ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Market Awareness and Profitability

​Case Study of Mango Production in Karnataka

A case study of mango farmers in Kolar district of Karnataka analyses the determinants of profitability and constraints faced by the horticulture industry in India in general. The mango value chain is explored in-depth to understand the market choices of farmers and the role of market intermediaries. The study is based on data collected from a primary survey of 131 farmers and uses an instrumental variable approach to model the profitability of farmers as a function of market awareness, distance from markets, farming practices, and control variables. It finds that in addition to age and education, distance to markets and farming practices are significant factors influencing the profitability of mango cultivators.

The study was carried out with the financial support of the South Asia Network of Economic Research Institutes (SANEI) in 2014.

Agriculture is the predominant source of livelihood in South Asian countries, with the sectoral share of agriculture in the gross domestic product (GDP) ranging from 19% (India) to 39% (Nepal). These countries face numerous challenges in the form of small landholdings, decreasing investment in agriculture, environmental degradation, and the increasing globalisation of agriculture, resulting in cheap imports which threaten the livelihoods of several farmers. As a result, there is an increasing trend towards crop diversification in South Asia in favour of high value-added horticultural commodities, livestock, and fish products. Horticulture not only has a high employment potential, but can also contribute to the export revenues.1

In India, the annual rate of growth of net value added of agro-industries at constant prices increased from 5.15% during the pre-reform period (1985–1990) to 8.3% during the post-reform period (1991–96) (Gandhi et al 2001). With the launch of the National Horticulture Mission by the central government in 2005–06, there was a spurt in area and production of fruit and vegetables from 11.8 million hectares in 2004–05 to 16 million hectares in 2015–16 (GOI 2017). However, despite these developments, the horticulture sector has not performed well in export markets, and the share of fruits and vegetables in total exports has fallen steadily from 28% in 2009–10 to 14% in 2015–16 (APEDA 2017). The reasons cited included lack of infrastructure and the presence of intermediaries among others. At the same time, the initial thrust on horticulture and the various subsidies to promote the industry resulted in the excessive use of chemical fertilisers and pesticides, and exploitation of water resources through indiscriminate digging of borewells, jeopardising the sustainability of the ecosystem and farmer livelihoods in many regions.

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Updated On : 25th Jan, 2019
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