Custom Hiring Centre (CHC)

Vol.
3 Issue-9, May 2023 (e-ISSN: 2582-8223)
Custom Hiring Centre (CHC)

Mo Naushad1 and Nivedita Prasad2
1
M.Sc. Scholar, Department of Agronomy, United University, Jhalwa, Prayagraj (U.P.)
2
Assistant Professor, Department of Agriculture & Allied Sciences, United University,
Jhalwa, Prayagraj (U.P.)
ARTICLE ID: 13
Introduction
Custom Hiring Centre (CHC) are basically a unit comprising a set of farm machinery,
implements and equipment meant for custom hiring by farmers. The main objective of CHC
is to supply of farm implements to small, marginal and poor farmers at subsidized rates on
hire. This enables the small and marginal farmers to take up farm operation on time.
Advantages of CHC:
Provides access to small and marginal farmers to costly farm machinery.
Reduces drudgery
Reduction in cost of cultivation
Work opportunities to skilled labour
Increase in cropping intensity wherever feasible
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Efficiency in use of resources and applied inputs.

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Crop diversification
www.justagriculture.in
Vol. 3 Issue-9, May 2023 (e-ISSN: 2582-8223)
Timely production
Provides farm advisories
Objectives:
Reduce the drudgery of women by the supply of women-friendly mechanical
equipment.
To make available various farm machinery / equipment to small and marginal women
farmers mobilized under MzSRLM.
To improve mechanization in villages with low farm power availability.
Ensuring equipment availability in an entrepreneurship mode with an articulated
business plan, so that it is operated sustainably.
Potential for Custom Hiring Center’s:

The least amount of agricultural electricity is available for small/marginal land
holdings. With small/marginal holdings making up 80% of all land holdings, CHC has a
tremendous opportunity to meet the need for agricultural equipment throughout such a broad
region. Recognizing this potential, the Indian government plans to expand farm electricity
69
availability from the current level (0.93kw/ha) to 2kw/ha during the 12th plan period. One
such effort to achieve the goal is the Sub Mission on Agricultural Machinery (SMAM).
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Additionally, incentive programmes are being developed to entice business owners and agri
graduate students to open bespoke employment facilities.
Therefore, keeping in view the emphasis of agricultural farm machinery and the need
for taking the of farm machinery within the reach of small/marginal farmers, institutional
credit needs to be made available for CHCs.
Location of the CHCs
Ideally, the CHC shall have to be located in a place where by and large small land
holdings are located within a radius of 5 to 7 kms. This will reduce the transport cost and
time of transport of agricultural machinery. In other terms, one CHC is expected to cater to
4/5 villages and therefore a common place equidistant from the villages catered is advisable.
Potential Borrowers
Although organizations like line departments and Multipurpose Societies, Primary
Agricultural Credit Societies, Marketing Societies, etc. have equipment for bespoke hiring, a
sizable sector is yet unexplored. In rural locations, informal employment practices are also
common, although prompt availability is rarely guaranteed. Therefore, it's important to
motivate people to establish CHCs, including progressive farmers, rural youth without jobs,
agri grads, and village-level organizations like the Water Users Association, the Watershed
Committee, the SHG Federations, etc.
CHC Unit
CHCs are basically a unit comprising a set of farm machinery, implements and
equipment meant for custom hiring by farmers. Though certain implements and equipment
are crop specific, the traction units like tractors, power tillers etc., and self-propelled
machinery like combine harvesters etc., are used in common. Therefore, an ideal model
envisaged in this project comprise farm machinery that are commonly used for tillage
operations for all crops, multi crop equipment and a minimum of crop specific machinery.
Total Cost
This model is essentially suited for areas where paddy is cultivated predominantly.
The CHC may comprise the following machinery:
i. 35 hp tractor - for tillage operations, traction source and transport
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ii. Power tiller – for tillage operations in small farms, traction source for small
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equipment and agri input transport for short distance
iii. Multi crop Power thresher

iv. Winnower
v. Self-Propelled Reaper
vi. Sprayers
vii. Repairing tools
The cost of the unit works out to ₹15.50 lakh, which includes cost of construction of
a work shed of 500 sq. ft. The land cost which is not considered in the project may however,
be treated as margin. Provision of a workshop shed has been made for parking the machinery,
carryout day-today repair, maintenance and service works.
Income and Expenditure
While the major income is generated out of custom hiring, recurring cost involved are
fuel / lubricant cost for the machinery, driver charges, repair maintenance charges, labour,
interest on bank loan and insurance are the major recurring cost taken in the economics.
Financial viability of the project:
The outcome is summarized as below:
Net Present Worth @15 % discounting factor = ₹343432
Benefit Cost Ratio = 1.08:1
Internal Rate Return =23.4%.
Average Debt Service Coverage Ratio = 1.49:1
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Vol.

3 Issue-9, May 2023 (e-ISSN: 2582-8223)

Custom Hiring Centre (CHC)

Efficiency in use of resources and applied inputs.

Potential for Custom Hiring Center’s:

equipment and agri input transport for short distance

iii. Multi crop Power thresher

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