Saving in livestock

„Because of their direct and indirect saving value, cattle especially buffaloes are cared extraordinarily²⁰⁸. People say ‘when a child dies, family members weep, but when a buffalo dies the whole family hungers’“ (KUHNEN 1989a:8).

Saving in livestock represents the most practiced form. The possession of a large number of animals in not only a status symbol but a security in the case of crop loss or other unexpected emergencies. „Especially in rainfed areas, livestock act as a saving bank (LÖFFLER 1992:159). „Besides land, livestock represents one of the popular means of production of rural households, which may be sold or bought when needed“

(MÜLLER 1992:111, 319).²⁰⁹ In the case of an unexpected crop loss, cattle can be sold to secure the survival of the household. Even in peak cultivation seasons, the shortage of labor for livestock raising can be managed by women and children. This possibility to minimize the future risk may be understood as a major motivation for the relative higher amount of saving in this form. Livestock is denoted as 'always available cash' at home;

because of their income generating value, animals are considered to be a strong economic base for poor families.²¹⁰

“The sale of milk and milk products (yogurt, cheese, and ghee) could supply to the households, which keep small animals and which have marketing opportunities, a constant and relatively regular income flow and reduce their dependence on their seasonal income and the harvest yields of crop products.

[Similarly] The sale of the so-called animal by-products of sheep and goat-keeping (especially wool and hair, hides and skins) allows the producers to earn a side income and could acquire importance beyond the framework of the farm“²¹¹(ECKER 1978:23).

208 IFPRI Rural Survey of Pakistan, 1986/87-1988/89 (ALDERMAN/GARCIA 1993:50) shows a strong and positive correlation between ownership of female buffaloes and household income. Poor peasants prefer female buffaloes to cows because of the higher quantity and quality of buffalo compared with cow milk. Buffaloes milk has a higher fat content (National Research Council 1981), which makes it more useful as a supplement in poor diets and in the preparation of churned butter (ghee), which is itself a lucrative cash product. The data in this survey further shows that the three-year average household value of ‘milk and milk products’ for female buffalos, is more than two and a half times higher than those of cows: Rs. 1,494 for female buffalos versus Rs. 556 for cows. Poor rural households in Pakistan may well prefer female buffalos but these are far more costly than cows: the average purchase price for a female buffalo is Rs. 4,516 versus Rs. 2,439 for a cow, and it is more expensive to feed. Annual fodder (own and purchased) and purchased feed costs for a female buffalo are Rs. 525 as opposed to Rs. 473 for a cow.

SEABRIGHT (1991:69) also obtains similar results in his detailed survey of the livestock market in South India.

For further details on this point, see ADAMS 1986; and SHARMA 1982.

209 MÜLLER (1992) reports on rural Bangladesh that prosperity and influence of landowners was commonly determined by the number of animals one possesses. The amount of land had a limited significance in those days and landowners with one or two productive animals were considered poor (DATTA 1989:78).

210 Other income (farm) generating activities also need not be negatively influenced by sheep and goat-keeping in the households of the rural poor. On the contrary, the goat-keeping of these animals would even bring about yield increases (e.g., increase in the crop yields and maintenance of soil fertility on account of the high quality of these animals’ dung).

211 This does not only apply to marginal farm households, but also to agricultural labourers who earn better wages in the peak periods of work during the harvest as compared to their average earnings per annum as a result of the greater labour demand.

AJAM (1971:128) also reports for Pakistan that livestock keeping contributes a relatively higher amount of capital formation per land unit to small farmers and tenants as well as to the total capital formation of the household. This is especially true for the households with an agricultural income. In the case of agricultural households with secure non-farm income, the significance and share of livestock in the total capital formation of a household has been reduced to a larger extent. Table 21 presents a total value of the saving in livestock in twelve case study households. “Livestock keeping usually performs the function of a saving bank. The higher amount invested in them remains saved till some emergency and capital scarcity, when it is again made available by the animals being sold“ (MÜLLER 1992:344).

Table 21: Saving in livestock in the twelve case study households in 1991-92 (Rs.)

Cases Net income Value of the

animal saved*

% of total income

Case 1 5,51,150 -

-Case 2 4,62,760 -

-Case 3 3,47,300 -

-Case 4 2,77,250 -

-Case 5 1,95,200 -

-Case 6 1,91,000 20,000 10.5

Case 7 1,51,250 -

-Case 8 1,35,910 12,000 8.8

Case 9 1,27,460 8,000 6.3

Case 10 78,150 1050 1.3

Case 11 31,402 14,000 44.5

Case 12 39,058 10,000 25.6

* Livestock saving includes only those sheep, goat, calves and hens which are seen as saving and can be sold at any time.

Source: author’s own survey

Livestock keeping has a dual impact on the household economy, firstly, as a source of extra income²¹² and, secondly, by acting as cash which is always available at home.

The most commonly practiced methods are the following:

− Surplus cash, whenever available, is utilized preferably to buy a buffalo,²¹³ the most highly valued animal. The money invested remains saved until the buffalo is sold to get cash again. A buffalo represents not only a status symbol but a strong existence base²¹⁴ by representing a long-run addition in the household economy (KUHNEN 1989a:7-8).

212 The results of IFPRI Rural Survey of Pakistan, 1986/87-1988/89 (ALDERMAN/GARCIA 1993:88) see both livestock raising and non-farm income sources as an instrument to reduce rural inequality. This implies that, if the equitable distribution of rural economic growth is an important objective in Pakistan, strategies to encourage the increase of non-farm income and livestock development would be desirable.

213 A well maintained stock of buffaloes is usually considered a sign of a household’s secure economic situation. See also HELMRICH (1986:4544f).

214 ECKER also reports from the irrigated area of Pakistan’s Punjab that it is only in exceptional cases that castrated buffaloes are used as draught and working animals in agriculture such as for ploughing rice fields or as draught animals for heavy loads. The main trend of production in buffalo keeping is the milk

production. Thus, about 68.3 percent of the milk in Pakistan is produced by buffalo cows. Female buffalo calves are bred with special care. Male calves are considered to be a necessary evil and are often neglected.

− Parents usually gift a female calf to their daughter in dowry.²¹⁵ If her in-laws do not have enough place, it is left with her natal family. Not only are its products supplied to her regularly by her family, but it also represents her saved cash deposited with them, which keeps on increasing day by day and which can be claimed at any time. "Many women receive monetary or non-monetary transfers from their father's and/or brother's households. In addition to the 'marriage demand payment' that is received by their husband's family, at the time of marriage and afterwards, they personally receive bigger items such as animals or land" ²¹⁶ (RÄDER 1988:96).

− Goats and sheep represent another form of saving. „The size of their stock, their health and nourishment level is a decisive criterion to judge the social status and economic position of a household“ (MÜLLER 1992:109).²¹⁷ Small goats are usually bred by women.²¹⁸ They receive them usually as gifts from neighbors, relatives or their natal family. Sheep and goats count among the most important agricultural productive animals after cattle and buffaloes from the viewpoint of saving.²¹⁹ Women usually do not invest much in their breeding. As their multiplication rate is very rapid, goats increase in number in a much shorter time and at negligible costs. They are denoted as 'women's cash' and are sold whenever cash need arises. This is an approved cash and can be spent openly.

As to whether livestock keeping is a hoarding, saving, existence base or investment, the concept of 'livestock hoarding' does not exists in the present study. Almost every type of animal keeping is of a productive nature. Animals can be converted into liquid assets, may generate cash when needed or may be consumed directly in case meat is needed. Animal keeping is seen as money deposited in a bank and drawn whenever required without any risk of loss and formal procedures. In the absence of proper access to the financial institutions and due to mistrust of their functioning, it seems to be the best possible arrangement to keep money under one' s own control. „Livestock keeping possesses a monetary and non-monetary effect on capital formation. Animal buying is an investment which simultaneously and indirectly expands the economic base of a household, [...], but it should be considered a ‘middle stage’(saving) in the actual formation of capital, which is oriented towards buying of land by selling the animals“

(MÜLLER 1992:329). Investment in cattle as well as in sheep and goats is just a

‘protective strategy’ for a surplus amount. The later sale of these animals is usually an already decided goal.²²⁰

Livestock keeping, however, does not mean saving for every economic stratum. The difference can be observed in the way of dealing with animals, input (total investment in

215 Livestock is influenced more by the non-monetary transactions such as consumption on birth, death, religion, and gift exchange. Mothers usually gift some goats to their newly married daughters to make a basis for the woman in the newly established household (MÜLLER 1992:301).

216 In the case of the community under study, however, such gifts include only animals, as there exists no example of land transfer.

217 See HELMRICH (1986:453f) for the influence of livestock keeping on the socio-economic status of a household.

218 See also MALONEY/AHMED (1988:28).

219 MÜLLER (1992:96), for example, ascertains in rural Bangladesh that sheep and goat keeping is

practiced by all income classes, and 80 percent of the stock is usually a result of breeding by the household.

Goats are preferred to sheep, because these are not considered to be as clean.

According to MÜLLER’s results, the size of livestock is directly proportional to a household’s landholding;

it decreases with the decreasing land size and increases with addition in land.

220 Plowing animals are again sold after the preparation of land, and this capital is invested in crop production to increase income (MÜLLER 1992:353).

food and labor) and output comparison of a specific animal species, its number and the social stratum of the owning household.

Cattle, i.e., cows, buffaloes, oxen and bulls are not intended to be sold in case of any urgent cash need. It represents an economic base in low income and small farm families.

Cattle as one of the major source of income and food products cannot be sold in any emergency. Even in middle class households, where it represents a source of additional income, attempts are made to avoid risking this share of income. In such lower and lower middle strata, these animals are required for major agricultural tasks such as plowing, threshing, leveling, transport of goods, etc. and the sale of cattle results in a risk for the major income source (farm) as well. Cattle keeping serves as an existence base in this case, not as a surplus. Hence, it cannot be used for saving purposes.

In the upper middle stratum, however, where agricultural activity is mechanized and is sufficient by itself to provide a secure base to the household economy, livestock is usually kept either as status symbol or to get milk and homemade milk products for household consumption. Animal products are not a source of income in this class and, therefore, can eventually be sold when cash is needed and no other suitable alternative is at hand. The only reason which may hinder this act is the cultural sanction against its sale as in the case of jewelry. Only calves are bred with a saving orientation in this stratum. Very young animals are bred with the intention of selling them after one or two years at a better price.

They usually do not represent an important component of the household's economic base and can be sold at any time. This is a method which is socially approved.

Kids represent a real possibility to save. They are kept only by women who want to save to fulfill their own occasional needs. Goats breeding is usually practiced in lower and middle class households. The sale of goats influences the household's economy positively. Poultry can also be counted in the same category.

In conclusion, animal keeping as a saving means can only be ascertained in a better-income class in the study area. This class owns farms of a sufficient size or earns a non-farm income and may buy animals to save surplus money and sell them without experiencing any fall in the household's economy.