Evaluating economic viability and environmental externalities of integrated tilapia-sugarcane farming in Maharashtra

Abstract

In recent years, farmers in Maharashtra have engaged in aquaculture-sugarcane farming, with those from the Ujjani reservoir area practicing integrated sugarcane farming using tilapia farm discharge water. This study aims to systematically compare the economic viability and environmental externalities between sugarcane-only farms (SF) and tilapia-sugarcane farms (TSF) within the commanding area of the Ujjani reservoir. Primary data was collected from the 160 farmers (80 SF, 80 TSF), and Secondary data were collected from published literature, the Department of Fisheries, and fisheries cooperative societies. Data analysis used descriptive statistics to characterize demographic profile, farm performance (cost-benefit analysis, production function), and farmers' perceptions. Principal component analysis (PCA), cluster analysis, and two-way MANOVA were employed for environmental assessments. Results indicate that TSF yields higher profits across all cost scenarios, with a Benefit-Cost ratio of 1.69, surpassing SF's ratio of 1.55. The Cobb-Douglas production function analysis reveals increasing returns to scale for both SF and TSF, with the sum of coefficients exceeding one. The results of the Principal Component Analysis (PCA) indicate that 31 variables rated by sugarcane growers were extracted into ten components, which explains 65 % of the total variance for SF and 62 % for TSF. K-means cluster analysis grouped these components into four clusters, termed externalities of irrigation. A Two-way MANOVA indicated significant differences (p < 0.05) between SF and TSF farmers' perceptions of these externalities, with further distinctions among four farmer categories and significant interaction effects. Policy recommendations include financial incentives and environmental regulations to support TSF adoption, sustainable land-use policies, and institutional interventions for management practices and market research. These measures address challenges and promote the transition to sustainable TSF practices.