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Rural Mechanisation: Why History matters


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Rural Mechanisation: Why History matters

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Rural Mechanisation: Why History matters

  1. 1. Rural Mechanisation: Why History matters Stephen Biggs, SOAS, UK & Scott Justice, CIMMYT Presentation prepared for the IFPRI-CIMMYT Workshop on Agricultural Mechanization and South South Learning in Addis Ababa, Ethiopia on October 31 and November 1 2017. ..
  2. 2. Outline • Introduction • History of Academic policy debates, data collection and analysis • Historical Spread of mechanization in rural areas of South Asia – 10 Observations • Ways Forward – South Asia – Genera Policy Analysis framework • Conclusions • Acknowledgments
  3. 3. History of academic policy debates, data collection and analysis Historical Time Line 1960s - 2017 1960 1970 1980 1990 2000 2010 2020 Mid 1960s-mid 1980s Open policy debates and data collection Mid 1980s- Mid 2000s Closing of debates and data collection Mid-2000s - 2017 Revival of policy/ academic interest
  4. 4. Illustrations of the Literature in the Early period (Mid 1960s-Mid 1980s) • Agricultural and Industrial Inter-relationships in West Pakistan (Falcon, 1967) • The green revolution: generation of problems (Falcon, 1970) • Mechanization of small farms in Thailand and Malaysia by tractor hire services (Chancellor, 1971) • Changing machinery, technology and agricultural adjustment (Donaldson & McInerney, (1973), • Energy inputs and agricultural production under various regimes of mechanization in northern India (Singh, G., & Chancellor. 1975). • The Choice of Technology in Developing Countries (Timmer, Thomas, Wells and Morawetz, 1975) • Perrin, R. K., & Winkelmann, D. 1976. Impediments to technical progress on small versus large farms (Perrin, R. K., & Winkelmann, D. 1976)
  5. 5. Illustrations of the Literature in the Early period (Mid 1960s-Mid 1980s conti. • Factor prices and methods of cultivation in Political Economy of Agrarian Change (Griffin, 1979) • Interlocking factor markets and agrarian development: a review of issues (Bardhan, 1980) • Overseas aid and the transfer of technology. A study of agricultural mechanisation in Sri Lanka’ (Burch, 1980) • Transitional trade and rural development. (Harriss, 1981) • Farm power and employment in Asia (Farrington, Abeyratne & Gill, 1982) • Science, Politics and the Agricultural Revolution in Asia, (Anderson, Brass, Levy, & Morrison, 1982.) • The Sustainability of Mechanization in Thailand. Working Paper No. 98, Consequences of Small Farm Mechanization Project. (Chancellor, 1983) • Agricultural Mechanisation: A comparative analysis (Binswanger, 1986)
  6. 6. Features of the Closing of debates and data collection (Mid 1980s to Mid 2005) • Closing of rural engineering departments in the International Centres and other places Silsoe College in the UK, etc. • Closing of data collection and the mechanization program in FAO • Reduction of field research by economists and other social scientist on rural mechanization changes • Increased reliance on census data, national sample surveys, etc that were often too aggregate, out of data, or did not collect data relevant to understanding rapid changes taking place in patterns of rural mechanization. • Separation of different areas of rural engineering (water from river and road transport, processing, harvesting, tillage, etc) • Agricultural mechanization left out of agricultural and rural development projects and planning
  7. 7. Revival of Debates and data collection (Mid 2000s-2017) Features of current policy debates Contextual changes from the early (mid 1960s- Mid 1980s) period: • Massive expansion of choice of techniques and institutions • Major concern with energy policy and new alternative power sources • Role of global agricultural machinery MNC companies has grown • Global trade in rural capital goods is now very large • More concerns with drudgery reduction for rural workers • Role of equitable rural economic development in national development • Role of migrant workers from rural areas in the local and global economy Current Agenda: • Topics of this conference!
  8. 8. Historical Spread of mechanization in rural areas of South Asia We concentrate on the spread of smaller engines and markets in services because: 1. This technology has made major contributions to the intensification of agriculture and other rural economic activities 2. It continues to spread rapidly today 3. The role of smaller scale rural mechanization and rural industrialization has been neglected in the academic literature and policy debates
  9. 9. Observations on the experiences from South Asia
  10. 10. Observation 1: diverse patterns of ag & rural mechanization (Estimates for 2012) Bangladesh India Nepal Energy Source No Units Total hp % of total hp No. units Total hp % of total hp No. units Total hp % of total hp 2WTs* 500,000 7,500,000 53% 300,000 4,500,000 2% 16,000 240,000 13% 4Wts** 35,000 460,000 3% 3,500,000 122,500,000 55% 30,000 900,000 51% Irrigation shallow tube well pump Diesel *** 1.2 M 6,000,000 42% 9,000,000 45,000,000 20% 120,000 600,000 34% Irrigation pumpsets Electric**** 100,000 200,000 1% 12,000,000 48,000,000 21% 10,000 40,000 2% Total 14,160,000 100% 220,000,000 100% 1,780,000 100% Estimates of the numbers of power sources (and their horsepower ratings) used primarily in agricultural and processing uses, including groundwater irrigation pumps. It does not for example include the many engines used in Bangladesh to power riverboats, rice mills, processing, etc, although these are a major part of the Bangladesh agriculture and rural economy * Average of 14 hp per 2-wheel tractors (2WT ** Average of 30 hp per 4-wheel tractor *** Diesel / petrol irrigation pumpsets are average 5 hp. 5 – 10 % of the pumpsets are petrol/kerosene **** Average electric tubewell is 4 HP
  11. 11. Observations2: Long history of diverse “South- South” trade in rural capital goods and growth of different local rural capital goods industries
  12. 12. • South Asia has a long history of South South exchanges in trade in small scale “good enough” equipment – Chinese pumpsets in Bangladesh (1980s) followed by 2 Wheel tractors – Nepal: 2WTs from Japan (1970s) Korea (1980s) and China (1990 – present) – Chinese and now Vietnamese 2WTs into Sri Lanka – Recently Chinese small scale equipment coming into India and Nepal in last 10 years – Vietnam: small engines from USA to Vietnam – Axial flow pumps from Thailand to Bangladesh (2013) Observations 2 Examples “South- South” trade in rural capital goods
  13. 13. Examples of agro sales, manufacturing and repair industries – Examples Nuwakot Nepal – Hikarie Sales Agency in Sri Lanka and – Rajkot, India mini-4WT factory Illustrations of rural capital goods industries
  14. 14. Observation 3. Diversity of equipment in use in the same geographic area: Example Harvesting • Two types of harvesting in the same village in Odisha, India • One a Small tractor driven combine • The other is 2WT reaper • Both owned by rural entrepreneurs selling harvesting services • Both very satisfied with their investment in machinery and selling services
  15. 15. 12,000 “Good Enough” Chinese Mini Tillers(MT) in hills of Nepal – Where avg life of MT is 3 years but total pay back costs in 1-2 years. – Many of these small machines operate in the same village but by HHs in different economic / social cicumstances Observation 3. Diversity of equipment in use in the same geographic area: Example Tillage
  16. 16. Observation 4 The same engines provide power for different operations
  17. 17. Small machinery used for agriculture purposes in Bangladesh
  18. 18. Observation 5: Field water management by small engines is often a central condition for other areas of rural mechanisation
  19. 19. Observation 6. Informal R&D in the rural economic workplace: a central source of technology innovation • Bangladesh: Engines jumping from shallow tube wells to boats in 1980s • Ubiquitous Layflat pipes on the Gangetic plains • Vietnam: Engines jumping from pumps to long tail boats back to Axial flow pumps in 1960s (D. Biggs) • Bamboo tubewells and the pumps service markets in Bihar in the 1970s
  20. 20. Observation 7: Some rural mechanisation technology spread very rapidly • Recent spread of (petrol & diesel) mini-tillers in Nepal (last five years from virtually 0 to over 15,000 in 20017 ) • Recent spread of electric battery powered three wheelers in Bangladesh (estimates of 50,000 ) and Nepal (estimates of 15,000 ) during last 6 years. • Smaller combines from China spread rapidly in Sri Lanka from hundreds in 2009 to 12,000 in 2017 (See Abeyratne 2017, Samarasinghe 2017).
  21. 21. Observation 8: Hotspots and Corridors • We see there are often hotspots, cluster and corridors in the early spread of small engines and equipment
  22. 22. In South Asia the Importance of markets for providing agro-machinery inputs and services • Water markets (STWs and LLPs) in Bihar, Bangladesh and Thailand • Two and four wheel tractor tillage in Sri Lanka and Bangladesh • Transport services in Nepal • Well diggers providing shallow tube well drilling services in India, Nepal Bangladesh Observation 9: Markets in “powered” services have always been present- and are expanding with new equipment Bangladesh 1980s Nepal 2003 Bangladesh 1991
  23. 23. (Continued) Observation 9 Markets: Comments and Questions • See literature of Chancellor in the 1960s and 1970s, Hayami & Otsuka,1993, Mandall, 1980s) • Smaller scale rural entrepreneurs providing engine services, without official “land consolidation“, land levelling, etc. have led to economic growth in rural areas. • Explains why small holders are persisting and growing in some South Asia countries (Rigg). • Explains why agricultural productivity in Bangladesh is increasing while size of holding is declining. (Mandal’s “economic holding” is the relevant unit rather than the “small farm”. • Explains why small holders are more efficient than larger holdings in Nepal (recent WB report in Nepal) • Research needed to investigate whether monopoly rents are being charged by small scale rural entrepreneurs for services?
  24. 24. (Continued) Observation 9 Markets: Comments and Questions • Is there privilege access in service markets for smaller engines? (Literature on water markets in Bangladesh ) • How is price setting achieved? • Is smaller engine service provision more efficient, better or worse than alternative institutional models for service provision. • Two major goals of national economic policy. – Sources of finance for smaller engines and equipment generally come family savings (therefore mobilizing domestic savings for investment in productive equipment). – When bought on hire purchase, loans appear to be repaid. • Perhaps the spread of smaller scale machinery and service markets is leading to more efficient and equitable rural and national economic growth.
  25. 25. Observation 10. Effects of Government Policies and Donor projects • Government policies and donor projects have played a central role in the spread of different patterns of rural mechanisation in South Asia • To understand the spread of engines and markets in services, it is always necessary to investigate the role government and other actors in the economic change. • We say no more as this is the main topic of this workshop.
  26. 26. Ways Forward South Asia • Revival of Macro Leontief economic policy analysis, with emphasis on the disaggregation of inter sector linkages in rural areas (Falcon 1969). • Revival of field studies in rural areas by economists and engineers. (For examples cost effective studies of rural entrepreneurs who provide custom services, and studies of other small and medium and rural entrepreneurs (Chancellor on service provision 1971). • Support pragmatic contemporary, field based rural energy accounting analysis (Singh and Chancellor 1975) • Promotion of professional collaboration between economics and engineering in teaching, field work, data collection and policy analysis.
  27. 27. Ways forward General: Policy Analysis Framework 1. The importance of the location and time specific context for the role of rural mechanisation in national planning. 2. Cost effective and timely data collection and analysis for current policy use. 3. Figure for the analysis of Interest and lobby groups that influence patterns of rural mechanization and rural industrialization.
  28. 28. Interest and Lobby groups influencing rural mechanization policies, projects and practices Local smaller and larger scale farming and capital goods lobby groups. Culture of Multinational Agricultural Machinary Companies/ local subsidaries Alternative rural mechanization and rural industrialisation patterns in National economic growth Culture and Bureaucratic Structures and budgets of local Ministries/banks and of donors/Int. Banks Culture and budgets of Local and Int. Academic/research interest groups (University depts., Thinks tanks, Research Centres)
  29. 29. Concluding Remarks
  30. 30. Thank you
  31. 31. Acknowledgements • GoN, NAMEA, Andrew McDonald, Gokul Poudel and other CiMMYT, Nepal colleagues • Colleagues Sri Lanka: Melvin Samarasinghe and Fred Abeyratne • CSISA BD, Sattar Mandal, Murdoch U., and other Bangladesh colleagues • IFPRI South South Colleagues • FACASI Colleagues • CSISA and BISA India and IRMA colleagues