Striking a balance between economic benefits and ecological preservation amidst the expansion of shrimp farming.
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Assessing the long-term implications of shrimp culture in India

How can we strike a balance between economic benefits and ecological preservation amidst the expansion of shrimp farming?

Agricultural land conversion for shrimp culture is the burning issue in Purba Medinipur district, West Bengal, India. Purba Medinipur district, a coastal province of West Bengal, experiences a booming shrimp culture industry due to its favourable environmental conditions. The shrimp industry constitutes one of the major economic activities in this district, contributing to foreign cash flow by exporting frozen shrimp to foreign markets.

Since the beginning of the high-growth variety vannamei shrimp culture in Purba Medinipur, agricultural land conversion has peaked. There are two apparent reasons: 1. Increasing the demand for new lands for the ever-expansion of shrimp farms; 2. By leasing the lands for shrimp culture, landowners earn more money than farming. However, the scenarios are complicated, with several inevitable consequences hidden from both ecological and economic points of view.

Figure 1: A shrimp farm from the study site
Credit. Authors

What is the future of these converted lands?

The study examined three land categories: those leased for shrimp cultivation, adjacent agricultural lands affected by shrimp pond salinity, and control rice cultivation lands. We analysed two scenarios over 20 years: one including a 10-year leasing period and another without it. We considered factors such as land restoration costs and production loss post-leasing. We collected financial data and discounted by up to seven percent for analysis.

Outcome of scenarios

In the first scenario, where we included the shrimp production period, leasing lands represent the maximum NPV compared to the adjacent agricultural and control farmlands in all discount rates (Figure 1). However, in the second scenario, where we eliminated the leasing period, the NPV is minimal for the leased land compared to the other two. At the same time, the NPV is maximum for the control land (Figure 2).

State-based top-down regulatory policy intervention is necessary to halt land conversion and ensure the proper distribution of land for shrimp cultivation.
Figure 2. NPV of 1st scenario
Credit. Authors
State-based top-down regulatory policy intervention is necessary to halt land conversion and ensure the proper distribution of land for shrimp cultivation.
Figure 3. NPV of 2nd scenario
Credit. Authors

NPV is used to indicate the profitability of these lands. It shows that land leasing for shrimp culture is the best financial option for landowners. However, profitability may drop during the period of re-cultivation. The profitability turned negative beyond the five percent discount rate. Also, the BCR value indicated the same results; beyond the five percent discount rate, the BCR became less than one. Soils of these lands were compared, and there were significant differences in some soil components.

Primarily, non-agricultural lands were converted; that was the growing phase. With the shrimp economic boom, increased demand for the virgin lands, and then the farmlands started to be converted; further, the adjacent farmland conversion was due to externality.

Suvendu Das

Inference of scenario outcomes

These results imply that shrimp culture practice alters the soil characteristics of leased land, affecting future soil productivity outcomes. Repeated culture in the same land causes more damage; even the benefits from the shrimp culture also gradually decrease with respect to the increasing cost of production in the same land. Therefore, the land value of the leased land falls in the future. From the long-term point of view of land conservation and maintaining the existing value of the land, the shrimp culture is a non-sustainable practice.

Where is the solution?

The complete shutdown of the shrimp culture can not be a solution. Shrimp culture boosts the coastal rural economy. Several undeniable benefits are generated, which are also very important from a developmental point of view. However, the implicit costs of shrimp culture will always be there (Table 1).

BenefitsCosts
1. Increase in private investment
2. Wage development
3. Increase in per-capita income
4. Increase in land value
5. Government investments in new transportation
1. Salinity intrusion
2. Loss of soil fertility
3. Completely non-suitable for recultivation after shrimp farming for several years
4. High restoration costs for farming
5. Gradual low production of the crop in comparison to the before shrimp culture’s years
Table 1. Benefits & Costs of intensive saline water shrimp culture

Therefore, sustainably balancing the costs and benefits is the new challenge. Taking care of shrimp culture practice through proper scientific measures can minimize the negative effects. Determining the threshold limits of land conversion involves estimating NPV and BCR while incorporating costs such as externality costs, damage control costs, post-operational restoration costs, etc. The actual area of converted land can be below the limit or beyond the limit of the threshold level. The converted land areas in the present-day scenario have likely crossed the threshold level. State-based top-down regulatory policy intervention is necessary to halt land conversion and ensure the proper land distribution for shrimp cultivation.

Conclusions

This microeconomic study has been published. The most interesting part of the study is to link ecological damage to economic outcomes. The land or soil micro-ecosystem is affected by the intensive saline water shrimp culture, and it causes production loss in the future. The research is not an alien concept to the scientific world. However, the analytical approach and the interlinking of cost-benefit analysis to impact assessment are the key highlights of the study. The study is relevant to many other shrimp-growing regions of India and Southeast Asian shrimp cultivation countries.

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Journal reference

Das, S., Saha, P., Adhurya, S., Ray, A., & Ray, S. (2022). Present and future scenarios of changing land use patterns from the perspective of agroecosystem under the shadow of ever-expanding shrimp culture. Environmental Development44, 100772. https://doi.org/10.1016/j.envdev.2022.100772

Suvendu Das obtained his PhD in October 2023 from Visva-Bharati University, India. His research domains include ecosystem services, ecological economics, and ecological modelling. He has experience working on numerous collaborative projects and has published several articles in reputable journals. He is particularly interested in transdisciplinary research concerning land use dynamics, ecosystem service valuation, and policy interfaces.

Alok Ray is a retired economics professor from the Indian Institute of Management, Kolkata, India, where he taught for over 30 years. He obtained his PhD from the University of Rochester. Professor Ray also lectured at Calcutta University, Delhi School of Economics, Cornell University, University of Rochester, University of Pittsburgh, Portland State University, Queen's University, and Monash University. He authored a book titled "Trade, Protection, and Economic Policy" (Macmillan). He regularly contributes articles on current events to various English newspapers and has provided consultancy services to the UN, the World Bank, the Government of India, and several corporations.

Santanu Ray is a Distinguished Visiting Professor at the Kerala University of Digital Sciences, Innovation and Technology, India. He was a professor in the Department of Zoology at Visva-Bharati University, India. During his time at Visva-Bharati, he served as the Director and Advisor at the Indira Gandhi Centre and Foreign Students Cell. From 2009 to 2021, he worked as an associate editor for the Journal of Ecological Modelling. His areas of research and teaching include ecological modelling, ecology, theoretical ecology, environmental science, and systems ecology. Throughout his academic career, he supervised seventeen PhD students and four postdoctoral fellows, and has authored numerous research articles and book chapters.