This study attempts to examine the economics of paddy seed production vis-a-vis commercial grain production and the variables that are discriminating the seed production from commercial production in union territory of Puducherry. Primary data on the cost of cultivation of both seed crop and commercial production of paddy were collected from 120 selected sample farmers through a suitable pre-tested schedule. The conventional tabular and linear discriminant functions were used to analyze the data. The findings of the study indicate that the cost of cultivation is higher in seed production as compared to the commercial production of paddy. But the total return is higher in seed production than commercial crop production. Further, the results of discriminant analysis reveal that there are noteworthy differences in the gross return between seed production and commercial production of paddy. Besides, it is evident from the analysis that the expenditure on miscellaneous items also contributed to the significant differences between the seed and commercial production of paddy.

Rice is an important food crop of the union territory of Puducherry accounting about 63% of the total cropped area and contributes about 98% of total food grain production (Anonymous, 2005). In view of increasing demand for quality seeds, the Government of Puducherry established a Seed Certification Agency in January 2000. The basic functions of the agency are production, collection, storage, testing and distribution of mainly the certified paddy seeds. There are several studies pertaining to cost of cultivation of paddy under commercial production, but there are only a few studies related to cost of paddy seed production. Hence, the main objectives of this study are: To analyze the economics of paddy seed production vis-a-vis commercial production, and to specify the variables that are discriminating the seed production from commercial production.

The study has been conducted in the Puducherry region as it ranks the highest area under paddy compared to other regions. A sample of 60 seed growers was selected from the list of registered seed growers at random. A matching sample of farmers, having commercial cultivation of the paddy crop, was selected randomly from the same village wherefrom the seed growers were selected, thus making the total sample of 120. Primary data on the cost of cultivation on both seed crop and commercial production of paddy were collected from the selected sample farmers through a suitable pre-tested schedule during the agricultural year 2005-2006. Tabular analysis was used to estimate the costs and returns.

The linear discriminant function analysis was used to identify the variables that were important to discriminate between the two groups of farms. In multivariate analysis, linear discriminant function, which is better than any other linear function, will discriminate between any two chosen classes (Dillion and Goldstein, 1984). The concept underlying the discriminant function analysis is that linear combinations of the independent variables are formed and they serve as the basis for classification. Thus, the information from multiple independent variables is summarized in a single index. For the application of linear discriminant function, two groups of roughly equal size are required.

Comparative Economics of Seed Production Vis-a-Vis Commercial Grain Production of Paddy in Puducherry, commercial production, tabular and linear, production, collection, storage, testing, distribution, discriminant function analysis, linear discriminant function, Dillion and Goldstein.