Resettlement policy framework and specific resettlement action plan


Agricultural activities of leasehold farms, assets, and incomes



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4.3Agricultural activities of leasehold farms, assets, and incomes


More than 73 percent of the affected leasehold farmers were established during the period 2004-2005, and the oldest one was created in 1995. All farms that currently cultivate cotton/wheat were established in 2004-2006 (Table 3).

Table 3. Year of establishment of affected leasehold farms




1995-1999

2000-2003

2004-2006

As a % of affected leasehold farmers

11%

14%

76%

Main specialization of leasehold farms, % of farms

Cotton/wheat raising *

0

0

100

Gardens*

21

26

53

Source: 2009 SA survey

*Note: this sub-division on cotton/wheat and orchards farmers is limited and is done only on the basis of plots size. Some of the surveyed cotton/wheat farmers have sub-plots with hundreds of fruit trees also. Tables 9-11 below clearly describe the current assets of all the affected farms.

Twenty-one of the 37 surveyed farms (57 percent) have one plot, but others have several plots situated close to each other, but separated by roads, or other farm’s plots. Further, 58 percent of orchard farmers have from 2 to 5 separate sub-plots, while 72 percent of cotton/wheat raising farmers have only one plot; 4 farmers have 2 plots; and one farmer has 10 separate plots. The soil quality of their plots is close to the average for the Project area and the ball-bonitet varies from 42 to 76 with an average of 61 balls.



Affected farms are very different in terms of the size of their land holdings. Plot size varies from 1 to 72 ha, as shown in the table 4. Six of the seven gardens to be affected are located in Altyaryk raion and the only large (21.5 ha) garden affected is in Rishtan raion.

Table 4. Farming information about affected leasehold farms




Altyaryk

Rishtan

Baghdad

Total

Total number of farms

913

5

23

37

Main specialization of leasehold farms, No of farms




Cotton/wheat raising

3

4

23

30

Gardens

614

1

0

7

Average size of plot, Ha




Cotton/wheat raising

66

47.7

54.3

54

Gardens

1,914

21.5

-

4.3

Source: 2009 SA survey
Affected leasehold farms provide significant employment. The average number of permanent employees in the affected leasehold farms is almost 13 persons (including the farmer) and varies from 2 to 34 people. All the workers are officially registered workers and have signed contracts with the farmer. The average number of person-months spent on-farm by all the permanent workers was 100 person-months which is an equivalent of a full year for about 8 workers. The maximum number of temporary workers was high – 59 people on average, and the average number of person-months spent on-farm by all the temporary workers was 307 months (which is an equivalent of a full year for 26 people). Thus, the average affected farm provides full-year equivalent employment to 34 people. Despite the fact that orchard farms are small in terms of the amount of land, the number of permanent workers on these farms is similar to those dealing with cotton and wheat. The maximum number of temporary works is required for cotton farms and for gardens during the harvesting season. In terms of negative effects on employment, the most vulnerable farms will be the 6 small orchard farms in Altyaryk district, because most of them, even with the replanting of lost trees will have to shed at least 1/3 of their workers. Others will have no adverse impact in terms of employment.
Expenditures per hectare are relatively uniform over the Project districts. The average income of leasehold farms over 12 months preceding the SA survey consisted of 20 percent of the gross revenue. Farmers who grow fruits have the highest income per hectare, while those who deal with cotton or wheat may even lose money. However, among the orchard farmers, there were two without cash incomes because the gardens are still very young and no harvesting has yet occurred.
Bookkeeping is a very weak part of leasehold farmer’s activities. Cotton and wheat growing farmers are very vulnerable in terms of freedom of using their banking accounts:

  • One the one hand, the necessity to sell sufficient produce within the State order system discourages farmers from showing a poor yield. In some cases, unsuccessful farmers have to buy wheat at local markets and pass it to the State to fulfill their contract and prevent sanctions (if the farmer does not fulfill the State order during 3 years, the leasing contract on the land can be denounced).

  • On the other hand, too much production may cause requests to sell the production on fixed price (lower than the free market) if a raion has not fulfilled the State order.

Balancing between these two choices, most farmers try to have close-to-zero balance in their accounting books, as it shown in Table 5 below.

Table 5: Officially registered indicators of performance on affected leasehold farms in 2008 (extracted from accounting books of farms)




Total

Orchards

Cotton/wheat

Average official annual income (000 soums)

22,000

24,338

19,637

Official gross net income (000 soums)

3,765

4,581

2,898

Proportion of farmers with no profit, %

8 (3 farms)

2

1

Source: 2009 SA survey
Also, farmers unofficially reveal the harvesting of secondary crops after wheat and hide both cash expenditures and incomes from this type of activity. The tanshes system (credits from the State to grow cotton and wheat) restricts the use of money from their banking accounts to buy necessary inputs for secondary crops; thus, the farmers have to buy many inputs using their own cash without revealing this in their accounting books.

In terms of reimbursements for land acquisition, all farmers are vulnerable because in most of cases they cannot reveal their real yields, expenditures, and incomes. The average figures, used by Geodezcadastre bodies (average ball-bonitet of the soil, average yields, average net incomes etc.) may cause significant uncovered losses to farmers should large-scaled land acquisition takes place. This is an important reason to conduct unofficial surveys and, if possible, censuses so that real losses can be identified. Thus, to calculate compensation to farmers in the context of the current RF, realistic and accurate data were collected.

Cotton and wheat are the predominant crops on leasehold farm plots, while the areas of other these crops are insignificant. Leasehold farmers keep cropping patterns as instructed by local authorities; the cropping patterns depend on the planned target output of cotton and wheat to be sold to the state procurement organizations. Fruit and vegetable farmers are free to grow anything they want and sell it on the free market, but their land plots are too small and the share of crops excluding cotton and wheat is about 20 percent in the area affected by IDs.

Table 6. Crops structure on the leasehold farm plots affected by IDs

 

No of farms and %

Mean, Ha

Minimum, Ha

Maximum, Ha

Average weighted, %

 

Valid

Missing













Cotton

30(81.1%)

7(18.9%)

12.24

5.3

23.3

43.0%

Wheat

29(78.4%)

8(21.6%)

10.13

3.3

20.8

34.4%

Corn

3(8.1%)

34(91.9%)

2.07

0.6

5

0.7%

Rice

1(2.7%)

36(97.3%)

1.00

1

1

0.1%

Potato and vegetables

10(27.0%)

27(73.0%)

1.23

0.02

5

1.4%

Melon, water-melon

2(5.4%)

35(94.6%)

2.20

1.4

3

0.5%

Bean crops

2(5.4%)

35(94.6%)

0.59

0.38

0.8

0.1%

Fodder root crops

14(37.8%)

23(62.2%)

5.76

0.4

13

9.5%

Hay, Lucerne

2(5.4%)

35(94.6%)

5.50

2

9

1.3%

Apple tree

7(18.9%)

30(81.1%)

0.69

0.1

2.2

0.6%

Apricot tree

9(24.3%)

28(75.7%)

1.68

0.02

11

2.3%

Peach tree

10(27.0%)

27(73.0%)

1.64

0.005

6

1.9%

Merry tree

4(10.8%)

33(89.2%)

0.10

0.005

0.25

0.0%

Pomegrenate

1(2.7%)

36(97.3%)

2.00

2

2

0.2%

Persimmon

2(5.4%)

35(94.6%)

0.40

0.1

0.7

0.1%

Circassian walnut tree

2(5.4%)

35(94.6%)

0.55

0.1

1

0.1%

Mulberry tree

6(16.2%)

31(83.8%)

4.08

0.6

14.7

2.9%

Vine (table variety)

1(2.7%)

36(97.3%)

6.00

6

6

0.7%

Source: 2009 SA survey
Despite having their land with high ground water table, and having the limitations on watering secondary crops, the farmers use their plots intensively, and the amount of land under secondary crops was about 12 percent during 2008 (so the land usage was 112 percent).
As one can see from the table above, cotton and wheat occupy 77.5 percent of the land. It is important to note that the structure includes all types of crops and trees, including secondary crops and plants between the trees. This crop structure has been used for the calculation of sums to be reimbursed to farmers before the land acquisition for IDs. All calculations and other relevant figures for the calculation of reimbursements are included in the Chapter 8 “Valuation of and compensation for losses” below.
Shortage of machinery and high costs of leasing machinery is one of the acute problems for agricultural operators. Small farmers do not have any machinery. Only the highest-income leasehold farmers (particularly, leasehold farmers whose plots are more than 30 ha) can afford to buy independently a tractor or seeding machine, etc. Moreover, farmers with small plots, especially if they work on one to two orchard plots, have no need to buy heavy machinery.

Table 7. Availability of own machinery




Percentage of leasehold farmers who have own machinery, %

Average quantity of machinery owned by leasehold farmers, pieces

Tractor

57

1.2

Combine harvester

0

0

Plows, seeding machines

46

2

Thrashers, mills, rice mills

5

1

Truck

5

1

Water pumps

5

1

Electric generator

11

1

Car

62

1.1

None of above

22




Source: 2009 SA survey
In terms of other assets and infrastructure, the surveyed farmers almost have nothing. Only one of the surveyed farmers has a building for storage, one person has a barn in the fields, and few farmers have summer camps in the fields. None of the existing infrastructure will be damaged during the construction of IDs.



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