LITERATURE RIVIEW

The rural economy of India is wholly agriculture based. Tropical monsoon climate, flat land, fertile soil,

inherent skill of labourars have made India an agrarian nation. Although its share in Gross Domestic

Product has declined from over half at independence to less than one fifth. Currently, agriculture

remains the predominant sector in terms of employment & livelihood with more than half of India’s

workforce engaged in it as the principal occupation Agriculture still contributes significantly to export

earning & is an important source of raw materials as well as demand of many industries. Agricultural

marketing & credit institutions play vital roles in the development of rural economy.

Agricultural marketing is a series of interconnected activities involving planning, production,

growing & harvesting, grading, packing, transport, storage, agro &food processing, distribution & sale.

The existence of good marketing system is an assurance to the farmer that his produce will be taken off

to the field. Such a system will indicate the farmer the type of goods for which demand exists & the

quantities in which these goods are needed. This will help in the optimum use of the land. It can be so

designed that it helps in maximizing the rate of growth in agricultural sector. A well designed

marketing set up is of considerable help in the promotion of the well being of the people.

The introduction of economic reforms in India in 1991 is expected to result in higher agricultural

growth, diversification of agriculture from food-grains-dominated agriculture to processed foods,

animal husbandry products & fruit & vegetables & increased domestic & international trade in

agricultural commodities. All these pose new challenges in the field of agricultural marketing including

infrastructure for rapid transport, processing, cold storage, quality control & preservation. This is one
of the reason why the role of agricultural marketing & credit institutions in the development of rural

economy has been given so much attention.

In geography, main emphasis have always been given on the studies of spatial

distribution, temporal change, correlation between physical & cultural factors. But geography as a

holistic study, emphasis must be given on other aspects of economic & human geography.

In land use & crop intensity model of Johann Heinrich Von Thunen, his main was

to show how & why agricultural land use varies with the distance from a market. He gave two basic

models:

a) The intensity of production of a particular crop declines with the distance from the market.

b) The type of land use will vary with the distance from the market.

Handel, T.K. et al (1996) stated that agricultural development could be possible

through emphasis on investment, irrigation installation, quality seed & marketing.

In the 1970s & 1980s there was a consistent economic down turn & decline in

aggregate cocoa output in Nigeria. This culminated in the introduction of structural adjustment

programme (SAP) in 1986 to stem this trend. E. O. Idown, D. A. Oslintogun & O. Obewasola(2007)

found in their study that after two decades of operating SAP & economic liberalization policy in the

country, cocoa production still remains in the hands of small holder operators with little application of

chemical inputs to enhance outputs.

In their paper, Imad Eldin Elfadil Abdel Kalam & Ibrahim Sulieman Ismail

(2007)concluded that the government policies of COMESA member countries, especially Sudan, should
pay more emphasis to encourage integrating their markets regionally to benefits from potential of

trade & comparative advantage exist in the region.

In the Peruvian jungle, there are two main cocoa marketing channels : the

intermediaries & the co-operative. In their paper, A. Hignchi, M. Moritaka, S. Fuknda(2010) analyzed

Peruvian cocoa farmer’s socio-economic characteristics as these attributes affect their decision making

process in the cocoa commercialization for their self-improvement & evaluates if the farmer’s

participation in Acopagro ( Peruvian co-operative) or not influences the increment in the cocoa

production. Policy makers & farmer’s organizations should consider these results in order to contribute

to improve the competitiveness of the farmer’s marketing channels not only towards the development

of the organizations’ but also to their communities as a whole.

In their paper, Hammad Badar & Qamar Mohy-ud-din(2005) stated that high

price of fertilizers particularly of DAP, delayed payments & low price of wheat were the main

marketing related grievances expressed both by the progressive farmers & traditional farmers in

Faisalabad, Pakistan.

Several aspects of rural poverty like incidence of rural poverty, the relation

between rural poverty & food prices etc. are discussed in J. W. Meltor & G.M. Desai ‘s article (1986)

‘Agricultural Change & Rural Poverty’. For the development of the financially backward sections of the

society, the authors focused on the availability of the institutional & infrastructural facilities, on the

employment generation through the recognition of the social disparity in the distribution of assets &

power, on the increase of non-agricultural employment opportunities by checking the rapid growth of
agricultural population, on socio-economic research aimed at the effective policy defining for them &

on disseminating the benefit of technological changes in all the sectors of the country.

G.S. Bhalla & Y. K. Alagh(1979) stated that the interaction among the

institutional, technological & environmental factors determines the level of agricultural output &

growth.

Alternatives in Agricultural Development (1980), a project sponsored by the

Indian Council of Social Science Research, New Delhi & published from Allied Publishers Private limited,

New Delhi, India explains the objectives of agricultural development, evaluates the performance of the

several alternatives in development strategy & emphasizes the necessity of adopting the appropriate

strategy for the proper agricultural development.

In the study of Integration of Markets for onion & potato in Karnataka state,

Balappa shivaraya & Hugan L.B. (2002) stated that there is need to establish cells for vegetables to

generate market information & market intelligence which would provide a better platform for guiding

the farmers in marketing their produce. Efficient functioning of markets is an essential prerequisite of a

sound marketing system to provide remunerative prices of the produce to the farmer-sellers as well as

to providing of goods at reasonable prices to the innumerable consumers.

In their paper, [Link] Kumar Basu, S. Sri Hari Naidu & Y. Eswara Prasad (2002)

concluded that small farmers sold maximum of their produce in the local market i.e. weekly market/

fairs & to village render & received less price as compared to wholesale market & as against other size

groups. Reverse results were found in the case of large size groups i.e. they sold maximum of their
produce of selected farm produce in wholesale market i.e. to wholesaler. Commission agent at district

market committees & gained higher price than other groups.

F.A. Shaheen & [Link] (2002) stated that the impact of enhanced

investment in horticulture has been highly encouraging in terms of vastly improved production of 96.1

million tones in 1990-91 to 141.00 million tones in 1996-97 in India. Involving about half a million

households, apple plays a key role in rural economy of the state with an average yearly turn over Rs.

750 crores. The improvement in the production is quite important, but marketing has play an equal

importance to develop a commercial crop which is purely produced to sell in the market. Though,

there have been multi-dimensional efforts to increase the production of apple in the state but

marketing has not received proper attention. There is need for strengthening & streamlining the

arrangements for enforcement & inspection to ensure a regulated system of proper auctions, trading

practices & margins of intermediaries.

Up till now, the foregoing survey reveals that there must be some planned

attempts to study the impact of agricultural marketing & credit institutions on the development of

rural economy. In the present era of globalization, every market is competitive. This is why sustainable

agricultural development without endangering environment, quantitative & qualitative development

of agricultural produce is a necessity in India.

1. Agrawal, A.N.(1992). Indian Economy Problems of Development and Planning (18 th ed., pp.278-

290). New Delhi: Wiley Eastern Limited.

2. Bhalla, G.S. (2007). Indian Agriculture since Independence (pp.175-194). New Delhi: National

Book Trust.

3. Kolars, F. John & Nystuen, D. John (1974). Geography- The study of Location, Culture and

Environment (pp. 195-203). Boston : McGraw-Hill.

4. Idown, E.O., D. A. Osuntogun & [Link] (2007). Effects of market deregulation on cocoa

(Theobroma Cocoa) production in south-west Nigeria. African journal of Agricultural Research,

2(9), 429-234. Retrieved from [Link]

%20et%20al,pdf.

5. Imad Eldin Elfadil Abdel Kalam & Ibrahim Sulieman Ismail (2007). Potential for agricultural trade

in COMESA region : a comparative study of Sudan, Egypt & Kenya. African Journal of

Agricultural Research, 2(10), 481-487. Retrieved from

[Link]

6. Higuchi, A., Moritaka, M. & Fuknda, S. (2010). An analysis of the Peruvian jungle cocoa farmers :

Acopagro Co-operatives vs. intermediaries- a case study. AGRIS online papers in Economics &

Informatics, 4 (special). 3-8. Retrieved from

[Link]

7. Badar Hammad & Qamar Mohy-ud-din (2005). Wheat production & marketing: A comparative

study of traditional and progressive farmers in Faisalabad (Pakistan). Journal ofAgriculture &

Social Sciences. 18/3-2235/2005/01-1-16-19. Retrieved from [Link]

Delhi : Oxford University.

9. Bhalla, G. S. & Alagh, Y.K. (1979). Performance of Indian Agriculture – A district wise study. New

Delhi. Sterling Publishes Pvt. Ltd.

10. Balappa Shivaraya & Hugan, L. B.(2002). A study of Integration of Markets for Onion & Potato in

Karnataka state. Agricultural Marketing, 14(2),36-38. Retrieved from

[Link]

11. Basu, G. Sunil K., Naidu,[Link] Hari N. & Prasad, Y. E.(2002). Sale Pattern and Marketing of

Groundnut- A case study in Andhra Pradesh. Agricultural Marketing,14(2), 27-28. Retrieved

from [Link]

12. Saheen, F. A., & Gupta, S. P.(2002). Economics of apple marketing in Kashmir Province-

Problems & prospects. Agricultural Marketing, 14(2), 11-19. Retrieved from

[Link]