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Introduction
Chilli (Capsicum annum L.) is one of the important commercial crops of India. Chilli or hot pepper is a tropical vegetable as well as spice crop commonly used throughout the world as spice for its pungency and red colour from ripe and dried fruits and also for pungency and flavour from green fruits.1 Chilli is indigenous to South America and was first cultivated around 7000-6000 BC. By the turn of 15th century, when Spanish and Portuguese discovered South America, it was widely cultivated. Due to distinct type variability available in the North- Eastern states, it is assumed that Christian missionaries directly introduced capsicum into North East India from South America.2 Major chilli producing and exporting states in India includes viz., Andhra Pradesh, Karnataka, Maharashtra, Orissa, Tamil Nadu, Madhya Pradesh, West Bengal and Rajasthan accounting for more than 80.00 per cent of the total area and production. The state of Andhra Pradesh is the leading producer of chilli both in area and production contributing on an average of 25.00 per cent of the total area and as high as 40.00-50.00 per cent of the total production.3 India has a huge comparative advantage in growing and export of chilli, thus this potential can be realised through initiatives of the government in facilitating the farmers and traders by means of developing transport facilities and other inputs in the process of marketing.4
The States in the North Eastern region have been producing substantial quantities of fruits and vegetables, which have considerable potential for exports to the international markets. As per estimates of North Eastern Council, the region produces 23.44 lakh tonnes of fruits in 4.87 lakh ha area and 1.22 lakh tonnes of spices like turmeric, ginger, onion and chillies. Nagaland has the unique characteristic of highest size of operational holdings at 6.8 ha, which is higher than the Northeast regional average of 1.59 ha and also of the all-India level 1.6 ha. Therefore, Government as well as local inhabitants should get more attention for implementation the cultivation of these crops, which may generate more income as well as employment with minimum investment of input, and chilli cultivation is one of them, therefore with the specific objective to analysis economics of chilli cultivation the present study has been proposed.
Materials and Methods
The present study was conducted related to economics of chilli cultivation in Wokha district of Nagaland, India. In the study local and land race varieties of chilli growen in the study area was considered as most of the farmers grows local and land race varieties. In Wokha District of Nagaland out of total five Rural Development Blocks, two R.D. Blocks viz; Wozhuro-Ralan and Wokha were selected for the present study because of the fact that a large number rural population engaged in of chilli cultivation in the region. Two villages from each block were selected randomly which and from each village 15 respondents were drawn which comprises of 60 numbers of total respondent for the detailed study. In order to have representative sample from each village a sample of 15 respondents was drawn randomly from each villages. This will result in selection of 60 respondents from 4 villages. The distribution of total respondents based on the size group of land holding were classified as given below.
|
Group |
Land holding size(ha) |
No. of selected farmers |
|
Marginal |
<1.00 |
11 |
|
Small |
1.01-2.00 |
14 |
|
Medium |
>2.01 |
34 |
|
Total 60 |
||
Cost A1= It includes hired human labour + seed cost + marketing charges + transportation cost and depreciation + 8 per cent interest on working capital
Where, depreciation is calculated as,
Depreciation= Original value of the asset – Junk Value/ Average life of the assets × 100
Cost B1= Cost A1 + interest on fixed capital excluding land
Cost B2= Cost B1 + Rental value of owned land
Cost C1= Cost B1+ imputed value of family labour
Farm business income= Gross return – CostA1, here the gross return includes all those economic products from chilli as well as bi products.
Farm investment income= Farm business income – imputed value of family labour.
Family labour income = Gross return – CostB2
Net income = Gross return – Cost C3
Benefit Cost Ratio:
Benefit cost ratio on variable cost= Gross income / Variable cost
Benefit cost ratio on total cost= Gross income / Total cost (Total Cost= Total Fixed cost + Total Variable Cost)
Results and Discussion
In order to obtain conclusive results and scientific interpretation from the study, the data collected were subjected to various economic and farm management analytical tools and techniques. The findings from the study on economic analysis of chilli cultivation in Wokha district of Nagaland, India are presented as below.
Economics of Chilli Production
Cost of chilli production per hectare across various size group
The cost of production includes in the study takes into account inputs cost like seed cost, human labour, marketing and transportation cost, interest on working capital, rental value of land at the prevailing rate in study area, deprecation on implements and interest on owned fixed assets. The estimate of per hectare cost of chilli cultivation on sample respondents in the study area is presented in Table 1.
Table 1: Item wise break up of per hectare cost of cultivation of chilli across various size groups.
| Sl. No. | Particulars | Marginal | Small | Medium | Average | |
| Variable cost | ||||||
| A. | 1 | Human Labour i) Family Labour | 83000.00 (79.90) | 104500.00 (70.45) | 97000.00 (59.45) | 94833.34 (68.50) |
| ii) Hired Labour | 9100.00 (8.76) | 25550 (17.22) | 9400.00 (5.76) | 14683.34 (10.60) | ||
| 2 | Marketing cost | 350.00 (0.34) | 400.00 (0.27) | 6750.00 (4.14) | 2500.00 (1.80) | |
| 3 | Seed cost | 900.00 (0.86) | 1250.00 (0.85) | 5600.00 (3.43) | 2583.34 (1.87) | |
| 4 | Interest on working capital | 4485.00 (4.32) | 7242.5 (4.88) | 33212.5 (20.36) | 14980.00 (10.82) | |
| 5 | Total variable cost | 97835 (94.18) | 138942.5 (93.67) | 151962.5 (93.13) | 129580.00 (93.59) | |
| B. | Fixed cost | |||||
| 1 | Rental value of owned land | 0.00 (0.00) | 0.00 (0.00) | 3500.00 (2.15) | 1166.67 (0.84) | |
| 2 | Depreciation on implements | 5500.00 (5.30) | 8500.00 (5.73) | 7000.00 (4.30) | 7000.00 (5.05) | |
| 3 | Interest on fixed capital excluding land | 550.00 (0.52) | 900.00 (0.60) | 690.00 (0.42) | 713.34 (0.52) | |
| 4 | Total fixed cost | 6050.00 (5.82) | 9400.00 (6.33) | 11200.00 (6.87) | 8883.34 (6.41) | |
| C. | Total cost(A+B) | 103885.00 (100.00) | 148342.00 (100.00) | 163162.5 (100.00) | 138463.00 (100.00) |
From the table 1, it can be seen that, the per hectare cost of chilli cultivation for the sample farmer was ₹.1,03,885.00, ₹.1,48,342.00, and ₹. 1,63,162.50 respectively for marginal, small and medium group of farmer with an average of ₹. 1,38,463.00. Thus it shows that the cost of production increased with increase in farm size. Joko and Sumarno (2015) in their study on chilli production and adoption of chilli-based agribusiness in Indonesia also concluded similar findings5. On the average, per hectare total cost of chilli cultivation was found to be, ₹. 1,38,463.00. Of all the inputs items, the cost of family labour constituted the highest per cent being 68.50, followed by interest on working capital 10.82 per cent hired human labour 10.60 per cent, marketing cost 1.80 per cent and seed cost 1.87 respectively. Out of the total cost the share of variable cost and fixed cost was found out to be 93.59 per cent and 6.41 respectively. The finding is also in comformity with, Mahadevappa and Mokshapathy Mahadevappa (2015) in their study on production and marketing of organic vegetables in Belagavi district of Karnataka.6
Farm profit Measures on sample farms
Table 2 reveals, farm profit measures on sample farms from chilli production. The cost concept of Cost A1, Cost B1, Cost B2, Cost C1 and Cost C2 were used in present study.
From table 2, it can be seen that the per hectare Cost A1 ranges from ₹. 20,885.00 in marginal group, ₹. 42,942.50 in small group and ₹. 62,062.50 in medium groups of farmer with an average of ₹. 41,963.34, whereas cost A1 was found out to be highest in medium and lowest in marginal group of farmers. The per hectare Cost B1 was found out to be ₹. 21435.00, ₹. 43842.50 and ₹. 62762.50 for marginal, small and medium group respectively with an average of ₹. 42680.00. The cost B1 was found to be highest in medium group (₹. 62762.50) and lowest in marginal group (₹ 21435.00 ). The per hectare Cost B2 was found out to be highest in medium group (₹.66,262.50) and lowest in marginal group (₹.21,435.00). Cost B2 for small group was ₹. 43,842.50. On an average Cost B2 was found to be ₹. 43,846.67 per hectare. Cost C1 was found to be, ₹. 1,04,435.00, ₹. 1,48,342.50 and ₹. 1,59,762.50 per hectare for marginal, small and medium group of farmers respectively with a average of ₹. 1,37,513.34 per hectare. Thamburaj et al., (2001) also made similar findings in their study.7 The Cost C2 was found out to be ₹. 1,04,435.00, ₹. 1,48,342.50 and ₹. 1,63,262.50 per hectare for marginal, small and medium group respectively with an average of ₹. 1,38,680.00 per hectare. Whereas, Cost C3 for marginal, small and medium groups of farmer was ₹, 1,14,878.50, ₹. 1,63,176.75 and ₹. 1,79,588.75 per hectare respectively with an average of ₹. 1,52,548.00 per hectare. Mohammed (2016) in his study on analysis of Income and Constraints to Chilli Pepper Production in Kaduna State, Nigeria. also found similar conclusion in their studies.
Table 2: Farm profit measures on samples farms (in ₹)
| Particulars | Farm size group | ||||
| Marginal | Small | Medium | Average | ||
| 1 | Average yield(q/ha) | 75.00 | 74.76 | 75.57 | 75.11 |
| 2 | Average price (per q) | 4000.00 | 4000.00 | 4000.00 | 40000.00 |
| 3 | Gross income per hectare | 300000.00 | 299040.00 | 302280.00 | 300440.00 |
| 4 | Total fixed cost (TFC) | 6050.00 | 9400.00 | 11200.00 | 8883.34 |
| 5 | Total variable cost (TVC) | 97835.00 | 138942.5 | 152062.5 | 129613.34 |
| 6 | Total cost (TFC+TVC) | 103885.00 | 148342.00 | 163162.5 | 138463.00 |
| 7 | Cost A1 | 20885.00 | 42942.5 | 62062.5 | 41963.34 |
| 8 | Cost B1 | 21435.00 | 43842.5 | 62762.5 | 42680.00 |
| 9 | Cost B2 | 21435.00 | 43842.5 | 66262.5 | 43846.67 |
| 10 | Cost C1 | 104435.00 | 148342.5 | 159762.5 | 137513.34 |
| 11 | Cost C2 | 104435.00 | 148342.5 | 163262.5 | 138680.00 |
| 12 | Cost C3 | 114878.5 | 163176.75 | 179588.75 | 152548.00 |
| 13 | Farm business income | 279115.00 | 256097.5 | 240217.5 | 258476.67 |
| 14 | Farm investment income | 196115.00 | 151597.5 | 143217.5 | 163643.34 |
| 15 | Family Labour income | 278565.00 | 255197.5 | 236017.5 | 256593.34 |
| 16 | Net income | 185121.5 | 135863.25 | 122691.25 | 147892.00 |
| 17 | BCR based on variable cost | 3.06 | 2.15 | 1.98 | 2.39 |
| 18 | BCR based on total cost | 2.88 | 2.01 | 1.85 | 2.24 |
Gross Income
The average yield of chilli per hectare was found to be 75.00 q, 74.76 q and 75.57 q for marginal, small and medium group of farmers respectively. Considering the prevailing price of chilli in the study area which is ₹.4000.00 per q the gross income was found to be ₹. 3,00,000.00, ₹. 2,99,040.00 and ₹. 3,02,280.00 for marginal, small and medium group respectively. The average yield in the study area was 75.11q with a gross income of ₹.3,00,440.00. The study revealed that per hectare gross income was highest in medium group of farmer and lowest in small group of farmer. Jagtap et al., (2014) studied, resource use efficiency and economics of marketing of green chilli and revealed similar findings.9
Family Labour Income
The family labour income per hectare was found to be ₹. 2,78,565.00 ,₹. 2,55,197.50 and ₹.2,36,017.50 per hectare for marginal, small and medium group of farmer respectively. The average family labour income was ₹. 2,56,593.34 per hectare. Family labour income was highest in marginal group and lowest in medium group of farmer in the study area. This showed that medium group of farmer utilized more hired labour than owned labour for the cultivation of chilli.
Net Return
The average net return per hectare from chilli cultivation was found out to be ₹. 1,47,892.00. The net return per hectare was found to be highest in marginal (₹. 1,85,121.5) group and lowest in medium (₹.1,22,691.25) group. Whereas, net return was ₹. 1,35,863.25 for small group of farmer. Verma, et al., (2015), in their study on marketing of Coriander Spice in Rajasthan also made similar finding in their study on marketing of Coriander Spice.10
Benefit Cost Ratio
The benefit cost ratio of chilli cultivation in the study area was 3.06, 2.15 and 1.98 for marginal, small and medium group of farmer respectively. The average benefit cost ratio over variable cost was 2.39. The benefit cost ratio over total cost was highest in marginal group (2.88) and lowest in medium group (1.85).The Benefit Cost Ratio for small group was 2.01 and the average for the sample group of farmers in the study area was 2.24. Tirlapur et al.,(2014) also revealed similar finding in their study on economics of production of major crops in Dharwad district.11
Conclusion
The study comprises of 60 chilli farmers selected through multi stage random sampling technique. From the study it was revealed that, the average area under chilli cultivation was found to be 0.012 ha. In the study area, the average total cost of chilli cultivation was found to be ₹. 1,38,463.00 per hectare. Out of the total cost, the share of variable cost and fixed cost constitute 93.59 per cent and 6.41 per cent respectively. It was also found that the per hectare cost of chilli cultivation for the sample farmer was ₹. 1,03,885.00, ₹. 1,48,342.50 and ₹. 1,63,162.50 for marginal, small and medium group of farmer respectively with an average of ₹. 1,38,463.00. Thus it shows that the cost of production increased with increase in farm size. The average yield of chilli per hectare in the study area was found to be 75.00 q, 74.76 q and 75.57 q for marginal, small and medium group of farmers respectively. Considering the prevailing price of chilli in the study area which is ₹ 4,000.00 per q the gross income was found to be ₹. 3,00,000.00, ₹. 2,99,040.00 and ₹. 3,02,280.00 for marginal, small and medium group of farmers respectively. The average yield in the study area was found out to be 75.11q with a gross income of ₹.3,00,440.00 and with an average net return of ₹.1,47,892.00. The overall benefit cost ratio was found out to be 2.39 which shows good return from the chilli cultivation.
Acknowledgement / Funding
The Authors heartily express gratitude and thankfulness to the SASRD, Nagaland University for providing all necessary facilities during the course of the research. The authors also indebted to all the participants covered under the study for providing those valuable data and information.
Author Statement
This manuscript is an original research work and has not been published or submitted in any other journal.
Conflict of Interest
There is no conflicts of interest associated with this publication.
Ethical Approval
This article does not contain any studies with human participants or animals performed by any of the authors.
References
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