Gujarat Agriculture performance-debate relooked

In a literature review below I bring out the major points discussed about Gujarat Agriculture in the past few years, the basic points which I would like to underlie are

·       Is this growth sustainable or a statistical aberration* due to high volatility?

·       Gujarat’s growth story is marked by a significant divergence between economic and human development. Besides, the agriculture sector in the state is faced with several special constraints- mainly agro-ecological and social-demographic.

·       *The agricultural ‘growth’ seen in the recent past in Gujarat is nothing but a good

 recovery from a major dip in production occurred during the drought years of 1999 and 2000, because of four consecutive years of successful monsoon and bulk water transfer through the Sardar Sarovar project. The real ‘miracle growth’ in Gujarat’s agriculture appears to have occurred during the period from 1988 to 1998.

·        six factors that were given a concerted push by the Gujarat government from 2002-03 onwards:

a sustained programme of water conservation and management;

a massive and well-coordinated extension effort;

a successful overhaul of rural electricity distribution;

a strong emphasis on non-food crops like horticulture, Bt cotton, castor and isabgol;

sustained and comprehensive support to livestock development;

major revamping of agriculture-supporting infrastructure, including roads, electricity and ports.

·       Gujarat is not an outlier economy in 1993 to 2002 and 2003 to 2009. In both these periods, Gujarat’s growth story broadly corresponds with those of other developed states like Maharashtra, Andhra, Karnataka and Tamil Nadu.

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 GUJARAT AGRICULTURE-A MACRO OVERVIEW

In a report written for IWMI and IFPRI (2009) by Ashok Gulati, Tushaar Shah and Ganga  Shreedhar, the authors give a very favourable picture of Gujarat’s growth particularly from 2000/2001 to 2006/2007. Quoting the introduction to the paper:

“The paper explores if Gujarat’s agricultural story is sustainable and can be a divadandi (lighthouse) for other states and developing regions. First the sources of growth are identified followed by the main drivers of growth i.e. which policies and institutions have accelerated agricultural growth after 2000. Cotton, the high value segment (livestock, fruits and vegetables) and wheat are identified as the main sources of growth as they have grown rapidly both in production and value terms. Private sector has driven the cotton boom; but public sector has also played an important role. Besides favorable monsoons in the past few years and past investment in rural roads, active role of public sector through [a] mass based water harvesting and groundwater recharge; [b] reform of rural power system through Jyotigram Scheme; [c] reform of agricultural marketing institutions; [d] revitalized and reinvented agricultural extension system are among the factors that have contributed to Gujarat’s impressive performance in agriculture.”

However the authors themselves bring forward an important limitation of their paper, when they ask the question: Is this growth sustainable or a statistical aberration due to high volatility?

In a paper presented in a workshop on “Policy options and investment priorities for accelerating agricultural productivity and development in India”, November 10-11, 2011, Amita Shah presented a paper on “Perspective on Gujarat’s Agriculture”. She introduces her article with a section “A Decade of High Growth Rate and Beyond” in which she writes-

 
“ The last decade is marked by a phenomenally high rate of growth in Gujarat’s agriculture, the sector which till then was being viewed as the most lagging and highly fluctuating segment of the state’s economy. Development of irrigation, especially under the Sardar Sarovar Project (SSP) and also through augmentation of ground water during the last decade seem to have helped mitigating the uncertainty in the agriculture production, which in turn, has created favorable conditions for taking up high value crops such as cotton, spices, fruits and vegetables besides oilseeds. All these have led to a sustained high rate of growth for much of the period during 2000-2010. Access to bio-technology (BT) especially for cotton seeds has further strengthened the production base by way of enhancing stability as well as productivity thereby income form the sector. The success of Gujarat’s agricultural growth, has taken place at a time when the sector, in several other states had failed to demonstrate dynamism not to talk about buoyancy. No wonder therefore, the high growth trajectory in the state’s agriculture sector is being upheld as a potential `role model’ especially for the agriculturally lagging states.”

 She sets the stage for her discussion with the following

“The current debate on Gujarat’s agriculture is not so much about the rate of growth per se; rather it is more about what has driven the growth, how equitable/inclusive the growth is, and what are the likely environmental implications of such growth pattern. Essentially all these issues focus on the nature and composition as against the rate of agricultural growth in the sector, as the former may have significant role to play in influencing food and nutritional security unlike the growth rate in the sector as discussed in the previous section.”

After discussing various related issues in  Gujarat’s Agriculture she concludes with a section on “Constraints and Challenges”:

“Gujarat’s growth story is marked by a significant divergence between economic and human development. Besides, the agriculture sector in the state is faced with several special constraints- mainly agro-ecological and social-demographic. These include: i) low and variable rainfall with single rainy season thus, rendering large parts of the state as dry land/semi-arid region; ii) heavy dependence on ground water for irrigation, drinking/domestic water supply, and industrial-use; iii) a substantial larger tribal population (about 15% of the state’s population) facing high levels of poverty; iv) pressure for conversion of farm land for non-agriculture uses; and v) influx on migrant farm labour from the relatively poorer regions in the neighboring states (M.P. and Rajasthan) which may work against corresponding increase in agricultural wages. Together these constraints may create additional stress on natural resources especially, land and water; affect quality of drinking water often drawn from deep aquifers; and lead to unequal sharing of benefits between the farmers and the farm labour.”

Tushaar Shah, Ashok Gulati, Hemant P, Ganga Shreedhar, R C Jain write in EPW, 2009, Secret of Gujarat’s Agrarian Miracle after 2000: “Arguably, mass-based water harvesting and farm power reforms have helped energise Gujarat’s agriculture.”

 A contrasting perspective is provided by M. Dinesh Kumar, A. Narayanamoorthy, OP Singh, MVK Sivamohan, Manoj Sharma and Nitin Bassi in a Working Paper for Institute of Resource Analysis and policy “Gujarat’s agricultural growth story Exploding Some Myths” ,March 2010 where they write-

“The agricultural ‘growth’ seen in the recent past in Gujarat is nothing but a good

recovery from a major dip in production occurred during the drought years of 1999 and 2000, because of four consecutive years of successful monsoon and bulk water transfer through the Sardar Sarovar project. The real ‘miracle growth’ in Gujarat’s agriculture appears to have occurred during the period from 1988 to 1998.”

Shankar Acharya in his article “Agriculture:be like Gujarat :Other states have much to learn from Indian Agriculture’s star performer”, July 14, 2011, Business Standard, quotes Ravindra Dholakia and Samar Datta: High Growth Trajectory and Structural Changes in Gujarat Agriculture (Macmillan, 2010). He writes, broadly speaking, professors Dholakia, Datta et al  identify six factors that were given a concerted push by the Gujarat government from 2002-03 onwards:

• a sustained programme of water conservation and management;
• a massive and well-coordinated extension effort;
• a successful overhaul of rural electricity distribution;
• a strong emphasis on non-food crops like horticulture, Bt cotton, castor and isabgol;
• sustained and comprehensive support to livestock development;
• major revamping of agriculture-supporting infrastructure, including roads, electricity and ports.

Further Acharya quotes the authors from their preface writing “It is not a miracle that happened exogenously. It is fully endogenous, systematically led by long-term vision and comprehensive strategy requiring solid commitment and dedication to the cause, political will to pursue market-oriented reforms of policies and institutions, interdepartmental and inter-ministerial coordination and cooperation, and a responsive and entrepreneurial farming community”.

M K Venu in his column in Financial express “It’s Gujarat, not just Modi”, August 13, 2012, states that Arvind Panagariya’s growth data series from 1993 to 2009 reveals an interesting feature. Gujarat’s much hyped growth story over the past decade is not borne out by hard data. Gujarat is not an outlier economy in any of the two phases shown by Panagariya—1993 to 2002 and 2003 to 2009. In both these periods, Gujarat’s growth story broadly corresponds with those of other developed states like Maharashtra, Andhra, Karnataka and Tamil Nadu.

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