, 25.00% of the sample farmers did not follow the suggested transplanting method Wider spacing (25 X 25 cm 2 or 30 x 30 cm 2) : All the sample farmers followed the suggested wider spacing Weed management: Of the total sample farmers 66.67 per cent of them followed the suggested weed management practice where as 33.33 per cent of the sample farmers did not practice the suggested weed management. Water management Nearly 58 per cent of the sample farmers did not follow the suggested water management practice where as 41.67 per cent of the sample farmers completely adopted the suggested water management practice. Organic manure application (10 t/ha): Of the total sample farmers 36.67 per cent of them applied suggested organic manure where as 63.33 per cent of the sample farmers did not apply the suggested quantity of organic manure. Reasons for practicing SRI method by the farmers in the study area are presented in Table 4.16. Almost all the farmers growing SRI method of paddy expressed that less water requirement was the major reason for following SRI method of paddy. So, this criterion was placed in the first rank among all the reasons for adopting the SRI method . Higher yields in the case of SRI method of paddy cultivation was the second major reason for practicing the SRI method by the sample farmers. Seed rate was considerably less in SRI method. The saving in seed material was one of the major reason which attracted the sample farmers to adopt the SRI method. Majority of the sample farmers expressed that less incidence of pest and diseases was the forth most important reason for practicing SRI method. Saving in fertilizer requirement was observed in SRI method of paddy cultivation. Farmers expressed that less fertilizer requirement was one of the reason to adopt the SRI method. Constraints in practicing SRI method of paddy cultivation are presented in Table 4.17. High labour requirement was the major constraint in practicing SRI method. Especially during transplanting and weeding days sample farmers faced the dearth of labour availability. The SRI method was a labour intensive method of paddy cultivation. The next major constraint in SRI method was high weed infestation. The specific constraint pertaining to the study area was poor drainage condition especially during heavy rainy seasons. The other constraints expressed by the sample farmers were manual conoweeder operation and high cost of cultivation.

Table 4.16: Reasons for practicing SRI method Sl. No. 1. 2. 3. 4. 5. Particulars Less water requirement Higher yield Less seed rate Less incidence of pests and diseases Less fertilizer requirement Rank 1 2 3 4 5

Table 4.17: Constraints for SRI method Sl. No. 1. 2. 3. 4. 5. Particulars High labour requirement Weed menace Drainage Manual conoweeder operation High cost Rank 1 2 3 4 5

V. DISCUSSION
The results of the investigation presented in the previous chapter are discussed in this chapter under the following heads. The main focus here is to throw light on some of the causes responsible for the major trends observed in the findings. 5.1 5.2 5.3 5.4 5.5 5.6 5.7 General characteristics of sample farmers. Nursery cost in traditional and SRI methods of paddy cultivation. Costs and returns structure in traditional method and SRI method of Paddy production. Technical and allocative efficiency in traditional and SRI methods of paddy production. Structural break and nature of technological change between traditional and SRI method Sources contributing to the yield differences between traditional and SRI methods of paddy production. Adoption levels and constraints in SRI method of paddy cultivation.

5.1

GENERAL CHARACTERISTICS OF SAMPLE FARMERS

The general characteristics of the sample farmers are presented in Table 4.1. The data presented in the table indicated that the average age of the traditional paddy farmers and SRI paddy farmers was 41 and 37 years, respectively. This implied that relatively young farmers were involved in SRI method of paddy cultivation. The family size (7) of traditional paddy farmers was higher than that of the SRI paddy farmers (6). The average number of male members (4) was equal in both the methods of paddy cultivation. However, female members (3) were more in traditional paddy farming families when compared to that of SRI paddy farming families (2) in the study area. From this, it could be inferred that the sample farmers in both the methods of paddy cultivation belonged to medium size families. None of the SRI paddy farmer was an illiterate and most of them were having secondary education whereas half of the traditional paddy farmers were found illiterates. This implied that educated farmers were involved in the SRI paddy cultivation. The average land holding of traditional paddy farmers and SRI paddy farmers was 3.53 and 5 hectare, respectively. It indicated that farmers having comparatively large holding have adopted SRI method of paddy cultivation. The livestock and machinery position of SRI paddy farmers was more than that of the traditional paddy farmers (Table 4.2.). From this, it could be inferred that SRI paddy farmers had more diversification and mechanization of farming activities. Cropping pattern followed by the sample farmers was presented in Table 4.3. The data presented in the table indicated that traditional paddy farmers grew more number of crops in rabi season (7) than in the kharif season (5). SRI paddy farmers also followed the same with 9 crops in rabi or summer season and 8 crops in kharif season. It was observed that the total number of crops taken up by the SRI paddy farmers in both the seasons were more than the number of crops taken up by the traditional paddy farmers. The same phenomenon was observed season-wise. From the above results, it could be inferred that there was slight differences in the general characteristics of the respondents between the two methods of paddy cultivation. SRI paddy farmers were comparatively young, educated having high assets and growing more number of crops.

5.2

NURSERY COST IN TRADITIONAL METHOD AND SRI METHOD

In this section, input utilization pattern and expenditure in nursery management of both the methods have been discussed, as there was distinguishable difference in nursery

management between the two methods. The input use pattern and cost incurred on different inputs in nursery management of both the methods is presented in Table 4.4. It was inferred that traditional paddy farmers have used higher amount of various inputs in nursery management, when compared to those by SRI paddy farmers in nursery management. The high nursery cost of Rs. 1374 per hectare was observed for traditional paddy farmers as against nursery cost of Rs. 178 per hectare for SRI paddy farmers. This was mainly due to more quantities of most of the inputs used in traditional nursery management. The farmers did not use fertilizer in SRI nursery and hence the amount spent on fertilizer in SRI nursery management was zero. This resulted in lower cost in SRI nursery management. The duration of nursery was also less in SRI, which might have limited the chance of using more quantities of Plant Protection Chemical and human labour.

5.3

COSTS AND RETURNS STRUCTURE IN TRADITIONAL AND SRI METHODS OF PADDY PRODUCTION

In this section, the cost of cultivation, input utilization pattern, output and returns realized in traditional and SRI methods of paddy cultivation are discussed. The input use pattern and extent of profit in traditional paddy cultivation and SRI paddy cultivation has been examined by computing per hectare input use, cost and returns. This analysis was made method-wise. The per hectare input use pattern in traditional paddy cultivation and SRI paddy cultivation is furnished in Table 4.5. The per hectare cost of SRI paddy cultivation (Rs. 28088) was more than that of the traditional paddy cultivation (Rs. 26655). High labour costs were the major reasons for higher per hectare cost of SRI paddy cultivation, more expenditure on human labour (Rs.9283) in SRI paddy was because of more number of labour demanded for careful transplanting of single seedlings and for frequent intercultivation. Generally labour requirement was more in SRI cultivation. The higher expenditure on bullock labour (Rs. 1080) in SRI paddy cultivation was because of more number of leveling operations to be done in order to prepare a level land, which is congenial for transplanting by avoiding water stagnation on the fields. The amount spent on FYM (Rs. 2339) was high in the case of SRI paddy compared to that in traditional paddy (Rs. 1078) as more quantities of FYM are applied in SRI paddy method. However, expenditure incurred on fertilizer (Rs. 3450) in SRI paddy was less when compared to that in the traditional paddy (Rs. 3730). Higher quantities of FYM are applied in SRI paddy. There was a glaring difference in the costs incurred on seed item between the two methods mainly due to the very less quantity of seed use in SRI paddy cultivation. Expenditure made on PPC was Rs. 2552 and Rs.1053 in traditional paddy and SRI paddy, respectively. The pest and disease incidence was less in SRI paddy farms; specifically brown plant hopper damage was less, which was major pest in paddy in the study area for kharif season. It was interesting to note that irrigation charges for SRI paddy farms (Rs. 251) was less than that of the traditional paddy farmers (Rs. 514). The number and quantity of water required in SRI method was less. Less depreciation cost was observed for traditional paddy farmers when compared to that of SRI paddy farms (Rs. 468). It was worth 2 noting that even with high seed rate and more number of hills per m , the yield level (6.07 t/ha) of traditional paddy was less than that of SRI paddy (8.51 t/ha). This was mainly because of more number of productive tillers per m2 in SRI paddy. Though, per hectare cost of cultivation (Rs.28089) was high, the net returns (Rs. 28877) realized was higher for SRI paddy compared to that of traditional paddy (Rs. 14838) mainly due to high gross returns (Rs. 56966) in SRI paddy cultivation where paddy yield harvested in SRI paddy cultivation was more and there was no discrimination between the prices of output of both the methods. It was interesting to note that the returns per rupee spent in traditional paddy was Rs. 1.56 against Rs. 2.02 for SRI paddy farmers mainly because of high gross returns in SRI paddy cultivation. High bullock labour cost in SRI paddy was necessary as leveled land for transplanting operation was a prerequisite.

Plate 2a. Strong and well developed roots in SRI method

Plate 2b. SRI paddy plants with productive tillers

5.4 TECHNICAL AND ALLOCATIVE EFFICIENCY IN TRADITIONAL AND SRI METHODS OF PADDY PRODUCTION
The classical production function assumes that all the farmers are technically efficient. Efficiency would be relevant when it is studied in the context of the situation in which the farmer operates. Frontier production function is an approach where the efficiency is studied on a relative basis. The farmers in a particular area evaluated for their efficiency by comparing with the best in their peer group. This is done by shifting the intercept of the average Cobb-Douglas production function upwards top coincide with the most efficient farmer and the rest are compared with this, both in terms of output and input. The production parameters of the estimated Cobb-Douglas production function are presented in Table 4.8. The coefficient of determination (R2) was 0.83 and 0.85 for the estimated traditional and SRI paddy functions, respectively. This implied that 83 per cent of variation in paddy output in traditional method and 85 per cent of variation in paddy output in SRI method was explained by the included variables. The high and significant F values indicated that the Cobb-Douglas function was adequate in explaining the variations in the paddy output due to variations in the variables in the model for both the methods. Constant returns to scale was noticed in both the cases since bi was near to one. The constant term (intercept) in the case of SRI paddy was significant and much higher than that for the traditional paddy. This virtually signifies the upward shift in production function due to technological change. An examination of production parameters indicated that all the variables had positive and significant coefficients in both the estimated production functions except land, which was positive and non-significant in the case of traditional paddy and negative and non-significant in the case of SRI paddy. From this, it was inferred that all the variables made a positive and significant contribution to the yield. However, the contribution of land to the yield was not statistically explained. Any attempt to increase paddy productivity in the study area must be accompanied with the use of these resources. MVP-MFC ratios in traditional paddy indicated that there was scope for increased use of seeds, fertilizer and FYM keeping the use of other resources at a constant level. The MVPMFC ratios for these resources were more than one. However, traditional paddy farmers should reduce expenditure on PPC and miscellaneous items, labour and area under paddy cultivation, as the MVP-MFC ratios for these resources are less than one (Table4.9). MVP-MFC ratios in SRI paddy indicated that there was a scope for increased use of all the inputs except land. The farmers of SRI method could maximize their profit in paddy production by using more of all the resources barring land as MVP to MFC ratio for all the resources except land was more than one.

Timmer,s measure of technical efficiency

The average technical efficiency was slightly higher for traditional paddy farmers (79.8%) compared to that (73.4%) for SRI paddy farmers. Majority of the traditional paddy farmers were operating between 71 per cent and 75 per cent efficiency level. It is also true for SRI paddy farmers. only about 3.33 per cent of traditional paddy farmers and 1.66 per cent of SRI paddy farmers were found to operate at high technical efficiency rating of above 90 per cent. About 30 per cent of SRI paddy farmers and 25 per cent of traditional paddy farmers were operating in technical efficiency rating of below 70 per cent (Table4.10). Hence, there is a vast scope for improving paddy productivity in both the methods by reducing technical inefficiency without using additional resources. Comparatively SRI paddy farmers were technically more inefficient than the traditional paddy farmers. This was mainly because of the fact that SRI method was a new practice and farmers are not yet fully acquainted with the SRI technology in paddy.

Kopp measure of technical efficiency

The results presented in Table 4.11 indicated the extent of excess use of resources in view of the existence of technical inefficiency in paddy production. The quantities of different inputs required for the farmers to produce the existing level of output at the highest level of technical efficiency were called as frontier level of inputs.

The use of resources by traditional paddy farmers revealed a greater degree of inefficiency. In other words, the traditional paddy farmers could achieve existing level of production by using 12.71 per cent (seeds) to 36.77 per cent (land) less inputs than the existing level of input use. Whereas SRI farmers could produce the existing level of output by using 5.08 per cent (seeds) to 34.18 per cent (land) less inputs than existing level of input use. So, this calls for greater attention on part of farm management specialists and extension workers to train the farmers, since these farmers are using excess quantities of inputs in production of paddy than the required level to achieve the frontier level of production. Though, technical efficiency of traditional paddy farmers was marginally higher than the SRI paddy farmers, the economic efficiency of SRI paddy farmers was higher than the traditional paddy farmers. It was mainly because of high allocative efficiency level of SRI paddy farmers (0.683) than their traditional paddy counterparts (0.526). By overcoming the inefficiency (both technical and allocative) in traditional paddy and SRI paddy production, the profits could be increased in study area. Hence, more concerted efforts are needed to improve efficiency in both the methods of paddy production (Table4.12).

5.5 STRUCTURAL BREAK AND NATURE OF TECHNOLOGICAL CHANGE BETWEEN TRADITIONAL AND SRI METHODS
Complete structural relationship between production functions of SRI method and traditional method was estimated with both the intercept and slope dummies. It could be noticed that none of the slope dummies was significant except dummy variables for manure and seed (Table 4.13). The positive signs of the dummies for land, human labour, fertilizer and expenditure on plant protection chemicals and miscellaneous items suggested that the productivity of these inputs was higher in the case of SRI method of paddy cultivation when compared to traditional method of paddy cultivation. The significant intercept dummy indicated that the technological change was mainly because of change in intercept.

5.6

SOURCES CONTRIBUTING TO THE YIELD DIFFERENCES BETWEEN TRADITIONAL PADDY AND SRI PADDY

The decomposition analysis revealed that the per hectare yield of traditional method of paddy was less than that in SRI method by 33.72 per cent (Table 4.14). Thus, the present study showed that there was well over 30 per cent difference in the paddy yields between traditional method and SRI method. This implied that paddy output could be enhanced by nearly 34 per cent if the SRI method of paddy cultivation was adopted by all the paddy growing farmers. The contribution of SRI technology to the productivity difference between the methods of paddy cultivation was estimated at 31.61 per cent. The analysis revealed that a larger share of the productivity difference was accounted for by the difference in method of production alone. In this context, better guidance from the extension agencies and from persons involved in the transfer of technology to the farmers fields would be of immense help to the paddy cultivators. This called for urgent steps to restructure and restrengthen the existing extension network to persuade the farmers to popularize the SRI method and to overcome their difficulties during the course of their adoption and assimilation. The contribution of differences in input levels to the productivity differences between the SRI method and traditional method of paddy cultivation was meager and it was 2.1 per cent. Seed (-17.83%), expenditure on PPC and miscellaneous items (2.01%) and fertilizer (0.9%) contributed negatively to the productivity difference. This implied that farmers growing SRI method paddy obtained higher output per hectare than that obtained by the farmers of traditional method of paddy by spending less on those inputs. On the other hand, FYM (15.19%) and human labour (7.65%) had positive contribution to the productivity difference. Altogether, the total contribution of differences in the levels of input use to the productivity gap accounted for 2.1 per cent, indicating that the productivity on traditional paddy farms could be

increased by about 2 per cent, if the per hectare input use levels on these farms could be increased to the same level as on the SRI paddy farms.

5.7

ADOPTION LEVELS AND CONSTRAINTS IN SRI METHOD OF PADDY CULTIVATION

Adoption levels of sample farmers growing SRI method of paddy are presented in the Table 4.15. It was inferred that wider spacing was the only practice completely adopted by all the sample farmers (100%). The next practice completely adopted by majority of the farmers (81.67%) was the nursery area followed by careful transplanting practice (75%), weed management practice (66.67%) and transplanting time (56.67%). High partial adoption level was observed in the case of organic manure application (63.33%) followed by water management (58.33%) and seed rate (56.67%). Reasons for practicing SRI method by sample farmers are presented in the Table 4.16. From the table it was clear that less water requirement and higher yield levels were the factors attracting farmers to adopt SRI method by the sample farmers. The other reasons were low seed rate, less incidence of pests and diseases and low fertilizer requirement. Constraints in practicing SRI method of paddy cultivation are presented in Table 4.17. From the table it could be inferred that high labour requirement was observed to be the major constraint for SRI method. Heavy weed infestation was the second next constraint for practicing SRI method of paddy cultivation. Other problems encountered by sample farmers in practicing SRI method were poor drainage conditions, difficulty in manual conoweeder operation and high cost of cultivation.

VI. SUMMARY AND POLICY IMPLICATIONS

INTRODUCTION
Rice is the staple food for about 50 per cent of the worlds population that resides in Asia, where 90 per cent of the worlds rice is grown and consumed. In Asia, India has the largest area under rice (41.66 million ha) accounting for 29.4 per cent of the global rice area. Rice is one of the largest traded commodities in the world with a total quantity touching 16.4 million tones The green revolution of 1960s was oriented towards high input usage particularly hybrid seeds, fertilizers, irrigation and plant protection chemicals. As a result of higher use of these inputs the cost of cultivation escalated. This is more so in irrigated crops like paddy. The skewed distribution of green revolution results and increased costs of cultivation have given alarming signals to the future needs of food security. SRI-System of Rice Intensification-is a system of production of rice. SRI is considered to be a disembodied technological change in paddy cultivation. SRI involves the use of certain management practices, which together provide better growing conditions for rice plants, particularly in the root zone, than those for plants grown under traditional practices. This system seems to be promising to overcome the shortage of water in irrigated rice. It offers increased productivity for resources like land, labour and water. In fact, it is a less water requirement method of rice cultivation, which is suitable to poor farmers who have relatively more labour than land and capital. The growth has been flat and has started declining in some of the progressive states and reversing the trend is not easy. The lackadaisical pace of growth was witnessed even in rice. After a long period of technological breakthrough and adoption, yield gap still exists in many of the states. In the country, more than 50 per cent of the potential yield in the case of rice is not realized yet. The benefit-cost ratio for rice cultivation declined to 1.41 during 200001 from 2.45 per cent in 1973-74. Decline in factor productivity and output-input ratios clearly substantiate that the returns to investment in agriculture seem to have been declining. Therefore, potential for increasing production of crops through adoption of wide range of modern technologies has remained unexploited in many parts of the country because of unfavourable output-input prices. It is generally, believed that farmers in developing agriculture fail to exploit fully the potential of a technology and/or make allocative errors with the result that yields show wide variation, usually reflecting a corresponding variation in the management capacities of the farmers. This shows that considerable scope exists for raising productivity and income of the farmers by improving their efficiency. The on farm demonstrations conducted during kharif in Andhra Pradesh during 200304 using SRI method of paddy cultivation showed increased yields of about 2.5 t per ha over conventional paddy in 2004-05. There is tremendous motivation in SRI by the farmers of Andhra Pradesh. The state government and the ANGRAU with other government and nongovernment organizations have started promoting SRI methods in various districts of Andhra Pradesh. Therefore it is right time to examine various economic issues of SRI cultivation. Hence, this study was taken up.

SPECIFIC OBJECTIVES OF THE STUDY

1. To compare and contrast the cost and returns of paddy cultivation in traditional and SRI methods. 2. To decompose the contribution of resources to the productivity differences between traditional and SRI method of paddy cultivation. 3. To study the technical and allocative efficiency in paddy cultivation under traditional and SRI methods.

4. To suggest appropriate policies for improving resource productivity in paddy cultivation.

METHODOLOGY
The present study was carried out in Prakasam and Guntur districts of Andhra Pradesh. Paddy in both the districts is cultivated on an area of 3.9 lakh hectares. SRI paddy was widely cultivated in both the districts. Hence, these districts were purposively selected for the study. There is a need to analyse profitability and efficiency issues in traditional paddy cultivation and in SRI paddy cultivation. Accordingly S.N. Padu and Karamchedu mandals in Prakasam districts and Ponnuru and Piduguralla mandals in Guntur district were selected. From each of the selected mandals, three villages following both SRI and traditional methods were selected. From each of the villages, ten farmers comprising five farmers following SRI method and other five following traditional method were randomly interviewed. The required data were collected by personal interview method with the help of pre-tested schedules. The data was pertained to the crop year 2005-06.

ANALYTICAL TECHNIQUES EMPLOYED

For the purpose of achieving the objectives of the study, the data collected were subjected to statistical analysis. To workout the cost and returns structure, the tabular analysis was employed. The farm-management cost concepts was used for cost analysis. Cobb-Douglas production function was fitted to estimate the technical and allocative efficiency in both the methods of paddy cultivation. Decomposition analysis was employed to figure out the sources contributing to the yield differences between the methods. Dummy variable technique was employed to know the structural break and nature of technological change between traditional and SRI methods of paddy production.

MAJOR FINDINGS
General characteristics of sample farmers
SRI paddy farmers are found to be of younger age group. The average family size of traditional paddy farmers and SRI paddy farmers was medium. All the SRI paddy respondents were found to be educated. The average land holding of traditional paddy farmers and SRI paddy farmers was 3.53 hectares and 5 hectares, respectively. The livestock and machinery position of the SRI paddy farmers found to be slightly more than that of the traditional paddy farmers. SRI paddy farmers were growing more number of crops per season and per year than the traditional paddy farmers.

Nursery cost for traditional paddy and SRI paddy cultivation

Nursery cost for traditional method (Rs. 1374) was considerably higher than that of the SRI method (Rs. 178), expenditure made on seed (Rs. 922) contributed substantially to the high nursery cost in traditional method. No expenditure was made on FYM in traditional nursery management and no expenditure was made on chemical fertilizer in SRI nursery management. The share of PPC was negligible in both the methods.

Costs and returns structure in traditional paddy and SRI paddy production
The quantities of seed, fertilizer and PPC use was more in traditional paddy cultivation whereas human labour, bullock labour, machine labour and FYM use was more in SRI paddy cultivation. Fixed costs like rental value of land and interest on fixed capital were found to be more for traditional paddy farmers. Depreciation cost was more for SRI paddy farmers. However, land revenue remained same for both the methods of paddy cultivation.

The share of human labour in the total cost was more in both the methods. The least contributing item to the total cost was land revenue in both the methods. The share of variable cost in total cost was 84.46 per cent and 84.89 per cent in traditional paddy and SRI paddy, respectively. The rental value of land was the major contributing expenditure to the fixed cost in both the methods. SRI method paddy farmers harvested higher yields (8.51 tonnes/ha) than the traditional method paddy farmers (6.07 tonnes/ha). Net returns over cost A, cost B and cost C in SRI method paddy cultivation were more than those of the traditional method paddy cultivation. The returns per rupee spent was around Rs. 2.02 for SRI method paddy and Rs. 1.56 for traditional method paddy.

Technical and allocative efficiency in traditional paddy and SRI paddy

The coefficient of multiple determination (R ) was 0.83 and 0.85 for estimated production functions of traditional paddy and SRI paddy, respectively. The constant returns to scale was noticed in both traditional paddy and SRI paddy production. Both traditional paddy production and SRI paddy production were positive and significantly conditioned by all variable inputs except land for which the positive relation was noticed in traditional paddy production (statistically not established) and negative relation in SRI paddy production (statistically not established). MVP-MFC ratio was more than one for inputs like seed, fertilizer and FYM but less than one for inputs like labour, expenditure on PPC and miscellaneous items and land in traditional paddy cultivation. MVP-MFC ratio was more than one for all the inputs except land for which it was negative in SRI method of paddy cultivation. The average technical efficiencies for traditional paddy and SRI paddy farmers was 0.798 and 0.734, respectively. Most of the farmers were found to operate between 0.71 to 0.75 technical efficiency rating in both the methods of paddy production. Traditional paddy farmers can save 25 per cent inputs and SRI paddy farmers can save 22 per cent inputs to produce the existing level of paddy output by enhancing efficiency. The allocative inefficiency level (47.4%) was more for traditional method of paddy cultivation than that of the SRI method of paddy cultivation (31.7%). SRI paddy farmers were found to operate at high economic efficiency level (50.00%) when compared to traditional paddy farmers (41.9%).
2

Structural break and nature of technical change

There was a structural break in the paddy production with the introduction of SRI method. Technological change between traditional and SRI method of paddy production was because of the shift in the intercept.

Source contributing to the yield differences

The total productivity difference between the SRI method of paddy cultivation and traditional method of paddy cultivation was estimated to be 33.72 per cent.

The difference in technology (31.61%) was found to be the major contributor to the yield differences between SRI paddy and traditional paddy.

Adoption level of SRI paddy farmers

All the sample farmers followed the wider spacing in SRI method of paddy cultivation. Complete adoption level was high in the case of nursery area (81.67%) followed by transplanting practice (75%), weed management (66.67%) and transplanting time (56.67%). Partial adoption level was high in the case of organic manure application (63.33%)followed by water management (58.33%) and seed rate(56.67%). Major reasons for practicing SRI method by sample farmers were less water requirement and higher yield levels. Major constraints in practicing SRI method were high labour requirement and weed menace.

POLICY IMPLICATIONS
1. The paddy yields are high by about 30 per cent in SRI method when compared to the yields in traditional method of paddy cultivation. It was well supported by decomposition analysis. Therefore, the government and extension agencies need to popularize and encourage the widespread adoption of SRI cultivation. Government may even provide incentives by way of subsidies or in other forms to encourage widespread cultivation of SRI method. The use of resources like seeds, fertilizers and FYM can be increased to optimize the resource use and get maximum returns in traditional method of paddy cultivation, whereas in SRI method of paddy cultivation, use of all the resources can be increased except land. So, there is a greater scope for reorganization of resources in both the methods of paddy cultivation as revealed by MVP-MFC ratios of the resources. The technical inefficiency levels in both the methods of paddy production (26.6 % in SRI method and 20.2% in traditional method) indicated that there is a scope to enhance the productivity levels in both the methods without using additional resources. Therefore, there is a greater responsibility on the part of the extension department to provide timely suggestions and to conduct extension programmes regarding recommended practices of production in SRI paddy cultivation as well as in traditional paddy cultivation. High labour requirement particularly for transplanting and weeding operations was the major constraint in practicing SRI method. The agricultural engineering department should fabricate different models of power operated mechanical weeders suitable to different soil conditions.

2.

3.

4.

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APPENDIX I SCHEDULE I. General information a) Name of the respondent: Age Education Village Taluk : Social participation Main occupation : member of panchayat/co-operatitive/others : : : Dist : :

Subsidiary occupation :

b) Particulars of family:

Sl. No

Family members

Sex

Age

Education

Occupation

II. Asset position

a. Particulars of land holding

Sl.No. 1. 2. 3.

Area cultivated (acre) Owned: area: Value Leased in: area Value Leased out: Area Value

Irrigated

Un irrigated

Total

Land rent

Land revenue

b. Machinery and equipments

Sl.No. 1 2 3 4

Items Tractor Sprayer Duster Pump set

Life span

Number

Year of purchase

Purchase value (Rs.)

Present value

5 6 7 8 9 10

Wooden plough Iron plough Harrow Line marker Rotary weeder Others specify

C) Other assets Sl.No. 1 2 3 4 5 Items House Bullock cart Bicycle Motor cycle Well/bore well 6 Other (specify) Life span Number Year of purchase Purchase value (Rs.) Present value

d) Live stock position

Sl.No 1 2 3 4 5 6 7

Items Bullock (pair) Cows Buffaloes Young stock Sheep Goat Poultry birds etc,

Number

Year of purchase

Purchase value(Rs.)

Present value(RS)

e) Debt condition

Sl. No. 1.

Sources Commercial Bank

Purpose

Type

Amount (Rs)

Year

Interest (%)

Repaid (Rs)

Over due

2.

Cooperative Bank

3. 4.

Moneylender Relatives&Frie nds

5.

Others

III. CROPPING PATTERN Season Kharif Crops Variety Area Yield / ha

Rabi

Summer IV. COST OF CULTIVATION a) Nursery management Area: a1)Labour wages: Particulars Family labour M Land preparation FYM application Sowing Fertilizer application Spraying Others Note: M=Men, W=Women, BP=Bullock pair, ML=Machine labour. b1) Input cost W BP ML M Hired labour W BP ML Seed rate: Nursery duration:

SI.No. 1. 2. Seeds

Particulars

Quantity Kg/g/L/ml

Price/Unit

Total cost (Rs.)

Seed treatment chemicals 1) 2)

3.

Fertilizers 1) 2)

4. Crop:

Others Variety: Area:

Season: b) Labour wages: Particulars

Soil type:

Source of irrigation:

Family labour M W BP ML M

Hired labour W BP ML

Ploughing Clod crushing Puddling Transportation &Spreading of FYM Transplanting Fertilizer application Weeding 1) Hand weeding 2) Mechanical weeding Spraying Irrigation Harvesting Threshing &Winnowing Others (specify) Note: M=Men, W=Women, BP=Bullock pair, ML=Machine labour. c) Input cost Particulars SI. No. 1. Fertilizers 1) 2) 3) 4) Quantity Tons/Kg/ L Price/Unit Total cost (Rs)

2.

Pesticides 1) 2) 3) 4)

3. 4.

Irrigation (Number) Others : : : : : : :

Total cost (b1+c) Rs. d) Marketing cost 1.Transportation cost 2.Commission paid 3.Tax paid 4.Any other charges Total (d) Rs. e) Returns SI.No. 1. 2. 3. Particulars Main product By product Total

Quantity (tonnes)

Price/Unit

Total Returns

V. Knowledge about SRI method of Paddy cultivation 1. When did you first come to know about SRI method? 2. Source of information Source A.E.O./A.O. Print media Mass media Relatives Neighbor farmer Others (specify) Yes No

3. When did you first adopted SRI method of paddy? 4. Have you under gone training /demonstration / extension tour etc

VI. Adoption level of SRI method of paddy cultivation by farmers: SI.No 1 2. 3. 4. Suggested SRI method of practices Nursery area 1cent (for 1 acre of land) Seed rate 2 kg / acre Transplanting 8-12 days seedlings Careful transplanting of soil and roots intacted Seedlings 5. Planting at wider spacing per say 25x25 cm2 or 30x 30 cm2 6. Weed management (Working with rotary weeder initially at 10-12 days after transplanting and there after thrice at 10 days interval) 7. Water management (Field should kept wet and water should not be allowed to stagnate) 8. 9. Organic manure application (10 t / ha) Others 100% Partial 0%

VII. Reasons for practicing SRI method: Sl .No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Particulars Suitability of land Less seed rate Less water requirement Less fertilizer requirement Less incidence of pest and diseases Less number of days to transplant seedlings Hybrid responsive Higher yield Less cost Others Yes

VII. Constraints for SRI method SI.NO. 1. 2. 3. 4. 5. 6. Particulars More Labour requirement Weed menace Unavailability of implements Cyclone / Flood Higher seedling mortality Others Yes

APPENDIX-II Estimated traditional paddy and SRI paddy production function

Sl. No. 1. 2. 3. 4. Intercept Seeds Labour Fertilizer

Particulars

Traditional method 0.2578

SRI method

Pooled

0.3224

0.3176 0.1746 (0.1196)

0.3440* (0.0905) 0.0680 (0.0480)

0.1548* (0.0365) 0.2827* (0.0654) 0.2013* (0.0536) 0.2273* (0.0696) 0.1200** (0.0497) 0.1659** (0.0536) 0.2317** (0.0791)

5.

Farmyard manure

0.0306 (0.0215) 0.2028* (0.0548)

6. 7 8

PPC + miscellaneous R
2

0.0723 (0.0629) 0.1857* (0.0484) -0.0351 (0.1682) 0.775 37.22* 0.743 29.44* 0.795 56.96*

F value

Note : Figures in parentheses are standard errors * Significant at 1% level ** Significant at 5% level

APPENDIX-III Geometric mean levels of inputs and output per hectare

Sl. No.

Input/Output

Traditional method 73.52 141.39 307.5 4.34 7523.67

SRI method

1. 2. 3. 4. 5.

Seeds (kgs) Human labour (mandays) Fertilizer (kgs) FYM (t) PPC+ Miscellaneous Cost (Rs)

5.31 185.66 283.12 9.21 6693.51

6.

Output (Q)

60.70

85.10

TRADITIONAL AND SRI METHODS OF PADDY CULTIVATION A COMPARATIVE ECONOMIC ANALYSIS

SIVANAGARAJU P. 2006
ABSTRACT
The present study was conducted to ascertain the economics and sources contributing to the productivity differences besides examining technical and allocative efficiency of both traditional and SRI method of paddy production in Prakasam and Guntur districts of Andhra Pradesh. The per hectare cost of cultivation of paddy was Rs. 26655 and Rs. 28088 for farmers following traditional method and SRI method, respectively. The variable costs constituted the major portion of the total cost of cultivation forming about 84.46 per cent and 84.89 per cent in traditional and SRI methods, respectively. The rental value of land formed the major item of fixed cost in both the methods. The net returns over cost C was found to be higher in SRI method of paddy cultivation which was estimated to be Rs. 28877. Constant returns to scale was noticed in both traditional paddy and SRI paddy production. The elasticity of production for seeds, labour, fertilizer and farmyard manure were positive and significant in both the methods of paddy production. The elasticity of production for plant protection chemicals and miscellaneous expenditure was positive in both the methods of production but it was significant in the SRI method of paddy production. MVP-MFC ratios in traditional paddy (>1) indicated that there was scope for increased use of seeds, fertilizers and FYM. MVP-MFC ratios in SRI paddy indicated that there was scope for increased use of all the inputs except land. The average technical efficiency was slightly high in SRI method (79.80%) than in traditional method (73.40%). However, SRI paddy farmers were found to operate at high economic efficiency level (50%) when compared to traditional paddy farmers (41.90%). There was a structural break in the paddy production with the introduction of SRI method. Technological change between traditional and SRI method of paddy production was because of the shift in the intercept. The total productivity difference between the SRI method of paddy cultivation and traditional method of paddy cultivation was estimated to be 33.72 per cent. The difference in technology (31.61%) was found to be the major contributor to the yield differences between SRI paddy and traditional paddy.

Dr. H. BASAVARAJA
Major Advisor