WORLD 13ACLWIK

SLTMMAI( OF TE ]pxz4jLy.d ]DAPT EPQT ON

COTTON PODUCTION PROS PCTS ( INDIAN CASE STUDY )

J,=13' 1•4

A. F. FERGUSON & CO.

A. F. FERGUSON & Co. H A N S A LAY A.

BARAKHAMBA ROAD NEW DELHI - 110001

WORLD BANK

SUMMARY OF THE FINAL DRAFT REPORT ON - -

THE COTTON PRODUCTION PROSPECTS

(INDIAN CASE STUDY)

CONTENTS

PAGE NUMBER

INTRODUCTION

1

IMPORTANCE OF COTTON IN THE INDIAN 1 ECONOMY

COTTON AREA, PRODUCTION AND YIELDS 1

Varieties 1

ORGANISATION OF THE COTTON SUB-SECTOR 5

Cultivation 5 Input supply services 5

Seeds 5 Fertilisers 8 Agro chemicals 8 Agricultural implements 8 Credit supply 8 Extension and training 9 Usage of inputs and other agronomic practices 9

TEL: 331 . 354-1, 52.56.5266 GRAMS: AFFCON. NEW DELHI TELEX: (031) 62972 FAX: 91-11-3325437 OFFICES AT: BANGALORE. BOMBAY. CALCUrrA. MADRAS, NEW DELHI. VADODARA

- ii -

CONTENTS (CONTD.)

PAGE NUMBER

ISSUES IN INPUT SUPPLY AND USAGE

10

MARKETING

10

Ginning 11 Domestic marketing of cotton lint

11 Export marketing of lint

11 - By products utilisation

13

ISSUES IN COTTON MARKETING

13

RESEARCH

13

ISSUES IN COTTON RESEARCH

14

CROP PROTECTION

14

ISSUES IN CROP PROTECTION

15

GOVERNMENT POLICIES/REGULATIONS

15

Cotton specific legislation 15 General legislations and policies

18 Textile policy 18

ISSUES IN GOVERNMENT POLICY

20

CROP ECONOMICS

Comparison with competing crops .1 Domestic Resources Costs (DRC)

21

ISSUES IN CROP ECONOMICS

21

- iii -

CONTENTS (CON=.)

PAGE NUMBER

KEY ISSUES FOR THE COTTON SUB SECTOR

21

Unfavourable farm economics

24 Lower yield

24

PROJECT PLANNING MATRIX

24

- 00000 -

ANNEXIJRES ATTACHED TO THIS REPORT

ANNEXURE ]. PROBLEM TREE AND OBJECTIVE TREE

ANNEXURE II CORE OBJECTIVE : TO IMPROVE PROFITABILITY AND RESOURCE RISK

ANNEXURE III : PROJECT PLANNING MATRIX

1. A. F. Ferguson & Co. (AFF) have been retained by the World Bank (WB) to conduct a study on the cotton production prospects in India in the coming decade. Findings of this study will form the basis for future directions in research and development; institutional strengthening and identification of investment needs. AFF has completed the study and this report contains a summary of findings and conclusions. A detailed report has been submitted separately.

IMPORTANCE OF COTTON IN TEE INDIAN ECONOMY

2. Cotton is an important crop in India for several reasons

(1) About 70% of the country's requirements of fibre for clothing is met by cotton

(2) Cotton and cotton based products account for about 30% of India's exports at present

(3) The sector is a significant employer.

Exhibit 1 gives •a "snapshot" of the cotton sub-sector.

COTTON AREA, PRODUCTION AND YIELDS

3. Cotton is presently grown in India over an area of 7.5 million ha, the largest in any country of the world. The current production is 12 mn bales while the average yield is about 270 kg./ha. It is important to note that world yield levels are 3 to 4 times of Indian yields. Area under cotton cultivation can be broadly divided into three zones

(1) Northern India consisting of Punjab, Haryana and Rajasthan

(2) Central India consisting of Maharashtra, Gujarat and Madhya Pradesh

(3) Southern India which includes Karnataka, Tamil Nadu and Andhra Pradesh.

Exhibit 2 gives a map showing the cotton growing locations.

Varieties

4. There are 100 varieties under of cotton cultivation in India (including hybrids) but 20 to 25 varieties account for 90% of the crop. In terms of staple length, long staple constitutes 51%, medium staple 41% and short staple 8% of the total production.

1

EXHIBIT 1

OVERVIEW OF THE COTTON SUB-SECTOR 1992-93

COTTON PRODUCTION

1. Total area = 7.54 mn ha

of which rainfed (est) = 60% irrigated (est) = 40%

2. Total production (lint) = 2.05 mn MT

of which long staple = 0.91 mn MT medium staple = 1.00 mn MT short staple = 0.14 mn MT

3. Yield (seed cotton) overall = 272 Kg/ha rainfed = 130 Kg/ha irrigated = 570 Kg/ha

PROCESSING INDUSTRY

4. Number of ginneries = 3598

of which prvate sector = 3169 cooperative sector = 429

5. Number of spinning mills = 874

of which public sector = 73 private sector 683 cooperative sector = 118

6. Number of composite mills = 268

of which public sector 115 private sector = 151 cooperative sector = 2

EXPORTS

7. Total textile exports = Rs. 162 bn.

of which cotton textiles, yarn = Rs. 49 bn. and ready made garments = Rs. 88 bn.

6. Share of textile exports in total country's exports = 30%

2

EXHIBIT 1. (CONTD.)

9. Handloom sector 6 to 10 mn.

10. Powerloom sector = 6 Tflfl.

11. Organised mill sector = 12 mn.

12. Cultivation, ginning, trading = No reliable estimates available

Sources : (1) Compendium of Textile Statistics, 1993, Office of the Textile Commissioner, Government of India

(2) Status paper on cotton in India, 1993, Directorate of Cotton Development, Government of India

2 -

INDIA C.OITON GROWG

ZONES

CA

SPUR

OR4(R.S )4IRS'J1V74

I AR8R(JM ZONE

i : CE_47Ri AR9(J A.I(O iE9A:ELw

QT

SOUTHERN :R$jW : AR9CCL.4 - ILIi B3 :E ZE

ZCNE

I

4

ORGAWCSATION OF THE COTTON SUB-SECTOR

5. There are various agencies involved in the cotton sub- sector. These agencies and their roles are given in the following paragraphs.

Cultivation

6. Cotton farms are essentially privately owned. The holding size could range from 1 ha to over 10 ha. However, the average holding size in the 9 major cotton growing states is less than 5 ha (Refer to Exhibit 3). The holding size of farms being on the low side does affect the level of mechanisation. About 60'c of the area under cotton farms is rainfed due to which cotton is essentially a mono crop. The crop sequences being followed in each of the regions is also given in Exhibit 3.

Input supply services

7. The input supply services consist of

(1) Seeds (2) Fertiliser (3) Agro chemicals (4) Agricultural- implements (5) Credit supply (6) Extension.

A description of these services is given below.

Seeds

8. Seed production and distribution in the country is governed by seeds Act- 1966 and the Seeds (Control) Order 1984. The type of Seeds used by farmers include certified seeds (seeds notified for release by central/state level release committee); truthfully labelled seeds (seeds which comply with rules applicable to seed production and distribution but are not certified) and seeds produced by farmers. Exhibit 4, flowcharts the distribution system.

9. Seeds are produced both in the private and public sector. The table below indicates the approximate share of each in the production of quality seeds

Certified

Truthfully labelled

Private sector 30-40% < 90% Public sector 60-701 > 10%

100%

5

mT 3

CPAWTZmTr=B or MM 3 CM71M ,zG

ITIN NORTHZOKX CENTRAZZONI - SOUTXER€ONE

RARYANA PUNJAB LMASTIANGUJAIAT N. P. MAIIARASNTP.A A.P. RARNATAXA TAI4I LNADU

1. Cropsequence

followed

Rharit cotton Cotton cotton cotton/ Cotton/ Cotton! Rain- Irri- Cotton. - If irraga-

(Su.r) jover Soyabeen sunflow.r/ fed gated chillies. tad, then

over Soyabean joway. cotton,

Cottoiocton paddy. chillies,

lower i11- groundnut, bEjra.

Led- i.e redgram vegetables

gram

R.abi Wheat Wheat Wheat Jovar Wheat Labijowar If irri-Slack Wheat, - R.ainied

(Winter) wheat/ gated. gram. maize, cotton.

Sunflower ground- Red around blackgram.

nut sun-gran, nut and j owar

flower ceac-

•eeda nu.

2. Whetb.nrri- Irri- Irri- Irri- Mainly Plainly Plainly Bothirrig- - Hybrid

gat.d/reinfedqat.d gated gated ra3.nf.d rainied rainf.d gated/rain- under

cotton but need fed irrigated

based condition.

irrigation - Variety

is used underrainfed

3.Av.ragand 2.75 3.7 434 3.15 2.52 2.5 1.72 2.41 1.01

bo1dinn

the state C ha C

(Sourc.-

i5$5-S.n.us

SOURCE APP Survvf Cultivators.

6

W I

(1)

a

C

WI-I

04 z fl I

I LJ II

II

ZI

CI

— a Ill Iz I CI X I

:i U I H1 II

Ml Ml

C ii

a I I

II

7

Fertilisers

10. In case of fertilisers, nitrogenous fertilisers are under government control with respect to production, distribution and prices etc., while phosphatic and potassic fertilisers are outside government control. Decontrolled fertilisers are sold through either the cooperative supply channel or private network of dealers. Government control over the private dealers is through issue of licenses as well as periodic inspections to ensure compliance with the rules. Exhibit 4 illustrates the distribution system for fertilisers.

11. All three sectors i.e. public, private and co- operative, are involved in manufacture of fertilisers. The public sector accounts for about 46% of Nitrogenous and 29% of phosphatic fertilisers. Co-operative producers have share of about 12-16%.

Agro chemicals

12. The private sector dominates production and distribution of pesticides, insecticides etc. though several public sector formulation units exist. The distribution channel for agro chemicals is similar to that for fertilisers and is shown in Exhibit 4. The government regulates distribution by li.pn1ng dealers and inspecting their goods for quality.

Agricultural implements

13. As regards agricultural implements, state owned agro industries corporations are responsible for producing, procuring and distributing them. There is also an extensive involvement of the private sector in both manufacture and distribution.

Credit supply

14. Farmers obtain credit both from formal institutions and from the informal sector. The institutional credit structure consists essentially of

(1) Cooperatives with Primary Agricultural Cooperative Societies (PACS) at village level

(2) Commercial banks through their rural branches

(3) Regional Rural Banks (RRBs) or Grameen Banks which were set up since 1975 to specifically imprcve the flow of credit to the low income groups.

15. Crop loans are given to cotton .growers through PACS. The loan amount depends upon the scale of finance fixed for the crop based upon Drimarily the cost of cultivation of a crop. Part of this crop loan is given on cash basis and the rest on

8

kind basis, consisting of specified quantities of seed, fertilisers, pesticides and implements.

Extension and training

16. Extension is essentially under the aegis of the Ministry of Agriculture which has a department of extension which is largely not crop specific but for all the crops including cotton at central/state/district levels. The Department of Agriculture at the state level is the key agency involved in extension. In addition to the extension through the state department, widespread use of extension aids, publications, mass media is made to reach to the farmers more effectively. As in the case of input supply, the extension work is really not crop specific. There could be 1-2 additional officers for a certain crop in certain states. For example Haryana has 2 specific officials who monitor extension work in cotton.

17. The linkage among research and extension has been achieved through the training and visit (T&V) system in the states. In each of the districts, there are three Subject Matter Specialists (SMS) who train area and village level extension workers on a fortnightly basis on three or four crucial issues. These SMS also keep themselves abreast with latest developments by coordinating with agricultural universities specialists and experts.

Usage of inputs and other agronomic practices

18. Inspite of the fairly elaborate system of inputs production and distribution, actual usage is quite low. No reliable data on consumption of truthfully labelled seeds by the private sector is available but certified seed production, both of varieties and hybrids, is only about 10% of estimated requirement, indicating a fairly poor seed replacement rate, especially for varieties. Fertilisers usage in quantity terms was low in rainfed areas while timing of usage in irrigated areas is linked to availability of irrigation. Usage of plant protection chemicals was widespread, but not in line with recommended practices both in terms of timing and quantity (over use was common) and usage of biological measures was limited by availability. Production credit was available but not for the farmer to hold stocks in case of low prices and the credit institutions were weakened by political and populist measures such as loan waivers.

19. Spacing and maintenance of pant population to recommended levels was not usually practiced. Low awareness and usage of plant growth zcr, transplanting inter croping etc. was noted. In irrigated areas, furrow/bed method war common with minimal usage of sprinklers and increasing water table and soil salinity was being noticed due to over irrigation. Mechanisation levels were very low and found mainly in the northern region for land preparation and planting.

15

20. A weak link in the whole chain was extension and this was true for all crops, despite the numbers, spread and inputs such as training etc. This, to an extent, contributed to poor/inadequate usage of inputs described above.

ISSUES IN INPUT SUPPLY AND USAGE

21. The major issues in input supply are

(1) Availability and quality of inputs, especially certified treated seeds and pesticides

(2) Lack of mechanisation and availability of technology for small farms

(3) Availability of credit to the farmer to hold stocks

(4) Quality of extension and reach specific for cotton.

MARKETING

22. In India, farmers sell only seed cotton either at the village level to traders and commission agents or at the wholesale markets. These market's could either be regulated markets which have certain bye-laws for all transactions or unregulated markets where operations are done through local customs or informal associations and their bye-laws. The buyers at these markets could either be

Public sector

(1) State Co-operative Marketing Federations (20% of total production)

(2) Cotton Corporation of :ndia (8-10% of total production)

Private (about 70% of total production)

(3) Traders

(4) Textile mills, either directly or through their agents.

23. Usually prices are determined by auctions or bids t - - t while fr village level sales there could be a contract i price. No formal grading system exists quality of the produce based on visual inspection. Payments are usually ma.-_ immediately or within a week in regulated market: Transpertaticn and movement of seed cotton is done in ope. vehicles and there is multiple handling.

10

Ginning

24. There are about 47,000 gins in India out of which about 67% are single roller gins, 32% are double roller gins and only 1% are saw gins. These gins are distributed across the private (76%) and cooperative sector (24%) . Nearly 75% of the gins are between 50-100 years old and suffer from the following limitations

(1) Lack of pre-cleaning facilities

(2) Non-availability of moisture control equipment

(3) Lack of mechanical handling of seed cotton

(4) Lack of proper storage facilities.

Ginning charges are determined by the government under the cotton ginning and Pressing Act.

Domestic marketing of cotton lint

25. Marketing of cotton lint is well organised through the East India Cotton Association (EICA) which has members for both the private trade and cooperative marketing organisations.

26. Cotton is stored largely as lint by the public and private sector. The traders are regulated with the selective line of credit (whereby traders had to maintain higher margin money for advances against their seed cotton) . Stocking at mills is regulated by the government by specifying the quantum of stocks it can hold at any time. Suffer stocking operations by the government have been discontinued since 1989. As shown in Exhibit 1, most of the spinning capacities is in the private though the public and cooperative sectors are not insignificant.

27. Gujarat, Maharashtra and Tamil Nadu have the maximum number of textile mills and surplus cotton lint is transported to these states from other cotton growing states. In most of the states, an agriculture transport license is required to transport cotton. The various kinds of cots involved in cotton marketing from seed cotton to lint have been summarised in Exhibit 5.

Export marketing of lint

28. Exports of cotton are regulated through a quota system operated by the Ministry of Textiles. Based on estimated sup1"c export rniotas and minimum export prices are announced and applications invited from exports - private, co-ooerat.ve anc public sector. Based on unit realisation and other considerations, cuotas are released though in the past, the -. public sector and co-operative organisations have been given a bulk of the quotas.

mrrT S

COSTS IN Cony, HAwTM (St= corrox TO tilT

St. NATURE OF COSTS BCRJ(E BY PAC TO

NO. COSTS

1. RAPAS (SEED COTTON Market price Purchaser i.e. Trader/ Farmer

PRICE • PACEAGI) CC/Marketing Federations

COST OF GINNING RAG

2. MART CISS Varies from Purchaser i.e. Trader! Regulated market

(FOR REGULATED state to state CC/Marketing federations

NARXZIS) around 1-2% at

basic Rapes cost

3(4) TRANSPORTATION Depending on Purchaser i.e. Trader/ Hired

TO GINNY the distance CC/Marketing Federations vehicle

(usually own operator

transport

(b( GINNING CHARGES Ginning charges Purchaser i.e. Trader! Ginnery

vary from state CCl/Plarketizig Federatona

to state and

year tc year

4. TRANSPORTATION OF Depending on Purchaser i.e. Trader/ Vehicle

PRESSED RAZZ TO distance CC/Marketing federation. operator

GODOWN

S. SALE PRICE OF - Negotiated Purchaser i.e. Spinning Lint

LINT (RAZZ PRICE) price for CCI Mills supplier

- Trade price for

Textile ills

- Settled price for

—cc-operatives

TRANSPORTATION - Transportation Purchaser i.e. Spinning Transporta-

OF LINT rates Mills tion

OTEER COSTS

7. SALES TAX - Varies from Spinning Mill Trader/Dealer and

to Itate act dealer in turn to the

between 3-4% - Imported State Government

I. Cc$OUSSIONTO 0.25% to It of Spinning Mills Dealer!

TL*.DER/AGERT lint pric.. trader

snaa 7kA5A, o..e.

AGENT BUYS LINT state to state

ON BEHALF OF-A

SPINNING MILL)

NOTE Octroi is leviable in some states on cotton movement.

SOURCE 1. RICA Annual (1991-92)

2. Meetings at the State level

12

By products utilisation

29. Although applications of cotton by-products is well researched, commercial exploitation is limited. As a result, much of these by products are used as fuel, fodder etc. by the farmer. A possible reason for this is inadequate focus by research agencies on commercialising these technologies.

ISSUES IN COTTON MARKETING

30. The issues in cotton marketing, covering seed cotton and lint, are given below

(1) Multiple handling and poor farm work methods leading to high trash content in seed cotton

(2) Outdated gins, poor margins, lack of infrastructure and lack of modernisation of ginneries (due to control on ginning charges), leading to poor quality of lint and its packing

(3) Restriction on movement of cotton leading to delays and rent seeking

4) Restriction on credit and stocks leading to rent seeking and high cost of cotton lint

(5) Lack of quality testing infrastructure and gradation methods at regulated markets and ginneries. Hence quality is a subjective estimation and no premium for quality lint

(6) Low utilisation of by products.

RE S EARCE

31. Cotton research is essentially government funded and is carried out primarily at - -

(1) Central Institute for Cotton Research (CICR), Nagpur

(2) Central Institute for Research on Cotton Technology (CIRCOT), Bombay

(3) Research stations in different states

(4) Various State Agricultural universities (SAtis)

Private sector involvement is minimal in research. The entire cotton research at different centres in the country is being pursued under All India Cotton Coordinated Improvement Project (AICCIP) . This project obtains 75% of itg funding from the Indian Council for Agricultural Research (ICAR) and the rest from the states where research is undertaken.

13

32. Research is being undertaken in the following areas

(1) Plant breeding

(2) By product utilisation and marketing of product research

(3) Agronomy research

(4) Control of pests, insects and weeds.

Although no formal evaluation of the cotton research programme has been undertaken, it has undoubtedly made a positive contribution to the Indian cotton scene. Steady improvements in yields, introduction of hybrids, improved agronomic practices etc. are some of the highlights of the research effort.

33. In the current five year period (1992-97) the following issues are being addressed

(1) Development of genotypes for increasing yield, fibre quality, resistance to insect pests and tolerance to biotic and abiotec stresses

(2) Development of low cost production technology including lowering costs of inputs such as seeds, etc.

(3) Increase in by-product value

(4) Augmentation of germplasm etc.

The overall aim is to undertake measures which help in increasing the profitability and suztinability of growing cotton in the various growing zones in the couatry.

ISSUES IN COTTON RESEARCH

34. The issues in research are

(1) Lack of availability of high yielding cultivars with resistance to bollworm

(2) Lack of drought resistant varieties

(3) Lack of commercialisation of by product research

(4) Lack of farm economics for IPM and biological control.

CROP PROTECTION

35. Crop protection is done at the farm level by the individual farmers. The dealers being the main source of

14

information for their use and application, chemical pesticides are widespread and no !PM or area based approach is being adopted. No crop loss estimation and lack of information on insects, pests and diseases has led to lack of database for analysis and strategy design to counter their impact.

ISSUES IN CROP PROTECTION

36. The issues in crop protection are lack of

(1) Quality pesticide usage

(2) IPM technology adoption

(3) Area based approach

(4) Crop loss estimation.

The adoption of techniques like IPM and area based approaches has been affected by the lack of working out of economics to the farmer and the practical problems associated with recoveries of charges from farmers.

GOVERNMENT POLICIES /REGULATIONS

37. Government regulation influencing cotton operate at all levels i.e. farm, marketing/ trading and processing. These are operated both at the union or central level (primarily through two ministries i.e. agriculture and textile) and at the state level. Exhibit 6 summaries the broad policy objectives and mechanism to implement the same.

38. The policies/regulations impacting cotton can be broadly classified into

(1) Cotton specific legislations

(2) Legislation and policies which are not cotton specific

(3) Textile policy.

These are briefly discussed below.

Cotton specific legislation

39. The 3 major cotton specific legislations are

(1) Cotton Control Act to maintain purity of variety and avoid mixing. This specifies what varieties can be grown in areas covered under the act

(2) Cotton Transportation Act which regulates transport of seed cotton to avoid mixing and contamination

15

S UJILIi(

1tUAU &ICY fJEC1ii. D P1CiIiC POUCI K 1SK UI ill WECUNal

UiECTiYC UI THE POLICY CENTRAL WKWUT AECI STATE VERT

POLICY WvULEU POUCY iUCD

Fars ievei iProcuctioni

Enabling the farier to get remunerative Minimum support price NIXISTRY UI Liupport prices TATEs DEPARTMENT

prices and give policy direction to the AIcuLruRE UI iCtTURE

farmer

Developing varieties and production Research programs of KAR Cotton Production STATEs DEPARTMENT

technologies Central overnient Act for purity of UI AiCULTURE

of variety

Extension of fart practices and aaoptior, intensive Cotton hikISTV UI Cotton PrAction KPARTSENI

of tecnnoiogy District rograue 4GA1CiJLTURE prograis fr fart UI ARiCULtE

(ICUP) for extension tecnnoioy

of proauction ecnno-

logy ICIJP 5TATEs DEPARTMENT

UI AUCULTURE

a1ntaining purity of varstes CoU.on Control iict h7515TRY UI Cotton Control STATES T$CT AiCJL1URE ALL UI iCULiURE

arecjno (ov the farmer

Enabling the faruer to wEst his Procurement policy by

produce effectively Cotton Corporation of

India for avoiding

Ensure that the farier gets his money distress saie by

on time farurs

Reducing distress sale by farmers

Reguiting tixing of cotton

MIITRI 01 keguiitea markets STATE ;UVT.

TTiLES for enaoiing the AiRICULT4RE

fatter to iarct and UEPAiEii

get remunerative

prices

Prxureient scheme STATE UvT.

to avoid panic sale AAICiJLTRE

and enacie crop DEPAWKEXT

iaruting

Cotton transporta- STATE GOVT. tion Act for avoid- 0-OPERATIVE

ing iixing of cotton iCDCRAiIU

HOAD QUECTIVEZ. AND SPECIIIC POLICY HiCiiAiSiS Of TE OiERitiIEIT

fP.OP OJECiiVI. OF THE POLICY CETRáL STATE O&ME1 AECY

POLiCY IMULYLD POLICY iVOLiEU

1. Saintaining II standards for cotton Cotton inning and MINISSTRY Of cotton 0nning ARIcULTUkE

pressing Pressing Acts for TEXTILES and Pressing DEPARTMENTS

maintaining 151 Acts for the ginning

sunoaras rates quality ma

ana capacity

:. Contro.iiing the rates of ginin to - - do -00- - 00

it scoici to CiLs

Controili.A. capacity of ginning units or)

anc eepir•; trzcx of tne quaitty ana

q.faiitty of assec oaies

0. Trade aivd TxtIl5

1. Proviains cloth at cneap prices to Textile Policy MINISTRY or State Textile DEPARTMENT O

for cotton and TEXTILE Policy for AICULTE

man-aaoe fibre promoting cotton niD TEXTILES

content

uiOeiines --r cotton ar un-taue Textile policy MIXISTU Of

fibre content -. TEXTILES

ecuatin the cotton for the nanaioo. Essential Couo- MINISTRY Of

sector ensuring nan yarn is avaiiaoie aities ct for TEXTILES

to ioioi eaiers sating iotñ and

yarn avaiiaoie

4. €guLtcg crecic ano stocks to 3V010 R&i Regulation REERVE

noaroing specuiatio for credit Of INDIA

Seguiatn -; movement oi cotton and avoia Cotton iranspor- DEPARTMENT Of

alxing anu infection oifferent utlOn Act to TEXTILES

regions

avoid infection

Quota sysces! for export of cotton Import and Export MINISTRY OF

(iint to regulate aciestic prices- and - Poiicy for quota TEXTILES

ensure oriy surplus is exported of exports

- 17

(3) Ginning and Pressing Factories Act which, amongst other things, allows government to fix ginning charges.

In practice, the first two acts indicated above are only on paper, partly because of the problems in implementation as it is a physical measure. The Ginning and Pressing Act is implemented in most places in that charges are fixed but this is apparently a cause for poor ginning facilities as the charges are unremunerative, leaving no surpluses to upgrade facilities.

40. A fourth cotton specific legislation, called Maharashtra Monopoly Procurement Scheme, is applicable only in the state of Maharashtra. Under this scheme, only the state cooperative federation can trade in seed cotton in that state. While the objective is to ensure better prices to farmers, it apparently leads to smuggling of cotton across state borders (depending upon prevailing prices) and leads to rent seeking.

General legislations and policies

41. Legislation and policies that are not cotton specific but affect cotton are

(1) Agriculture production policy which determines the Minimum Support Price (MSP)

(2) Essential Commodities Act which aims to ensure availability of specified commodities at reasonable prices. Cotton and textile are covered.

42. Agriculture production policy lays down physical targets for various crops based on requirements and complementary to this are policies relating to land use, pricing, incentive/price support, inputs, credit etc. Cotton being a crop is affected by this in terms of availability of resources and price support. This MSP, which aims to- provide a floor price and price signals to farmers, is determined by the production policy; when market prices fall below the MSP, the government intervenes through its agency (in this case the Cotton Corporation of India) by making purchases at the MSP.

43. The Essential Commodities Act allows government to determine product mix, prices and stocking levels at various points in the cycle. The Act is enforced in line with the textile policy discussed below and any contravention invites stringent action.

Textile policy

44. The Textile Policy provides the basis for government intervention in all aspects of cotton after it is ginned as-at this point it is an industrial raw material. The policy is essentially driven by the need to meet the country's clothing requirements and hence covers all relevant fibres. Under this

18

policy, the Ministry of Textiles carries out the following interventions through designated agencies - :

(1) Import export of cotton and products

(2) Prices

(3) Fiscal policies for man made fibres

(4) Hank yarn requirements of the handloom sector.

45. The import export policy is apparently governed by the need to meet domestic demand for cotton. If preliminary crop product estimates indicate that surpluses are expected, export quotas are declared which are adjustid as better information on cotton arriI come in making this very adhoc iipracticéT fl r!Tfjigh prices or shortagTiorts are allowed. 1eceir chan to overcome some of the drawbçjcs ôf the imp export

are minMvWdas

fiUat the beginning of the seasoh which can only b upwards and dut3lTfe imports.

46. Although no direct price interventions are resorted to, domestic prices are usually kept below international ones by linking exports to surplus production. This is done to encourage value added exports, ensure reasonable process of cloth to the population and to ensure yarn at reasonable prices to the large and vulnerable Drice sensitive handloom sector. Insulation of domestic and international markets through the export policy, specifying the quantities of stocks that mills can hold under the Essential Commodities Act and advising the Reserve Bank of India on credit availability to trade are some of the measures used to prevent stockpiling in the system and maintain low domestic prices.

47. Fiscal policies governing excise, import duties etc. on man made fibres and cloth will naturally influence the fibre mix in clothing. These duties on man made fibres and its inputs have been steadily decreasing over the years so that cotton's share in the fibre mix reduces from 70% at present.

48. The handloom sector meets about 30% of the country's clothing needs and employs 6-10 million people. Moreover, much of its produce is sold to low income price sensitive customers. To ensure raw material availability to this sector, the government has made it obligatory for spinning mills to produce 50% of its output (excluding yarn for exports, captive consumption etc.) in hank form. Called the hank yarn obligation and under the Essential Commodities Act, no price controls are exercised but offtakes are not guaranteed. Excise duty concessions are available to specified buyers and in times of rising prices direct price support is provided to the handloom sector which purchases the hank yarn.

19

ISSUES IN GOVERNMENT POLICY

49. The major issues related to government policy are

Cotton specific legislation

(1) Poor implementation of the Cotton Control Act, mainly because it is a physical measure and results in rent seeking

(2) Low administered ginning charges are a cause for poor quality of ginning

Textile policy

(3) Insulation from the international cotton market results in low prices especially for long staple

. I cotton because of the domestic markets requires only medium and short staples

(4) Low domestic prices are maintained at the cost of the farmer. (This is further illustrated in the

\ discussion on crop economics)

(5) Physical measures like stocking control, hank yarn obligation etc. are difficult to implement and result in rent seeking.

CROP ECONOMICS

50. The costs of cultivation based on data collected during the primary survey and from CICR Nagpur is given in Exhibit 7 for all the 3 regions. The costs being considered here are total costs which includes both out of pocket and imputed costs. The important points that emerge are

(1) The highest profits are in case of northern region which amount to about Rs. 6300. This is primarily because of higher yields

(2) Returns in case of Southern region are higher than those of the central region primarily due to lower costs

(3) Cost of cultivation of hybrids cotton is almost 33%-45% higher than the varieties. However, due to better yields and prices the profits are higher.

51. What needs to be emphasised is that in this analysis the yield considered is for the sample which is much higher than the average for the state. If the average yield for the state is considered, except for the Northern region, the other regions would suffer a loss if total cost of cultivation (i.e. C2 costs

20

which include both imputed as well as out of pocket expenses) is considered. In other words, cotton is facing lower economic returns which is bound to have an impact in the future years. Secondly, except for the Northern region and some parts of the Southern region cotton is essentially a monocrop. Profits from this crop represent returns to the farmer from the total farm over the whole year. If these are not remunerative, there is bound to be a shift to other crops.

Comparison with competing crops

52. Exhibit 8 gives the comparison of output/input ratios of cotton with the competing crops. As can be seen, except in the case of Haryana, Punjab and to a less extent Andhra Pradesh, and Karnataka, the output/input ratios for cotton are lower than those of the competing crops.

Domestic Resources Costs (DRC)

53. The domestic resources cost calculated for the three zones consideringdifferent staple length indicates a competitive advantage for Indian cotton. The DRC's are given below

(1) North : Rs. 30 (2) South : Rs. 30 (3) South : Rs. 19

This exchange rate is 1$ = Rs. 33.00

ISSUES IN CROP ECONOMICS

54. What seems to emerge is that especially in rainfed areas, economics of growing cotton are unfavourable and substitution will occur where it is technically feasible for grow alternative crops. Thus, improved yields and better returns on by products are sustainable solutions to improve cotton production prospects.

KEY ISSUES FOR THE COTTON SUB SECTOR

55. eased on an analysis of the performance of the cotton sub-sector and factors affecting it, the key issue which emerges is that in India cotton is a crop with low profitability and high risk. The 2 main reasons for this are

(1) Unfavourable farm economics

(2) Lower yield

Details of the factors affecting each of these are given below.

21

mill?

COARIBOII OF COP? OF CULTIVATIOW OF SIZV COTTON

ITEM NORTHERN REGION CENTRAL REGION SOUTHERN REGION

(1990-91) 1992-83) (2992-93)

1. Type of Medium staple Short staple Hybrid medium Long staple Long staple Hybrid bog

cotton grown staple staple

2. Whether Irrigated Rainfed Reified Rainfed Rainfed Irrigated

irrigated

or tainted

3. Cost of '600 6.3so 10.200 8.100 5.000 9.000

cultivation

C2

4. Returns

Price 1.150 850 1.100 1.000 1.200 1.200

(Re./quintal)

Yield 12 8 11 10 5 9

(Quintal/ha)

Total returns 13.800 6.800 12.100 10.000 6.200 10.800

S. Profit over CI 4,300 450 1.900 1.300 1.000 1.800

Source CACP & CICR Nagpur Primary Survey and

Primary Directorate of Economics

Survey and statistics Tamil Nadu

22

EXHIBIT d

OUTPUT INPUT RATIO OF COMPETING CROPS

REGION YEAR

NORTH

COTTON PADDY

Punjab (1986-87) 1.39* 1.15 Haryana (1987-88) 1.49* 1.37

CENTRAL

COTTON SOYA SUN GROUND- SUGAR FLOWER NL!I CANE

M.P. (1986-87) 1.24 1.45 - - - Gujarat (1987-88) 1.02 - - 1.19 - Maharashtra (1983-84) 1.07* - 1.52* - 1.29*

SOUTH

COTTON SOYA- SUN- SUGAR FLOWER CANE

Tamil Nadu (1978-79) 1.28* - - 1.62

Andhra Pradesh (1978-79) 1.21* - - 1.48 Karnataka (1985-86) 1.37* 1.34* 1.40 -

SOURCE CACP

* CACP figures used for calculating output/input ratio

* For year 1981-82

NOTE

Output/input ratio is defined as

Wholesale price per quintal

C2 cost per quintal

23

Unfavourable farm economics

56. Unfavourable farm economics is essentially due to

(1) Low prices which are a result of the control Dn foreign trade, poor fibre quality and low ab :y of the processing centre to pay

(2) High risk crop due to problem of pests, deper ce in rainfall

(3) Poor commercial exploitation of by products

(4) Government policy for promoting edible c seed crop.

Lower yield

57. Lower yield is a result of

(1) Lack of adequate number of high yielding varieties/ hybrids for rainfed areas

(2) Poor Agronomic practices as a result of improper field preparation activities, low seed rate, low usage of treated seeds and improper usage of fertilisers/pesticides

(3) Lack of mechanisation

(4) Poor usage of inputs in rainfed areas

All the above problems have been summarised in the problem tree which is enclosed in Annexure I. The objectives required to deal with the problems listed in problem tree are spelt out in Annexure II.

PROJECT PLANNING MATRIX

58. Based on the problem tree and the objective tree, the modifications/changes required have been summarised for all 3 areas technological, institutional and policy in the Project Planning Matrix as required by WE. This is enclosed in Annexure III.

24

! HI!

1 I=-

I IM

C

a ubOu

- lJIfl4J

—5,

U

02

'0

Z 00

-0-01 1

AVU 11 Pef• 1

CORE oaJzcTrvz L TO IROVZ PROPITAIILITY AXD P.0CZ 1211

oB.7EcrIVIs SHORT TERM MEDIUM T5534 LOONG TUN

A. TO ACHIEVE HIGHER PRICES

1. Rationalism controls . Remove export quota

on foreign trade fixation

Delink exports from

domestic consumption

2. Improve fibre quality . Improve quality of

seeds used and ensure

varietal maintenance

Reduce trash content

by improving ginning

facilities

Reduce trash content

by improving work

methods through

extension

Reduce mixing of

varieties

3. Improve ability of - Rationalise hank yarn

processing sector to obligation of spinning

PAY mills towards handloom

sector

4. Ensure Premium for - Grading standards to be - Extend Infra.trcture

Quality Cotton established to all market yards

and ginn.ries

Infrastructure to be

established at selected

market yards and

ginneriss

B. TO REDUCE THE CEO? RISE

4. Improve selection of • Improve analysis of

methods of pest causes of variation

management in crop losses

S. Address problems of • Improve usage of - Improve research to

pests pesticides especially develop cultivars

in rainfed regions having strong plant

resistnce especially

to bollworm

• Reduce sale of spurious - improve availability . Implement area based

pescictdes of acid delirited seeds pesticides application

rviz 11

Peg. 3

OBJECTIVES SHORT TERM MEDIUM TERM LONG TERM

- I.prove extension

for 1P94 and area

based approach

• Maintain a database

on effectiveness

and economics of

I PM

. Reduce dependence of

rainfall

Intensify adoption

of 1PM approach to

improve biological and

cultural control

- To develop drought

tolerant, heat tolerant

and .arl securing

drought escape varieties

Increase adoption of

IPM approach to improve

cultural control to

avoid resistance to

pesticides

To provide protective

irrigation facilities

C. TO IMPROVE YIELDS

7. Develop genetic

resources with higher

yield.

S. Improve agronomic

practice.

- Improve extension

- Improve usage of

treated seeds

- I.prove usage of

fertilisers and

pesticides

Develop high yielding -

varieties/hybrids for

rainfed areas

9 :.prove ,echantsation - Steps to be taken to

reduce uneconomic

holdings

- Steps to be taken to

develop Low cost

technologies for small

farmers

AXNzru]Lz 11

Mg. 3

OBJECTIVES SHORT TERN MEL:UM TSPJq LONG TERN

10. I.prove usage of inputs - Develop high yielding - Improve irrigation

in tainted areas varieci.s/hybrids for facilities

rainfed areas

0. TO IMPROVE BY- PRODUCT trrILISATIOW

- Commercialise

research

ARZ ZU

Peg. 1

pio7zcr Pt..AJIWIWG MATRIX

ACTIONS TO PR TAKEN IN THZ SHORT !XIJI 192

StJ)04A&Y OF OBJECTIVES/ OBJECTIVELY VERIFIABLE MEANS OF VERIFICATION IMPORTANT ASSUMPTIONS

ACTIVITIES INDICATORS

OVUALL GOAL

To improve cotton profitability (1) Yield per hectare (1) Govt. publications (1) Achievement of results

a reduce risk (2) Farmer income (2) CACP Data listed in the matrix

(3) Increase in cotton (3) Periodic Farmer Survey

acreage

PURPOSE

To increase yield & improve

farm economics comparable

with international standards

RESULTS

Technological

Improve effectiveness and

economics of IPM a area based

approach

WVLTS

Institutional

(i) a. Improve availability

of certified seeds at

lower prices

b. Make state seed corpo-

ration, more market

responsive by ensuring

autonomy in operations

c. Varietal maintenance

(2) a. Initiate spraying of

fertilizers

b. Rationalise availa-

bility of irrigation

water

(1) Reduction in chemical

pesticides

Increased usage of treated (1> Pa.Xmer survey I.provument of systes at state

seed. (2) Data from government seed corporations to estimate

organizations (State costs more effectively

Seed Corporations)

Improved yield and quality Reports from Market Yard

in some varieties and breeders

Improved usage of ferti- (1) Farmer survey

liser 2) Reports by extension

offices

AIXU7.Z I 1

P490

SUMMARY OF OBJECT: VES 3BJE1VELY vERIF:ARZE MEANS OF VERIFCATON IMPORTAN, ASSUNPT:CNS

ACTIVITIES :PIDICATOR-S

(3) Strengthen testinc Reduction in sale of Reports of extension offices

facilities for pe.ti- spurious pesticides

cidem

(4) Strengthen distribution :.prove.ent in usage of (I) Sales reports of primary

network of pesticides pesticides in rsinfed agricultural cooperatives

in the rainied area region societies (PACS)

(2) Survey of Careers

(3) Reports of extension

offices

(S) Strengthen extension net-

work by proper training

at fare level

(U Modernime gins Reduction of crasA control Cinners survey

by improvement of ginning

facilities

(7) New institution to be Comparison of forecasts

involved in crop estlea- vs. actuals

tion and demand estima-

tion

(I) Improve estimation of

(tank yarn demand

() Commercialise Research Higher usage for cotton Trade industry source

of by product utilis.- by product, - ti on

RESULTS

Policy

(1) Legislation to ensure Increased usage of treated

treatment of seed, before seeds

sale whether certified

or truthfully labelled

(2) Regulate sale of spurious

pesticides and testing

AIOUIZ III

Page 3

I

i

SWQIP.RY OF OBJECTIVES/ OBJECTIVELY VERIFIABLE MEANS OF vEa:F:CAT:oN IMPORTANT ASSJMPTONS

ACTIVITIES INDICATORS

a. Extension to cover

training of private

dealers as well as

modernization of

training methods

b. Extension efforts to be

strengthened by involv-

ing non-government

organizations and other

traders, seed manufac-

turers etc.

(4) A. Ginning rate fixation

to be modified

Statute changes would be

accepted and passed by the

government at the state level

b. Making cleaning faci-

lities mandatory

C. Setting up of a fee

charging statute for

funding modernization

(5) Stabie export policy

Revievi; h.ir.k yarfl

obligation limits

Fixed export quantity

Oinxier, survey

Government announcement

and trade survey

k)flIUTiU III

Peg. 4

stm04.s.RY or OBJEC:vEs/ spEc:r::xr:oN OF :$P)fS'COSTS :MpoRAwr ASSUMPTIONS

acrxvrT: zs

Technological

Extension and working out

fare economics

Institution"

(1) a. Steps to be taken to

encourage contract farmer, in terms of

- Better price, for

the product

Better infrastructure

support for delivering

seeds from farm, to state seed corpora-

t ions

b. Price fixation for pro-

ducing and sale of seeds by aut000.ous committee in the state seed corporations

- el1 n !CAA

for letting up of pro-

cedure, monitoring and compliance of to varie-tal maintenance

(2) a. Initially the extension

department can take the

initiative to start the

spraying by using

contracted labour etc.

Later on, once the

practice becomes popular

the costs can be borne

by the cultivator.

themselves

It is economiCa

Study to be conducted at various state seed corporation, to strengthen systems

ensure autonomy to critical functions

13 state seed corporations are already being covered under National Seeds

Pne3ect III)

~ e7%0 to s-r 'ir rhe e.fl

AXWZIO7.Z ! IX

Peg. S

$2)OQ.P't OF oB.Jz:vEs/ SPECIFICAON OF :Nptrrs/cosrs MPORTAI.1T Assu7lP-rIONs

ACrIVIES

b. Scheduling of irrigation DOA to initiate meetings

water to be worked out

betveen irrigation

department and Director

of Agriculture channel

wise rather toan canal

wise

(3) Set up testing labs where State to provide inspectors for

farmers can teat their testing samples

pesticides

(4) a. Provide financial Financial allocation for demonstration

support to co-operative and distribution by state agencies

channels for distribu-

tion of pesticides

(5 a. Provide extension an

demonstration at farm

level on pesticides

usage

b. Use interactive methods

like computers etc. to

improve training at fee-

tiveness of extension

wOr*.rs

-.c. Training dealers to Design of training progrses

understand the correct for dealers

quantities of fertiliser/

pesticides required

d. Tratz extension workers Design of training programmes

to understand need to for workers

increase farmer aware-

ness regarding correct

methods of field pre-

paration

e. Demonstrations to be aide

toincrease farmer aware-

ness of the improvement

in yields due to better

methods of field prep.-

ratioa

- Funds for setting up laboratories

- Availability of funds

- willingness of parties involved

Ainiirnu III

Paqe

sWOtA.Ry or oBJEC:vtS. SPECIFICAT:N or :NPtrrs/COSTS IMPORTAff A.ssUI'wr:oNs

Ac:vITxES

() Setting up a fund for

modernisation

(1) Involve ISRO for satellite

mapping

(U) a. Setting up a study

jointly by mills and

the government to

estimate hand yarn

obligation

b. Initiating data collec-

tion on statistics of

registered lncs,

operating looms by

making district level

members of co-operative

federations responsible

for it

(9) Set up standards for

cotton grading

Contribution to be made by mills and

government through cess or fee. The

policy changes required to initiate

this cess or fee are included under

policy change.?

Textile Commissioner to formulate

a programme for involving ISRO

Proper market estimate by a reputed

fir, in India

Increase responaibilcy of district

level members of cooperative society

(1) Involve BIS

(2) Strengthening of market yards

with infrastructure

(1) Availability of funds

(2) Government willingness

Technology and cost benefit

would be favourable

Ponds available for the study

Availability of funds

(10) A. Set up a cell under -

CIRCOT for commercia-

lisation

b. Sailing technology

through cechno -economic

feasibility studies

AfRXUP1 I!!

Peg. 7

StJ)O4ARY OF OBJECTIVES/ sPEcrF:CATI0N OF xsPu'rsicosrs :MPORTMrr ASSUMPTIONS

ACTIVITIES

ACTIVZ7IIS

Policy

(1) Notification under the Legislative action by the state Government willingness

Seed, Act

(2) Create a cc.e or increase

license fee of trader to

finance casting cost of

pesticides

Penalty to be sever for

sale of spurious pesti-

cides

a. Training of private Design of training programme for

dealers to be included dealers and by using new methods by

in extension programme Extension Department /State Department

of Aariculcure

b. Involve WOO., trade,

etc.

c. If knowledge base a - Invitation to WOOs for participation

problem, any changes in extension work. Details like

in education process Compensation etc. to be worked out

at low level to be

introduced by soderni-

methods, by usages of

films, computers etc.

(4) Amending of act for

a. Fixing maximum rates

for ginning which give

a reasonable race of

return to a modern

ginnery. Ultimately

decontrol on prices is

the main objective

b. Making certain infra-

st'tt..:e like 1DCr-

ing, cleaning mandatory

for ginning units

c. Statute required for tee

AJWIXOIZ II!

Pegs $

5WQARY OF OECTIVESi sPEClFATON OF 1NPu5/COS5 :MPORTAN-r As3Mpr:ONs

AcT:vIIEs

5) Announcement of long tern

transparent export import

policy by textile Commia-

sionner based on fiscal

measures like export duty

() Fixing maximum limit of Textile Commissioner to get initial Willingness of the government to

hank yarn obligation and estimation of flank yarn obligation conduct such a study

reviewing it periodically through an independent study

during the season and

announce th* flank yarn

obligation

I

A)IEDlZ III

Peg.

pRoJECT PLANNING MATRIX

ACTIONS TO II TAXIW IN THE SHORT TZP.JI (j TZARS)

SU)9A&Y OF OBJECTIVES/ OBJECTIVELY VERIFIABLE MEANS OF VERIFICATION IMPORTANT ASSUMPTIONS

ACTIVITIES INDICATORS

OVWLL GOAL

To improve cotton profitability (1) Yield per hectare (1 Govt. publications (1) Achievement of results

& reduce niL (2) Farmer Income (2) CACP Date listed in the matrix

(3) Increase in cotton 3) Periodic Farmer Survey

acreage

POIPOSI

TO increase yield & improve

fans economics

RESULTS

Technological

(1) Reorient research towards Development of drought 1) Farmer survey Research effectiveness, funds

drought resistant varieties resistant varieties (2) Data from research availability

station

(2) Research programme to Development of genetic (1) Farmer survey Research .ffsctivenees, funds

develop high yielding resources with higher (2) Data from research availability

ral-.!Cd mdc yels

(3) Research programmes to Increased sechanisation (1) Parser survey Research çffectiven.se, fund

develop low cost mechanisa- available

tion possibilities for

small farms

RESULTS

Institutional

(1) Reorcanising research on (U Development of cultivars (1) Farmer survey Research effectiveness. funds

pests with strong pest rests- (2) Data from CICRa 1PM available

stance especially to

bollworm

• (2) Adoption of 1PM approach

• to improve b'ological

and cultural control

mnrzxvxz III

Pegs 10

su,oy o c:ES, 08;ECT:vE1Y VERIFIABLE MEANS p R:P:cAT:M :MpowANr ASSUMPTIONS

ACTIVITIES INDICATORS

(2) Provide good quality seed Improved availability of (1) Parser survey

to farmer by providing acid delirited seed (2) Reports from government

institutional strengthening organisation istate

Seed Corporations)

(3) Strengthen extension network Reduction in trash content (i) Parser Survey

by proper training at farm proper work methods (2) Ginners survey to check

level if fibre quality has

improved

(4) Regulation of varieties Reduction in mixing of (1) Trade survey

varieties

(S) Statistical data on crop Improvement in analysis of

losses caused of variation of

crop losses

6) CCR to strengthen resarch Development of generic

for rair.fed areas resources with higher

yields

(1) Data from IPM institute

(1 Reports of Research

stations, agricultural

universities

I

I

POLICY

(1) Regulate distribution of

quality seed

21 .I • to

grown

(3) Increase size of cotten

growing holdings

Improved availability of

acid delinted seed

in i;

varieties

(1) Parser survey

(2) Trade survey

Ii

I

AIWT.XUII I 11

Peg. 11

StJ)OARY OF Oa:ECT:VES, spEc:F:A::CN OF INPUTS/COSTS MPORA?C ASSUIPIONS

ACTIVITIES

ACTIVITIES

T.chaological

(i) Design research projects Avb_ty of requisite germlasm.s Availability of funds and technical

manpower

Coordinate with other inter-

national research organisa-

tion.

(2) a. Coordination with inter-

national research bodies

in countries with similar

climate like that of India

to exchange information

b. Setting up of a special

research project for

developent of these

varieties

(3) a. Coordination with other Central and state funding for such Availability of such funds and

countries which have small projects technical manpower

farms

b. Setting up a project for

development of such

t echac 109 lee

ACTIVITIES -.

Institutional

1) Research programmes ICAP to formalise such a research Availability of funds

prograe orientation options

- On bollworm resistance Joint fuding Willingness of private seed companies

- to participate

Biological and culture) Government funding private research

control with 1PM Availability of fund'

• Co-ordination of research Private petting research done

programmes between IPM through government

institute and CIcE

- Conduction of research - -.

with private seed manufac-

turers

AIIUIV7.I :11

Page 12

SZ)O(ARY OF oss:vts spE::F:A:3N F :Nplr?s 'ccs- s :NpoRANr ASSWPT'ONS

ACTIVITIES

(2) State seed corporations to

set up acid denctng plants

3) Train extension workers and

tamers on trash content and

contamination

Conduct experiments at farmers

field on trash content and

demonstrate the effect of

better work methods

State co-operation and allocation

for such pro3ects

Avaiability of funds

(4) a. MOA/DOA to revamp department

for inspecting varieties

b Notify s..cn varieties at

state level and reion

-_, se

C. Ginning ac: to notify

varieties that can be

ginned in an area based on

notifications at the state

level

willingness of government and private

sector participate

d. Variety detecting equipment

in ab -a:,r.es to be set

up by govereot

(5) Research stationa.'etate gover-

nment agricultural universi-

ties extension department to

collect crop loss information

to be provided to state

government statistical

department as well as IPM

Institute

I Providing technical inputs

financial suppert to CICR to

strengthen research in rainfed

areas

States to finalise which of these

organisations would be able to do

it in each state

Availability of funds

Punds for regular statistical

research and data collection

Policy

(1) Make it eanda::ry for cotton Legislative Measure in the Seeds Act. Government willingness

seeds to be delnted

S

AaIwU1.I 111

Page 13

S7ARY OF 0BJEcT:vEs/ SPECIFICATOII OF :NpuTs/coss :,p:RTA Assl?T:oNs

ACTIVITIES

(2) Reverse the trend towards

abolishing the cotton control

act in various states

Government penalties for non-

compliance by farers/ginneries

Penalties on distribution of

...da of unapproved varieties

(3) Research programme* to develop

low cost mechanization

possibilities for small fares

(4) Initiate steps to discus,

rationalization of land

ceiling laws and tenancy laws

Start co-operative or leased

farms to increase .chaniaa-

tion

OA to initiate discussions

MOAto initiate setting up of

demonstration fare in certain

cotton growing districts

Agnmuzz III

Palo 14

ACTIONS TO !! TAXZY LN I'! !9 !!! .(i:. TEARS)

SU)4ARY OF OBJECTIVES/ OBJECTIVELY VERIFIABLE MEANS OF VERIFICATION IMPORTANT ASSUMPTIONS

ACTIVITIES INDICATORS

OVERALl. GOAl.

a

To improve cotton profitability (1) Yield per hectare

& reduce risk (2) Farmer income

(3) Increase in cotton

acreage

PUEPOSI

To ensure a sustained increase in

yield and sustained improvement in

farm economics

RESULTS

Technological

1) high yielding varieties

RESULTS

Institutional

1) a Strengthening extension

of high yielding

varieties

t' .!:.1r' cnat:--

between research agency

-. and the farmer

(2) Reduction in pest incidence by

institutional strengthening

3 Strengthen IPM institution and

extension

POLICY

(1) Announcing a plan for research

for high yielding varieties

(2) Regulate area

tion of pesticides

(I) Government publicazons 1) Achievement of results

(2) CACP Data listed in the matrix

(3) Periodic Farmer Survey

AIXIXVI2 t It

Peg. 15

SUMMARY OF oBJEO:vEs. SPEt:F::A:QN OF :NPu7s,c3ss P3RAN ASSUNPQNS

ACTIVITIES

Technological

Ii) Research programmes to be Availability of technology and Availability of funds

undertaken which can be coordination between farmer and

extended to the field for research scientists

lower costs and higher yields

ACTIVITIZS

Institutional

(i) Focussing on high yielding A committee to review performance

varieties in extension of the research

Setting up a rev:ew, committee

for research

2) Government to d area based Extension department of the state Willingness of the government

application to ensure that area based applica-

tion is done

(3) Provide additional IPW labs Research and training programme Availability of funds

for research design by the institute of peat

management

POLICY

(1) ICAR to prepare plan and CICR to participate in the plan Government willingness

I ormalise the same wth

Government of cda

I