As I write this part of the feature I realized how little I knew. Economics, specially the human aspect of it, is so intricate that it can baffle even open-minded social psychologists. All the same I am to try and record some peculiar features in animal rearing pattern of India that may not look logical to a money manager, but important for study. 

MONEY

Money in state politics plays a pivotal role in shaping public policy in individual states and across the nation. www.followthemoney.org 28 Nov 2003 

Money represents value of a material, individual or community. Use of money was evolved out of deeply rooted customs as is shown by the study of primitive forms of money like cattle, cowree shells, whale teeth and ornamental jewelry. The clumsiness of barter was only one of the factors that led to the evolvement of money. Banking was invented before coins and reached a high level of sophistication in Egypt (Nile valley civilization). The status of a country is often determined by its money power expressed in terms of its Gross Domestic Product (G.D.P.) or fiscal status. Economic development used to be an indicator of the well-being and prosperity of people. 

MONEY AND DEVELOPMENT
Today, human development is being understood as distinct from economic development. While economic development is the sum total of individual profits accrued from within and without the country, human development indicates the level of access of the community to certain minimum needs like education, food and health care. While Economic development stems out of a commodity concept, Human development has community concept as its basis. "Human development report, 1999" published by UNDP, shows that economic development need not naturally result in human development. The data (table 1) crisply projected the benefit accrued by various economic groups as a result of economic development. It is seen that 86% share of the benefit from world GDP went to the richest twenty per cent people, 13% to middle sixty per cent and 1% went to the poorest twenty per cent. Shares of benefit from export of goods to rich, middle and poor were 82%, 17% and 1% respectively. Sixty eight per cent share of the benefit from foreign investments goes to the 20% richest, 30% to the middle 60% and 1% to the poorest 20%. Benefit of Internet use to rich was 93%, to the middle was 6.5% and to the poor 0.2%. Economic development comes in a package of credits and debits. 

TABLE 1. ECONOMIC DEVELOPMENT : SHARE OF BENEFITS TO VARIOUS ECONOMIC GROUPS

ECONOMICS

Economics is the science dealing with assets, the laws relating to value of material, market, its trends, sustainability etc. Behavioral economics, the human face of economics is only the beginning. Socionomics investigates the real engine driving the markets - social mood.[www.socionomics.org]

Classification apart, economics of the Animal Husbandry in India had been dealt as livestock economics of India and the economic aspect of animal husbandry practices of India. Planners or the peers of the department to seek an identity for the sector frequently project first aspect. Though there is nothing in common between the science dealing with animal husbandry and agriculture, the two sectors had remained clubbed since long; to such an extend that the people whose main vocation is animal husbandry report that their vocation is agriculture and that animal husbandry is a source of additional income. But when data was analysed it was seen that more than 50% of their income comes from animal husbandry. Agriculture offers them employment for 100 days or less each year. Perhaps clubbing animal husbandry with agriculture by government for all policy matters including subsidy, loan or tax had its impact on the mindset of the people. 

The economic aspects of animal rearing perhaps not been fully studied in India, much less by Indian economists. A few references obtained are the work of non-Indian scientists who either studied the existing animal husbandry pattern of India or used the data collected on their behalf. Unfortunately these studies dealt the fundamental aspects of economics as a science. 

Socionomics has special relevance to the study of animal husbandry as it can serve as a helpful tool to understand some of the social (community) events and trends which appear illogical from a general economist's view point, -

OBSERVATION 1. Though rearing one high yielding cow is more economic than 2 or 3 low yeilders, the live-stock owners of five southern states of India during a survey told that they preferred more cows in their backyard as it gave them better identity and credit value in the society. 

It is true that factor productivity is more favourable in case of a high yielding animal. But to the rural dairy owner keeping 2-3 cows is hardly a problem as family members share work. Since Cows/ buffaloes are either bought on bank loan, lease, on personal loan from relatives or on a security of jewelry or house, high cost and the risk involved make proposition of a single high yielder less attractive. A second cow is to be introduced when the first cow becomes pregnant and its yield dips to maintain the daily income level. A homegrown heifer is often retained as a third animal. Expense on input is divided among all animals though the animals 'in milk' does get better feed. Apart from milk, dung of three cows is substantial for sale or for use as manure. Balanced feed, mineral supplement or dewormer; are not usually given as they are not perceived to be beneficial. Grains unfit for human consumption, supplemented by tree leaves, cut and carry grass, crop residue, etc. form daily ration. Manpower involved is normally not considered towards costing. 

OBSERVATION 2. The urban livestock production is also an important business as market demand for freshly drawn milk is high, wherever available. The importance of urban livestock production has in fact, long been recognised in Indian Government Policy. However, such production was formerly regarded as being "out of place" and certainly more of a problem to urban planners than an asset. This is seen clearly in the First National Five Year Plan, which reads, - 

It is estimated that, at present 60 to 70 per cent of the fluid milk requirement of the urban areas is derived from cattle maintained within the municipal limits. These cattle are generally kept in unsanitary and congested conditions, which affect their health, milk performance and breeding capacity. They are also a source of nuisance to the surrounding residential area. A majority of these animals when they become dry are sent to the slaughterhouse. Maintaining cattle in this manner is uneconomic and is a drain on the cattle wealth of the country.

The plan included removal of cattle from urban areas, a measure highly desirable both from the standpoint of public health and the conservation of the cattle-wealth of the country. The dislodged cattle and their owners may be rehabilitated by providing facilities for setting them in villages around the cities.

This broad objective remained for some time. Indeed, one of the aims of Phase I of Operation Flood was to displace urban-based milk production by making it uneconomic through the enhancement of low cost rural production. However, this objective was dropped in Phase II and Phase III of Operation Flood once it was realised that the comparative advantage of urban-based milk producers meant that they had a key role to play in the national development programme.

Fifty years after the First Five Year Plan, this negative view is being challenged by a more positive discourse promoting the importance of urban "agriculture" (a western term that include A.H.) as an integral factor to the development of sustainable and environmentally friendly cities. Cattle and other livestock, formerly perceived as pollutants, are increasingly recognised for their value in recycling waste, as well as in providing products needed by the urban market, and thus offering a source of living for those struggling to make needs met.

OBSERVATION 3. Now let us analyse a case study from Orissa (see table below) In spite of the fact that it is easy, cheap and quick to till agricultural land using tractor, people of Orissa are still using the traditional draught animal power. 

This proposition that appears mathematically logical and sound. The "green revolution" reduced animal power from 70% to 25%. Tractors today meet 23.8% of the energy needed for tilling. The energy supplemented by Draught Animal Power (DAP) is 25%. Assuming that all the land we till are on planes, we need another million of tractors to replace all the bullocks. This is because the machinery has to be simultaneously available during tilling season. Agriculture already consumes nearly 1/3rd of the total P.O.L. used in the country. Domestic production of crude oil has declined from 63% in 1989-90 to a projected 32% of the projected requirement in 1999-2000. Whether a country which already imports oil worth 35,000 crores (350 Billion Indian Rupees) can shift to total mechanisation without affecting our fiscal balance has to be seen. Even if it is brought in through a policy decision, will the end user accept it? Use of tractor is difficult on small strips of land and terraced areas where land is uneven. Farm animals are used for transport of goods, irrigation, sugar cane crushing, and chaff cutting etc. also. To replace them with tractors and trolleys would be necessary along with mechanisation. 

Many tractors though available on Easy Monthly Installment (EMI), the farmers are finding it difficult to repay debts. Some of them do rent tractors, but consider it a cumbersome, as customers (specially the small holders) do not make prompt payment. In ideal conditions tractors would fetch work for 90-100 days per year and that is often not enough to pay back debts as can be seen from experience of Punjab. Even the harvester combines are finding it difficult to complete the job. Thousands of migrants from eastern region help states like Punjab, Haryana and western Uttar Pradesh in harvesting. Migration from drought prone districts along with their families and bullock carts help sugar cane crushing of irrigated regions of Maharashtra.

OBSERVATION 4. Similarly, it is easy quick and cheap to use automotives to transport agricultural products. But one can find 15 million carts are in use in the country. 50% male cattle born each year out of 100 million breedable animals shall remain idle and become a liability as slaughtering bullocks is not legally permissible in 34 of the 36 states/ UT's of India. If public perception and social consequences are not considered in economic analysis, modernization may remain an armchair idea unacceptable to the end user. 

OBSERVATION 5. 62.8% of the landed of India are marginal farmers who till for themselves. Mechanisation may mean leasing their land for contract farming and freeing them of their traditional vocation and indulgence. If plans are not available to socially engineer the surplus manpower to be spared by mechanization, social upheaval may take any direction; this is not desirable.

5.1 Nearly 200 million people who are now involved in seasonal farm labour would find this opportunity diminishing, if not totally unavailable. Migration to urban slums in search of job would be one alternative to them. 

5.2. Eighty-four million draught animals (bovines) would be idling in the byres (sheds) of small and marginal farmers who cannot feed them or maintain them. 

5.3. In mechanised harvesting with combines the chaff is not collected. Chaff is a staple feed for Indian cattle and buffaloes. Feeding grain based concentrates to them would mean higher input on dairy farming and competition of animals with man for food grains. We are already seeing a sizeable reduction in the cattle population in the country especially in regions where cross breeding had been well established. Buffaloes are replacing crossbred cattle as they can thrive well on dry fodder and common property resources. 

5.4. with the number of cattle on decrease the output of dung too would decrease. Import fertiliser will have to be increased further, tilting fiscal balance unfavourably. Diesel consumption & electricity consumption would increase from the present 30% and require more import. This would not only further fiscal imbalance but also affect the energy share of other sectors.

OBSERVATION 5. On cost involved for the assumed requirement for an organized goat/ sheep farm designed to produce 300Kgs. of meat/ chevon per day is discussed below. -

 
More than 12 crores of Indian rupees are to be arranged for livestock, land, feed and salaries. On a bank loan with the interest rate of around 8-10%, that means Rs 8-10 lakhs as monthly interest alone. The current market rate of mutton/ chevon is Rs. 100/- per kg. One can buy 300 Kg mutton or chevon from open market at Rs 9 lakh a month. We may debate why anyone would invest a sizeable sum for venture that may not fetch enough to pay interest, not to talk of the repayment of capital.

If we go by the copybook, India may need 14 Million Hectare (MH) of pasture for its 163 million sheep and goat alone. But migrant shepherds are generating mutton and chevon with zero input leaving India's limited (11.3 MH) pastureland for cattle and buffalo (mostly). 

OBSERVATION 6. A society working in close understanding with a meat processing company studied the average cost of rearing male buffalo calves in 10 villages of Aligarh district of Uttar Pradesh in India. At the end of the study it was observed that the villagers spent on an average Rs. 12/- per buffalo calf per kg body weight gain. The green fodder was not costed since it was cut and carry or was residue from the dam. But the farmers were readily selling these male calves to the bulk buyer at the rate of Rs. 10 per Kg live weight. Possibly the perception of receiving a lump-sum of Rs. 1000/- for a calf weighing 100 Kg was alluring against spending small amounts towards input on a daily basis. Absence of a competitive market or lack of organization of the producers could be other attributable reasons. 

MARKETING

Marketing is a highly complicated process and an important link between the producer and the consumer. Successful marketing has basis on optimisation of resources at each point viz. production, processing, packing, warehousing, transport & communication, retailing, sale etc*. Planning, infrastructure development and information technology (IT) is involved all the way. Our studies are often limited to sales and marketing of products.

MARKET TREND (global) 

While debating the export policy, it is reasonable to look at the current world market trend and market pull. World prices for wheat and coarse grain declined in 1998; prices of oil seed, oil cake and meals too declined during the same period; so did world meat prices. But edible oil and fat looked up. [In spite of this, price of food grains soars high in domestic market; more so when packaged and sold]

In this backdrop, India is importing edible oil and is attempting to exports oil seeds, oil cakes, food grains etc. Can we complain of fiscal imbalance when lack of market strategy is evident all the way? There was no taker (domestic or export) for locally produced rice in Assam early 2000 (due to unfavourable factor productivity?). The incumbent food grain glut in Punjab (lack of buying mechanism and of storage) too indicates the need for a holistic research on food grain (agricultural produce) market. 

There is an urgent need to improve the purchasing power of rural masses, which form a vast array of consumers for products manufactured in industrial/ processing sector. Many people though are not direct buyers, form secondary consumers for durables (seconds, second hand goods etc.). The capacity building of small holders can thus widen the market base. Animal husbandry of India has immense potential to this end, besides addressing innumerable sustenance issues.

There is also a need for capital generation (in potent areas) and raw material production to boost trade. The estimated rise of urban population from 1/3rd to 1/2 of the total population, and increase in cost of food grains (chiefly due subsidies and support price) in every successive year is indirectly expected to push urban demand for animal products significantly by 2010. 

It is understood that communities have varying needs and different characteristics which makes any attempt to manipulate human activity both dangerous and often fruitless. These realities have to be borne in mind during the planning of capacity building and training. Communities should never be regarded as not having capacity.

More than economics, the socionomics study of "poor dependent" endeavours where the consumers or middlemen stand to benefit is worth investigating. Possibly endeavors could be socially engineered to the benefit of both producer (small and unorganized in animal sector) and consumer (the low income).