Global environmental concerns of contract farming

Abstract

Contract farming is a global phenomenon for expanding agribusiness in villages. It reflects the legal as well as social acceptance of small and marginal farmers (SMFs) into agribusiness relationships and new strategies of production. Global experiences of contract farming practices started in the United States where the U.S. agribusiness USAID has actively promoted contract farming as a partnership between SMFs and private investors. Central America, Southern Europe and part of North and East Africa have pioneered in the internationalization of the contracting of grower-exporters, freezers, canners and brokers. In Third World countries contract farming has dual origin. Many of the African and Malaysian settlement schemes, tea production inKenya, tobacco and livestock in Thailand, rubber in Malaysia, palm oil in the Philippines arepublic sector enterprises in which the state is typically the dominant partner in joint ventures with transnational agro-industry and foreign banks. In this global scenario, the present chapter comparatively examines the problems and benefits of contract farming in India with special reference to the environmental impact of contract farming on the use of groundwater and land quality. The conclusion drawn highlights that in a contract farming system, sometimes productivity declines due to a shifting production relation to other farmers as well as to other regions. On the other hand, there is an excess use of fertilizers and pesticides for the contract crop compared to basic food crops, raising the question of sustainability of farmers and their livelihood and environment in India and across the globe.