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2. LITERATURE REVIEW.

In the context of India’s tea export, there exists vast literatures .But for this study we have included

some of the important empirical works which are matched with our objectives.

Chand and Tiwari,(1991),analyzead growth and instability of India’s export and import of agricultural

commodities. Jaganathan , (1992) , in his paper examined the instabilities of export earnings of selected groups and

selected commodities and all the commodities from the period 1974-75 to 1989-1990. Pal , (1992) , analyzed the

magnitude , causes and effects of instability of agricultural export earnings of India for the period 1979 to

1989.Subramaniam , (1995) , analyzed the impact of fluctuations in tea production and exports on international tea

trade .He articulated that India plays a significant role in world tea trade , being the world’s largest producer ,

consumer , and exporter . Therefore , fluctuations in India’s tea production , consumption and exports are enough to

disturb international tea trade . Aiello , (1999) , analyzed that the effects of export earnings instability on economicgrowth of developing countries has long interested economists for several reasons . Reddy , (2001) , examined

global demand for and supply of tea by estimating semi – log trends separately using data of the recent past , 1974

to 1988 , on the area under cultivation of tea , production , export and retention of tea for domestic consumption .

Debraj , (2003) , in a column in India together news letter said that globalization has hit the Indian tea industry . He

added that its traditional market in the countries that made up the former Soviet Union have been steadily drained up

and hence results in falling demand for tea in abroad .Sathe and Deshpande , (2006) , in their paper made an attempt

to review the changes in their trends and composition of agri-trade from 1990 till 2004 . South Asian watch on

Trade (2006) analyzed that in Nepal, tea had potential to benefit large segments of rural population and lift them out

of poverty and stagnation. Shinoj and Mathur , (2008) , in their paper identified that the recent developments in the

international trade scenario and corresponding alterations in India’s foreign trade policies has depicted for reaching

implications for India’s agricultural sector and agricultural exports in particular . The study also revealed that India

had been able to maintain its comparative advantage , but several others such as tea , coffee , spices , etc., had been

negatively affected by trade openness policy . Wong ,(2006) ,proclaimed that the existence of a positive and

significant effect of trade openness on the productivity of manufacturing industries in export - oriented industries

in the years after trade reforms curve implemented, but decreasing productivity after 2000 .Yucel, (2009),

examined the causal relationship between trade openness and economic growth (GDP) for the Turkish economy .

The findings of his study showed that while trade openness has a positive effect , financial development has a

negative effect on growth. Vander and Wall (2008) examined the sustainability issue in the tea sector for six

leading tea producing countries in the world,viz ,India ,Srilanka , Vietnam , Indonesia , Kenya and Malawi .This

study is based on an extensive field study of civil society organization in these countries . A considerable number of

studies have attempted to explain empirically the relationship between trade openness and government expenditure.

Rodrik , (1998), Adsera and Boix , (2000), and Albertos , (2002), proclaimed that existence of positive linkage



between trade openness and government spending is due to high compensation hypothesis where as Alesina and

Spolaore ,(1997), Alesina et al (1997) , Frankel and Romer (1999) , and Bretschger and Hettich , (2002) , indicated

that government size and trade openness are interrelated with country size . Smaller countries tend to have higher

trade shares than the larger countries as the same amount of trade flows represents a different shares of GDP .

Alkan , et al .,(2009) in their paper investigated the importance of tea sector all over the world among major

producer. Nagoor (2009) examined the performance of India’s tea exports and identified the underlying

factors . The study also looked at tea exports and production response in major tea exporting countries

under WTO regime . Nagoor and kumar , (2010) in their paper investigated that with the signing of the Free

Trade Agreement with the Association of South East Asian nations , there are apprehensions that the

consequent reduction in import tariffs will adversely affect the Indian tea industry . Adhikary and Maity,

(2010) computed instability indices of various sections of export for 1966 - 1967 to 1986 - 1987 .

Keeping all these studies in mind we now return back to our main study i.e, the study of analyzing

the trend of India’s tea export in the scenario of trade openness . The next section will not only analyze the

results but also we will try to explain the reasons behind these results . Finally , on the basis of our study we

will suggest several policy prescriptions to take the advantage of trade openness for exporting tea from India.

REVIEW OF LITERATURE

2.1. Review of literature is an integral part of any research study. It palys a significantrole in shaping the purspective of researching to set the tone of the study. A huge

vollume of literature is avilable with regard to export of rice from india, particularly

rice.Here, a brief attempts is being made to explore of a little of the vast aray of

literature resources relating to export of rice from india to other countries.



2.2. Maizels ,(1968) tested the hypothesis relation between exports and saving. He

took annual data from 11 member nation of the overseas sterling area for the period

1950 to 1960 and found a significant degree of correlation between savings and

exports.

Kelker and sharma (1976) examined the trend and determinants of india’s export

performance for the period 1961 to 1974. He concluded that reason for loss of india’s

export share in world maekt lies on supply as well as on demand side.

Kannan, (1986) analysed the export performance of agricultural commoditis from

1968-69 to 1881-82. In case of almost all the commodities, incresed unit value was

primarily an important factor in the achievement of higher export earnings. In case of

rice, marine products, quantum increse was reinforcing factor.The export of rice sugar

and raw cotton were subject to considerable instability.

Pahariya and Ahuja, (1986) applied the Heckscher-Ohilin Sumuleson model to indianeconomy to explain the commodity pattern of her trade. They concluded that physical

capital intensity was not good predictor of india;s tarde pattern as a single explanatory

variable the human capital did better job than any other variable.

Mukherjee, (1987) empirically investigated the relationship between exports and

economic growth in India for the period 1950-51 to 1980-81.she observed the

negative regression coefficients between GNP growth and export growth showing that

‘a 1 percent increase of bringing about any increase in income, was seen to be

accompanied by decrease in income’.

Nayyar, (1987) studied india’s export performance for the period 1970-85 as well as

for two sub-periods 1970-78 and 1978-85.He argued that during 1970-78 ,various

internal factors like decrease in agricultural production increased domestic demand

for manufactured goods contributed to slowing down of export growth but after 1978

external factors were responsible for slow growth.

Tyagi, D.S. (1990) in his article analyzed the problems and alternatives related to

Indian food economy. In his article he suggested that although a very well developed

Statistical system exist in India, neither the degree of reliability is very high nor the

statistic are available on time. so, immediate steps should have to be taken to improve

the reliability and timeliness of basic information required for managing the food

economy,

Nandi and Biswas, (1991) tested two way causality between export growth and

growth of income in India for the period 1960-1985.The econometric results showed



that in Indian context, causality ran one way only i.e. export growth-led growth of

national income but growth of income had no impact on growth of export.

Dutta, (1996), mentioned that a major problem of Indian rice milling industry is that,

due to large varities in grades and grain sizes, machinary adjustment become

different. De- husking paddy, seperation and polishing equipments require

improvement in designs by incropting hydraulic and electronic controls. This is

needed if Indian rice is to cater to the needs of the premium markets both at home and

abroad.

Patnaik, U. (1997) observed falling total area under foodgrains and decelerating

growth of foodgrains outfood below the population growth rate during the period of

structural adjustment.

Durga, P.K. (1997) in his article also discussed the world rice market with properly of

India’s rice export.

Childs, N. & Burdett, A. (2000) in there article analyzed the U.S rice export market.

This article breaks up the us rice export market by type of rice exported and describes

recent trends within each market. In their article, they found that U.S share of global

rice exports have declined since 1989.The U.S exports raise in all three form: paddy,

brown and rough. However since the mid 1990s only rough rice has shown any

sustained growth.

Dorosh, P.A , (2001) in his article analyzed the issue of trade liberalization and food

security with giving emphasis or focus on the rice trade between Bangladesh andIndia .From his study he found that the trade liberalization offers potential benefits

for national food security by enabling a rapid increase of food supplier following

domestic production short falls.

Khan, A.U, (2004) in his article discussed growth and farmer related issues related to

the Indian agriculture. In his analysis , he also included the impact of GREEN

REVOLUTION on agriculture.

Gruere, G. et al. (2004) In there article analyzed the potential effects of introducing

GM rice in India with or without China.They also focused on 4 types of GM riceresistance to biotic and a biotic stresses, such as drought resistant rice and use a multi

country , CGE model to stimulate their introduction in India.

Wailes, E .T.,(2004) in his article discussed the various implication of the WTO

DOHA ROUND for the rice sector, In other words he analyzed the impact of WTO

DOHA ROUND on the rice sector.At the end of his study ,he found that the benefits



of such policy reform on a global basic will benefits Japan, China the Europe union

and Australia by large measure and the policy reform one rarely zero sum as is

suggested by the estimate given in his study .

Barah,B.C,(2005) article analyzed the dynamics of rice economy in India a and he

also discussed the emerging scenario &policy option related to the Indian rice

economy .He also used spatio temporal rice related data from secondary sources

pertaining to rice growing the areas to study the trends and growth pattern over the

decades (1950-51 to 2001-02) He also discussed the poor performance of agriculture

sector in eastern India & thus it requires the enhancement of rice productivity and

rice based system by focusing & prioritizing the rise research in eastern India.

Warr, P.G & Wollmer, F.T,(2005) in his article examined the long demand

relationship of Thailand exports of rice drowning upon recent developments in the

statistical analysis of economy time series and the inside of airsing from a recent

debate on the elasticity of demand for manufactured exports from LDC’s. A

relatively robust long run price elasticity of demand for rice is obtain to between -1.2

ands 1.9.The “small country “hypothesis is rejected using the specification of the

price normalized demand equation .They also found that the result of there analysis

are relevant for current agriculture policy debate in Thailand.

Boriss, H.(2006) in his article analyzed the various aspects of US, Rice market. In his

article, he also analyzed the various industry characteristics & production related to

rice in US.US rice policy & govt. programmes are also a part of his analysis He

discussed various issues such as export import etc. related to US rice sector.

Banik, N.(2007) in his article identified a set of factors that appear to be responsible

for an increase in India’s export growth during recent years .He also examined the

possible impediments to high export growth in a sustained manner .He found that

increase in India export‘s during the year following 2000 is predominantly services

driven and is attributed to increase in factor productivity , growth in world trade, an

increase intra –industry trade and external sector reform .He suggested that India

should be willing to take a more constructive approach ,along with other developing

countries, at multilateral forms such as WTO.

Slaton, T.& Timmer ,P(2008) in his article analyses the crisis. in the world rice

market .in this article ,they analyses that under the leadership of U.S, the countries

like Japan ,China & Thailand can solve the problem of world rice crisis

Pandian, B.J.,(2009) in his article discussed about the System of Rice Intensification

(SRI) in Tamil Nadu. In his article, he has mentioned that the System of Rice



Intensification is a holistic agro-ecological crop management technique seeking

alternatives to the conventional high input oriented agriculture through effective

integration of crop, soil, water and nutrient management. He further stated that SRI

grown rice is introduced to the US food trade & consumers also. He also discussed

the Chinese experience related to the SRI.

Mitra, S & Jasling T (2009) In their article analyzed export restrictions from two

different but related angles. In their analysis, they dicussed the welfare implications of

export restrictions both for the country imposing such measures as well as for the rest

of the world. They further tried to explore an overview of how export restrictions

have been addressed in trade negotiations and agreements and other such efforts to

achieve greater market stability. They also stated the global and domestic impact of

export restrictions and tried to estimate the change in world welfare due to export

restrictions.

Kulkarni, K. G (2009) in their article analyzed the effects of India’s trade policy on

rice production and exports. They analyzed the economic effects of such trade policy

in the framework of Comparative Static Model that explains the costs and benefits of

tariffs and subsidies. They found that the protectionists trade policy actions

undertaken in 2008 resulted in an estimated $ 260 million increase to national welfare

consumers benefited from lower prices and the loss to producers was offsets the govt.

aid, including debt reduction. While it’s policies appeared to limit the transmission of

higher world prices to Indian consumers, India’s monopoly power in the production

of rice could have limited the full effect of price decrease.

Iqbal,B.A,&Merwe,T.V.D(2010)in their article discussed the issues of Indian food

crisis. They also analyzed the issue of Indian food crisis by examining the reasons for

food crisis, existing trends in production of food crops, state wise procurement of

wheat, and rice, per-capita availability of food grains, trends in price rice, genesis of

crises and fear that Indian planners are having in mind. They also discussed the

currents trends and economic impacts of food grains and at the end, they found that

slow agricultural growth has been a cause of food crisis.

Sharma , A , (2011) in his article analysis about the Rosola basmati rice .com , an

agro-product export comp. that intoduces high quality of Basmati rice and the various

issues related to its export from India. In his article he also talked about royal basmati

rice which is also another variety of Indian rice that the rosola BASMATI RICE com.

company also supplies to many foreign markets.

2.3. Hence, this attempt to review a few of the studies that had been conducted in

this field not only brought certain trends and charecteristics of rice trade in india but



also can serve the purpose of forming hypothesis of this study. So, kepping all these

studies in mind, we came back to our main study, i.e. ‘Export of rice from India to

abroad.’

Radha Charan Rabidas

Roll No.: 15 (4th Sem)

Email ID: [email protected]

REVIEW OF LITERATURE:

2.1. There are vast literature to review regarding the pattern and

trend of rice production in India. Regarding this concept many

researchers and scholars contributed by their empirical works. In

mailto:[email protected]





the following sections an attempt has been made to review some of

the available literature on the pattern and trend of rice production

in India.

2.2. SOME MAJOR EMPERICAL WORKS:

Blyn, (1966), in his article he found that as every foodgrains

plays an important role in Indian food economy. There is no

separate government policies for boosting rice production. He also

mentioned that performance of Indian agriculture after

independence was much better than before independence. Sen,

A.K. (1967), in his article analysis that the production relatedissues of rice. In his article he also discussed that the high rates of

increase in production, the instability or year to year fluctuations in

rice output increased during the post-green revolution period

particularly in the second decade. Many explanations are offered

for this phenomenon. Bhuian,(1992), mentioned that there is a

need to study the input use pattern and the practices followed by

the farmers in paddy growing regions. Since water is also very

important input in rice production, so nearly half of irrigation

water is used for rice production. Tiwari, K.N. (2002), according to

him to achieve rice production target by 2012, balanced and

adequate phosphorous and potassium fertilizer as well as nitrogen,

sulphur and zinc is essential. To improved rice production and

productivity in rainfed areas may not only help the resources. For

farmers, but also substantially increased food production. He also

mentioned that there is urgent need to educate farmers about theimportance of balanced used of fertilizers in increasing yields and

profits in rainfed rice ecology. Uphoff and Randriamiharisoa,

(2002), in their study they found that more rice can be produced by

using less water, provided that concurrent changes are made in the



way that plants, soil nutrients are managed. Ramasamy, (2003),

mentioned the production elasticity estimated by the studies

conducted in different states over the period indicates that either

there is no production response to various factors inputs or theresponse is declining. The total factor productivity which grew at

an average rate of 1.37 percent per annum in the 1970s and 1.33 %

in 1980s.Kapur, B.N.(2003), showed that the status of rice

production in the state of Haryana has also been remarkable with

the production of 2.68 million tones in the year 2000-2001 over an

area of 10.5 million hectare contributing to 3.16% of total

production in the country. Vittal, K.P.R. et al. (2004), in their

article, they discussed the two main seasons related to rice

production in India. They also analysed the method of rice

production in India. They also calculated the area and yield growth

rate of each district in India. Although the rate are treated as

stagnant and others were decided based on the sign positive or

negative. Ravichandran, S and Singh, (2005), in their article they

found that during the year 2002-2003, the production of rice was

declined due to the draught. The stock of rice reduced from

25.62million tones in 2001-2002 to 19.37million tones in 2002-

2003. From their article we can say that the intensity of draught

experienced in year2002-2003 and the decline in rice reserve.

Barah, B.C. (2005), state that the rice sector has witnessed rapid

dynamism in production processes. After climbing a height of

fourfold increase in production during past four decades, the

production curves have started showing downward trend and productivity decelerating since the later half of the 1990s. Leip, A.

and Bocchi, S. (2OO7), in their article they state that rice

cultivation and production is both an important sequester of carbon

dioxide from the atmosphere an important source of green house



gasses. In this context they given example as, in 2004 the global

paddy rice output was 607.3million tones at 14% moisture content.

At the gain/straw ratio of 0.9 for most currently planted rice

varieties, the global rice straw output in 2004 was about 676million tones at 14% moisture content. This means that in 2004,

rice sequestered about 1.74 billion tones of carbondioxide from the

atmosphere to produce about 1.16million tones of biomass at 0%

moisture content. Sanjay. K. Srivastava, et al. (2009), in this paper

they concern the impact of climate change on agricultural

production as well as rice production. Increase in temperature,

higher carbon-di-oxide concentrations and abnormal patterns of

precipitations coupled with higher frequency and intensity of

drought and floods are likely to enhance considerably the climate

risk to the major agricultural ecosystems. Towards this, the study

on climate risk assessment to rice based agro ecosystems, which

support the livelihood security for very large number of poor and

marginalize in India has been reported this paper.

2.3. In the next section ie.section 3 we will study the pattern andtrend of rice production in India. We will also analyse the research

result explaining the reason behind these result. Finally, like any

other research work we will also indicate the line of our future

research.

Rupak Kumar Doley




Email ID:

[email protected]

Review Of Literature:



2.1. Review of literature is an indespensible part of any research

works that provides an important and usefull track to frame their

research works. There are sufficient literature regarding the current

export situation of coffee from India, contributed by manydifferent researchers and scholars. Now we will try to review those

literature that match with the concept of coffee export from India.

2.2. Dudeja, (1989), in his article, ‘India hopes to export surplus

coffee’ publish in Tea and Coffee Trade Journal , mentioned

various demands of the coffee exporters and coffee growers in

order to increase the internal as well as external demand. Mehta,

(1996), in his article, ‘Indian coffee exporters aims for US market’mentioned different steps, which are taken to increase the export of

coffee in US market. Gahiro, L. (2000), assessed the fluctuations in

Burundi’s coffee production in different years and also the results

of the slight change in coffee marketing structure in 1991 due to

the partial liberalisation initiated by the World Bank. Lewin, B.

and Giovannucci, D. (2002), in their article, Global Supply and

Demand: New Paradigms in the Coffee Markets, assessed thelarger global situation in terms of both the dominant supplying

countries and the evolution of demand. Achoth, L. (2005),

mentioned the status of the Indian coffee industries as an export

industries with 70% of the total production being exported. He also

mentioned the various research activities of the Coffee Board of

India to find out the comprehensive problem of the mould

contamination in coffee after the country received its first report of

rejection of coffee from Africa during 1994, which left the coffee

producing countries with no alternative but to fall in line with

international standards. Bhat, R. V. (2005), described the

organisation and the activities of different research institutions and

training centres by the Coffee Board of India in order to maintain



the coffee quality and safety management and control in India with

positive effect. Potts et al. (2007) assessed the need for economic

stability of coffee producers, its stratigies for development and put

forwarded some specific recommendations for actions. Mercereauand Vignault, (2008), identified the status of the quality of coffee

and coffee industries in India with Italy and ex-communist block as

the major export destination. They also mentioned that the

sustainable standards have low penetration in the Indian coffee

intustries. Giovannucci,D. and Potts, J. (2008), mentioned that

among the certified commodities, the certified coffee has been

growing at a much faster pace than any other segment of the coffee

industry after its first trade in 1967 through fair trade.

Mohan, S. and Russel, B. (2008), in their paper modeled

the relationship between the producers and the world price of

coffee in three different countries, viz., Brazil, Guatemala and

India allowing for the effects of changes in market structures. They

also found that liberalization has benefited producers substantially

in terms of higher real coffee prices and a higher share of the world price of coffee. Mutandwa et al. (2009), using the Boston

consulting group (BCG) matrix for analyzing the market for coffee

export in Rwanda, recommendate that, if the role of coffee export

to the country economic vistas is to be consolidated, there is a need

of understanding the social, economic, cultural, institutional and

technological factors affecting sub population in the importing

countries. They also discussed appropriate strategies for their

destination. Smith, E.S. (2010), in his thesis, he found the Fair

Trade to be the key contributor to sustainable income- generating

strategies and socio- economic stability among rural and small

scale coffee farmers. Mohapatra,(2010), mentioned that India’s

coffee exports may be hit due to the higher prices that received by



the domestic producers in the domestic spot market. In the paper,

he also mentioned that theb domestic player can expect much

better result from high international future price. Jonsson, L.

(2010), in his paper focused the attention on describing politicalrent seeking on the Rwandan coffee sectors institutional structure.

In the paper, it is also mentioned that , the institutional changed

with the liberalisation of the coffee sector and this change, in turn,

provided an opportunity to analyse how and why political actions

taken that changed the institutional structures and thereby curbed

corruption. Govindan, A. (2010), identified the decline in the

production and the increase in the consumption of coffee in India.

He represented the imposition of production subsidy in order to

increase and improve the quality of coffe and also mentioned the

imposition of export susidy in order to export Indian branded value

added coffees and high value coffees to the far off markets, such as

United States, Canada and Japan. Daumal, M. (2010), in the paper

determined through time series regression whether the regional

disperities are linked to countries’ (India and Brazil) trade

openness with the result that Brazil’s trade openness has

contrbuted in reducing the regional inequalities, while, the opposite

result has been found in case of India.

2.3. After reviewing and keeping all those study in mind now we

are back to our main study, ‘Current Export Situation Of Coffee

From India’, corresponding to the future analysis of the researchresults along with the explanation of the reason behind these

results.



Danswrang Basumatary


Email ID:

[email protected]

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