|2020 Vision Focus 4 - Promoting Sustainable Development in Less-Favored Areas (IFPRI, 2000, 18 p.)|
John Kerr is assistant professor in the Department of Resource Development at Michigan State University, U.S.A.
Home to nearly 300 million people, the South Asian semi-arid tropics cover mainly southern interior areas of India and small parts of Pakistan and Sri Lanka. Poverty levels are high and literacy rates low. With productivity greatly limited by low, variable rainfall, lack of irrigation, and poor soils, the semiarid tropics contrast sharply with the irrigated areas of the Indo-Gangetic plain, which was the cradle of the Green Revolution and remains the region's breadbasket. Nonetheless, infrastructure and access to markets and services are relatively good compared with Sub-Saharan Africa, in part because South Asia's high population density reduces the per capita cost of infrastructure. Since nearly all of the South Asian semiarid tropics lie in India, this brief focuses on that country.
Raising agricultural productivity is essential to stimulating economic development, reducing poverty, and protecting natural resources in the Indian semiarid tropics. Three-quarters of the population lives in rural areas, and their livelihoods depend on agriculture. Moreover, agricultural growth can create purchasing power among rural people that generates demand for locally supplied goods and services, helping create jobs off the farm. Raising agricultural productivity also complements natural resource conservation because it requires better management of soil, water, and nutrients.
Rainfed agricultural growth is nearly stagnant in the semiarid tropics, and Green Revolution technologies have had little impact. Farmers pursue complex, multifaceted strategies for earning their livelihoods, with a premium on reducing risk. They are keenly aware that new agricultural technologies and natural resource management practices usually incur opportunity costs by competing with one or more of the many components of the farm household economy. Where feasible, farmers in the semiarid tropics have made large investments in irrigation wells to convert small dryland areas into highly productive irrigated plots that now provide a significant share of household food, fodder, and cash needs.
Infrastructure and access to markets also influence rainfed agricultural development. Access to institutional credit sources is limited, and marketing restrictions reduce the profitability of some crops. On the other hand, government policies have made oilseeds more profitable, greatly benefiting farmers in the semi-arid tropics. Infrastructure investments have generated marketing opportunities for these crops and also for milk, whose production has flourished under village-based marketing cooperatives.
NATURAL RESOURCE DEGRADATION
Natural resources in the Indian semiarid tropics are subject to various forms of degradation. Soil nutrient deficits are wide spread on rainfed land. Farmers have abandoned traditional crop rotation systems because of land scarcity; they also apply less organic matter, which has high value as fodder and fuel. Irrigated plots received most of the available manure and most fertilizer.
Soil erosion is also widespread. Soil conservation programs have had limited impact, mainly because recommended practices were incompatible with existing farming systems. Farmers have indigenous methods to control erosion, but they often fail to adopt these methods because they are not profitable and because of factors such as short-term tenancy contracts and credit market restrictions. Investment is higher on irrigated plots because water management practices also have soil conservation benefits.
Water may be the key to sustainable intensification of agriculture in the semiarid tropics, because farmers manage their soil better on irrigated plots. However, water sources are scarce and subject to degradation. For example, traditional irrigation tanks, or ponds that capture runoff from rainfall, have deteriorated as traditional community management systems have nearly disappeared. Well irrigation skyrocketed after 1980 because of technological improvements, underpriced electricity that makes the marginal cost of irrigation almost zero, and the fact that wells (unlike tanks) can be controlled individually. Underpriced power and open access to groundwater have encouraged overpumping, putting pressure on the semiarid tropics' unproductive, hard rock aquifers. The decline of tanks, meanwhile, reduces an important source of groundwater recharge.
Pastures and forests are extremely unproductive. Analysis suggests that more than 80 percent of India's uncultivated lands produce 20 percent or less of their biological potential. Village pasture and forest lands are largely government owned. Postindependence institutional reforms removed powerful landlords who had acted as gatekeepers to common lands. These reforms improved equity but failed to install an effective alternative management system. Common lands declined in area, productivity, and employment generation, and these changes hit poor people hardest since they depended most on these lands.
ELEMENTS OF A DEVELOPMENT STRATEGY
Four issues are especially significant for development of less-favored lands in the semiarid tropics: technology development, legal and administrative reforms for natural resource management, infrastructure investment, and risk management.
Improved agricultural technology, particularly more productive cultivars, is an important source of productivity growth in rainfed areas. Successfully introducing better agricultural technology will require that agricultural research and extension systems increase their focus on clients and appreciate the complex and often location-specific factors that determine technology adoption. For example, plant breeders need to pay more attention to fodder value, grain quality, and drought resistance. Fertilizer recommendations need to be tailored to location-specific agroclimatic conditions and rainfall fluctuations. More attention needs to be paid to improving indigenous soil and water management systems.
Biotechnology may be a source of raised productivity, helping stabilize yields through drought tolerance and pest resistance. Government investment will be needed to apply biotechnology to less-favored areas that the private sector will likely bypass.
Institutional Reforms in Natural Resource Management
Land and water resources could be better managed by reforming outdated laws and bureaucratic procedures.
Uneven access to land can prevent the most efficient allocation of land and complementary inputs such as labor, while insecure tenure inhibits investment in land improvement and conservation. Land access is highly correlated with poverty; households with even the smallest holdings face a much lower risk of absolute poverty than landless households. Opening up lease markets would provide secure tenure to those poor people who can access agricultural land only through tenancy. Similarly, women's legal right to own land needs to be translated into practice to improve their socioeconomic security and help them gain access to institutional credit.
Efficient groundwater management requires developing well-specified, enforceable property rights. This will be extremely challenging, and small-scale experimentation must precede major legal changes. Needed electricity price reforms are more likely to be forthcoming because the current pricing system drains state government budgets.
Watershed management projects aim to harmonize the management of soil, water, and natural vegetation. Major government investments have had limited impact, in part because technocratic approaches have failed to address the fact that watershed development distributes benefits unevenly between upstream and downstream areas yet often requires universal cooperation. Accordingly, social institutions to encourage cooperation and share net benefits are critical to successful watershed development. Some participatory projects, usually managed by nongovernmental organizations (NGOs), have introduced more farmer involvement and more attention to social organization. Government projects have officially adopted the same approaches, but they need to enable staff to work in a more decentralized, participatory way. Also, they should test innovative pilot projects before scaling up to a nationwide level. Some NGOs have purposely invested primarily in villages where people demonstrate a greater propensity for collective action or where there is less need for collective action. This is a sensible strategy for cost-effective use of limited watershed project budgets.
Improving Infrastructure and Marketing Institutions
Past public investments in infrastructure have contributed to agricultural growth and poverty alleviation in both rainfed and irrigated areas. Investments in new roads support agricultural growth and poverty reduction by raising net returns to agriculture and facilitating economic diversification. Returns to all types of government investments are particularly high in less-favored areas, in part because these areas have been relatively neglected in the past. Additional government investment in less-favored areas raises production by more, and brings more people above the poverty line, than does additional investment in irrigated areas.
Operation Flood provides an excellent example of the power of infrastructure and marketing. Launched in 1970, it created multitier milk production and marketing cooperatives throughout India that have succeeded in moving milk from rural producers to Urban consumers via collection and processing centers, thus improving food availability and raising rural incomes. India's dense population helped make this approach cost-effective. Even in villages with no motorable road, bicycles move milk quickly to a nearby dairy. Continued expansion of dairy production in the semiarid tropics will require efficient water management to support green fodder production.
Many agricultural commodities remain subject to various marketing restrictions. Marketing costs could be reduced through reforms such as allowing free interstate trade in rice, abolishing stocking limits on private traders, introducing a futures market to help reduce marketing costs, and removing cotton export quotas.
Finally, investment opportunities vary with both agroclimatic and infrastructural conditions within the semiarid tropics. Just as successful dairy development has required at least modest access to irrigation, soybeans and groundnuts both flourished where agroclimatic conditions were particularly suitable. Another factor that distinguishes the semiarid tropics is distance from a large town or city. More remote areas need more employment and may be attractive for labor-intensive industrial development. Villages closer to cities, on the other hand, often specialize in perishables such as cut flowers and fresh produce, and similar opportunities may remain untapped.
Traditional risk management strategies have helped people manage drought risk, but they are costly and ineffective in the event of widespread, major droughts. Government employment schemes help landless people cope with drought, and crop insurance appears to have a favorable impact, but at an extremely high cost to the government. For those who do not grow insurable crops, another form of insurance is needed. It must be affordable; be accessible to all, including the poor; compensate for total income losses; be practical to implement; and be able to be provided by the private sector. Area-based rainfall insurance offers a promising new alternative that in principle can meet all these requirements and could be tested on a limited scale. The government could also invest in early warning drought forecasting to help farmers plan.