Economic Impact of Custom Hiring Service Centres in Maize Cultivation: A Case Study from Karnataka

In order to overcome the problem of acute labour scarcity, Government of Karnataka in collaboration with Shri Kshetra Dharmastala Rural Development Project has established custom hiring service centres (CHSCs) on public private partnership mode in the year 2014 to provide services of machines and implements to farming community at affordable rates. The study has been conducted to examine the economic performance of the centre and economic benefits accrued to maize farmers of Shimoga district, representative of Malnad region of Karnataka in terms of reduced cost of cultivation, increased productivity, increased profit and reduced drudgery. The results indicated that maize farmers reaped additional profit of Rs. 5554.39 (24 percent) and saved cost of Rs. 2928.46 (15.71 percent) per acre by availing machines from CHSCs compared to private individual farmers. The reduced dependence on human labour was to the tune of 16.29 percent and increased yield observed was about 4.90 per cent compared to those farms who have availed services from private individual farmers. The economic performance of selected CHSC in terms of net returns over total cost was negative. The negative performance was due to the magnitude of dead investment made by the centre in terms of erroneous selection of non-location specific machineries and implements. Though, the performance of these centres was not satisfactory but by looking at the magnitude of economic gains realised by the farmers, Government of Karnataka should think of proliferating the number of centres with a caution of minimising dead investment through proper choice of implements and machineries.