RISK MANAGEMENT APPROACHES IN INDIA AGRICULTURE: A CASE STUDY

MANAGEMENT

Agricultural in India involves variety of risk this risk arise from climate variability frequent natural disasters, manmade disaster, pest out breaks accidental factors, borrowing money can also be risky with sudden changes in interest, risk also occurs as a result of changes in government policies, rural infrastructure, finally there are risks related to the health and well-being of the farmer and his family and the supply of labour for the farm, all these event severally affect farmers through loss in production and farm income and they are beyond the control of the farmers. These factors not only endanger the farmer’s livelihood and income but also undermine the viability of the agriculture sector and its potential to become a part of the solution to the problem of endemic poverty of the farmer’s and the agricultural labor. Risk management is involves choosing among alternatives that uncertain outcome and varying levels of expected returns. The approach to manage risk is national approach, regional approach and farm level approach. Risk perception can vary from farmer to farmer which depend on his experience and on the degree of his/her risk aversion. The strategies to manage risk include transferring the risk to another party, minimizing the risk controlling the downside or reducing the negative effect of the risk and accepting some or all of the consequences of a particular risk. The inability to manage risk and accumulate and retain wealth sometimes referred to as “the poverty trap”.

This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.