Growth and Variability in Cost of Cultivation in India

Abstract

Increase in cost of cultivation is the most important and vivid issue in the present scenario of Indian agriculture. There are many components of cost of cultivation like labour cost, machinery use charges, expenses on seeds, fertilizers & pesticides and irrigation charges etc. It directly affects the cost-return ratio and profitability. This paper is an attempt to compare and analyze the growth rate and variability in total operational cost and human labour cost (family, casual and attached labour) of cultivation of principal crops (paddy, wheat, cotton and sugarcane) in five major producing states in India. The present study is based on the secondary sources of information collected from the various government reports, Agriculture Statistical at Glance, etc. To measure the growth rate and variability, compound annual growth rate (CAGR) and coefficient of variation have been calculated. The results showed that the share of labour cost in total operational cost was more than 50 per cent in the cultivation of paddy, cotton and sugarcane in almost all five states, except paddy, cotton and sugarcane in Punjab and Maharashtra, respectively. There has been found a huge difference in growth and variability in cost of cultivation among states. The growth rate of both costs in wheat, paddy and cotton cultivation in Punjab was lower than other states.