Food and Agri Economics Review (FAER) 1(1) (2021) 41-45 Quick Response Code Access this article online Website: www.faer.com.my DOI: 10.26480/faer.01.2021.41.45 Cite The Article: Dikshya Khatiwada, Jaya Prakash Dutta, Kalyani Shrestha, Gaurav Adhikari, Hikmat Paudel (2021). Economic Impact of Agricultural Mechanization in Rice Farming in Shivasatakshi Municipality of Jhapa District, Nepal. Food and Agri Economics Review, 1(1): 41-45. ISSN: 2785-9002 (Online) CODEN: FAERCS RESEARCH ARTICLE Food and Agri Economics Review (FAER) DOI: http://doi.org/10.26480/faer.01.2021.41.45 ECONOMIC IMPACT OF AGRICULTURAL MECHANIZATION IN RICE FARMING IN SHIVASATAKSHI MUNICIPALITY OF JHAPA DISTRICT, NEPAL Dikshya Khatiwada* 1 , Jaya Prakash Dutta 2 , Kalyani Shrestha 1 , Gaurav Adhikari 1 , Hikmat Paudel 1 1 Agriculture and Forestry University, Rampur, Chitwan, Nepal 2 Department of Agricultural Economics and Agribusiness Management, Agriculture and Forestry University, Rampur, Chitwan, Nepal *Corresponding Author Email: dikshyakhatiwada1107@gmail.com This is an open access article distributed under the Creative Commons Attribution License CC BY 4.0, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. ARTICLE DETAILS ABSTRACT Article History: Received 06 May 2021 Accepted 04 June 2021 Available online 28 June 2021 A study was conducted in Shivasatakshi municipality of Jhapa district to assess the economic impact of agricultural mechanization in rice farming in 2020. Altogether, 40 rice farmers were selected randomly and surveyed using a semi-structured interview schedule. Based on the use of machinery, farmers were categorized into mechanized and non-mechanized farmers. Cost and revenue were calculated among both categories. T-test was used to compare the mean cost and revenue between mechanized and non-mechanized rice farmers. The average cost of production of rice was NRs.87,215.50/ha. The cost of human labor was found higher in both categories (more than 40%). The average total cost of production was lower in mechanized farms (NRs.67,191.74/ha) as compared to non-mechanized farms (NRs. 1, 07,239.27/ha). The contribution of rice grain and straw to the overall revenue was 98.53% and 1.46% respectively. The average revenue from production was calculated to be NRs.1, 21,879.25/ha. The average gross revenue was greater in mechanized farms (NRs.1,26,042.90/ha) than non-mechanized farms (NRs. 1, 22,067.00/ha). The benefit- cost ratio was observed higher in the mechanized rice farms (1.898) than non-mechanized farms (1.143). The findings of the study showed that mechanized rice farming reduced the cost of production by lowering down human labor cost and increased the profitability of the enterprise. Therefore, it is recommended to adopt machinery for rice cultivation in Shivasatakshi municipality, Jhapa. KEYWORDS Rice, mechanization, B: C ratio, labor, machinery 1. INTRODUCTION Agriculture is central to the livelihood of Nepalese people. It is the main source of Nepal’s Gross Domestic Product (GDP) and Nepali’s income and employment opportunities (Shrestha, 2012). It contributes 27.6% to the national GDP. 80% of the total cultivated land in Nepal is used to grow cereal crops (ADS, 2015). Rice dominates the country’s crop sector accounting for over 42.5% (168047 ha) of the total area under food grains and shares 51.6% in total food grain production (MoAD, 2017). It is a predominant staple food crop of Nepal which supplies about 40% of the food calorie intake and contributes nearly 20% to the Agricultural Gross Domestic Product (AGDP) and almost 7% to GDP (CDD, 2017). It is grown in a wide range of agro-ecological zones under varying climates, altitudes, and topography ranging from 60 meters in Terai (Kanchankawal, Jhapa) to 3,050 meters above sea level in Chumchaur, Jumla in Nepal (Bhujel, 2004; Bista, 2004). Jhapa district is the leading producer of rice in Nepal with the production of 3, 32,933 metric ton and productivity of 4.020 tons per hectare under the area of 82,826 hectares (MoALD, 2017/18). It has been selected as a super zone for rice production under the Prime Minister Agriculture Modernization Project (PMAMP). In recent years, the rice self-sufficiency ratio is below 100, which means domestic rice production is not sufficient to meet domestic consumption. While Nepal was a marginal exporter of rice before 1980, it has now turned a rice-importing country due to the combined effects of slow growth in yield and rapid growth of population (Tripathi et al., 2019). Nepal now imports huge quantities of milled rice every year, draining fiscal resources and adversely impacting development efforts (Nepal and IRRI, 2019). The total amount of paddy imported in the year 2016/17 is 1, 63,302 Mt and 3, 93,918 Mt respectively creating a huge trade deficit (MoALMC, 2018). In addition to this, labor scarcity is an emerging constraint in Nepal. Farm wage rates increased more than four folds in the last one decade. The average farm labor wage rate increased from NRs.30 per day in 1993/94 to NRs. 350 per day in 2013/14 (Bhandari, 2014). This has increased the production cost and has reduced farm profitability. As rice is most labor intensive among cereal crops, rising labor costs will reduce its comparative advantage and encourage farmers to shift from rice to non- rice crops unless labour costs are reduced. With reduction in cost of different farming operations such as; land preparation, transplanting, harvesting etc. mechanization can be an appropriate option in Nepal where labor shortage and high cost of production are major problem of farmers (Uprety, 2011). This study compares the cost and returns of rice production of mechanized and non-mechanized rice farms and motivates farmers to adopt machinery for rice cultivation. 2. MATERIALS AND METHODS 2.1 Study Site Shivasatakshi municipality of Jhapa district was purposively selected for the study as the area was noted for its high rice production potential. The study site is located at latitude of 26.61258°N and longitude of 87.83528°E. The mean annual precipitation, maximum and minimum temperature of the study site are 250-300 cm, 42°C and 10°C respectively