ASSIGNMENT NUMBER 1

(Sustainability Challenges in the Shrimp Industry)

GROUP NUMBER 4

SECTION A

NAME OF THE STUDENTS

Namandeep Singh Oberoi
Hemangi Sharma
Shreya Sinha
Neralla Phalgunanand Sharma
Deepika Lohia
Aditi Satyendra Srivastava
Monisha Panghal
Q1. Develop a high-level causal-loop diagram (with main stock-flow chains for the wild shrimp catch and
aquaculture production activities) depicting the key variables and feedback (balancing and reinforcing)
loops that most likely are creating the system dynamics in this situation.
Q2. Recommend how Murray could successfully facilitate discussion at the workshop.

It was very important for Murray to facilitate and moderate the discussion at the workshop where in
wild shrimp fisheries, shrimp aquaculture companies, regulatory bodies and environmentalists were
participating, as the thought cycles, processes and the aim of all three are very different. The
environmentalists were against the exploitation of resources to increase yield in the industry and
believed in sustainable development. The wild shrimp fisheries and shrimp aquaculture believed in
maximizing production and catch by exploiting the resources and earning maximum profits. Murray
could moderate the discussion amongst the stake holders by the below methods.

a. He must have a criterion by categorizing meeting of Shrimp fisheries, Aquaculture. Most of the problem
involved in the industry was not only because of Lack of communication but also of competitive attitude
followed by them.

b. He must also be make sure of including environmentalists at the meet, and can put forth their opinion
on pollution levels and resources available and effect on other ecosystems in the workplace.

c. He must also showcase the LOOP diagram that can explain precisely how their decisions involved with
each criterion and what could be their effects.

d. He can also give statistics about growth in SHRIMP industry since its inception and at present report of
The Food and Agriculture Organization (FAO) of the United Nations, that across species, 52% of
the worlds fisheries were fully exploited, and 24% were overexploited, depleted, or recovering from
depletion. According to some environmental groups, the greed and waste of some large commercial fishing
fleets combined with modern developments in fishing technology had led to the massive overfishing that
included wild shrimp and certain fishing practices such as cyanide fishing and dynamite fishing were
extremely destructive to whole natural marine habitats

e. He can show how it has been important source of cash as shown in case The vast majority of farmed
shrimp was produced in developing nations where the activity was an important source of jobs, tax
revenues, and foreign-exchange earnings and in many tropical developing countries, shrimp was the most
valuable fishery export, contributing substantially to the livelihoods of poor vulnerable communities,
particularly as a source of cash.

f. He must also facilitate how BOOM AND BUST of this industry happens and how their depleting
strategy of making short-term profit effects environment and shrimp population, How consumer surplus
(supply) is being created also when market is down based on demand.

g. He can put forth the regulations kept on shrimp industry in majority of the places like Ban on Shrimp
farming within mangrove areas to preserve ecological balance as it was getting deforest for their short term
benefits in aquaculture and Prohibition of Loans for farms near them, so that it is beneficiary to eco system
and industry as well.

h. He can put forth Prisoners Dilemma game that can make these stakeholders understand the supply and
demand in the cycle, so that they can follow conserve strategy for long-term benefits.

i. He can conclude on the structural dynamics of the regional shrimp industry and opportunities for
improvement toward a goal of long-term stability, sustainability, and financial security.

Q3. Suggest system regulations/interventions or good practices that would positively impact on the
long-term life of the shrimp industry.

Every capitalist economy faces Boom and Bust at some point of time. It is defined as a
period of great prosperity or rapid economic growth which is abruptly followed by one of
economic decline. Same scenario was noticed for the Shrimp industry. The boom of shrimp
production collapsed due to viral pathogens, self-pollution and general environmental
degradation. This caused investment losses, financial insecurity and environmental damage.
During the years 2002-2003, a boom was seen (2.9 mt), but during 2004-2005,it further declined
(~3.2mt). To resolve this, during boom, the producers should keep the prices low and produce
more so that demand increases. Similarly, during bust, the producers should keep the prices high
and production should be moderate.
Combined efforts of governments, independent international organisations and environmental
groups had brought about some improvements in terms of legislation and best practices.
Shrimp was mostly traded frozen and transported by ship to the final market. But to increase
shelf life and hence productivity of the shrimps, it can be transported through airways.
Fisheries can increase the efficiency of shrimp trawlers in order to catch more shrimps per trip
and invest in bigger boats in order to realise economies of scale. This can increase the supply of
fish for the market. To increase the amount of shrimp produced, there should be a limit on the
number of fisheries fishing in the region.
Since the size of shrimp harvests affects the total supply of shrimps in the market, larger shrimp
harvests should be invested upon.
Competitive Dynamics is dominated by two strategiesConserve and Deplete. Fishery
Management only takes into account the Deplete Strategy where the annual catch of shrimps is
maximised by outdoing the competitor. This only leads to short term profits. In contrast,
Conserve strategy should be followed since limited annual catch of shrimps would lead to long
term sustainability.
The non-cooperative behaviour of both fisheries resulted in depletion of fish reserves and hence
damage to the ecosystem. Fisheries and aquaculture firms need to adopt a cooperative position to
manage the profitability of their industry. There should be a proper communication channel
among the firms.
Due to technological advancements, there were large harvests, but fisheries were unable to
record the
amount of catch. So proper technology should be implemented, in order to access the catch and
keep a check on production. In order to protect the environmental interests, the government
should act as a mediator and enforce contracts between the fisheries.
Due to personal interests of commercial fishing fleets coupled with modern developments in
fishing technology lead to massive overfishing. In order to curb this problem, government should
act as a major stakeholder and should regulate the shrimp fisheries along with providing
subsidies. Also, the government should ensure that all shrimp farms be licensed.
Government of developed countries should pay attention to illegal, unreported and unregulated
fishing, by their fleets in distant waters. Cyanide and dynamite fishing should be prohibited to
save marine ecosystem as this would prolong the life of shrimp industry.