Financial Evaluation of Short Rotation Tree Crop under Agroforestry System in Tamil Nadu

Abstract

This paper presents the financial evaluation of short rotation tree crops under agroforestry system.  Agroforestry involves the cultivation of two or more plant species with woody perennial in a single fragment of land. Multi-stage purposive sampling technique was employed in selection of the district, blocks and villages based on area under forest cover. Dharmapuri district of Tamil Nadu was taken for this study. Though there are many short rotation tree species grown in the study area, farmers prefer Malabar Neem (Melia dubia) for its multiple uses. The prominent agroforestry systems in the study region viz. Agri-Silviculture and Silviculture were selected. The primary data was collected from 80 sample farmers for the agricultural year 2018-19 and the sample respondents were surveyed from January to February, 2020. Financial analysis viz., Benefit-Cost Ratio (BCR), Net Present Worth (NPW) and Internal Rate of Return (IRR) were performed to check the feasibility of the investment in Agri- Silviculture and Silviculture system. The results indicate that additional income (68%) and meeting emergency cash requirement (67%) were the major reasons for adopting short rotation tree crops. The Net Present Worth per hectare in Agri-Silviculture and Silviculture system was Rs. 3,43,823 and Rs.1,97,909. BCR of Agri-Silviculture system has been found to be higher (2.01) than Silviculture system (1.66). Growing Malabar Neem with agricultural crops is more beneficial when comparing trees alone, it is capable of providing income round the year in a short span of time. Using tree crops as a contingency fund allows the farmer to meet the unforeseen expenses.