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Multi-national corporations and agricultural development: a study of contract farming in the Indian Punjab

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  • Sukhpal Singh

    (Institute of Rural Management, Anand, Gujarat, India)

Abstract

This paper examines the rationale, practice and implications of contract farming under the MNCs in vegetable crops in the Indian Punjab from the new institutional economics perspective. It is found that the MNCs deal with relatively large producers, their contracts are biased against the farmer, and the contract crops perpetuate many of the existing problems of the farming sector like high chemical input intensity, unstable future incomes, and social differentiation, though contracting has led to higher farm incomes and labour employment, especially for women. There is an inherent contradiction in the objectives of the contracting parties and that of the local economy and suitable institutions and organisations are not present in the state. Copyright © 2002 John Wiley & Sons, Ltd.

Suggested Citation

  • Sukhpal Singh, 2002. "Multi-national corporations and agricultural development: a study of contract farming in the Indian Punjab," Journal of International Development, John Wiley & Sons, Ltd., vol. 14(2), pages 181-194.
    • Handle: RePEc:wly:jintdv:v:14:y:2002:i:2:p:181-194
    DOI: 10.1002/jid.858
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    Cited by:

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    2. Gersch Inka, 2018. "Producer organizations and contract farming: a comparative study of smallholders’ market strategies in South India," ZFW – Advances in Economic Geography, De Gruyter, vol. 62(1), pages 14-29, March.
    3. Jose Blandon & Spencer Henson & John Cranfield, 2009. "Small-scale farmer participation in new agri-food supply chains: Case of the supermarket supply chain for fruit and vegetables in Honduras," Journal of International Development, John Wiley & Sons, Ltd., vol. 21(7), pages 971-984.
    4. Cavatassi, Ramina & González-Flores, Mario & Winters, Paul & Andrade-Piedra, Jorge & Espinosa, Patricio & Thiele, Graham, 2016. "Linking smallholders to the new agricultural economy: The case of the plataformas de concertación in Ecuador," IFPRI book chapters, in: Devaux, André & Torero, Maximo & Donovan, Jason & Horton, Douglas E. (ed.), Innovation for inclusive value-chain development: Successes and challenges, chapter 12, pages 375-410, International Food Policy Research Institute (IFPRI).
    5. Jose Blandon & Spencer Henson & Towhidul Islam, 2009. "Marketing preferences of small-scale farmers in the context of new agrifood systems: a stated choice model," Agribusiness, John Wiley & Sons, Ltd., vol. 25(2), pages 251-267.
    6. A. Haroon Akram-Lodhi, 2008. "Forum 2008," Development and Change, International Institute of Social Studies, vol. 39(6), pages 1145-1161, November.
    7. Poulton, Colin & Dorward, Andrew & Kydd, Jonathan, 2010. "The Future of Small Farms: New Directions for Services, Institutions, and Intermediation," World Development, Elsevier, vol. 38(10), pages 1413-1428, October.
    8. Rama, Ruth, 2023. "Technological Transfer Channels of Food and Beverage Processing Multinationals to Host Countries: An Empirical Analysis," MPRA Paper 118162, University Library of Munich, Germany.
    9. Viet Hoang, 2021. "Impact of Contract Farming on Farmers’ Income in the Food Value Chain: A Theoretical Analysis and Empirical Study in Vietnam," Agriculture, MDPI, vol. 11(8), pages 1-16, August.
    10. Briones, Roehlano M., 2015. "Small Farmers in High-Value Chains: Binding or Relaxing Constraints to Inclusive Growth?," World Development, Elsevier, vol. 72(C), pages 43-52.
    11. Kumar, Shiv & Chandra, Subhash & Singh, D.R. & Chaudhary, Khyali R., 2013. "Contractual Arrangements and Enforcement in India: The Case of Organic Basmati Paddy Farming," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 68(3), pages 1-8.
    12. Celina Schelle & Benno Pokorny, 2021. "How Inclusive Is Inclusive? A Critical Analysis of an Agribusiness Initiative in Kenya," Sustainability, MDPI, vol. 13(19), pages 1-17, October.
    13. Viet Hoang & Vinh Nguyen, 2023. "Determinants of small farmers' participation in contract farming in developing countries: A study in Vietnam," Agribusiness, John Wiley & Sons, Ltd., vol. 39(3), pages 836-853, July.
    14. Anup Raj & Andrei Kuznetsov & Thankom Gopinath Arun, 2020. "Culture of Sustainability and Marketing Orientation of Indian Agribusiness in implementing CSR Programs—Insights from Emerging Market," JRFM, MDPI, vol. 13(11), pages 1-19, November.
    15. Bellemare, Marc F. & Bloem, Jeffrey R., 2018. "Does contract farming improve welfare? A review," World Development, Elsevier, vol. 112(C), pages 259-271.
    16. Thapa, Ganesh & Gaiha, Raghav Gaiha, 2012. "Food Security in Asia and the Pacific: The Role of Smallholders," Asian Journal of Agriculture and Development, Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA), vol. 9(1), pages 1-37, June.
    17. Marc F. Bellemare, 2018. "Contract farming: opportunity cost and trade†offs," Agricultural Economics, International Association of Agricultural Economists, vol. 49(3), pages 279-288, May.
    18. Anika Trebbin & Markus Hassler, 2012. "Farmers' Producer Companies in India: A New Concept for Collective Action?," Environment and Planning A, , vol. 44(2), pages 411-427, February.
    19. Mungandi, Sepiso & Conforte, Daniel & Shadbolt, Nicola M., 2012. "Integration of Smallholders in Modern Agri-food Chains: Lessons from the KASCOL Model in Zambia," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 15(3), pages 1-22, September.
    20. Ashok K. Mishra & Anjani Kumar & Pramod K. Joshi & Alwin Dsouza, 2022. "Monopsonists, Disruptive Innovation and Food Security: The Case of High‐Value Commodity," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(1), pages 460-476, March.
    21. Barik, Prasenjit, 2021. "A critical analysis of India’s Contract Farming Act 2020," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 34(Conferenc), October.

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