A PROJECT REPORT ON
GREEN REVOLUTION & ITS SIGNIFICANCE IN INDIAN ECONOMY
SUBMITTED TO: Ms. Eritriya Roy (Faculty Economics)
SUBMITTED BY: PranavVaidya `Roll No. : 117 Semester- II
Date of Submission: 24th of January 2014 HIDAYATULLAH NATIONAL LAW UNIVERSITY 1
TABLE OF CONTENTS:
Acknowledgements………………………………….
Statistical Tools……………………………………...
Research Methodology………………………………
Objective…………………………………………….
Introduction………………………………………….
2
Acknowledgment First & foremost, I take this opportunity to thank Ms. Eritriya Roy, Faculty, Economics, HNLU, for allotting me this challenging topic to work on. She has been very kind in providing inputs for this work, by way of suggestions and by giving her very precious time for some discussion and providing me resource of her vast knowledge of the subject which helped me to look at the topic in its very broad sense also to look at some of the very narrow concepts by expertise view. Therefore she proved to be a database in making this project. Hence I would like to thank her. I would also like to thank my dear colleagues and friends in the University, who have helped me with ideas about this work and also a source for constant motivation and hence they were a guiding force to me in making of this project. Last, but not the least I thank the University Administration for equipping the University with such good library and IT lab. My special thanks to library staff and IT staff for equipping me with the necessary books and data from the website. I would also like to thank the hostel staff for providing me a healthy and clean environment that provided me a great concentration level.
PranavVaidya Roll No. – 117, Sec-C Semester- II (B.A.L.L.B. Hons .)
3
Objectives: 1. Analyzing conditions of Indian Agriculture and Indian Economy during pre-green Revolution era. 2. Examining the effect of green revolution on Indian economy. 3. Analyzing merits and demerits of green revolution through the tables.
Research Methodology: This research paper is descriptive & analytical in approach. It is largely based on secondary & electronic sources. Books & other reference as guided by faculty of Economics are primarily helpful for the completion of this project.
4
Introduction Just after India got its independence, it was the utmost need of the government to check out the problems related to the common people since after the British rule, India who was once known as “The Golden Bird”, was in broken down in terms of its financial status, as it was influenced by colonial experience, which made it one of the poorest economy of that time.
In the case of India, the Green Revolution at first started in the late 1960s. With the success of it, India attained food self-sufficiency within a decade by the end of the 1970s (the first ” wave of the Green Revolution”). However, because it confined only to wheat crop and in northern India such as Punjab, it failed to raise income in the vast rural areas of the country. The second “wave of the Green Revolution”, however, reached India finally in the 1980s. Since it involved almost all the crops including rice (which is a very important staple food in eastern and southern India) and it covered the whole country, it was able to contribute to raise rural income and alleviate rural poverty in the whole country. Thus the second Green Revolution in the 1980s was essential for the history of Indian economic development.
This paper composes as followings. In the section I, we will reflect the process of the agricultural development in India after its independence in 1947. In particular, the process of the first and the second waves of the Green Revolution and their impacts will be delineated in detail. In the section II, the role of the Green Revolution in India on its history of economic development will be presented.. Finally, we will summarize the argument and conclude.
5
Chapter-1 India after Independence
1. Green Revolution: A Historical Perspective:
The history of modern agriculture in India begins in 1757. In that fateful year the Indians lost the Battle of Plessey to the East India Company of the British soldier-traders. As a consequence of the defeat, the revenue rights of one district in Bengal, the 24-Paragannahs, had to be ceded to the Company. The foothold thus gained by the British in the civil and revenue administration of India expanded rapidly. By 1765, large territories of India, particularly in the provinces of Bengal, Bihar and Orissa, had come under the control of the Company; and agriculture in India had become subject to the British administration and its modernizing influences.
2. British period: The British had no use for this Indian concept of agriculture as an autonomous way of life. In their eyes, the agriculture on which they acquired control was nothing but a source of revenue. According to Dharampal’s estimates, around 1750AD, for every 1000 units of produce, the producer paid 300 as revenue. Only 50 units of these 300 went out to the central authority, the rest remaining within the village; by 1830, he had to give away 650 units as revenue, 590 of which went to the central authority1. The independent cultivator of yesteryears, who cultivated has land to fulfill his needs, thus had become a tool to produce revenues that would fuel the Industrial Revolution of England. Independent cultivators, cultivating their own piece of land, were not likely to put external economic needs before 1
CLAUDE ALVAREZ, HOMO FABER: TECHNOLOGY AND CULTURE IN INDIA, CHINA AND THE WEST 1500-1972, ALLIED PUBLISHERS, DELHI 1971.
6
their need to eat and cloth. They required the concept of private property in land, personified in the landlord, to teach them that it is more important to progress, to industrialize, than to eat and cloth. The British provided them with the landlord, and, ‘modernized’ them. How successful were the British in modernizing Indian agriculture - in making it responsive to the needs of the industry and the vicissitudes of the market -The period before the First World War was marked by a favorable world market in all export crops and expansion in the domestic manufacturing capacity in textile and jute. It is perhaps one of the best periods in British Indian agriculture, with per capita food availability hovering around 540 gm. per day throughout this period, in spite of substantial exports of rice and wheat. Then World War I came, followed by the Great Economic Depression, and the World War II. Export markets contracted. Prices of agricultural produce crashed2. While non-food grain production merely stagnated, production of food grains started showing a declining trend even when population was rising. Interestingly the only crop that showed expansion in this period was sugarcane, which was granted protection by imposing new tariffs on import. Thus, in this fifty-year period we see Indian agriculture going up or down with the worldwide economic forces. These forces, and not the needs of the people, decided how much of what the Indian agriculture would produce. Economics won, life failed.
3. Independence phase: As noted above, independence came to India at a time when agriculture was passing through a particularly bad phase. Bengal had just passed through a major famine. Per capita food availability, at 417 gm per day in 1946, was dangerously low. Rural indebtedness had been increasing alarmingly. According to the Central Banking Enquiry Committee, rural 2
The general wholesale price index for Calcutta, which stood at 202 in 1920 (July 1914=100), declined to 173 in 1924, to 141 by 1929 and touched the rock-bottom of 87 points in 1933. Indices for cereals, pulses and oilseeds in 1933 stood at 66, 84 and 74, respectively. See, Report of the National Commission on Agriculture, Delhi 1976; volume 1, p.128. In the following we refer to this Report as NCAR 1976. The Report quotes these figures from Vera Anstey, The Economic Development of India, Longmans Green, and London 1971. Later with the outbreak of the Second World War, food prices increased reflecting a general scarcity.
7
indebtedness had nearly doubled between 1929 and 1936. Cultivators were finding difficulties meeting their fixed liabilities such as rent, land revenue, etc. Many of them were turning into land-less laborers 3. Partition of the country worsened the situation further. The country was facing an acute shortage of both the commercial crops and the food crops. Something needed to be done immediately to improve agriculture.
3
GEORGE BLYN, AGRICULTURAL TRENDS IN INDIA, 1891-1947 (Univ. of Pennsylvania Press, Philadelphia 1949). Also see, NCAR 1976, vol.1 p.199.
8
Chapter-2 Indian Agriculture and Indian Economy during pre-green revolution era
Agriculture was the predominant sector of Indian economy at the time of Independence from colonial rule in 1947. The share of agriculture in total gross domestic product at that time was above 55 per cent, and about 70 per cent of workforce was engaged in agriculture sector. Since the urban industrial and tertiary sectors were very small, and absorbed only 26 per cent of labor force, vast majority of Indian population, about 83 per cent, lived in rural areas (Census 1951). Though agriculture was the predominant sector at that time but its productivity was very low and output growth during 1901 to 1946 was less than half of the population growth. As a consequence of this, per capita income of rural population was awfully low. With the beginning of era of planned development in 1950-51 it was recognized that agricultural development is the key for rural economic development, improvement in living standard and living conditions of country’s populace, and eradication of widespread poverty and malnutrition prevalent in the country.
Performance of agriculture sector was also considered crucial for overall development of vast majority of people of India and for attaining several economy wide goals. It was thus imperative to follow the policy and development strategy which favored quick and high growth rate of agriculture. Another notable feature of India’s agricultural economy is its diversity. Both, agriculture growth and productivity have shown tremendous variation across regions and states of the country.
Economic reforms initiated in early nineties had a significant impact on agricultural sector, primarily due to the opening up of economy to external competition, liberalization of trade and deregulation of input and other sub-sectors. Analyzing the year-on-year growth in 9
Agricultural GDP for the entire period is cumbersome and such growth figures are subject to sharp inter-year fluctuations that make it difficult to identify any structural breaks or secular acceleration/deceleration. In order to overcome this problem and to capture the effects of major changes in technologies and policies on the sector in various phases, an analysis based on decadal trend growth rates is attempted here. The GDP-Agriculture series was first smoothened by taking 2-year moving averages to remove the effects of abrupt weather variations and other shocks. Further, trend growth rates were estimated by fitting semi-log trend to the smoothened data. The series begins with 10-years period from 1950-51 to 196061 and is extended up to the latest decade ending with the year 2010-11. Based on this, five distinct phases of growth were identified and are outlined below: (i) Phase I: Pre-green revolution Period (1950-51 to 1967-68) (ii) Phase II: Early green revolution period (1968-69 to 1985-86) (iii) Phase III: Period of wider dissemination (1986-87 to 1996-97) (iv) Phase IV: Post-Reform Period (1997-98 to 2005-06) (v) Phase V: Period of Recovery (2006-07 to 2009-10/2010-11) The term Green Revolution originally described developments for rice and wheat, highyielding varieties (HYVs) have since been developed for other major food crops important to developing countries, including sorghum, millet, maize, cassava, and beans. The green revolution was kick-started from the year 1966 and the effects of adoption of superior technology and institutional reforms were found to manifest from 1968-69 onwards. The subsequent period is classified as early green revolution period and a visible reversal of growth in GDP agriculture was observed. The decadal growth rate reached near 3 per cent by the decade ending with 1985-86. The period of wider dissemination of technology was characterized by sustained growth in the sector for over a decade peaking at the year 1996-97. The deceleration of growth was started from 1997-98 onwards and a clear indication of slumping of the agricultural sector was visible till the year 2005-06. This slump is widely perceived as an outcome of substantial diversion of resources away from agriculture to other 10
sectors of the economy, a point which is elaborated in subsequent sections. However, a significant recovery of growth was observed in the last few years that have pushed the decadal growth rates above 3 per cent. In nutshell, the growth series clearly establish the sharp deceleration of the agricultural sector in the post-reforms period and an unambiguous turnaround in the last five years, which also happens to be the 11th five year plan period. Trend growth in GDP-Agriculture based on 10 years period: beginning from 1951-61 and extending with 2001-10 ( Per cent)
An obvious line of action was to concentrate on improving irrigation facilities that had been severally depleted with partition. Only 19.7% of the net sown area within the Indian Union was irrigated. In addition to improving irrigation it was necessary to take steps to put the cultivators back on the land and reduce rural indebtedness through land reforms. Some sort of land reforms had in fact become a political necessity, given the aspirations that people associated with independence. Action on both these fronts was started immediately after independence. Between 1947-48 and 1949-50 the net irrigated area increased from 18.9 to 20.2 million hectares; most of the increase came from increase in the area irrigated by wells and other minor sources. Irrigation facilities kept on increasing at about the same pace, achieving an annual rate of increase of 0.67 million hectares of gross irrigated area for the 11
period 1950-51 to 1968-69. Land reforms were initiated by most states in the early fifties. These envisaged abolition of zemindari, security of tenure for tenant cultivators and fixation of reasonable rents; later some ceilings on land holdings were also introduced. Though carried out in a half-hearted manner, these land reform measures continued to provide some relief to the cultivators’ right through the fifties and early sixties. The new technology of the ‘miracle seeds’ and associated practices was indeed successful in generating high yields, wherever sufficient resources to effectively implement it could be mobilized. For some especially endowed areas, the increase in yield could even be justifiably characterized as revolutionary. This was amply borne out by a number of studies carried out to make a scientific evaluation of the response of different crops in different areas under the High Yielding Varieties (HYV) Program4. Green Revolution led to sizable increases in returns to land, and hence raised farmers’ incomes. Moreover, with greater income to spend, new needs for farm inputs, and milling and marketing services, farm families led a general increase in demand for goods and services. This stimulated the rural nonfarm economy, which in turn grew and generated significant new income and employment of its own. Green Revolution also contributed to better nutrition by raising incomes and reducing prices, which permitted people to consume more calories and a more diversified diet. Big increases occurred in per capita consumption of vegetable oils, fruits, vegetables, and livestock products. Now let’s know about the measures adopted in Green Revolution
Use of high yielding varieties (HYV) of seeds
Irrigation.
Use of insecticides and pesticides.
Consolidation of holdings.
4
Peter Rosset, Lessons from the Green Revolution 1 ( March/April 2000) (unpublished manuscript) (on file with author).
12
Land reforms.
Improved rural infrastructure.
Supply of agricultural credit.
Use of (chemical) fertilizers.
Use of Sprinklers or Drip Irrigation.
Green Revolution proved out to be a major help to the India, it helped removed the flaws of the agriculture and also decreased the hunger issues of the country and also resolved the problem of malnutrition.
13
Chapter-3 Drawbacks and Failures of Green Revolution A revolution of this magnitude was bound to create some problems of its own. Critics charged that the Green Revolution resulted in environmental degradation and increased income inequality, inequitable asset distribution, and worsened absolute poverty. Some of these criticisms are valid and have been or still need to be addressed5. Critics of the Green Revolution argued that owners of large farms were the main adopters of the new technologies because of their better access to irrigation water, fertilizers, seeds, and credit. Small farmers were either unaffected or harmed because the Green Revolution resulted in lower product prices, higher input prices, and efforts by landlords to increase rents or force tenants off the land. Critics also argued that the Green Revolution encouraged unnecessary mechanization, thereby pushing down rural wages and employment. Although a number of village and household studies conducted soon after the release of Green Revolution technologies lent some support to early critics, more recent evidence shows mixed outcomes. Small farmers did lag behind large farmers in adopting Green Revolution technologies, yet many of them eventually did so. In regional terms, only the states of Punjab and Haryana showed the best results of the Green Revolution. The eastern plains of the River Ganges in West Bengal also showed reasonably good results. But results were less impressive in other parts of India. Another shortcoming of the Green Revolution was that it spread only in irrigated and high potential rain fed areas, and many villages or regions without access to sufficient water were left out. Although evidence suggests that even in these cases villagers obtained important indirect benefits through increased employment and migration opportunities and cheaper food, the benefits were rarely sufficient to prevent further widening of income gaps. In India,
5
INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE (IFPRI), Green Revolution – Curse or Blessing at p. 2.
14
for example, poverty in many low-potential rain fed areas has improved little even while irrigated and high-potential rain fed areas have progressed6. Excessive and inappropriate use of fertilizers and pesticides has polluted waterways, poisoned agricultural workers, and killed beneficial insects and other wildlife. Irrigation practices have led to salt build-up and eventual abandonment of some of the best farming lands. Groundwater levels are retreating in areas where more water is being pumped for irrigation than can be replenished by the rains. And heavy dependence on a few major cereal varieties has led to loss of biodiversity on farms. Some of these outcomes were inevitable as millions of largely illiterate farmers began to use modern inputs for the first time, but inadequate extension and training, an absence of effective regulation of water quality, and input pricing and subsidy policies that made modern inputs too cheap and encouraged excessive use also created negative environmental impacts. Green Revolution does-cannot alleviate hunger because it fails to alter the tightly concentrated distribution of economic power, especially access to land and purchasing power. Even the World Bank concluded in a major 1986 study of world hunger that a rapid increase in food production does not necessarily result in food security-that is, less hunger. Current hunger can only be alleviated by "redistributing purchasing power and resources toward those who are undernourished," the study said. In a nutshell-if the poor don't have the money to buy food, increased production is not going to help them. Introducing any new agricultural technology into a social system stacked in favour of t he rich and against the poor-without addressing the social questions of access to the technology's benefits-will over time lead to an even greater concentration of the rewards from agriculture, as is happening in the United States. Because the Green Revolution approach does nothing to address the insecurity that lies at the root of high birth rates-and can even heighten that insecurity-it cannot buy time until population growth slows. Finally, a narrow focus on production ultimately defeats itself as it 6
INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE (IFPRI), Green Revolution – Curse or Blessing at p. 3.
15
destroys the very resource base on which agriculture depends. We've come to see that without a strategy for change that addresses the powerlessness of the poor, the tragic result will be more food and yet more hunger.
16
Conclusion Overall, the Green Revolution was a major achievement for many developing countries and gave them an unprecedented level of national food security. It represented the successful adaptation and transfer of the same scientific revolution in agriculture that the industrial countries had already appropriated for themselves. The Green Revolution also lifted large numbers of poor people out of poverty and helped many non poor people avoid the poverty and hunger they would have experienced had the Green Revolution not occurred.
17
References
18
