No attempt to tackle Farmers distress

After the welcome move to spend Rs 6.9 lakh crore on roads and carry out mega Rs 2.11 lakh crore recapitalisation of banks, Prime Minister Narendra Modi government needed to step on the peddle to tackle the farm distress in the country, which is real and shattering. Father of India’s green revolution M S Swaminathan is right is saying India cannot eradicate poverty in the country without without tackling the woes of farmers, who formed 50 per cent of the population.

Demonetisation had virtually crippled the farming community, which largely depended on cash economy. That too demonetisation came at a time when things were looking up for them because of good monsoon afte two successive years of drought. The timing was so bad that demonetisation was done when farmers needed cash flow the most as November is the time when Kharif harvest takes place and Rabi sowing begins. The hasty rollout of GST has added to the farmers woes as it had jacked up some of their inputs costs. It is therefore not surprising that agriculture, which should have grown by at least 5-6 per cent taking advantage of low base due droughts in the previous two years, managed to clock only 2.5 per cent growth in spite of good monsoon.

Along with big ticket public investment on roads, government should have come out with big ticket investment on irrigation projects and linking  of rivers, which had remained virtually non-starter so far. It is sad that though India had one of the largest areas under irrigation in the world, yet more than half of the over two lakh crore hectares of land were still rain dependent. Take the case of Bihar and Jharkhand. While Bihar has floods every year, Jharkhand has drought most of the years. All one had to do is connected all the Himalayan rivers in Bihar to the rivers in drought stricken Jharkhand. This has not happened in 70 years of independence.

Solutions are already available and now technology too is there but the political will appears to be missing despite the fact that a large chunk of the country’s members of parliament are farmers. Doles like no farm income tax or periodical farm loan waiver do not address the issue, which is deep rooted and needed concerted and comprehensive solution. Unfortunately the Indian political class look at only short-term political gains and not the long term and permanent solution to the problems of agriculture as it does not help them win elections every five years. Swaminathan had nicely summed up in his report, government has to do two things basically that is to ensure farmers get remunerative income that is cost plus 50 per cent should be price for farm produce and secondly creation of proper marketing system for farm produce, which has not happened so far in the country. Minimum Support Price, a price stabilisation mechanism, though a good tool, has so far has largely benefited only the rich farmers as only they have marketable surplus in the country.

Swaminathan is right in saying that Agriculture ministry needed to be made Agriculture and Farmers Welfare Ministry. Mere change in name as has happened lately will not suffice. What he actually meant was  that the ministry should undertake large scale measures to improve farmers welfare and that has not happened so far.

Animal husbandry and livestock are equally important as they go hand-in-hand with farming. Livestock is a sort of insurance to farmers.  Cows which ceases to be milch cows, used to be sold and he used to get some money for it. Now because of the activism of the Gorakshaks, they are no longer able to sell their aged animals. He has not only lost the money that he used to get as a sort of insurance, but also spend more money in the upkeep of the useless animals, which had to be fed till it dies on its own. This eats into already poor finances. This is one of the reasons  for pushing down farmers income further adding to his misery.

Another issue that government needed to address is stable import-export policy for farm produce. One does not understand why government allows import of rubber, apprently succumbing to the pressures of tyre industry, when there is surplus rubber production in Kerala and NorthEast. This further depressed local rubber prices putting rubber growers into difficulty. Export policy too is funny. Whe there is surplus production in Onions, it cannot be exported as government takes time to annouce lifting of ban on onion exports. This  again results in glut leading to crash in prices.

There is need for agriculture becoming smart taking advantage of  digitisation of the systems in the country. This will help in the use of technology for improving productivity. In United States the weather forecast is utilised to forecast shortfall of food grains in other countries  in the subsequent year and accordingly crops are cultivated for exports, thereby getting better price in forward trading. This sort of anticipatory cultivation needed to be encouraged.

With fragmentation of land holdings in India, contract or cooperative farming can be encouraged. If all the farmers say 100 odd farmers in a village pool in their land and cultivate one crop and tie up with an agency for marketing, it would fetch them better return.

Encouraging multi-brand retail, cold storage chains, and food processing parks in various parts of the country will help in marketing farm produce. Seventy per cent of the goods sold in multi-brand supermarkets are food products and it is already over $500 billion industry in the country. If it is tied to multi-brand retail outside India, it could be over one trillion dollar industry.

In sum, the big invstment push in infrastructure and recapitalisation of banks decided by the union cabinet recently is timely providing much needed impetus to jump-start the economy, now in a take off stage after the recent cleaning up operations and transformational tax reforms. But it would have been better if the Government had come out with a big ticket farm policy as well to ease the farm distress. Several farmers commit suicides year after year and it is sad that government does not do enough to address their issue. If independed India does not have starvation deaths as in the past, it is because of our farmers’ hardwork. If they stop working the entire nation will starve. So it is in our interest to uplift them. They are the most hardworking with least return and yet the nation has not improved their income, which does not increase adequately even to take care of the rise ininflation. There is need for yet another green revolution, which should include all crops and until that is done, the country cannot become a developed nation. Merely doubling per capita farm income is not enough as the average per capita farm income in most states is just Rs 20,000 per year at present. It has to go up manifold. Even if 20-30 per cent of the recommendations made by various committees have been implemented the country’s agriculture had progressed much better

(K R Sudhaman, a journalist for over 40 years, has been Editor in Press Trust of India and Economics Editor in TickerNews and Financial Chronicle)