4.1. Rice Residue Management – Farmers’ Decision Making
Variables such as access to technology, cost of operation, or pest presence that influence farmers’ residue management practices emerged as key themes from farmer interviews related to farmer decision-making. Residue management practices, their conditions of operation, and variables influencing each decision were aggregated into a flow chart (Fig. 1) that demonstrates the process used by farmers in decision-making for rice residue management. This flow chart helps present a more realistic picture of actions taken on the ground and their associated rationale, and demonstrates that four primary factors influence farmer decision-making -- technology choice, farm size, time available for residue management, and availability of machinery.
Choice of Technologies used
Active residue management practices, i.e., management practices that do not require residue burn, generally require a Super SMS attached to the Combine Harvester. In the absence of SMS, the Rotavator scenarios can be implemented. However, managing rice residue without a Super SMS drives up fuel cost. Active residue management scenarios also require a high horsepower (HP) tractor to operate the machines (either a Super SMS or a Rotavator). This dependence on high HP tractor is a key step in the farmer decision pathway. Each technology comes with its own set of choices and constraints. A Rotavator alone is insufficient for in-situ incorporation for a rapid two-week turnaround between harvests. Farmers may need to purchase or rent a Reversible Plough or Mulcher along with Rotavator. These considerations add to the capital, operational, diesel, and labor cost. Similarly, the adoption of Happy Seeder depends on farmers’ perception of pest and insect attack in the wheat crop. The use of Baler to collect residue is only feasible if the farmer has means of disposing the residue or giving it away as raw materials to factories or power plants.
Small vs. Large farms
Machinery used for residue management including (i) Super SMS
mounted on a Combine harvester (ii) Happy Seeder, (iii) Super Seeder and (iv) Baler require high power tractors (> 45 HP) to operate. Thus, the adoption of sustainable residue management is predicated on the availability of and access to a high Horse Power (HP) tractor. It is feasible for farmers cultivating on medium to large farms (10 acres of more) to purchase a heavy tractor of 50 horsepower or more, whereas purchasing a high HP tractor may be beyond the economic capacity for farmers operating on land less than or equal to 5 acres. Since machinery such as Super SMS, Happy Seeder and Baler require high HP tractors to operate, the use of these machinery is limited to medium to large scale farms. Thus, access to a high-power tractor is a limiting first step in the decision to burn agricultural residue. Those without such access are more likely to burn the residue.
Timing and performance constraints
Sowing short duration rice variety enables farmers to harvest the rice crop early, giving them a longer time window to manage the residue before sowing the next crop, primarily wheat or potato. Given more than 10 to 15 days between harvesting rice and sowing the next crop, and when provided with reliable electricity supply, farmers can fill the post-harvest fields with water and allow the rice residue to decompose and mulch. This makes it easy to incorporate the rice residue into the fields with a simple Rotavator or Reversible Plough, without having the need to burn the residue. However, the commonly cultivated variety by the interviewed sample size, is Pusa-44, a high-yield and long growing hybrid that leaves farmers only 10–15 days to manage the residue and prepare the field. Thus, a farmer growing long duration rice variety is very likely to burn the residue on the field in order to clear the field quickly.
Availability of Machinery
Marginal and small-medium scale farmers, often need to rely on the availability of agricultural machines on rent through farmers co-operatives, Custom Hiring Centres (CHCs), or wealthier farmers in the village. This is particularly challenging given the short time period available to manage the residue and clear fields to sow the wheat crop. Government subsidies for the purchase of selected agricultural machinery (50% of capital cost) from licensed manufacturers makes it feasible for medium-large farmers to purchase these machineries. Eight or more farmers can also apply for group (at 80% of capital cost) subsidy. Formation of farmer societies has been encouraged by the government as this increases the machinery purchasing capacity of farmers by shared ownership, bringing down their cost of active residue management.
4.2. Rice Residue Management: A Cost-Analysis
Residue management practices that emerged from farmer interviews had varying costs and incentives associated to them. We present the results of a cost analysis for six different residue management practices that emerge as candidates from farmer interviews in Fig. 2. Details of the cost-analysis can be seen in the Supplementary Information, with the conditions related to each practice shown in table SI-1.
Farm equipment can either be purchased or rented, with each having their own associated costs and constraints. Renting machinery obviates the need for upfront high capital cost, while adding possible time and availability constraints since a limited amount of local machinery is available for rent. In addition, some technologies including Super SMS, Happy Seeder, Super Seeder, Reversible Plough, Zero-Till Drill and Mulcher are eligible for government subsidies on purchases. These include a 50% discount on capital cost for individual farmers and an 80% discount for farmer groups with shared ownership. There are other subsidies as well. During the harvest season of 2019, the government provided an incentive (a “bonus”) of INR 100 per quintal (100 kg) of yield to small scale farmers (defined as those who own 5 acres or less of land), and who have not participated in agricultural waste burning. We also assume that large scale farmers (defined as those who own > 5 acres of land) have the capacity to purchase machinery. Renting of machinery is assumed to be done only by small scale farmers. The government incentives thus include fixed bonus incentive (available for small scale farmers only) for active residue management through renting machinery, 50% subsidy on purchase of agricultural machinery (except for Rotavator), and monetary benefits for giving away the residue (when using Baler). Figure 2 shows annualized net present value (NPV) for 10 years of cost of field preparation using the six common residue management practices with government subsidies.
In the absence of government subsidies, burning residue is the cheapest residue management option, followed closely by buying and renting a Rotavator. Government incentives of subsidy on machinery and incentives to not burn (for small farmers) are typically required to make alternatives less expensive than residue burn. Annualized costs for renting and buying Rotavator are only 2% and 12% higher than residue burning without subsidy. Including a government subsidy for capital costs and fixed bonus for small scale farmers, makes Rotavator use even more attractive–20% cheaper for rent and only 2% more expensive for purchase. The annualized costs for renting and buying a Happy Seeder are 64% and 54% higher than residue burn. In the presence of government subsidy and fixed bonus, these costs are 42% and 44% higher than residue burn respectively, for renting and buying a Happy Seeder. Finally, the cost of renting a baler is 22% greater than residue burning without government incentives. However, with the bonus and monetary benefits received for selling the residue, renting a baler is 31% cheaper than residue burn. Ex-situ residue management using Balers are the cheapest option with government subsidies. However, the costs do not account for the infrastructure required for disposal of residue and so it is difficult make me a generalized comparison with other in-situ methods.
Figure 3 represents a breakdown of the field preparation expenses for the different residue management practices considered. These expenses include costs of machinery (purchasing capital and rental, including combine harvester), costs of operation (labor, diesel, and repair), as well as field preparation costs (fertilizer and insecticide) during the following season. The capital costs for the machinery purchase option correspond to full machinery cost before government subsidy.
Equipment costs include cost of using a combine harvester with Super SMS for harvesting, in addition to the cost of other machinery used for residue management. These capital costs make up a large part of the expense borne by the farmer for each residue management practice, from 17% for purchase of Happy Seeder to 44% for renting a Baler. Fuel costs make up a substantial portion of the total. For example, the use of a Rotavator in combination with other machines such as a reversible plough or mulcher to manage rice residue in-situ, the tractor needs to be operated on the field several times which increases the diesel consumption. Diesel costs are lowest for full or partial burn as this alternative requires the least field preparation. Annualized diesel costs range from between 39% (Happy Seeder) to 13% (residue burn).
Farmers reported that fertilizer costs are lowest for in-situ incorporation, i.e., using Rotavator. This is consistent with the idea that in-situ incorporation rice residue balances the soil nitrogen content and adds organic carbon and other nutrients back into the soil (P. Kumar et al., 2015). Both farmers and experts highlighted the increase in insect and pest attacks in the winter wheat crop after using Happy Seeder to sow wheat. This is reflected in the high insecticide cost for purchase and rent of Happy Seeder.
These findings differ from those of (Shyamsundar et al., 2019) especially with respect to Happy Seeder, which their analysis finds to be the most cost-effective alternative. These differences emerge from differing assumptions used in the two studies. The differences in cost of field preparation can be attributed primarily to Shyamsundar et al.’s inclusion of irrigation and harvest operation costs. Our study further differentiates accessible alternatives based on size of land holdings. Through the farmer interviews, we conclude that medium to large scale farmers have the financial capability to purchase agricultural machinery, whereas small-medium scale farmers rent the equipment required for harvesting and field preparation. Our cost analysis accordingly contains cost for machinery purchase and rent attributed to differences in land holdings.
Overall, we find that residue management practices can be cost effective relative to residue burn, especially when existing subsidies are applied. The costs of field preparation and considerations for key farming decisions used in this paper are derived from farmer interviews and are thus a reflection of farmer behavior as narrated by farmers through semi-structured interviews, instead of idealizations of ‘rational’ farmer behaviors. However, as we discuss below, a cost-analysis alone does not paint a complete picture, and there are various reasons for the insufficient adoption of active residue management practices. These include, inter alia, farmer’s capacity to purchase or rent high HP tractor, access to agricultural machinery, timing of and access to government subsidy, perceptions of pest infestation and soil conditions post residue management all play an important role in the adoption of any residue management practice. We explore these further in the next section.
4.3. Farmers’ Perspectives and Government Incentives
As we highlight in this section there several reasons for the difference between economic analyses presented earlier and what farmers say is possible. These reasons are characterized in Table 1, and broadly fall into three categories: Trust, Awareness and Access. In what follows we describe how increasing trust in government measures and increasing awareness of residue management practices while improving access to them might help farmers reduce AWB.
Table 1
Farmers’ perspectives about trust, awareness, and access to government incentives and possible solutions to agricultural waste burning.
Residue Management options/policies | Trust | Awareness | Access |
Subsidy for Agricultural Machinery (& in-situ incorporation) | - Farmers receive subsidy reimbursement 6 months-2 years later. - Farmers unsure if/when they will receive the subsidy after purchase of machine. - Manufacturers raise prices in response thus nullifying benefit. | - Lack of awareness around training for handling equipment, government assistance, harms and benefits of farming practices. - Government did not warn of pest attacks (or other risk) from incorporating residue into soil. | - Subsidy benefits only large farmers and manufacturers, not small-scale farmers. - Small-scale farmers often do not have high HP tractors to operate heavy machinery, and do not benefit by subsidy. - No subsidy on rotavator, a widely used technology |
Payment/bonus to stop AWB | - Lack of transparency regarding the bonuses for land cultivated on lease. - Everyone, irrespective of method of residue management, filed claims to fixed bonus in 2019. | - Lack of monitoring on field fires. | - Implemented by Supreme Court halfway through harvest season. - Uncertainty regarding whether they will receive it in subsequent years makes it difficult to plan in advance. |
Ex-situ residue management | - Farmers recognize that it is not in the government’s capacity to facilitate collection of residues from all fields around Punjab. | - Farmers associate personal monetary benefits and value in using residue as raw materials. - Important mitigation measure. | - Lack of access to Balers in short time window and high HP tractors to operate Balers. - Absence of processing facilities |
Subsidy for Agricultural Machinery
Residue management technologies such as the Super SMS, Happy Seeder, Super Seeder, Reversible Plough, Zero-Till Drill and Mulcher are eligible for subsidies that involve 50% cost rebate on capital cost for individual farmers and 80% for farmer groups with shared ownership. Some farmers claimed that presence of government subsidy on machinery has inflated its market price. In addition, Table 2 shows that access constraints where farmers are required to purchase machinery at cost from a licensed manufacturer and the subsidy is then received in the form of reimbursement between six months to two years later. This can add to the carrying costs of a farm, and to the financial burden. Small scale farmers also noted that they cannot purchase expensive agricultural machines and thus do not receive the benefit of the government subsidy.
In addition, the cost of residue management with the help of a Rotavator is lower than the residue burn option. However, this residue management option depends on the availability of Rotavators and other machines (eg: Reversible Plough, Mulcher etc) in the short harvest period, as well as farmers’ access to large tractors to operate the machinery.
Payment/Bonus to not Burn
In 2019, the Supreme Court of India required governments to provide an INR 100 per quintal (100 kg) of yield as a bonus to small scale farmers who own 5 acres or less of land, and who have not participated in agricultural waste burning. Since the average yield in Punjab is 3 tons per acre, small farmers stood to receive a revenue of INR 3000 per acre. This is above the amount of Rs 2500 per acre suggested by (Jack et al., 2021) on the basis of a randomized control trial, but only half of what the farmers union is currently demanding (Tribune News, 2021). In our interviews small farmers were encouraged by the idea of such an incentive, which could be effective in offsetting the extra cost of active residue management. However, the provision of an incentive may not solve the problem of AWB, as the onus of residue management falls on farmers who often do not have access to the means and infrastructure to use AWB alternatives. As noted in Table 1, a key assumption of the scheme, that farmers get the appropriate government subsidy on time, is often not met. In addition, uncertainly in availability of the fixed bonus government incentive in the future also makes it difficult for farmers to plan for residue management in advance.
Ex-situ rice residue management
Ex-situ residue management after collecting residue from the field with Balers, was considered a preferred residue management practices by farmers and experts alike. Table 1 shows that farmers see a potential value in selling rice residue to power plants and factories, both in terms of personal monetary benefit and conversion of residue from waste to raw material. Farmers however recognize that it is not in the government’s capacity to facilitate the collection of residues from all the fields around Punjab. The short time window available for rice harvest and field preparation makes the task further challenging. Interviewed farmers suggest local residue collection centers be set up by the government in each village during the time of harvest where farmers can deposit their collected residue in time. A major access constraint for ex-situ residue management is the access to Baler machines in the short time window and a heavy tractor required to operate it.
Interviewed experts stressed the utilization of rice residue as a useful raw material highlighting several possible, but as yet unrealized, applications of rice residue, such power generation, and use as raw material for paper and building-board. However, small scale farmers may not have the tractors required to operate a baler, and the availability of balers is limited during the short harvest period of rice, and farmers do not necessarily receive monetary benefits for the residue that they give away. There is currently limited but growing capacity to absorb large amounts of residue generated in the region and the greater cost of ex-situ management falls on the government and the private sector to establish infrastructure and industry.
Our expert interviews also uncovered other possible solutions related to the AWB problem which we briefly describe below; these include growing of alternative rice varieties and changes to incentives for crop diversification. Currently the most common rice variety in Punjab is Pusa 44, a long duration hybrid variety that takes 130 days to mature after a 30-day nursery transplantation period. Growing short duration rice variety provides farmers with a longer time between rice harvesting and sowing of wheat crop for the next season, enabling the anerobic decomposition of rice residue, and so make in-situ incorporation more feasible. Further, agricultural waste burning of short duration variety rice takes place in pre-winter conditions and thus have reduced impact on ambient air pollution in the Indo-Gangetic Plain. The Ministry of Agriculture’s direction to the Food Corporation of India (FCI) and other state procurement agencies not to procure this variety in Punjab (Nibber, 2020), if implemented, may be an effort to reduce area under Pusa 44. Both farmers and experts were convinced that encouraging farmers to cultivate Basmati and other short-duration varieties of rice, can also help reduce AWB.
Further, the Food Corporation of India (FCI) buys rice grains from farmers in Punjab at MSP to meet India’s national food security demands. The provision of rice procurement at MSP and guaranteed monitory return at the end of the Kharif season is the main reason farmers continue to grow rice despite contrary recommendations from scientists and policy experts, and depletion of groundwater resources. Interviewed experts stressed in importance of crop diversification in Punjab and recommended phasing out rice cultivation in parts of the state while simultaneously setting up markets for other less water intensive crops. Almost 90% of the interviewed farmers expressed interest in switching away from cultivating rice, if provided with a reliable market for other crops. Crops such as such as maize, vegetables, American cotton, and pulses were some of the emergent alternatives to cultivating rice in the Kharif season from the interviews.