The impacts of mechanisation in the 20th century on farm productivity in particular and society in general are profound. Available studies show, at the end of the 19th century, it took 35 to 40 hours of planting and harvesting labour to produce 100 bushels of corn. A hundred years later, it takes only 2 hours and 45 minutes producing the same quantity of corn. Added to this are the ease and comfort with which farmers pursue their activities, such as listening to music and driving cosy cars in developed countries.
In rural areas of Bangladesh, mechanisation of tillage and threshing has almost replaced manual activities. In a labour-surplus economy, advent of mechanised agriculture should throw the poor out of jobs, increase poverty and create social tensions. But in reality, farmers witness the march of machines in the fields with smiling faces. However, not much research has been done on this trend excepting some case studies. Let us appraise our readers with an account of the development of mechanisation in Bangladesh's agriculture with particular emphasis on evolution of policies and socio-economic impacts of farm mechanisation on households. The write-up is based on a seminal work by Dr Mahabub Hossain and others who based their analysis on representative samples of households and machines.
We start with a historical anecdote. The First Five-Year Plan of Bangladesh continued a positive policy on promotion of tractors under the umbrella of farmers' cooperatives, otherwise called 'Cooperative Capitalism'. Many tractors were imported in the early 1970s and were fielded through cooperatives, but their use for tillage remained limited owing to a host of reasons. Arguments ran galore against promoting larger machines because of its negative effect on employment of the landless and unequal distribution of income. Faced with criticisms, small-scale equipment, such as, power pumps and shallow tube-wells, were found appropriate in the Bangladesh context. The machines started gaining popularity since the late 1970s.
Mechanisation of irrigation equipment got a boost in the late 1980s with a broad-based policy change including the liberalisation of markets for inputs, removing ban on imports of machinery by the private sector and reduction of tariffs. The policy promoted private sector investment due to reduction in the cost of imported agricultural machinery.
The reasons for growing mechanisation in Bangladesh almost resemble those of other countries. Both economic and non-economic factors fuelled mechanisation in this country. First, with growing scarcity of fodder, the maintenance of farm animals for providing draft power became costly. This development triggered mechanisation of tillage operations and reduced dependence on draft power animals. Second, rapid expansion of paved roads from farms to markets, microfinance provided by NGOs and marketed surplus of agricultural produce with diffusion of improved agricultural technology - all together went to create job opportunities for the landless in the rural trade and transport operations. As a result and over time, the agricultural labour market became tight and with it, agricultural wage rates started increasing rapidly. It is thus no wonder that wage hike forced farmers to look for labour-saving technologies in agricultural operations. As a result, a market for selling machine services developed. Third, the expansion of irrigated area following the Green Revolution has necessitated supply of irrigation water in the dry season. As rivers and canals dry up in dry season and surface water irrigation becomes a binding constraint, policy changes have helped import low-cost pumps and shallow machines (STWs) for irrigation purposes.
About 70 per cent of the sample machines were financed through own savings (STWs 75 per cent), thus appearing as predominant source of funds. Especially for power tillers and threshers, the second source is support system through friends/relatives (15 per cent), and roughly 12 per cent were funded with NGO loans. Of late, remittance money helps procure these equipments but the share is very low at 3 per cent. If we take an impression about age of machines and the sources of financing, the older equipments were mostly procured through own savings but the importance of savings was reduced over time. The role of micro credit has assumed more importance in recent years.
Only up to a quarter of STWs and power threshers are exclusively used for operation of own farms. Almost 90 per cent of the power tillers go for rented activities. In rural areas, a rental market for the machines has already developed for full utilisation of the services. The most common rental system is payment of rent in cash per season but sharing the crop is still dominant in many areas. Especially for STWs, renting for use per hour - a relatively more efficient system - is being practiced in one-thirds of the cases under consideration. Â
Let us look at the gross income generated through operation of the machines. Most of the income from the rental services comes from the Boro season, particularly for the shallow tube-wells. For power tillers and power threshers, the utilisation of services is also substantial for the Aman season. The highest incomes come from the power tillers, almost three times compared to shallow tube wells, and double compared to threshers. The gross income per machine is estimated to be Tk 51,000, Tk 148,000 and Tk 75,000 for STWS, power tillers and threshers respectively. The total cost, on the other hand, stands at Tk 43,000, Tk 84,000 and Tk 41,000 giving a profit per machine of Tk 8,000, Tk 64,000 and Tk 34,000 respectively. The estimated benefit-cost ratio thus stands at 1.18, 1.76, and 1.84. It is interesting to note that it takes 2.5 years to recover the investment in STWs, 1.87 years for tillers and 1.56 years for threshers.
Mechanisation is viewed as timely and efficient operation by the respondents. In fact, a major proportion of the respondents said it is time and efficiency considerations that drove them to mechanisation. This was followed by increased profit/cost reduction by a sizeable proportion of respondents. But about one-thirds of the respondents aired their negative perception also. Among the negative ones, the most prominent is environment-related issues followed by high repair and maintenance costs. It is, however, interesting to observe that some of the respondents perceived mechanisation as a cause of unemployment of labour. The other negative perceptions are, for example, shortage of finance, knowledge and skills needed, and increasing fuel cost.
The writer is a Professor of Economics at Jahangirnagar University.