Issue of Price Fixation of Wheat for its Future Area Expansion in West Bengal
THE prospect of wheat production in West Bengal can be said to hinge upon its cost-price relationship along with other factors. Therefore, it is important to examine whether the cost-price relationship is favourable or not to the wheat growers in West Bengal. If we are interested in bringing more area under wheat -in West Bengal we have to ensure a remunerative price to its growers. This may entail the intervention on the part of the government. A remunerative price can be ensured by the government by announcing appropriate minimum procurement prices. The appropriateness of such prices may be understood in relation to cost of production. The fixation of administered price on the basis of cost of production has been gaining ground in recent years. An attempt is made in this article to examine the appropriateness of such prices of wheat on the basis of cost of production in West Bengal.
The data for the present study have been collected through a sample survey where the sampling design adopted is three-stage simple random sampling with probability proportional to area under wheat. The districts of West Bengal have been considered as the first stage, villages as the second stage and operational holding as the third and ultimate stage sampling unit. Thus, 165 operational holdings have been selected from 13 selected villages spread over three selected districts, namely, Burdwan, Bankura and Hooghly districts of West Bengal. The reference period of investigation relates to the year 1975-76.
The concept of prime cost has been adopted in the present study. The prime cost designated as cost D has been defined1 as the cost incurred on account of total labour input, seed, manures and fertilizers, repairs and depreciation of implements and machineries, plant protection chemicals, interest on working capital and irrigation charges. It is not identical with cost Ai as adopted in Farm Management Studies. As land revenue and cesses are fixed for the farm as a whole, they have been excluded in computing prime cost. The imputed