Page 1 of 7
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
I SSN: 2395-0463
Vol ume 04 I s s ue 01
Ja nua ry 2018
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 919
Profitability of Wheat Cultivation in Haryana
Dr. Pardeep Kumar Duhan
Assistant Professor of Economics
Govt. College for Women, Mokhra (Rohtak)
Abstract
State agriculture has undergone spectacular change after using new agriculture technology
during green revolution. The present study initiates and analyzes growth rates in cost of wheat
cultivation and profitability of wheat cultivation in Haryana state covering the most recent period
from 2005-06 to 2014-15 by using growth rates (compound annual growth rates).The results of
this study about the growth rate in cost A1, Cost C2 and value of production show that Cost C2
recorded highest growth rate (about 10 percent) as compare to growth in cost A1 and value of
production. Value of production of wheat recorded less growth rates as compare to cost concepts.
It means economically, wheat cultivation in not very much profitable for the farmers.
Key Words: Costs A1, Costs C2, Compound Annual Growth Rate, Profitability.
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Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
I SSN: 2395-0463
Vol ume 04 I s s ue 01
Ja nua ry 2018
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 920
Profitability of Wheat Cultivation in Haryana
Introduction
Agriculture sector play a very important role in state economy of Haryana.The agriculture sector
has always been an important contributor to the Gross State Domestic Product (GSDP), although
the share of this sector in the Gross State Domestic Product is declining continuously. As a
consequence of rapid structural transition of the State economy over the years, the contribution
of the Agriculture & Allied Sector at constant (2011-12) prices went down to only 17.6 percent
of the GSVA during the year 2017-18 (Economic Survey of Haryana, 2017). The composition
of GSDP shows that the share of primary sector is continuously declining whereas the share of
secondary as well as tertiary sector is continuously increasing. It shows that the state economy is
shifting from agriculture to manufacturing and services sector. Still, the agriculture has great
importance in the state economy to provide employment to majority of population directly or
indirectly, generating income, providing raw materials to the industrial sector and ensuring food
security to the poor. Thus, agricultural development holds the key to overall development of the
state. State of Haryana witnessed the success of the green revolution in the country. During green
revolution there is manifold increased in food grain production in India and the State of Haryana
has contributed a lot to this. Evidences show that after independence, especially after green
revolution in mid-sixties Indian agriculture made tremendous progress in term of increase in area
under food-grain crops, their production and productivities. There is manifold increase in
production of food-grains especially of wheat and rice. Despite these some progresses in Indian
agriculture sector, Indian farmer community faces many problems. Evidence shows that
profitability in different crops cultivation in Indian agriculture is not very much impressive,
which is calculated on the basis of cost of cultivation survey data (Narayanamoorthy, 2013).
Pattern of inputs use are also changed and with this change cost of cultivation are consistently
increased (Raghavan, 2008). Stress in Indian farmer community is increasing day by day. As per
NSSO survey report, 40 percent of Indian farmers disliked farming as profession (Singh, 2018).
Recently in national capital, 184 farmers groups come together from different part of country to
take part in a protest walk. Over thousands farmers agitated in their respective states i.e. in
different part of Maharashtra, Madhya Pradesh, Rajasthan, Haryana and Punjab. Farmers
Page 3 of 7
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
I SSN: 2395-0463
Vol ume 04 I s s ue 01
Ja nua ry 2018
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 921
suicides in India is continuously increasing. Around 12,360 agriculture workers committed
suicide in 2014, out of which 5,660 (45.8 percent) were farmers/cultivators and 6,710 (54.2
percent) were agricultural labourers. In 2015, total agriculture worker who committed suicide
were 12,602, out of which 8,002 (63.5 percent) were farmers/ cultivators and 4,595 (36.5
percent) were labourers. There was 18 per cent increased in farmer’s suicides across India from
2014 to 2015 (NCRB).
Cost is the most important aspect in respect of farmer’s income or profitability of crop
cultivation. From initial plugging to final produce, even to reach the market, farmers are required
to incur various types of expenses which are categorized in paid out costs and imputed costs.
Paid out costs are those actual expenses which are incurred by farmers from their pocket i.e.
hired labour including human, animal and machinery, maintenance expenses, expenses on
material inputs such as seeds fertilizers, manure, pesticides and irrigation. Imputed costs are
those expenses which the farmer dose not incurs in cash e.g. value of family labour, managerial
input of the farmers, rent of own land and interest on owned fixed capital. The estimation of the
cost of cultivation both paid out and imputed costs are done by many expert groups or
committees appointed by Government of India. In India, the comprehensive scheme for
estimation of the cost of cultivation of principal crops was initiated in 1970-71 on the
recommendations of a technical committee appointed by Govt. of India on indices of input costs.
After that in 1979, a special expert committee constituted and recommendations of this
committee were implemented from 1981-82. In 1990, Govt. of India again appointed an expert
committee to review the methodology for computation of cost of cultivation or production. Govt.
of India accepted the recommendations relating to computation of cost under different cost
concepts like Cost A1, Cost B1, Cost B2, Cost C1, C2 and C3. At present state wise, cost of
cultivation data for principal crops is available from 1970 to 2014-15.
In this context present paper is an attempt to study the comparative analysis of growth rates of
different costs like Cost A1, C2 and value of production for wheat cultivation in Haryana from
2005-06 to 2014-15. It also measures the cost-return ratio of wheat cultivation over both the cost
A1 and C2 Cost as well. Total A1 costs include all expenses in cash and kind incurred in
