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Growing the service economy for sustainable wheat intensification in the Eastern Indo-Gangetic Plains: lessons from custom hiring services for zero-tillage

Author

Listed:
  • Alwin Keil

    () (National Agricultural Science Centre (NASC) Complex)

  • Alwin D’Souza

    () (National Agricultural Science Centre (NASC) Complex)

  • Andrew McDonald

    () (CIMMYT-Nepal, NARC Agricultural Botany Division)

Abstract

Zero-tillage (ZT) is a proven technology for enhancing wheat productivity and, hence, food security in the Indo-Gangetic Plains, while reducing production costs. However, very few farmers possess their own tractors much less the specialized seed drills required to implement the technology. As a consequence, adoption of ZT largely hinges on affordable access to custom hire services. In Eastern India, the service economy for ZT is expanding, but remains in the early stages of growth. ZT service businesses remain largely uncharacterized, and related business dynamics poorly understood. To address this knowledge gap and derive recommendations for an efficient targeting of public sector support for those service providers (SPs) who are poised for growth, we identified factors that influence ZT entrepreneurship, encompassing new business formation and the resulting scale of the enterprise. We used data from a census of 270 ZT SPs in Bihar, as documented by the Cereal Systems Initiative for South Asia (CSISA). To identify determinants of engaging in ZT service provision, the data were pooled with those of 1000 randomly-selected wheat farmers located in the same districts. We applied Heckman’s two-step estimation procedure to derive unbiased estimates of determinants of the scale of the ZT service businesses. ZT SPs are generally larger, tractor-owning farmers who have taken up service provision as a side business since 2010 or later. Only 8.3 % of the surveyed farm households owned a tractor, demonstrating the importance of service provision for accessing ZT and other mechanization technologies. ZT SPs expanded their businesses considerably from 2011 to 2012 to an average total of 20 clients and 50 ha serviced per SP. However, larger areas were primarily achieved by servicing larger client farms. Well-educated farmers with larger land holdings and extensive social networks are most likely to become ZT SPs. However, among this stratum, the relatively smaller scale farmers were most likely to provide services at a sizeable scale. To efficiently accelerate the spread of ZT technology, we conclude that these smaller-scale tractor-owning farmers are the most sensible targets for purchase subsidies on ZT drills as well as the primary audience for business development training. Since a considerable fraction of the ZT area expansion resulted from service provision to larger client farms, there is a need to develop business models that enhance the social inclusiveness of ZT services by reducing the transaction costs of reaching smallholders.

Suggested Citation

  • Alwin Keil & Alwin D’Souza & Andrew McDonald, 2016. "Growing the service economy for sustainable wheat intensification in the Eastern Indo-Gangetic Plains: lessons from custom hiring services for zero-tillage," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 8(5), pages 1011-1028, October.
  • Handle: RePEc:spr:ssefpa:v:8:y:2016:i:5:d:10.1007_s12571-016-0611-9
    DOI: 10.1007/s12571-016-0611-9
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    References listed on IDEAS

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    Cited by:

    1. Takeshima, Hiroyuki, 2017. "Overview of the evolution of agricultural mechanization in Nepal: A focus on tractors and combine harvesters," IFPRI discussion papers 1662, International Food Policy Research Institute (IFPRI).
    2. Keil, Alwin & Mitra, Archisman & Srivastava, Amit K. & McDonald, Andrew, 2019. "Social inclusion increases with time for zero-tillage wheat in the Eastern Indo-Gangetic Plains," World Development, Elsevier, vol. 123(C), pages 1-1.
    3. Sangha, Kamaljit K. & Maynard, Simone & Pearson, Jasmine & Dobriyal, Pariva & Badola, Ruchi & Hussain, Syed Ainul, 2019. "Recognising the role of local and Indigenous communities in managing natural resources for the greater public benefit: Case studies from Asia and Oceania region," Ecosystem Services, Elsevier, vol. 39(C).
    4. Paudel, Gokul P. & KC, Dilli Bahadur & Rahut, Dil Bahadur & Justice, Scott E. & McDonald, Andrew J., 2019. "Scale-appropriate mechanization impacts on productivity among smallholders: Evidence from rice systems in the mid-hills of Nepal," Land Use Policy, Elsevier, vol. 85(C), pages 104-113.
    5. Gulati, Kajal & Lybbert, Travis J. & Spielman, David J., 2017. "Diffusing to level fields: Evolution of laser land leveling technology markets in India," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258387, Agricultural and Applied Economics Association.
    6. Alwin Keil & Alwin D’souza & Andrew McDonald, 2017. "Zero-tillage is a proven technology for sustainable wheat intensification in the Eastern Indo-Gangetic Plains: what determines farmer awareness and adoption?," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 9(4), pages 723-743, August.

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