Some good news for the world's poor

December 16, 2005

Millions of poor rice farmers and consumers in Asia have received a little good news just in time for Christmas.

While the world's trading nations remain deadlocked on how to move ahead with agricultural reforms that could benefit the poor farmers of the developing world, research just published has confirmed details of a proven strategy to reduce poverty in the planet's two most populous countries, China and India.

The research shows that, in 1999, for every US$1 million invested at the Philippines-based International Rice Research Institute (IRRI), more than 800 and 15,000 rural poor were lifted above the poverty line in China and India, respectively. It also confirmed that such poverty reduction effects were even larger in the earlier years of the Green Revolution.

Presented in a peer-reviewed paper in the November issue of the journal Agricultural Economics, the research is robust confirmation of the very positive impact of rice research on poverty alleviation. "This research is important because it provides solid, additional evidence that should give all poor rice farmers hope because we know now that by providing them with new technologies via rice research we can lift them out of poverty," said IRRI Director General Robert S. Zeigler.

The paper's lead author, Dr. Shenggen Fan, works at IRRI's sister institute, the Washington-based International Food Policy Research Institute (IFPRI). In his paper, Dr. Fan said: "The results indicate that rice varietal improvement research has contributed tremendously to increases in rice production, accounting for 14 to 24 percent of the total production value over the last two decades in both countries. Rice research has also helped reduce large numbers of rural poor and IRRI played a crucial role in these successes."

Dr. Fan explained that new technology resulting from agricultural research can help to alleviate poverty in several ways. First, following the releases of new and improved varieties, farmers can produce more output at the same cost (or, conversely, the same level of output at a lower cost), which directly improves farmers' income.

Second, the diffusion of modern varieties results in lower food prices, as demonstrated in several studies. This is critical given that the poorest people spend a large share of their income on food.

Third, the productivity consequences of improved varieties resulted in greater demand for labor and wages. For example, earlier research found that the poor benefited from new technology as a result of greater employment opportunities as well as the upward pressure on wage rates in the labor market.

Explaining the large difference in impact between the 15,000 lifted out of poverty in India and the 800 in China, Dr. Fan said this was because China had already achieved rapid and very large reductions in poverty before 1999. "But the overall total reduction in rural poor through rice research in China has been much larger than in India," if looked at over the past 20 years instead of just 1999.

"Ending poverty among the world's poor is an enormously complex and challenging task," Dr. Zeigler emphasized. "But it's very important that we recognize what strategies really do have an impact so we can focus our resources on such techniques, and rice research is clearly one of these."

Dr. Fan's research follows earlier work by IRRI that showed that, in the four decades from 1961 to 2000, while the population of Asia's developing nations more than doubled, from 1.6 billion to 3.4 billion, efforts to avert famine resulted in the land area devoted to rice expanding by 30 percent, from 107 million hectares to 139 million hectares.

Rice production grew by an impressive 170 percent, from 199 million tonnes in 1961 to 540 million tonnes in 2000, thanks largely to the introduction of improved rice varieties. This unprecedented yield improvement not only helped millions avoid starvation but also saved thousands of hectares of fragile natural habitats from falling under the plow to create new rice fields.

That IRRI research team, led by senior economist Dr. Mahabub Hossain, also found that the total annual gains from the adoption of these modern varieties now stands at $10.8 billion - an astounding figure considering that it is many times the total investment in rice research made over the same 40-year period by IRRI and its many partners in the national agricultural research and extension systems of Asia's rice-producing nations.

Providing further evidence is an independent study of the impact of improved rice varieties and other crops over the past 40 years that showed they have significantly reduced prices for poor consumers, saved thousands of hectares of forests from being turned into farmland, and reduced the number of malnourished children.

The research, led by respected American economist Dr. Robert Evenson from Yale University, was the first major attempt to assess the economic impact of improved crop varieties, not just rice but also other important food staples such as wheat, maize, barley, cassava, and potato. Dr. Hans Gregersen, the head of a panel that reviewed the research, described the study by Dr. Evenson and his huge team of researchers as a "milestone" and a "monumental effort."

Dr. Evenson and his team found that the development of improved rice varieties between 1970 and 1995 had substantial impact in four major areas. Their findings indicate that, were it not for the development of improved varieties,However, Dr. Fan warns in his research conclusions that most of these benefits are the results of research conducted in the 1960s, 1970s, and 1980s. For both China and India, the increase in experimental yield slowed down in the 1990s.

"One of the reasons is a lack of agricultural research investment at both the national and international levels," he warns. "The budget of the International Rice Research Institute has also been severely cut in recent years. IRRI's budget of $32.6 million in 2000 was the lowest in 20 years, and was only 63 percent of its peak of $51.6 million (measured in 2000 prices) in 1990."

IRRI Director General Dr. Zeigler said that, unfortunately, this trend has continued until this year. "In 2005, IRRI continued to receive cuts in donor funding. We hope that this new research will help us finally turn this trend around so we can continue to help the world's poor rice farmers and consumers achieve better lives."
-end-
Title: National and international agricultural research and rural poverty: the case of rice research in India and China
Authors: Fan, SG; Chan-Kang, C; Qian, KM; Krishnaiah, K
Source: AGRICULTURAL ECONOMICS, 33 (3): 369-379 Suppl. S NOV 2005

The International Rice Research Institute (IRRI) is the world's leading rice research and training center. Based in the Philippines and with offices in 10 other Asian countries, it is an autonomous, nonprofit institution focused on improving the well-being of present and future generations of rice farmers and consumers, particularly those with low incomes, while preserving natural resources. IRRI is one of 15 centers funded through the Consultative Group on International Agricultural Research (CGIAR), an association of public and private donor agencies. Please visit the Web sites of the CGIAR (www.cgiar.org ) or Future Harvest Foundation (www.futureharvest.org ), a nonprofit organization that builds awareness and supports food and environmental research.

For information, contact Duncan Macintosh, IRRI, DAPO Box 7777, Metro Manila, Philippines; tel +63-2-580-5600; fax: +63-2-580-5699; email d.macintosh@cgiar.org or Johnny Goloyugo at j.goloyugo@cgiar.org Web sites: IRRI Home (www.irri.org ), IRRI Library (http://ricelib.irri.cgiar.org ), Rice Knowledge Bank (www.knowledgebank.irri.org)

International Rice Research Institute

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