Contract farming: Burden on exchequer
Kuppam's failed experiment points out better options toward state supported agriculure. A report by the Andhra Pradesh Coalition in Defence of Diversity.
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July 2002 : A one page sponsored advertisement item titled "A Showcase of Appropriate Technology and Systems" appeared in The Hindu dated 31.1.2000 under "Interface Focus - The Kuppam Project". It was claimed in the article that The Kuppam model is expected to provide the demonstration effect, which will enable replication of this model in other places. With rapid globalisation and changing trade terms, efficiency of production and competitiveness will emerge as the paradigms for success and this model may be one of the answers which Indian agriculture is looking for. It was also claimed in the sponsored advertisement that Kuppam, after Anand, may well be the starting point of ushering in yet another revolution centered around the competitive efforts of small groups of farmers.

"The Large Scale Advanced Farm Project (LSFAP), which is better known as the Kuppam Project", the above sponsored article claims, is a holistic approach to modernize agricultural practices by involving the Agriculture and all related Departments in the process of this technological upgradation. It revolves around Israel cooperative model of agriculture". An inset was also included in the above sponsored article under the caption "Why Kuppam"? The reasons stated for selecting Kuppam for the experiment are:

  • Kuppam area is part of DPAP block and chronically drought affected
  • Eighty-five percent of the population in the area live below the poverty line
  • Only 10% of the gross cropped area is under assured source of irrigation
  • Saline lands
  • Soil composed of gravel and stones of varying sizes with low level of organic matter

The advertisement made some claims, which were very attractive. It gave some data on "Demo Yield Comparison" for various crops grown in the project. The actual yield obtained for Potato, Gherkins, Chillies, Tomato, Groundnut and Baby Corn given in the advertisement were much higher than either the district (Chittoor), the state or the national average yield levels.

The advertisement also gave details of revenue as on 31.12.1999. This portrayed an average gross income of Rs. 38,639 per acre (calculated from the data) for gross cropped area of 352.25 acres on which standardized crops were grown. Similarly, an average gross income of Rs. 16,089 for an area of 159.65 gross cropped acres, was also given for the experimented crops. Thus, the overall gross income realised was Rs. 31,606 over a gross cropped area of 511.9 acres (which totaled to an income of Rs. 61.8 lakhs). The details of either the cost of cultivation or the net returns were not given. Therefore, it was difficult to say anything about the claims made in the advertisement regarding the financial viability of the technology.

In all, the information given is very interesting, inspiring and attractive. Therefore the Andhra Pradesh Coalition in Defence of Diversity, a network of voluntary development organisations working on the issues of sustainable agriculture and natural resources management in the state of Andhra Pradesh decided to send a team of experts and social activists, consisting of Prof.K.R.Chowdry (Agriculture Economist), Dr.A.Prasad Rao (Soil Scientist), Dr.Venkat (Permaculturist), Dr Uma Shankari (Tanks and Natural Resources) and Sri.Girish Khemkar (Documentary Film Maker) to Kuppam.

The team visited Ramakuppam from February 17 to 19, 2000. Sri Narendra Kumar, Sri.B.G.Naidu, Sri.Balavardhi Raju, Sri Nagesh all developmental activists and natural resources managers working in Chittoor district joined the study team in collection of information and experiences of farmers in the area.

The study team, in the course of collecting information, met a number of officials, farmers and other workers engaged in the area. They included officials of M/S. BHC Agro (India) Pvt. Ltd. at the project site office; the farmers whose lands have been taken over for Israeli Demo Project and also covered under the 2KR Project sponsored by Japanese International Cooperative Agency (JICA Project); workers engaged in the Kuppam project. M/S BHC Agro (India) Pvt. Ltd. also handed over a note to the study team at the site office (Annexure II). The information gathered and the impressions of the team have been incorporated in this report. Individual sources of information have not been quoted for obvious reasons. However the study team testifies that the information incorporated in this report is factual.

Articles in this series
 •  Uncultivated foods and the poor
 •  Genetic security in native baskets
 •  Contract farming: A burden
 •  Fortune favours prepared farmers
 •  The crops of truth At the outset, it may be mentioned that "The Kuppam Pilot Project" i.e. "The Demo (Central Project) Project at Chaldiganipalli Village", as indicated both in the Hindu advertisement and as per the note enclosed, is a demonstration project. This obviously implies that it is a project to be seen and appreciated by the visitors and that the information generated, in principle, is to be shared with others (visitors) so that the results from the demonstration are accepted. When large sized demonstrations are conducted, as in the present case, the more transparent the information generated is, wider will be the acceptability of the results from the technology sought to be demonstrated. It hardly needs any reiteration that when a demonstration is conducted with public money, the accessibility to the information generated must be so much more easier for the interested public. Contrary to this accepted principle, it was unfortunate that transparency and readiness to share the information generated were lacking with M/s.BHC Agro (India) Pvt. Ltd, which is involved in the actual demonstration of the Israeli Technology.

The local development activists who work under the banner of Chittoor Consortium of Voluntary Agencies (Chittoor Swachanda Samsthala Aikya Sanghatana) had provided advance information to the "Demo Project officials" about the impending visit of the study team to the project on 17th afternoon. The Team was surprised to note that its visit to the "Demo Project" was not taken in the right spirit but with suspicion, in spite of our specific introduction that we had come to see and learn from the demonstration. Except by way of giving a note, (Annexure II), the Administrative Officer of the project did not provide us any further information. Mr.Isaac, the Israeli Kuppam Project Manager appeared to be ill at ease with the Team's visit. He showed the heavy machinery lying before his office only after we introduced our professional background and made a plea that we had come all the way from Hyderabad to see the Demo.

One of us (Dr.A.Prasad Rao) requested Mr. Isaac for introduction to the scientific officer in the project so that we can have information on a few scientific aspects of the demonstration. A prompt reply came that no scientist was available to discuss with us, as they were very busy, in spite of our request that any time suitable for them will be suitable to us during our stay from 17th to 19th February. This response was quite discouraging. The officers in charge of the Demo were not prepared to share any more information than what was given in their note regarding administrative and economic aspects of the demonstration. The Team had to visit the Demo farm on its own and without being conducted. This was the atmosphere under which the Team had to gather the information. The Team has to check and cross check the information from various sources before arriving at the final conclusion.

The Kuppam Pilot Project

The Kuppam Pilot Project was primarily undertaken by the Government of Andhra Pradesh through its Rural Development Department to promote and demonstrate Corporate Agriculture as part of its new strategy for agricultural development in the State. The State cabinet approved the demonstration project with Israeli Technology offered by M/s.BHC (India)Pvt. Ltd. in September 1995. An agreement with the company was signed in September, 1997. But the actual implementation of the project began in June, 1997 (as indicated in the note of the company). The estimated cost of the project is as follows :

I year 1997 - 98 Rs. 521.09 Lakhs
II year 1998 - 99 Rs. 133.83 Lakhs
III year 1999 - 2000 Rs. 156.59 Lakhs
Sub Total Rs. 811.51 Lakhs
II year Farmer's Share Rs. 152.16 Lakhs
TOTAL Rs. 963.67 Lakhs

Out of the above amount, M/S.BHC (India) Pvt. Ltd. is charging Rs. 243.54 lakhs (Rs. 81.18 lakhs per year) for technology transfer. Of this, an amount of Rs. 387.26 lakhs was meant for infrastructure and Rs. 157.95 lakhs for equipment. The project was originally contemplated for about 200 acres, but the actual area covered is only170 acres. Thus the investment made by the government works out to Rs. 4.818 lakhs per acre if we take the original plan to cover 200 acres. On the other hand the expenditure works out at Rs. 5.668 lakhs per acre if we take into consideration the actual area developed, which is 170 acres. It was also gathered by the Team during discussions that no farmer has really contributed his/her share. Therefore if we ignore the hypothetical farmers contribution, the investment made per acre works out to a whopping Rs. 4.774 lakhs. This order of investment is at least ten times more than those of even rich farmers adopting modern intensive cultivation practices.

The note given by the company (Annexure II) clearly mentions the objectives of the project. These include among others:

Objective g : To develop a new concept and view for agriculture production to grow new intensive crops (based on modern agricultural methods and equipment,) bringing contract farming familiar to area and farmers",

Objective h : Making the farm as a commercial Demo-farm which is managed by one hand" i.e. corporate body through corporate farming.

Thus the objective clearly defines that the Demo is to prove the effectiveness of Corporate / Contract farming. Interestingly this objective is at the core of both Vision - 2020 for Agricultural Development, Swarnandhra Pradesh released in January, 1999 or elaborated as a strategy for development through the Working paper on Agriculture Agriculture Department of Andhra Pradesh released in November, 1999.

This implies that the policies envisaged through the vision and the working paper were conceived in 1995 itself, which is much earlier than they were publicly announced by the government. Experiment with the policies of corporate/contract farming has been grounded in June, 1997, without any consultation with the people of AP and without any discussion in the State Legislature, which is the highest policy making body in the State. Therefore, it is not surprising that both the Acharya N.G. Ranga Agricultural University, which is charged with the responsibility of development and assessment of any new technology for agriculture in the state, and the State Agricultural Department, which is charged with the responsibility of spreading any new technology to the farmers in the state, have been totally kept out of the experiment.

This means that the sustainability of Israeli technology was not assessed under the conditions obtaining in the state and the demonstration on Israeli technology was straight away began without involving competent and established technically bodies in the state. The reasons for such important deviation from established institutions and procedures are worth an exploration.


To facilitate the demonstration on corporate/contract farming, "Chaldiganipalle Mutually Aided Co-operative Joint Farming Society" was formed to enable participation of small and marginal farmers (167) in large numbers in the demonstration. The Society bears the name Mutually Aided Joint Farming Co-operative Society. But the members of the Society have no knowledge of the functioning of the Society. Nor do they know that it has entered into a contract with a corporate body for farming. The Team learnt that the Society came into existence much after the start of the demonstration. It also learnt that all the nine directors of the Society are employees working with the corporate body (M/s BHC Agro) Private Ltd. No general body of the Society has been conducted with the knowledge of its members (not even a big farmer like R.S.Madhusudhan Reddy Ex-Sarpanch who owns about 40 acre of land which were physically taken over by the corporate body). The farmers told the Team that it was the Government which took their lands and handed them over to the Israeli Company. They never gave their lands voluntarily to the corporate body. None of the farmers knows the details of the contract though the Israeli company claims that the Demo is a contract farming. It is probable that only the Government of A. P. signed the contract with the Israeli company and the formation of Mutually Aided Joint Farming Society was only to legitimate the dealings of the government/company with the farmers, whose lands have been taken over for the demonstration. The members of the Joint Farming Society were never consulted by the corporate body on any decision relating to the operation of the demonstration fields. Thus, no element of cooperation, not even symbolic, was involved either in the formation of the Mutually Aided Joint Farming Co-operative Society or in signing the contract or while dealing with the corporate body.


The lands taken over from the farmers were/are being managed by the corporate body (M/s BHC Agri India Pvt. Ltd.) at all stages, right from the stages of planning, through the stages of development and management. Every farm operation, including marketing, is managed by the corporate body which has employed heavy mechanisation except for harvesting (which is mostly manual since it is a hand picking operation) and cleaning of the produce. Even weed control is done through intensive use of pesticides. It is learnt that the average cost of cultivation is about Rs. 20,000/- per acre out of which the cost of agro-chemicals alone is about 23%. The cost of fertilization is about 18.1%. Power and fuel cost about 26%.

Seed costs about 8 percent. The cost of labour (mostly for machine operators or for field supervision and used only to a limited extent for harvesting and for shifting of pipes) is about 25%. Family members, whose lands have been taken over, are engaged as daily labourers. Their wages range between Rs. 50/- for male labour and Rs. 40/- for women labour. Some educated persons have been given supervisory/managerial role on the farm. It is not compulsory that the labour will be employed whenever they present themselves for work. They get employed only when there is work on the farm.

The company claimed that after an average period of 1.5 years, an income of Rs. 150 lakhs was realised and so far Rs. 29 lakhs income was distributed to the farmers @ Rs. 17,000/- per acre.


Since the start of cultivation in November/December'1997 and till the time of visit (February, 2000), the company has estimated the gross cropped area by the company at 565 acres (the crop period is for 2 years 3 months since the start of the demonstration). The average cropping intensity was about 1.5 per annum. It is possible that this crop intensity will be raised in a phased manner. After full development, the crop intensity could be between 2 and 3. The crops grown were mostly vegetables like Gherkin, Onion, Tomato, Potato, Water Melon, Sweet Melons, Capsicum, Chillies, Beans, Peas, Carrot, Okra and field crops like Groundnut, Baby Corn, Popping Corn, Grain Corn, Sunflower and Gram (dal) were grown. The major crop was gherkins (more than 200 acres as per the The Hindu advertisement with a net income of Rs. 12,000 - 15,000 per acre). The local food crops have almost been eliminated. The main guiding principle in deciding the crop was maximisation of crop income. The requirements of the members of the Mutually Aided Cooperative Society, which is supposed to be the contracting body were not at all taken into consideration. Farmers were never consulted while deciding on the crops to be grown. The crops chosen were only of short duration. This is an important aspect of the demonstration.


Any system of production (in this case a living agricultural system) is a process of transformation of various forms of energy, categorised broadly as inputs and outputs for a desired purpose.

Only those systems can be sustainable which satisfy two conditions: in the first place, the energy (inputs) needed for production must be generated by and within the system itself. In the second place, since the system has to support and provide for those maintaining it, such a system must be able to generate more energy (outputs) than what it needs for its own growth. Only under these two conditions can living systems of production (like agriculture) be sustainable.

In the Kuppam Project the claims made are only in monetary units. This masks the reality of energy transformation. For, when we have to consider energy inputs and energy outputs, the currency we should use can only be ENERGY UNITS and not monetary. Only then can sustainability be correctly assessed.

This being so, if we take into consideration the use of heavy machinery; electrical energy and its infrastructure for use of deep underground water, use of external inputs like seeds, nutrition for plants, pest-weed control methods, we see that all these are not only external to the system but also are very high congealed energy. And these have to be used for every cropping season.

If we convert all these (inputs) into energy units, and even taking the claims of production (outputs) as per the advertisement in monetary units, the ratio of this production output in energy terms will only be a small fraction of the energy that has gone in as inputs. This system is a net consumer of energy and not a net producer of energy. Under these conditions the Kuppam project is not sustainable in net energy terms.


It is only the government and not the company, which is making payments to the farmers for the lands taken over for the demonstration and it, is being done through DRDA officials. The payment for the land is , surprisingly not uniforms. At the time of taking over lands, farmers were promised a heavy payment of Rs. 30,000 to 50,000/- per annum. In practice, this was never paid. In the first year, the small farmers, specially dalits, were paid only Rs. 3000/- per acre. In the second year, Rs. 4000/- per acre was paid. In the third year, farmers were promised a payment of about Rs. 10,000/- per acre. Some have been paid this amount and some others were not yet. It is learnt that the vocal farmer members were paid additional amounts. Farmers were not happy with the payments because of the big gap between what was promised at the time taking over the lands and the actual payment.

The company has claimed an income of about Rs. 1.50 crores from a cropped area of 565 acres i.e. Rs. 26,549/- gross income per acre. An income of Rs. 17000/- per acre of net cultivated areas was paid to the farmers, as claimed by the corporate body, though in reality this has never been paid directly to the farmers. Some of those interviewed indicated that the Government was diverting DRDA funds to pay the farmers [this needs clarification from the concerned department]. Over a period of 2 years and 8 months, an average of Rs. 6,367/- per annum was claimed to have been paid to the farmer, which is not tallying with the actual payments received by the farmers. If the interest component on the investment alone is taken into consideration, which works out to about Rs. 52,000 per acre per annum @ 11% interest per annum, the economic viability of the project becomes questionable. Further, the data on 'returns' from farming claimed by the company needs a critical appraisal before confirmation. This is due to the fact that precise information on the cost of cultivation and the methodology adapted in computing the same, have not been spelled out anywhere.


The adopted Israeli technology broadly consists of intensive irrigated cultivation, use of heavy machinery and high input. Initially, the soils were ploughed deep (upto about 50 cm depth) and heavy dose of DAP at about 7.50 quintals per acre, was applied i.e. about 135 kg nitrogen and 345 kg of phosphorous. Deep ploughing, with or without turning the soil is being continued before every cropping. Agro chemicals, both pesticides and weedicides worth Rs. 4600 are applied for every crop. These are expected to leave considerable residues in the soil raising serious environmental concerns. No organic manures are being applied. Farmers are very much worried about the sustainability of productivity of their lands under the above circumstances.

Long term fertilizer experiments throughout India or abroad, clearly establish the need for conjunctive use of organic manures (Farmyard Manure) and chemical fertilizers for sustained higher crop productivity. These data also clearly establish that use of chemical fertilizers continuously in an imbalanced form (in this particular case only N, P and K are being used) reduce the soil productivity or efficiency of utilisation of applied N, P and K.

There is enough scientific evidence to show that this type of intensive cultivation is not sustainable from the point of productivity.

Seventeen borewells have been dug upto a depth of about 600 feet as against 250 ft borewells dug by the farmers in the neighbouring fields. There was no provision for groundwater re-change. Under intensive cultivation, there is steep depletion of ground water. Already the bore wells of neighbouring farmers have dried up or are drying up. Irrigated agriculture with such rapid depletion of ground water with no provision for its re-change can never be sustainable.

Ploughing or sowing has been done along the slope apparently to provide enough hydraulic pressure for flow of water in the laterals of drip pipes. This is already causing serious erosion even with little rains this year (eroded spots were video graphed). Ploughing along the slope is against the very basic principle of soil and water conservation.

It has been observed that even simple run off without erosion causes soil loss of 4 tonnes per hectare. Erosion-causing run off may lead to a soil loss of about 40 tonnes per hectares. Erosion of the type noticed in the demonstration will cause much higher soil loss. These soil losses will also lead to nutrient losses. It may be mentioned here that to buildup a soil of one inch thickness, it takes million of years. This fine topsoil, to be more specific, is crucially important from the point of crop production.

In conjunction with drip irrigation, where soils are kept under near saturated conditions, heavy machinery is operated for inter cultivation. This is causing heavy compaction of the soil leading to hardening. This is necessitating deep ploughing before every cropping. Such continuous deep ploughing will lead to mining of nutrients from the deeper soil layers, specially which are not applied regularly through fertilizers, and is highly deleterious from the point of sustainable production. Coupled with addition of no organic manure, continuous deep ploughing will adversely affect the physical environment of the soil, leading to unsustainable production

The Team observed that cultivation and planting were not even on grade except where multidirectional slope existed. No waterways were observed by the Team for safe disposal of excess run off, in case of run off causing rains.

No grounding of any Rain Water Harvesting measures were observed. Any efforts to increase the TREE COVER were not visible either. Both these strategies are essential components for recharging of the depleting water table and for drought proofing the lands. Any sustainable agriculture needs to pay attention to these two strategies, which unfortunately do not seem to be conceived by the project.

The use of machinery, the non-integration of the animal in agricultural practices, the heavy use of chemicals for fertilization and for pest-weed control, growing of only crops meant for market needs-all these agricultural practices in the Kuppam project have inborn potentials for depletion of the fertility of sols in the long term. Because, market oriented agriculture only mines whatever natural resources are there but never attempts to build assets of natural resources. Soils fertility will be the causality in such projects through these land use patterns.

The only positive point of the Israeli technology is increased water use efficiency with drip irrigation. This of course, is a well known technology and many farmers are already using drip irrigation with Government assistance at a much cheaper cost (Rs. 17,000/- to Rs. 25,000/- per acre) Compare this to the investment of about Rs. 4.80 lakhs per acre in the present demonstration!


Social impact of the present corporate farming is very adverse. Firstly, farmers tilling their lands have been driven out from their profession and only some are able to work as hired labourers on the demonstration farm. The benefit of subsidiary occupation like dairying with the use of crop residues, which is a byproduct of mixed farming, is lost. If the model is replicated everywhere, alternate employment of such displaced family members of the farmers becomes a serious problem. Some of the members of dalit families from the village, whose lands have been taken over, however, are able to work as hired labourers on the demonstration. Labour employment is only for 60 - 70 women along with 7 - 10 male members per day while the total membership of the society is 167.

Lands of many farmers were taken against their will (e.g. lands of S. R. Madhusudhan Reddy, - Ex- Sarpanch, who owns 40 acres of land on which he had grown huge mango and tamarind trees giving him regular income). Good cultivated lands, which were supporting cultivation of sugarcane, rice and other food crops, were also taken over. Farmers became totally dependent for a living on the corporate body losing their earlier independent livelihoods.

The land, labour and natural resources are being harnessed for the needs of an external market since all the products are market oriented.

What about the staple food needs of the local people? Locally needed cereals and pulses do not form a major portion of the targeted production. On this count of project does not provide agricultural production for sustenance of the local population and hence adversely affects local food security.

Foodgrain production has almost ceased. Only vegetables and other similar crops are being cultivated. This will adversely affect foodgrain supply to the people living in the area. Unlike in the past, dependency of the people on the market which in turn is controlled by the corporate bodies, is total. Subsidiary occupations like dairy were totally lost in the absence of any fodder by way of bye product from optimum produce.

Another important social aspect of the project will be the alienation of the lands of small and marginal farmers. This alienation will be reflected in the form that the owners will not have any say or control on how their lands and labour are going to be used. Title may formally rest with them but products of their labour and resources of their land holdings will be alienated. Result will be that they become insecure wage-labourers on their own lands. Such alienation will only increase phenomenally the poverty of rural households.

As it is the boundaries of the individual fields have been ploughed without leaving any trace of them. Now, farmers do not know where their lands are located. Farmers now cannot resume their own cultivation, even if they want due to boundary problems. This is going to be the biggest problem for restoration of peasant farming when once corporate farming has been established.

Though at the first sight, payments to agricultural workers on the corporate farm, appear high (Rs. 50/- for men and Rs. 40 per women), they have to put in grueling and hard work is for longer hours (8 hours) spread over from 7 a.m. to 6 p.m. They get a break of 30 minutes for breakfast and 60 minutes for lunch. But compare this to the payment they receive when they work for the neighbouring farmers. There they get Rs. 25/- plus meals with a shorter working period of about 7 hours. Further, work on the corporate farm is more intensive compared to the work in the other farmers fields. Therefore if we calculate a 60 hour week on the Demo farm the workers earn Rs. 350 for men and Rs. 320 for women. That is a wage of Rs. 5-83 for men and Rs. 5-30 for women per hour. If we compute the cost of the lunch they receive at Rs. 15, the labourers earn Rs. 280 at the private farmers field for a 42 hour week. This works out to Rs. 6-62 per hour which is 12% more than the wage the corporate body offers.

Absentee landowners, who do not actually participate in tilling their lands, appeared to favour corporate farming. However, farmers who were actually tilling their lands are opposing the corporate farm. They are very much worried about the excessive use of agro-chemicals, lack of use of organic manures and use of heavy doses of fertilizers. They are also worried that the productivity of their lands will be lost totally if the same chemicalisation of their fields continues, and they want to have their lands back.

On the other hand, they are worried that boundaries of their lands have been disturbed beyond recognition. They do not know how to retrieve their lands. Such farmers are expecting the Government to intervene and help them to resume their cultivation. These farmers are confident that they can get good yields from their fields if the Government can help them with 'drip system' for irrigation. At present, corporate farm is getting continuous power supply. Farmers want that a similar benefit should also be extended to them to ensure higher crop yields.


It was claimed in the sponsored ad feature (The Hindu dated 31-1-2000) [Annexure I] that "Kuppam, after Anand, may well be the staring point of ushering in yet another revolution centered around the competitive efforts of small groups of farmers". Probably, there cannot be a greater fallacy than this. There is no comparison between what is happening under the "Anand" model and in the production system in the Kuppam model. In Kuppam farmers are displaced and their work is substituted by machinery. There is not even a trace of an element of 'cooperation' in the Kuppam model, while in the Anand model, members and their representatives are activley involved in decision making. Secondly, Kuppam model is full of duplicity and farmers have been totally eliminated from their profession. They can participate in the farm operations only as hired labourers.

The Kuppam type of farming cannot even be called as contract farming. If it was really so, parties to the contract (farmers) should know in advance the obligations and privileges they are entitled to as members of the Mutually Aided Joint Farming Society. In the case of Kuppam not even well to do farmers like Madhusudhana Reddy, Ex-Sarpanch, leave alone poor dalit farmers, were supplied with a copy of the 'contract form' or the bye-laws of Chaldiganipally Mutually Aided Joint Farming Society. Finally, the hold of the farmers on their lands was totally lost in the Kuppam model, while in the Anand model, no such thing happened.

It was further claimed that "The Large Scale Advances Farm Project, which is better known as the Kuppam project, is a holistic approach to modernise agricultural practices by involving the agriculture and all related departments in the process of this technological upgradation. It revolves around Israel corporative model of agriculture". This is another biggest fabrication. Both the A P Agricultural University (Acharya N.G. Ranga Agricultural University), which has the main responsibility to evolve, test/assess any new technology for agricultural development and the State Agricultural Department which is charged with the responsibility of spreading any technology in the State for advancement of agriculture have been carefully kept out of the Kuppam experiments. The data generated through the demonstration has not been assessed by any technically competent person(s) or body(ies). This claim, thus, is totally inaccurate.

It was claimed that the lands were saline. It is also not correct. Though no data has been shown to the visiting Team, knowledgeable persons in the area are completely disagreeing with this assessment of the local soils. The Soil Scientist in the Team, from his visual observation, also does not feel that this claim could be correct. This claim has been apparently made in order to show that very good crops are being raised now while no worthwhile crops were raised earlier. The Team learnt from the interviews with farmers that even crops like Sugarcane, Rice, Orchards (Mango and Tamarind), a variety of food crops, groundnut and even many variety of vegetables were being grown earlier by the farmers. In the neighbouring lands, very good crops are being grown even now.

Drip irrigation which is a hallmark of the Demo farm is not totally new to the area. In fact the rainfall is not that unfavourable in the area compared to many other districts in the State. Well irrigation has been quite prevalent in Chittoor district. Therefore it must be understood that whether in agronomical or irrigation practices or in terms of soil fertility and rainfall this area has not been at the bottom of the ladder.

It was finally claimed that in the the Hindu advertisement feature that "Kuppam model is expected to provide the demonstration effect, which will enable replication of this model in other places. With rapid globalisation and changing trade terms, efficiency of production and competitiveness will emerge as the paradigms for success and this model may be one of the answers which Indian agriculture is looking for". This is the epitome of falsehood designed to 'market' unsaleables in the market with an aggressive salesmanship through collaborators.

In our report, it has been clearly shown how the Kuppam model is technically unsound, low in agricultural sustainability, environmentally destructive and economically unviable. The model is denying food production and balanced food to the people. Farmers are enslaved to the corporate farm managers. Rights of the farmers are totally suppressed. If the model is really replicated, it will raise a host of social problems and unrest of uncontrollable nature, if the emerging social problems are unresolved.

Unless someone gives grants or heavily subsidise upto about 90% of investment and its cost, the Kuppam model cannot be replicated. In the present atmosphere of cutting subsidies to the farmers under the impact of world bank conditionalities coupled with liberalization or globalization, giving this much subsidy to the agriculture sector in beyond imagination.

Therefore, the question of Kuppam model becoming one of the answers, which Indian agriculture is looking for, does not arise. Except the drip component, there are no positive aspects of the technology which can be advocated in the present social milieu. Hence all core claims made in the sponsored article are specious and not substantiated by any of the facts on the ground.

An amount of Rs. 243.54 lakhs was paid to the Israeli experts in the name of expenses for technology transfer for the demonstration. In the present demonstration no technology transfer is involved as no farmer member of the Chaladganipally Mutually Aided Cooperative society was trained by the Israel corporate body in the demonstration. Therefore, the claims of technology transfer is false. The amount charged only replicates the cost of Israeli experts.


The only positive point of Israel technology is the drip component, which costs about Rs. 17,000 - 25,000 per acre. The technology being already used by farmers, and provided by the government agencies including that of Karnataka Government in the neighbouring villages, works out to be much cheaper and feasible compared to the Israel technology, as shown in the demonstration. Farmers want that the govt. should help them to install and service the drip irrigation system. They are not in favour of all other components of Israel technology, which cost as high as about Rs. 4.8 lakhs per acre and not sustainable technically and environmentally and not viable economically or socially.

Corporate farming, assuming the above economic parameters to be valid in future also, will not be economically viable unless the state supports them heavily, as in Israel, at a much higher cost. At only a small fraction of supporting the corporate farming by the state, peasant farming can be made viable and vibrant absorbing all modern technological development and meeting the needs of the future. In the end, it can be said that Kuppam demonstration has miserably failed to show us an alternate path for agricultural development in the state. It cannot be replicated on its own. State support to peasant farming, at only a fraction of the cost of subsidy the state has to give to the corporate farming, coupled with right mix of pricing and marketing policies can make agriculture vibrant meeting the aspirations and the welfare needs of the people at large.

Dr Chowdry, Dr Prasada Rao, Dr Venkat and Dr Uma Shankari
July 2002

This article is part of a series of pulications reproduced with the permission of the Deccan Development Society