Utpal Kumar De

Regulatory capital and risk of Indian banks: a simultaneous equation approach

Purpose - – This paper aims to examine the association between regulatory capital and risk of Indian commercial banks and the impacts of other relevant variables on them. Design/methodology/approach - – The study is based on a secondary data set on Indian commercial banks collected from “Capitaline Plus” corporate database and annual reports of the respective banks. Total 41 major Indian banks (21 public and 20 private sector banks) are considered in this study. Here absolute values of capital and risk are used as dependent variables along with some relevant bank specific explanatory variables in a system of a two-equation model. Based on the nature of interrelationship and identifiability of the equations, three-stage least squares (3SLS) technique is used to estimate the relationship. Findings - – Risk and capital of Indian commercial banks are inversely associated. The influence of profitability on both capital and risk is significantly positive. Moreover, human capital efficiency is negatively associated with the undertaking of risk by the banks. In this respect, Indian private sector banks are found to be more efficient in utilizing human capital for reducing credit risk. Originality/value - – It is the first comparative study in India examining the relationship between capital and risk of Indian public and private sector commercial banks covering both Basel I and II periods. Further, the role of human resource in managing risk is considered as a relevant variable in this study.

A modified diversity index and its application to crop diversity in Assam, India

A new measure of diversification index is proposed taking the correlation structures of the shares into consideration. This index is a generalization of the Herfindahl-Hirschman Index (HHI) proposed in the context of concentration in industries. When this index is applied in the crop production along with other related data in Assam, India, it is seen that many of the interrelations are changed from that of found by HHI. The analysis helps us to plan for improvement of crop patterns in a region prudently.

Crop Diversification in Assam and Use of Modern Inputs under ChangingClimatic Condition

This paper tried to analyse the spatio-temporal trend of crop diversification in Assam over the last fifty years. It is pursued through changes in land allocation for the cultivation of various crops and also examined by the changing index of crop diversification. Here, Herfindahl Index is used to understand diversification and locational quotient is used to measure regional crop concentration. The result shows that in almost all districts, crop specialization has been taking place and more so in the last phase of our study period. The hilly and backward districts recorded more diversification but towards lower value crops, in accordance with the changing water availability, weather pattern, access to credit and risk. It goes against the normal feature of crop diversification where farmers diversify in favour of high value crops. Employing Random Effect GLS Robust Regression and Fixed Effect Model, irrigation, chemical fertilizer and growing erratic rainfall found to play important role in determining inter-zonal variation in crop diversification. However, the slow progress of irrigation did not help in crop diversity, particularly in off-monsoon seasons.

Degradation of Forest and Biodiversity in Sariska National Park, India and the Responsible Factors

Degradation of forest resources and biodiversity of Sariska tiger reserve has become an important issue due to its severe impact on the economy of century old forest dwellers. Due to extensive pressure from the villagers for grazing and other forest products for their survival, rising man animal conflict there has been an increase in the degradation of forest and its bio-diversity leading to decline in resource base. People living in this forest depends extensively on their pastoral activities and thus on the quality of the forest directly and indirectly. Also their economy is partly dependent on the growth of tourism which is based on the flora and fauna of the reserve. This paper tries to examine the degradation of forest in Sariska Tiger Reserve and its impact on the economy of the villagers inside the reserve. Analysis of primary data and other secondary information reveals that the percentage of earning of the villagers varies from 85 to 100 per cent depending upon the level of degradation and available alternative opportunities. Their economy and sustenance has been highly affected owing to the unsustainable extraction practice and thus degradation directly and indirectly. It thus calls for suitable population relocation with appropriate compensation in the form of opportunity creation and promotion of nature based tourism to take off further pressure on this forest. Steps are necessary to regenerate the carrying capacity through improvement of resource base by participatory management.

Adaptability of Farmers in Assam Towards Extreme Climate Effects: An Empirical Investigation

This chapter tries to examine the adaptability of farmers with changing climatic and role of various factors in adaptation and crop diversificaty in Assam. Diversity of crops here is measured by Herfindahl Index (HI) at the farm as well as village level. Also the adaptation index (AI) is constructed using formula AI = (∑P i * X i )/n, where P i is the weight of ith adaptation; X i . P i is computed as the proportion of ith strategy in the gross number of adaptations followed by all the farmers in the area. Effects of different factors on the level of diversification of crops by the individual farmers and on the adaptability with the changing agro-climatic conditions are examined by the multiple regression of the type Y = βX + D + U i . Here, Y represents either farm level Herfindahl Index (Diversity Index) or Adaptation Index. The results reveal that respondent farmers’ education, their farm size, area of possessions and contribution of agriculture in family income have positive impacts on a diversity of crops as well as adaptation by moderating the adverse climate impact or avoid climate related disaster. Education is highly dominant for obtaining better knowledge and expediting technology adoption capacity of farmers in a better way to the changing climate.

Involvement of Women in Natural Resource Collection in Rural Jharkhand, India

Women living in rural areas are very close to the natural environment. Most poor families are dependent on nature for their survival, grazing cattle, collecting water and fuelwood and similar tasks, which are considered inferior and suitable for women and children, are not remunerative. Adult males and some women work outside for a livelihood. The life of rural women, particularly tribal women, is so much intertwined with the environment, that the whole ecosystem revolves around them and they cannot even think of their survival without it. However, significant intra-household differences in the distribution of such activities between male and female members of the families exist, varying with socioeconomic background, cultural and religious beliefs and underlying attitudes towards women and children. This article examines to what extent women in rural Jharkhand are involved in such natural resource collection and management activities. We tried to unearth the impact of cultural and economic factors on women’s role in different economic sections and social groups. The analysis reveals that income, occupation and status of the families have a significant inverse link with the involvement of women and also of girl children at the cost of their educational prospects. Religious and cultural beliefs also determine the extent of women and children’s involvement in resource collection. The study indicates the low empowerment level of rural women in the area.

Informal household water market and determinants of price: Evidence from an Indian hill city

Pricing of water in the hill cities in India is different from that of plain lands, because water is a scarce resource in most of the hill cities. The supply of water by the municipalities is inadequate. The private vendors come into picture and they put the prices according to the difficulties faced in supplying to the specific locations. Thus prices become variables and are also based on the economic demand-supply mechanism in which the households try to maximise their satisfaction subject to budget and other constraints, while the vendors try to extract as much benefit as possible from the buyers. This paper tries to examine the pricing of household water use in Shillong urban area, India and the impact of various factors including income, house rent, seasonal scarcity of water, capacity of municipal supply, household size on the price-quantity determination. The analysis is made in terms of a simultaneous equation framework and the model is applied to a data collected by stratified random sampling technique across the municipal wards and nonmunicipal segments of greater Shillong urban Agglomeration. The result of three stage least squares reveals significant positive impacts of income, scarcity of water on the demand price while significantly negative impacts of quantity purchased, extent of municipal supply, house rent paid on the demand price. But the household size does not have any significant impact on the demand price though large household is expected to require more water. The supply of water on the other hand is not significantly affected by price, extent of municipal supply and deficiency though the coefficients are in the expected line.

Farmer's Response to Changing Climate in North East India

Diversification of land use in the cultivation of various crops provides an alternative way to moderate the climate risk. By choosing alternative crops that are resilient to various weather parameters, farmers can reduce the crop damage and achieve optimum output from their limited land resources. Apart from other adaptation measures, crop diversity can reflect farmers’ response towards changing climate uncertainty. This paper tries to examine the changing climatic condition through spatio-temporal variation of two important weather variables (precipitation and temperature) in the largest North-East Indian state, Assam, since 1950. It is examined by the variation in crop diversification index. We have used (1) Herfindahl Index for measuring degree of diversification and (2) locational quotient for measuring the changes in the regional crop concentration. The results show that, in almost all the districts, crop specialization has been taking place slowly and that happened mostly in the last phase of our study. The hilly and backward districts recorded more diversification but towards lower value crops. It goes against the normal feature of crop diversification where farmers diversify in favour of high value crops. Employing ordinary least squares method and/or Fixed Effect model, irrigation is found to have significant impact on crop diversification; while the flood plain zones and hill zones are found to have better progress in this regard, which has been due to the survival necessity of poor farmers living the zone. Thus crop diversity does not reflect very significant response from the farmers’ side towards changing weather factors (except rainfall) though they have significant impact on the productivity of various crops, and thus profitability. The study thus suggests the necessity for rapid and suitable diversification as alternative climate change mitigation in the long run.

Spatio-Temporal Pattern of Growth in Ericulture of Assam

This paper examined the spatio-temporal variation in ericulture activities in Assam and also tried to analyze the reasons for such variation. The observation revealed that the growth of ericulture in Assam has been associated with significant inter-district variation. There is dominance of the districts in ericulture that have relatively higher concentration of tribal population, who are presumably poor and depend much on this occupation for their livelihood along with other agricultural activities. The districts with more concentration of ericulture activities have always remained in the leading positions while the laggard districts have always been in the lower ranks in respect of ericulture activities.

Valuing Recreational and Conservational Benefits of a Natural Tourist Site: Case of Cherrapunjee, the Wettest Place on the Earth

Nature based tourism has been a very important source of income and employment in Meghalaya as the state is endowed with diverse scenic natural beauty that attracts a large number of domestic and foreign tourists every year. This paper attempts to examine the impact of various social, economic and locational factors on the visiting decision of the tourists to Cherrapunjee, the wettest place on the earth. The recreation benefit enjoyed by the visitors, from the natural beauty of the site is estimated by using both the revealed and stated willingness to pay i.e., Travel Cost method (TCM) and people’s willingness to pay for the preservation and improvement of the area through Contingent Valuation technique (CVM). Distance traveled and travel cost incurred by the visitors is found to have significantly negative impacts on the frequency of visit while income, education has significantly positive impact on the same. The estimated recreation benefits obtained from revealed and expressed WTP for the preservation and improvement of the site is in favour of policy induced increase of recreation charges in the site.