Agro-Economic Viability of Betel Leaf Industry - A Case Study in Tamluk Sub-Division of Purba Medinipur District, West Bengal

Abstract

The livelihoods of small/marginal farmers are most at risk to changing agro-climatic and agro-economic situations, especially those who cultivate high-value cash crops, which are dependent on its cultivation, marketing, continued demand and robustness of the supply chain. A systematic analysis of these aspects is thus crucial for maintaining the viability of a crop's agribusiness so that it may sustain its various stakeholders. This thesis examines the viability of the betel leaf agribusiness in Tamluk Sub-division of Purba Medinipur district in West Bengal, which is a prime centre of this crop in the country. Several statistical and econometric methods, along with geospatial techniques, have been used to fulfil the stated objectives. Results reveal that the marketing channels of this crop have changed over time, with several intermediaries now being engaged in its trading, which lessens profit margins for farmers. In all, six marketing channels were identified through which the betel leaf ultimately reaches the consumer, among which, farmers are unable to follow the most profitable one for them due to present market norms. Land and betel leaf farm (Boroj) site suitability analysis revealed the aptness or otherwise of present-day farm locations and helped identify those places where this crop's acreage can feasibly be expanded into, if farm credit and irrigation facilities are available. Economic analysis via computation of the Benefit-Cost Ratio and Net Present Value showed that betel leaf cultivation is still viable for most leaf types and sizes, except for those who cultivate small-sized Bangla leaves. Though farmers incur losses in the first year of Boroj establishment and planting of the leaf, their profit margins increase thereafter, providing them earnings till the tenth year, which is the usual lifespan of a new vine. The Mitha leaf variety is the most profitable among all leaf types, though rising input costs can lessen earnings, while Monte Carlo simulation revealed that even the cultivation of medium-sized Bangla leaf is viable. Reframing of market norms, easing the availability of credit facilities and betel leaf specific crop insurance are sorely required to assuage the effects of periodic natural hazards, with meagre government support available presently. Keywords: Betel leaf agribusiness; Supply chain; Marketing and demand; Land suitability; Market hinterland; Econometric analysis; Cultivation constraints.