An economic analysis of paddy straw burning in Haryana & Punjab

Burning of paddy and wheat straw is creating damage to not only environment but also to farm fertility of the soil as well as its organic quality. The straw has a lot of economic value as livestock fodder and for other uses. Unfortunately the farmers of Punjab and Haryana are not collecting the straw but burning it in the fields. This study aims at understanding of market mechanism of the straw in these states. In last four decade ,the changing demand and supply aspect of paddy and wheat is in opposite direction. Supply of the straw is consistently increasing but demand is stagnant or declining. The demand for the straw in these states is mainly as fodder of large animal such as cattle and buffaloes . Interestingly it is seen that amount of straw as fodder has increased multiple times since 1970-71 but the animals who consume it are declining. Price mechanism has crushed to zero or negative due to the abundance of straw but lesser demand. It is advised to policy makers or government to tackle the strawburning problem through increasing demand or decreasing supply technique for straw to make it economically viable in market mechanism. This analysis is the basic understanding of economic factors that lead to residue burning problems. It will help to design a plan and policy to control the straw burning which is necessary to reduce pollution and sustainable economic development of the states