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Environment-smart agriculture (ESA) aims at sustaining increased agricultural production while limiting negative impacts on the environment. The present study develops an index of composite on-farm environmental impacts (COEI) as a proxy measure to evaluate ESA and validates the index by mapping interactions amongst agriculture related environmental impacts and potential constraints to practice ESA by using the directed graph approach. The cost of mitigation to practice ESA was calculated by estimating the cost of reducing on-farm environmental impacts by using the damage–cost method. The approach was empirically applied to a sample of 317 High Yielding Variety (HYV) rice farms from three intensive rice-growing regions of northwestern Bangladesh. Results showed that the use of chemical pesticides contributed towards higher level of uncertainty in practicing ESA than the use of chemical fertilizers, irrigation and household pollution. The combined effect of the influence from these factor interactions was estimated at 2.3, which falls in the critical region of influence and implies extreme level of uncertainty in practicing ESA. The cost of mitigating negative environmental impacts is higher for the problems of ‘decline in soil fertility’, ‘increases in crop diseases’ and ‘reduction in fish catch’ as compared to other soil and water related impacts. Policy implications include investments in addressing the problems of ‘soil fertility decline’, ‘increases in crop diseases’ and ‘reduction in fish catch’ and raising farmers’ awareness on using farm chemicals to promote ESA practices for HYV rice production.

Environment-Smart Agriculture and Mapping of Interactions among Environmental Factors at the Farm Level: A Directed Graph Approach