Conference: Sustainable Development Goals: Preparedness and Role of Indian Agriculture

Call for Abstracts: Sustainable Development Goals: Preparedness and Role of Indian Agriculture

Source: Flickr (IFPRI) Leveled field being irrigated in eastern Uttar Pradesh, India.

The International Food Policy Research Institute (IFPRI) and the Trust for Advancement of Agricultural Sciences (TAAS) are jointly organizing a Conference on “Sustainable Development Goals: Preparedness and Role of Indian Agriculture” on 11-12 May 2017 in NASC Complex, New Delhi, India. The main aim of the conference is to prepare a roadmap for Indian agriculture to achieve Sustainable Development Goals (SDG's) before 2030.

Globally, poverty and hunger are still twin challenges before human civilization despite specific temporal and spatial efforts. Though extreme poverty has been reduced by more than half since 1992, yet more than 1 billion people live on less than $ 1 a day.  To continue the global collective efforts of Millennium Development Goals, countries adopted renewed set of goals to end poverty and protect the planet and ensure prosperity for all as part of new SDGs. There are 17 SDGs and four are directly related to agriculture: “no poverty”, “zero hunger”, “climate action”, and “life on land”.

Agriculture plays an important role for the livelihood of poor especially in rural areas. However, agriculture sector is currently facing numerous challenges. The question obviously before us is: How can agriculture contribute towards achieving SDGs? What should be the strategy to promote agriculture for achieving SDGs? What lessons other developing countries, especially South Asia, can learn from India or vice-versa?

It is our pleasure to invite you and your colleagues to participate in the conference and contribute abstracts in any of the following topics by 14 April, 2017:

  1. Status of Indicators of SDGs
  • Poverty and hunger
  • Land and water degradation
  • Climate risks
  1. Technologies to Accomplish SDG
  • Genetic enhancement
  • Natural resource management
  • Farm mechanization
  1. Role of Policies and Institutions
  • Backend service system
  • Agricultural marketing and food retailing
  • Agriculture-nutrition linkages
  1. Best Practices in Developing Countries
  • South Asia
  • Southeast Asia
  • Africa

We shall appreciate if you circulate the invitation letter to your colleagues and students for participation and contribution. You can send in 300 words abstract mentioning the topic under which abstract is submitted with complete details of the corresponding author to Vaishali Dassani (v.dassani@cgiar.org).

Concept Note - March 22, 2017

How microfinance has reduced rural poverty in Bangladesh

Cross-posted from the ifpri.org website written by Sara Gustafson and Shahidur Khandker

A woman at a market in Bangladesh. A new book shows that the growth of microfinance institutions over two decades in Bangladesh has helped the rural poor diversify their economic activities and boost incomes, lifting some 2.5 million people out of poverty.
A woman at a market in Bangladesh. A new book shows that the growth of microfinance institutions over two decades in Bangladesh has helped the rural poor diversify their economic activities and boost incomes, lifting some 2.5 million people out of poverty.

As microfinance institutions (MFIs) grow in many countries worldwide, debate continues over whether such programs truly benefit the poor. Proponents emphasize the need for innovative ways to provide poor populations access to financial services. Critics argue any successes may be temporary because microfinance programs require training and entrepreneurship skills, which many poor populations lack. In addition, some fear that beneficiaries may be charged high interest rates or become dependent on MFIs, borrowing more than they can pay back and becoming further trapped in poverty.

Beyond Ending Poverty, a new book published by the World Bank and authored by Shahidur Khandker of IFPRI, Baqui Khalily, and Hussain Samad, examines this debate in the context of Bangladesh, finding that microfinance institutions there have had sustained benefits over two decades in reducing poverty and increasing incomes. Microcredit accounted for a 10 percent reduction in rural poverty in Bangladesh over that time—meaning MFIs lifted some 2.5 million Bangladeshis from the ranks of the poor.

When Bangladesh’s microfinance sector was first established in the 1970s, its main goal was reducing rural poverty by providing microcredit loans for non-crop activities such as trading, and raising livestock and poultry. These loans were funded mainly by the government of Bangladesh and bilateral donors through group-based savings and lending programs.

Today, Bangladesh’s MFIs cover some 32 million members and give out more than $7.2 billion annually. Instead of relying on the savings of borrowers, MFIs now have access to institutional funds, including commercial banks. Modern microfinance in Bangladesh has expanded its scope from home-based activities and self-employment to include savings and insurance, microenterprises, and productive employment.

Microcredit also helped to diversify borrowers’ economic activities, boosting incomes in the process. Household income grew over the study period, driven by rising non-farm income. For households diversifying into non-farm activities, income growth was almost 29 percent higher than that of their counterparts who stuck exclusively to farming. The reduction in moderate and extreme poverty for this group was almost 8 percent higher. Better access to credit was found to be a key factor in promoting this shift.

But MFIs, despite their traditional focus on non-farm activities, have also aided farmers. Borrowing from an MFI raised farm income and reduced reliance on wage income, producing significant positive effects for women and marginal farmers. A 10 percent increase in women’s credit use was found to increase crop income by 3.5 percent, non-crop income by 2.8 percent, and total farm income by 0.7 percent. In addition, borrowing by both men and women has had important impacts on income, labor supply, household assets and net worth, and children’s schooling.

The book’s findings are based on data from household long panel surveys covering the period 1991-92 to 2010-11. This 20-year study period matters, the authors argue, because the benefits of microfinance programs—such as increased income generated through new self-employment schemes—take time to realize; in addition, given the growing complexity of the microfinance sector in Bangladesh, this broad range of data was useful in untangling the true effects of MFIs on the country’s rural poor.

The authors compared the operational efficiency data for Bangladesh’s leading MFIs with comparable data for MFIs in India, Indonesia, Mexico, Thailand, and Vietnam, finding that two of Bangladesh’s top MFIs (Grameen Bank and BRAC) are among the world’s most efficient microfinance institutions.

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Highlights of Recent IFPRI Food Policy Research in India

Source: (Flickr): Pallavi Rajkhowa, IFPRI
Source: (Flickr): Pallavi Rajkhowa, IFPRI

IFPRI began its enduring partnership with India nearly 40 years ago. In fact, IFPRI’s first Board of Trustees in 1975 included Vijay S. Vyas, Director of the Indian Institute of Management in Ahmedabad, India. IFPRI and India’s partnership played a particularly important role following the Green Revolution when that partnership analyzed the necessary policies to both promote domestic food production and to encourage farmers to adopt new rice and wheat varieties. IFPRI’s studies on the Green Revolution in India showed that agricultural growth had a strong impact on poverty alleviation and that further attention to agricultural growth was necessary to reduce poverty. In the late 1970s, amid stagnant food production, weather-related crop losses, and an ever-growing population, the Indian government sought food security solutions that extended beyond food aid; technology and rural development played leading roles in the IFPRI-India working relationship during that period.

During the 1980s, IFPRI’s research focused on India’s agricultural sector, particularly on agricultural growth linkages to the nonagricultural economy; the impact of high-yielding rice varieties in South India; and instability in foodgrains production, food subsidies, dairy development, and livestock demand. Research conducted during the 1990s included studies on topics such as public expenditure and poverty in rural India, incentives and constraints in the transformation of Indian agriculture, and high-value agriculture. Research topics since the 2000s have expanded to include malnutrition, public investment, climate change, value chains, capacity strengthening, and biofortification. As of 2015, the Institute has produced more than 450 publications on India’s food security and collaborates with dozens of Indian institutions.

IFPRI receives continuous financial and logistical support from the Indian Council of Agricultural Research and the Department of Agricultural Research and Education within the government of India and works alongside dozens of research collaborators in the country. This brochure highlights some of the key collaborations between IFPRI and its Indian partners, describing recent and ongoing work.

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National Workshop: Mitigating Agrarian Distress in Indian Agriculture

Cross-posted from the FSP India website written by Jaspreet Aulakh

Hamish John Appleby / IWMI
Hamish John Appleby / IWMI

Partially spurred by the recent droughts in several states in India, a conference was held in Telangana on October 15, 2015 focusing on “Mitigating Agrarian Distress in Indian Agriculture” as part of a series of dialogues being organized under the Indian Food Security Knowledge Platform and Policy Dialogue. The conference was jointly organized by IFPRI and Centre for Good Governance and took place at the CGG Conference Centre in Andhra Pradesh. Distinguished guests from government, national and international researchers, and private stakeholders participated in the event.

The workshop aimed to look at the problems the agricultural sector faces from the recent drought to formulate proper policies and programs, not only for achieving sustainable and inclusive development of agriculture but also integrated rural development. The main goal of the workshop was to frame a set of recommendations to resolve the agrarian crisis based on an evidence-based assessment of the situation.

Although there are already government policies in place to support irrigation in case of dry spells, including an early weather advisory system and power regulation, there are still many Indian farming communities feeling the impact of drought and entering a phase of agrarian distress. The worst fears of a second consecutive year of rain deficit have played out as 2015 saw the adverse effects of drought in states of Karnataka, Maharashtra, Telangana, Andhra Pradesh, Uttar Pradesh and Bihar. The Indian Meteorological Department (IMD) has reported 12 percent average shortfall covering 40 percent of India for 2015. With a 43 percent below normal deficit in rainfall, Karnataka is the only state to declare drought this year and many districts-- 27 out of 30-- are affected. Yet other states are suffering severely as well; Maharashtra is experiencing a deficit of 51 percent below normal rainfall, for instance.

The central government has released 591.35 million USD as a national relief fund for the state of Karnatakam and last year 617.6 million USD were released for state of Maharashtra. The states of Punjab and Haryana are able to better cope to drought this year due to advanced irrigation facilities than other parts of the country. The delayed rains of September may alleviate some of the further damage but it is unlikely to mitigate the damage already done to agriculture production for 2015.  Hence, there is a need to address this agrarian stress which is multi-faceted through government policies.

The specific objectives this conference were the following:

  • Assess the socio-economic impact of recent droughts in India,
  • Document technological developments to reduce impact of drought.
  • Review government policies and programs which mitigate drought impact.

The impacts of droughts are multifaceted. They range from impacts on the quality and quantity of agriculture produce, on resources such as soil and surface water and depletion of productive assets, and on reduced demand for non-agriculture goods and services. Drought can exacerbate poverty, along with other socio-economic phenomena such as outmigration and overcrowding of cities. Drought can also impact prices of agricultural commodities according to one study presented at this workshop. It was also discussed that hot spots for extreme poverty, unrest, and outmigration are drought-prone areas which can cause effects to be exacerbated due to low resilience to shocks.

Coping with drought has been one of the underlying objectives for government of India for widespread public programs such as PDS (Public Distribution System), MNREGA (Mahatma Gandhi National Rural Employment Guarantee Act), and Agricultural Insurance (National Crop Insurance Scheme). Agricultural insurance is not taking off in India despite the sufficient supply because the willingness to pay for insurance is low in India. Thus, there is need for improvement in product design for selling insurance products in India. Insurance is particularly important in drylands as there is high production risk. There needs to be more studies to estimate whether insurance has improved household economy and improved livelihood opportunities.  MNREGA which can also be applicable in scenarios of drought has prevented 14 million people from falling into poverty since the start in 2005. Less developed regions which use MNREGA show higher participation and higher rate of poverty reduction than more developed regions.

PDS as a vehicle for food security, is the oldest system designed by government of India and needs to be designed around three elements of ‘Availability’, ‘Acceptability’ and ‘Accessibility’ (3 ‘A’s) and active involvement of other states besides Uttar Pradesh, Punjab, Andhra Pradesh, and Haryana. Food availability is a necessary but not a sufficient condition for food security. The Abhijit Sen Committee (2000-2002) brought out the conundrum of availability of excess food and simultaneously food deprivation/starvation. Therefore, the focus of the policy instruments must be to improve access to food with proactive planning, particularly in areas prone to drought without waiting for manual-based declarations.

Presentations also highlighted the existing drought-proofing methods such as solar pumps, drought-tolerant seeds, cloud seeding, and diesel pumps. Cloud seeding was a new concept which is interesting technology used to seed small clouds to create artificial rain over the drought prone agricultural areas. Drought tolerant seeds is an agronomic intervention in which staple crops are bred for drought resistance (can tolerate dehydration in critical growth stages) and show early maturity helping them to escape dehydration. Solar pumps are another mitigation strategy used by Bihar government helped to bring down the cost of irrigation 266 percent when compared to conventional irrigation methods in the case of wheat.

The Telangana government programs includes several initiatives along with Universities to mitigate drought. The press is highly used in the months of high drought risk to spread the weather forecast of Indian Meteorological Department (IMD). The contingency plan in event of drought explaining the adaptation strategies, climate variability, and possible rainfall deficit is shared via video conferences and the farmers given sowing instructions for rainfed crops. The updated forecast is communicated to the officials of Department of Agriculture, farmers and scientists. Wide coverage of contingency plan is given via national television network and 14 other channels.

Bihar government programs for drought proofing include subsidies on shallow tube wells, diesel pump-sets, and investment in public tube-wells. Affordable irrigation is one of the essential components for creating resilient agriculture in Bihar which depends upon affordable power. The current solar-pump model needs immediate change, with farmers and solar companies requiring a modified financial model.

Some options discussed during the dialogue included-stress mitigation with relief measures and subsidies, reduction of single cash cropping, optimization of state reservoir capacities, crop insurance, and improvement of irrigation conditions, alternative government employment, and accessibility of low-interest institutional loans.

The summary conclusions of the dialogue include the following:

  1. There is a need for better information sharing on the role of particular departments within the government as well as more coordination in dealing with drought; for example, between those doing remote sensing and those looking at the agricultural markets and production. More discussion is needed on the role of national markets which can reduce the burden of distress by allowing free trade among Indian Agriculture Markets.
  2. Non-farm employment needs to be considered in policies, as it can be important insurance tool in the incidences of agrarian distress. The non-farm sector has high potential in Telangana and Andhra Pradesh states, for example.
  3. There are many existing policies such as MNREGA, PDS, and NIAS, demonstrating the government’s active role.However, new policies should be built around and in coordination with the programs in place and formulated in the context of the Indian political economy as.as these programs receive a great amount of funding but are not reaching the desired results on poverty reduction.
  4. Tweaking already existing programs cannot give a sustained solution for solving the existing issues. Thinking outside the box is needed along with provision of skill-development programs and crop diversification with livestock, for example.
  5. There is need for pragmatic policies which are based on real-time data and multi-programed technology. Climate-smart agriculture methods are needed as well as a location-specific understanding of the impacts of drought.

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Can Diversification Towards High Value Commodities Strike Gold For Farmers?

Farmer at Malda, West Bengal. Source: (Flickr): Divya Pandey, IFPRI
Farmer at Malda, West Bengal. Source: (Flickr): Divya Pandey, IFPRI

Konark Sikka former intern with IFPRI-South Asia office

Despite small land holding, agriculture’s falling share in national income, and limited scope of transfer of labor to non-farm sectors, agriculture still plays a significant role towards food security and poverty reduction. A recent IFPRI discussion paper on Agricultural Diversification and Poverty in India looks into hypothesis and assesses options for improving the outcomes of the farmers through crop diversification into high-value crops (HVCs) that boost incomes, generates employment, and reduce poverty. The estimates in the paper show that over 5 percent reduction in farm poverty in India can be achieved through crop diversification.

Overall, about 22 percent of farm households in India grow at least one HVC crop. In this study, the authors use Generalized Propensity Score Matching and Dose Response Functions to establish ranges within which crop diversification would effectively reduce poverty. The authors suggest that for marginal farmers, the allocation of land towards cultivation of HVCs needs to rise from the current rate of 39 to around 50 percent, in order to pull such farmers out of poverty. Expectedly, larger the land size, a smaller proportion of land allocated to high value crops is needed for this purpose.  However, increasing area need not be the only option with marginal farmers, since there often is an inverse relationship between farm size and productivity.

In moving towards HVCs, small and marginal farmers face several constraints such as lack of access to credit, input, seeds, high yielding varieties, technology and information, and limited markets in rural areas. For marketing their produce in urban areas they have to bear additional costs  for transporting.

Studies reveal that, with rise in income, urbanization, consumers preferences are shifting from cereals towards high value produce. With a rise in demand of HVC there is potentially a transformational shift of the agri-food marketing system that would involve movement towards  vertical coordination away from spot markets. Vertical coordination would be needed to improve  access to inputs, services, and output markets, and a reduction in marketing and transaction costs.

The authors conclude that diversifying crops with the cultivation of more high value commodities, which have a growing market in the urban areas of the country, could provide farmers with the much needed extra income. Contract farming will help in connecting small holder farmers in the supply chains that would enhance their livelihood.  Further they add, with better infrastructure and improved supply chain coordination, the same increase in income could also be achieved with lower levels of diversification.

 

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