Is there any decline in growth of rice production in Indian agriculture in post-liberalization era: Evidence from multiple structural breaks analysis

Abstract

This paper tries to find out multiple structural breaks and their causes for 11 major rice-producing states in India over the period 1970-71 to 2013-14 using the methodology of Bai and Perron. The existences of multiple structural breaks and a strong regional variation regarding the possible time points and the numbers of breaks are evident. The Liberalization policies may have either no or negative effect on growth of rice production. This is because from the results of multiple structural break analyses, it is evident that for five states namely AP, BI, HA, KA and OR the rate of growth of rice production has been decreased just after the introduction of liberalization policies or in the first half of the 90's decade. Also the introduction of the New Agricultural Policy, 2000, may affect the rice production because eight among the ten major rice producing states have one break in the first decade of this century, out of which five states namely AP, AS, BI, OR and WB have negative effect on growth. For the states like AP, BI and OR, the rate of growth of rice production has decreased both after the introduction of liberalization policies and also after the introduction of the New Agricultural Policy, 2000. Thus, the growth of rice production may mainly be affected by state-specific agricultural policies and agricultural policies adopted by the Government of India or due to the natural calamities.