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					Agriculture activity in the
 national accounts - how
   well it is measured?

        Pratap Narain
    B – 286 Yojana Vihar,
    Delhi – 110 092, India
       (Paper sponsored by UNSD)
Why EAA?

Traditionally, policy analysis makes use of statistics in
order to monitor developments and take decisions in
order to influence them. UNSD understanding the
need introduced the new term “macro-accounts” to
refer not only to national economic accounts but also
to satellite accounting, and, in particular, integrated
economic-environmental and socio-economic
accounting, in which monetary as well as physical
data are used.

Use of Macro Accounts in Policy Analysis, Series F No. 81, UN

    What is agricultural activity?
   Is it as defined in ISIC?
   What a policy maker wants – Output of
    agriculture activity? Land used for producing
    the output? Or the people engaged in the
    production of the output? Backward & forward
   Policy makers need is a combination of all the
    four, but most developing countries are
    producing data to answer the first question.
    This is the primary reason why national
    accounting is not popular in Ministry of
    agriculture and related offices.
Role of FAO
   FAO has introduced SEAFA in 1996 to fill this gap

   Two handbooks on - the compilation of Economic Accounts
    for Agriculture and collection of data and compilation of
    agri-environmental indicators in 2002.

   Handbook on EAA emphasizes collection of data for
    agricultural output, agricultural holdings as well as
    agricultural institutions and present country practices for
    overcoming data collection problems by adopting suitable
    proxy calculation.

   Handbook on agri-environmental indicators looks at specific
    data collection problems and advocates use of
    administrative and scientific data to enhance data reliability
    at reasonable cost.
                                         A. FOCAL UNIT OF ANALYSIS

                                                  B. COVERAGE
Principal agricultural products and     Principal agricultural products and      Total economic activities of all
their by-products resulting from        outputs of secondary activities          agricultural         institutions     –
economic activities under ISIC 01       performed at the holding whether         household,           corporate       or
                                        agricultural or non-agricultural         government – whose major share
                                                                                 of income or iginates             from
                                                                                 agricultural activities
                                                      C. DATA
Area, production, trade (export         Area, outputs, inputs, capital and       Income, expenditures, outputs,
and impor t), utilization (final and    labor used in production, seed           inputs, capital and labor used,
inter mediate), prices, nutr ient       variety, details of soil management      consumption, assets and liabilities,
content                                 and farming practices                    socio-economic and demographic
                                                                                 data, taxes and subsidies
                                                      D. USES
Total agricultural production          Productivity studies, production        Studies of living standards o f
Distribution of production by          functions, capital-output ratios,        population      dependent        on
commodity, region, type of              input-output coefficients                agriculture
institution, agro-climatic zone         Economic and environmental              Studies on poverty and food
Index number of production,            indicators                               security
inputs and prices                       Impacts        of        agricultural   Framing of government policies
Input-output projections               adjustments and government               relating to taxation, prices and
Studies of nutritional intake of the   policies                                 subsidies
population                              ABC analysis of research and            Studies of terms of trade
Economic indicators                    extension priorities and personnel       Formulation     of      macro-level
                                        development plans                        models
                                                     E. TOOLS
SEAFA:                                  SEAFA:                                   SEAFA:
Goods and services account             Production, generation of income,       Production,    generation    and
Satellite accounts for food            capital accounts and supporting          distribution of income, capital
balances      and        suppor ting    statements                               accounts       and      suppor ting
statements                              Input-output table                      statements
Supply and utilization account                                                  Multi-subject        (integrated)
Food balance sheet                                                              household surveys
     Agricultural Statistics System in
          Developing countries
Despite  the increasing awareness most
 developing countries still do not have an
 adequate system of agriculture statistics.
The available agricultural data are incomplete in
 terms of
    The range of commodities covered (for example, in many cases
     only cash crops for large farms are covered),
    The range of variables or data sets covered (for example in many
     countries data on agricultural inputs are practically non-existent),
    Coverage of the nation (sometimes parts of the country are
     excluded from the national statistical reporting system).

The   reliability of available data is often questionable
Data collection system
  Forimproving the production data - attention is
  required to extend the coverage to minor crops;
  agricultural production being done outside agricultural
  holdings (e.g. crop grown at bunds, kitchen gardens,
  road side plantation, etc.); horticultural crops and
  livestock production.
  Intermediateconsumption/ producer prices data -
  most appropriate method: cost of production surveys
  supported by time use survey
  Need of an integrated approach – a combination of
  agricultural – livestock census and institutional based
  sample surveys on cultivation practices and food
  consumption pattern
Data collection system – case of India
    Annual census of agricultural parcel/ Timely Reporting
     Scheme – estimates of area and production
    Weekly collection of data on wholesale and retail prices
    Cost of Cultivation Studies to obtain data on inputs &
    Data on electricity, insecticides, fertilizers from sources
     like Central Electricity Authority, Fertilizer Association of
     India, Pesticides Association of India
    Other sources like Tea Board, Coffee Board, Rubber
     Board, Directorate of Areca nut and Spices
     Development, Directorate of Cashew nut and Coca
     Development, Central Bureau of Narcotics, Directorate
     of Marketing and Inspection, National Horticulture
     Board, National Sample Survey Organisation
Data collection system – case of India
   Quinquennial Indian livestock census provides
    age-wise and sex-wise data at the district level
    on number of different categories of animals
    separately for urban and rural areas.
   Integrated Sample Survey data collected on
    bovine practices, poultry practices and number
    of sheep and wool production, feeding and
    grazing practices of sheep and number of
    animals slaughtered according to species,
    breed and age, live weight and carcass weight
    after slaughter in the case of meat production.
The way ahead
  Horticultural  crops and Livestock production –
   use of census supplementary modules as
   recommended by WCA 2010
  Statistics on Agricultural inputs, producer
   prices etc. – Cost of cultivation studies
   supported by time use survey
  Informal Agriculture Sector - agricultural
   activities of small and marginal cultivators,
   tribal/ nomadic population and households
   living in urban or semi-urban areas – Use of
   expenditure survey, small area estimation and
   other techniques
The way ahead
    Land use classification - an ideal classification
    can be prepared by evaluation of each segment
    of land and use of (a) the concept of gross and
    net area under use, and (b) the principles laid
    down in ISIC for classifying activities into
    principal, secondary and ancillary activities and
    their association to the owner of the unit.
    As it is not easy to collect comprehensive data
    for creating a global information system, a
    system of indicators based on macro-accounts
    may be developed to monitor and evaluate
    economic policies and programs.

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