Has diversity of crops increased in states with less government procurement?
Sai Krishna Muthyanolla
January 8, 2021
One of the arguments in favour of the new farm laws is that the reduced role of APMCs & state procurement may increase the diversity of crops. But what does the data indicate about the cropping pattern in various states over the 15 years between 2004-05 and 2018-19?
It has been over a month that farmers have been protesting near Delhi against the three Farm Laws that were passed in September’2020.  While farmers across the country have joined this protest, most of the representation at the protests in Delhi has been from farmers of Punjab & Haryana along with farmers even from Rajasthan.
Arguments both in favour & against these laws are being made by multiple parties. Lack of assurance in these laws about the Minimum Support Price (MSP), reduced role of APMCs, etc., are a few of the apprehensions of the protesting farmers.
Punjab & Haryana are among the states, where the greatest procurement of Rice & Wheat is done by the Food Corporation of India (FCI) through APMCs. This is probably one of the reasons behind the larger representation of farmers from these states.
Those in support of the new farm laws argue that the reduced role of APMCs & FCI and hence dependence on MSP would result in the increased diversity of crops. The argument being that the farmers in these states largely cultivate Rice, Wheat, and few other crops with guaranteed procurement by FCI.
In this story, we take a look at the data of cropping patterns in a few states between 2004-05 and 2018-19 to analyse if there is any correlation between the abolition or reduced role of APMCs and the cropping patterns.
APMC Acts are not implemented uniformly across the states
Agriculture Produce Marketing Committee (APMCs) are marketing boards established by State Governments to ensure farmers get a fair price for their produce.  The 2003 Model APMC Act, provided new guidelines regarding Agriculture Marketing. Since agriculture is a state subject, it was left to the states to legislate their own APMC law. While most of the states have enacted an APMC law, there are certain exceptions.
While few of the Northeastern States have not implemented the APMC law, Bihar & Kerala are the larger states where APMCs do not exist. Bihar has repealed the APMC act in 2006.
We take a look at a few of the States along with Bihar. The information is taken from RBI’s Handbook of Statistics on Indian States under the head “Agriculture & Allied”. 10 major categories of crops across the states have been considered for the analysis – Rice, Wheat, Pulses, Coarse grains, fruits, Vegetables, Oil Seeds, Sugarcane, Cotton & Raw Jute.
Bihar: No major change in the Area cultivated under Rice & Wheat
In 2004-05, Rice was sown in 31.2 lakh hectares and Wheat in 20.2 lakh hectares in the state of Bihar. Both these crops constituted around 65% of the total sown area (79.4 Lakh hectares) across the earlier mentioned 10 crop categories
By 2018-19, the total area under cultivation for these crops in Bihar reached 80.9 lakh hectares, a marginal increase compared to 2004-05. The highest during the period was 2007-08, with 85.4 lakh hectares.  As stated earlier, Bihar repealed the APMC Act in 2006.
The data over the period indicates that there is no major change observed in the extent of land being used for Rice and Wheat cultivation. The share of land being used for cultivation of Rice & Wheat remained around 65% in all these years with the exception of 2010-11 when the area under Rice cultivation was less than the other years.
While there is no major change in Rice & Wheat cultivation, there has been a shift in trends for other crops. The area under cultivation of pulses reduced from around 6.5 lakh hectares in 2004-05 to around 4.79 lakh hectares in 2018-19. Oil Seeds and Raw Jute also saw a reduction in the area of cultivation.
On the other hand, the area under cultivation of Sugarcane has more than doubled to 2.25 lakh hectares in 2018-19 compared to 1.04 lakh hectares in 2004-05. This increase in the cultivation of Sugarcane is observed since 2010-11.
Punjab: Increase in area under cultivation of Rice & Vegetables, decrease in the case of Coarse grains & Cotton
There has only been a marginal increase in the total area cultivated in Punjab for the aforementioned crops over the 15-year period (2004-05 to 2018-19), from 72.4 lakh hectares to 75.1 lakh hectares.
As highlighted earlier, Punjab is one of the states where the major procurement of Rice & Wheat happens through FCI and hence MSP is important for the farmers. A major portion of the land under cultivation in Punjab is for Rice & Wheat. Over this 15-year period, the proportion of land under cultivation for these two crops has also increased from around 84% to 88%. This is mainly contributed by an increase in the land under cultivation of rice, which increased from 26.4 lakh hectares in 2004-05 to 31.03 lakh hectares in 2018-19.
Along with Rice, there is an increase in the land under cultivation of Fruits & Vegetables as well. These crops seem to have been substituted for Oil Seeds & Cotton. The area under cultivation of Oilseeds has gradually dropped from 0.9 lakh hectares to 0.39 lakh hectares during this period where-as in the case of Cotton, the area under cultivation declined from 5.09 lakh hectares to 2.68 lakh hectares.
Haryana: The increase in land under cultivation can be attributed to Rice
Over the 15-year being period of 2004-05 to 2018-19, the area under cultivation for these 10 crop categories in Haryana increased from 59.3 Lakh hectares to 65.05 lakh hectares. This increase can be attributed to the increase in the land under cultivation for Rice. In 2004-05, Rice was cultivated in 10.28 lakh hectares and increased to 14.47 lakh hectares in 2018-19.
As is the case with Punjab, there is also an increase in the land under cultivation for Fruits & Vegetables. Cotton and Wheat have also seen a marginal increase in the area under cultivation.
The area under cultivation of Coarse grains & Pulses reduced substantially as is the case with Bihar and Punjab. Cotton & Sugarcane have also seen a decline in the area under cultivation.
With the available data, it is not possible to ascertain if the increase in area under rice cultivation is because of the additional area or in lieu of other crops. The proportion of area where Rice is being cultivated did increase from 17% to 22% during this period.
Maharashtra: Cultivation of Coarse Grains substituted by Cotton & Sugarcane
Maharashtra has a more equitable distribution of the area under the cultivation of different crops. Unlike the aforementioned three states, Rice & Wheat are not the major crops with a greater area under cultivation is for Pulses, Coarse grains, Oil Seeds & Cotton.
Although Maharashtra does have an APMC Act, the FCI procurement of Rice & Wheat is comparatively less. Baring few variations in between, the land under cultivation of Rice & Wheat remained nearly the same over the 15-year period.
However, a significant change can be observed in other crops. The area under cultivation of Coarse Grains has more than halved during the period. In 2004-05, it was 69.4 lakh hectares and gradually reduced to 33.2 lakh hectares in 2018-19. The sharper decline is observed during 2017-18 & 2018-19. However, the yield estimates, do not indicate any specific fall in the yield for Coarse grains.
There is also a fall in the area under cultivation of Fruits. At the same time, there is a corresponding increase in the area under cultivation of other crops – Vegetables, Oil Seeds, Cotton & Sugar. The proportionate increase of area under cultivation is more prominent in the case of Cotton & Sugarcane.
It has to be noted that unlike in the case of Haryana, there is not much variance in the total area under cultivation in Maharashtra over the 15-year period, barring a few years in between.
Madhya Pradesh: Increase in area under cultivation can be attributed to Wheat and Pulses
Madhya Pradesh is one of the states which follows a decentralized procurement (DCP) of Rice & wheat. It is among the states that have a substantial share of FCI procurement of Rice & Wheat. This is reflected in the larger under cultivation of these two crops. However, apart from these two crops, the state also has a proportionately higher area under the cultivation of Pulses & Oil Seeds along with Coarse Grains.
Over the 15-year period, a substantial increase is observed in the area under cultivation of Wheat, Pulses, Rice & Oil Seeds without a reduction in the area under cultivation of other crops. This was possible because of the increase in the overall area under cultivation.
No Definitive correlation between State Procurement (APMC) & Diversity of Crops
Analysis of data for these select states does not indicate any definitive correlation between state procurement (APMCs) and diversity of crops in the respective states i.e. the argument that state procurement (APMCs) hinders diversification of cropping pattern does not appear to be true, at least in these states.
Bihar, which has done away with the APMC act has not witnessed any substantial increase in the area under cultivation of crops other than Rice & Wheat. The increase in area under cultivation of Rice & Wheat in Punjab did not hinder the increase in area under cultivation of other crops, although there is a fall in the land under cultivation for Coarse grains. However, this trend is observed in other states as well, especially in the case of Maharashtra where there is a fall in the area under cultivation of Coarse grains. In Maharashtra, there seems to be a preference for cash crops like Cotton & Sugarcane.
Meanwhile, data for Madhya Pradesh indicates that the area under cultivation of various crops has increased because of the increase in overall area under cultivation. In a few of the other states like Uttar Pradesh, West Bengal, Odisha, and other southern states, there seems to be a specific preference for crops like Rice, Wheat, Coarse Grains, Pulses, etc.
The data from these states indicate that crop diversity is not necessarily dependent on APMCs or state procurement through MSP of specific crops.
Featured Image: Diversity of crops