The Persistent Pest Problem
For many farmers in Punjab, cotton has become a high-risk gamble. The primary culprit is the pink bollworm, a destructive pest that has developed resistance to genetically modified Bt cotton varieties. This pest bores into cotton bolls, feeding on seeds
and fibres, leading to severe damage that can wipe out an entire crop. Unlike other pests where some produce can be salvaged, a severe pink bollworm infestation often means a total loss, making the financial risk unbearable for many cultivators. The repeated failure of cotton crops due to pests like the pink bollworm and whitefly has drastically reduced the crop's profitability and pushed farmers to seek more reliable alternatives.
The Allure of Price Certainty
In agriculture, certainty is currency. While cotton prices are subject to market volatility and often fall below the Minimum Support Price (MSP), paddy offers a financial safety net. The government's robust procurement system for paddy ensures that farmers have a guaranteed buyer at a pre-announced MSP. For the 2026-27 season, the MSP for Grade 'A' paddy was set at ₹2,461 per quintal. In contrast, a significant portion of cotton often sells to private traders below the MSP, leaving farmers at the mercy of market forces. This price assurance makes paddy a far more economically secure option, even if it presents other challenges.
A Nudge from Subsidies
Government policies have also played a role in steering farmers towards paddy. The Punjab government has offered financial incentives to promote certain agricultural practices. For instance, cash incentives of ₹1,500 per acre have been provided to farmers adopting Direct Seeding of Rice (DSR), a technique aimed at conserving water. While the state has also offered subsidies on Bt cotton seeds in the past, the consistent and effective procurement infrastructure for paddy provides a stronger economic incentive. This combination of subsidies for specific paddy cultivation methods, coupled with free or subsidised electricity for irrigation, makes the entire ecosystem around paddy more attractive.
The Iron-Clad Procurement Machine
The economics of the cotton-to-paddy shift are cemented by the procurement process itself. Punjab has an extensive and efficient institutional framework for procuring wheat and paddy, largely run by the Food Corporation of India (FCI) and state agencies. This system ensures that virtually every grain of paddy produced finds a buyer at the MSP. Cotton lacks such a comprehensive and reliable procurement network. The Cotton Corporation of India (CCI) does make purchases, but its scale is often insufficient, leaving the bulk of the crop for private traders. This disparity in market structure is a decisive factor, as farmers prioritise the crop with a guaranteed sale.
The Environmental Trade-Off
However, this shift is not without a significant hidden cost. Paddy is a water-intensive crop, ill-suited to Punjab's semi-arid conditions. Experts estimate it takes up to 5,000 litres of water to produce just one kilogram of rice. Decades of paddy cultivation, fueled by policies like free power for tube wells, have led to a critical depletion of the state's groundwater table. Over 79% of Punjab's groundwater blocks are now classified as over-exploited, with the water table dropping by approximately one meter each year in some areas. While farmers are making a rational economic choice, the long-term environmental consequences threaten the very sustainability of agriculture in the 'Granary of India'.
