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The Adoption and Economics of Bt Cotton in India: Preliminary Results from a Study

Author

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  • Gandhi, Vasant P.
  • Namboodiri N V

Abstract

The paper presents preliminary results from a study of the economics and adoption of Bt cotton in India. Biotech crops, which made their appearance in the world about a decade ago, have gained substantial popularity and acceptance in many parts of the world including US, China, Australia, Mexico, Argentina and South Africa. However, their introduction in India has been relatively late and controversial and they still have considerable ground to cover in the country. Cotton is a major commercial crop in India but has substantial problems particularly from extensive pest damage and poor yields. Bt cotton offers a promising solution to these serious problems. Data from the survey, which covered the important cotton states of Gujarat, Maharashtra, Andhra Pradesh and Tamil Nadu, and 694 farmers, indicates that Bt cotton offers good resistance to bollworms as well as several other pests. The incidence of these pests is reported to be considerably lower in Bt cotton as compared to Non-Bt cotton. The yields of Bt cotton are found to be higher and the yield increase/ difference statistically significant in all the states under both irrigated and rain-fed conditions. As a result, given the good market acceptance of the product, the value of output per hectare is higher in all the states and conditions. The question of higher cost of cultivation exists, and is confirmed, mainly because of high seed cost and not commensurate reduction in pesticide cost. However, the profit is found to be higher in all the states to the estimated extent of about 80-90 percent on an average when the effects of associated inputs are included. The returns are highest in Maharashtra followed by Gujarat and then Andhra Pradesh. Subjective assessment indicates that farmers see advantage in Bt cotton in pest incidence, pesticide cost, cotton quality, yield and profit. Almost all farmers indicate that they plan to plant Bt cotton in the future. To increase the benefits from the technology, the farmers strongly urge reduction in the seed cost, greater field extension and demonstration work on the correct practices, and more Bt cotton varieties to suit the diverse agro-ecological settings.

Suggested Citation

  • Gandhi, Vasant P. & Namboodiri N V, 2006. "The Adoption and Economics of Bt Cotton in India: Preliminary Results from a Study," IIMA Working Papers WP2006-09-04, Indian Institute of Management Ahmedabad, Research and Publication Department.
    • Handle: RePEc:iim:iimawp:wp01980
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    References listed on IDEAS

    as
    1. Iyengar, Sudarshan & Lalitha, N., 2002. "Bt Cotton in India: Controversy Visited," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 57(3), September.
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    1. Nazli, Hina & Orden, David & Sarker, Rakhal & Meilke, Karl D., 2012. "Bt Cotton Adoption and Wellbeing of Farmers in Pakistan," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126172, International Association of Agricultural Economists.
    2. Krishna, Vijesh V. & Zilberman, David & Qaim, Matin, 2009. "Transgenic technology adoption and on-farm varietal diversity," 2009 Conference, August 16-22, 2009, Beijing, China 51750, International Association of Agricultural Economists.
    3. Swaminathan, Madhura & Rawal, Vikas, 2011. "Are there Benefits from the Cultivation of Bt Cotton? A Comment Based on Data from a Vidarbha Village," Review of Agrarian Studies, Foundation for Agrarian Studies, vol. 1(1), July.
    4. Shah, Deepak K., 2012. "Bt Cotton in India: A Review of Adoption, Government Interventions and Investment Initiatives," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 67(3), pages 1-11.
    5. Evita Pangaribowo & Nicolas Gerber & Pascal Tillie, 2013. "Assessing the FNS impacts of technological and institutional innovations and future innovation trends," FOODSECURE Working papers 11, LEI Wageningen UR.
    6. Raney, Terri & Matuschke, Ira, 2010. "Genetically Modified Crops In Developing Countries: Back To The Future," 14th ICABR Conference, June 16-18, 2010, Ravello, Italy 188106, International Consortium on Applied Bioeconomy Research (ICABR).
    7. Arjunan Subramanian & Matin Qaim, 2010. "The Impact of Bt Cotton on Poor Households in Rural India," Journal of Development Studies, Taylor & Francis Journals, vol. 46(2), pages 295-311.
    8. -, Dr S Saravanan & -, Dr V Mohanasundaram, 2016. "Development and Adoption of Bt Cotton in India : Economic, Environmental and Health Issues," MPRA Paper 73107, University Library of Munich, Germany.
    9. S.S. Kalamkar, 2013. "Biotechnology in Indian Agriculture: Review of Adoption and Performance of Bt Cotton," Millennial Asia, , vol. 4(2), pages 211-236, October.
    10. Gruere, Guillaume & Mehta-Bhatt, Purvi & Sengupta, Debdatta, 2008. "Bt Cotton and farmer suicides in India: Reviewing the evidence," IFPRI discussion papers 808, International Food Policy Research Institute (IFPRI).
    11. Anchal Arora & Sangeeta Bansal, "undated". "Diffusion of Bt Cotton in India: Impact of Seed Prices and Technological Development," Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers 11-01, Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India.
    12. Sadashivappa, Prakash & Qaim, Matin, 2009. "Effects of Bt Cotton in India During the First Five Years of Adoption," 2009 Conference, August 16-22, 2009, Beijing, China 49947, International Association of Agricultural Economists.
    13. Subramanian, Arjunan & Qaim, Matin, 2009. "Rural Poverty and Employment Effects of Bt Cotton in India," 2009 Conference, August 16-22, 2009, Beijing, China 50555, International Association of Agricultural Economists.
    14. Guillaume Gruere & Debdatta Sengupta, 2011. "Bt Cotton and Farmer Suicides in India: An Evidence-based Assessment," Journal of Development Studies, Taylor & Francis Journals, vol. 47(2), pages 316-337.
    15. Dr S. Saravanan, 2016. "Issues and Controversy of Bt cotton in India 2004-2014: A Reviews," Economic Analysis Working Papers (2002-2010). Atlantic Review of Economics (2011-2016), Colexio de Economistas de A Coruña, Spain and Fundación Una Galicia Moderna, vol. 2, pages 1-1, December.
    16. Narayanamoorthy, A. & Renuka, C. & Sujitha, K.S., 2020. "How does Bt cotton perform in rainfed areas?," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 33(1), June.
    17. -, Dr S Saravanan & -, Dr V Mohanasundaram, 2016. "Development and Adoption of Bt Cotton in India : Economic, Environmental and Health Issues," MPRA Paper 72993, University Library of Munich, Germany.
    18. Khandker, Varsha & Gandhi, Vasant P, 2021. "Agricultural technologies for marginal and landless farmers: the case of hybrid rice cultivation in India," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 34(2), December.
    19. Subramanian, Arjunan & Qaim, Matin, 2009. "Village-wide Effects of Agricultural Biotechnology: The Case of Bt Cotton in India," World Development, Elsevier, vol. 37(1), pages 256-267, January.
    20. Krishna, Vijesh V. & Zilberman, David & Qaim, Matin, 2009. "GM Technology Adoption, Production Risk and On-farm Varietal Diversity," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49173, Agricultural and Applied Economics Association.
    21. Kurup, Suresh A. & Reddy, A. Amarender & Singh, Dharm Raj & Praveen, K.V, 2021. "Risks in Rainfed Agriculture and Adaptation Strategies in India: Profile and Socio-Economic Correlates," 2021 Conference, August 17-31, 2021, Virtual 315127, International Association of Agricultural Economists.
    22. Ramasundaram, P. & Suresh, A. & Samuel, Josily & Wankhade, Shwetal, 2014. "Welfare Gains from Application of First Generation Biotechnology in Indian Agriculture: The Case of Bt Cotton," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 27(1).
    23. Khandker, Varsha & Gandhi, Vasant P., 2012. "Introduction of New Technologies in Agriculture: A Study of the Challenges in the Adoption of Hybrid Rice in India," 2012 Conference (56th), February 7-10, 2012, Fremantle, Australia 124325, Australian Agricultural and Resource Economics Society.
    24. Nazli, Hina & Sarker, Rakhal & Meilke, Karl D. & Orden, David, 2010. "Economic Performance of Bt Cotton Varieties in Pakistan," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61181, Agricultural and Applied Economics Association.

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