Commercialization and Agricultural Diversity: Insights from North Karnataka, India

Abstract

Aim: Agriculture has been the foundation of India's economy for centuries, providing livelihoods for a significant portion of the population. The present study aimed to analyze the impact of agricultural commercialization on diversity of agriculture. Specifically, it assessed the degree of commercialization and determined the diversification index for the study area. Specific Objective of the Study: To study the effect of commercialization on the diversity of agriculture in the study area. Place and Duration of the Study: The present study was conducted in Dharwad, Gadag, Belagavi and Bagalkote districts of North Karnataka based on the gross irrigated area. The study was conducted for agricultural year 2022-23. Methodology: The study utilized primary data gathered through personal interview method with 240 farm households from 24 villages across eight talukas in four districts of North Karnataka. It employed descriptive statistics and calculated the Household Crop Commercialization Index (CCI) to measure the extent of agricultural commercialization, along with the Herfindahl-Hirschman Index (HHI) to assess diversification. The Regression Adjustment (RA) method was employed to analyze how commercialization influences agricultural diversity. Results and Discussion: In regions considered less progressive, the CCI was lower at 89.54 per cent compared to more progressive areas where it reached 96.02 per cent, indicating a disparity in the degree of crop commercialization. Similarly, the HHI was lower in less progressive areas (0.45) compared to more progressive areas (0.66), indicating a less concentrated market structure. In areas characterized by higher progressiveness, farmers predominantly cultivated sugarcane, a crop with strong commercial value, which limited agricultural diversification. A notable gender difference was observed at a significance level of 10 per cent. Households with higher levels of commercialization exhibited significantly greater agricultural assets and slightly larger land holdings, indicating improved access to markets and higher agricultural productivity. The RA model in the analysis indicated a substantial ATET coefficient of 0.44, suggesting that increased commercialization strongly promotes agricultural diversity. Conversely, less commercialized households showed a POM coefficient of 0.07, confirming some degree of diversification. Significance of the Study: The study highlighted the dual role of agricultural commercialization in improving economic stability and promoting sustainable livelihoods, while also revealing critical gender disparities that necessitated inclusive policies. These insights have important implications for policymakers aiming to foster equitable agricultural development and strengthen community cohesion through enhanced economic and social support structures.