Growth, decomposition and yield convergence of paddy production in India: Evidence from state-level panel data, 2000-01 to 2021-22

Abstract:

Paddy (rice) is essential for India's food security and the livelihoods of rural communities. This study looks at the growth rates, sources of growth, and inequalities in yields among states for paddy in India from 2000-01 to 2021-22, using data from the Directorate of Economics and Statistics (DES), Government of India. Compound annual growth rates for area, production, and yield were estimated over two sub-periods: from 2000-01 to 2011-12 and from 2012-13 to 2021-22, as well as for the entire period. Production growth was decomposed into area, yield, and interaction effects. Inter-state yield differences were analysed using measures like CV, Gini, and Theil's T for both sigma and beta convergence. The total area in India stayed almost unchanged at 0.18% per year, while production growth increased from 1.82 to 2.39% per year. This growth was largely due to yield contribution, which accounted for 91.7% of overall production growth during the full period. Yield inequalities decreased consistently, with CV falling from 43.6% in 2000-01 to 25.4% in 2021-22. Sigma-convergence was confirmed through a negative coefficient in CV, Gini, and Theil (p< 0.01) along with beta-convergence (β = -2.45, R² = 0.62 for the entire period). Madhya Pradesh, Chhattisgarh, Gujarat, and Rajasthan stood out as states that were catching up. In contrast, Punjab, Haryana, Kerala, and Tamil Nadu were experiencing yield stagnation. Policy should focus on improving yield in lagging states rather than expanding area, while also considering resource sustainability in high-yield regions.