Agricultural crisis: Why BJP's poll promise of doubling farmers’ income by 2022 is a lofty ambition
Doubling farmers’ inflation-adjusted income from the current levels, say in six years, will be possible if the government acts in mission mode.
The 'promise is kokla (hollow)' says Pushpendra Singh of the Kisan Shakti Sangh, a western Uttar Pradesh outfit
Ghanvat, agricultural sciences graduate, is disappointed with the govt's reluctance to permit GM crop technology
Doubling farmers’ inflation-adjusted income from the current levels, say in six years, will be possible if the government acts in mission mode
The promise to double farmers’ income by 2022 in the Bharatiya Janata Party’s (BJP) election manifesto or Sankalp Patra has invited ridicule because it’s impossible to achieve within that time frame, but if the deadline were pushed back by a couple of years and earnest efforts made, it could change the face of Indian agriculture.
The “promise is kokla (hollow)” says Pushpendra Singh of the Kisan Shakti Sangh, a western Uttar Pradesh outfit. Singh cites many examples of the government failing the agricultural sector since the prime minister first announced the objective on 28 February, 2016 at a rally in Bareilly.
Average annual agricultural GDP growth has been 2.9 percent in the past five years, lower than the 4.3 percent rate achieved during former Prime Minister Manmohan Singh’s second term. Agricultural exports have fallen from a high of $43 billion in 2013-14 to $39 billion last year, while agricultural imports have risen from $14 billion to $23.5 billion during this period.
“It is the biggest jumla ever,” said Ashok Dhawale, characterising the BJP’s manifesto promise more as a rhetorical flourish than sincerely intended. A medical doctor by training, Dhawale who is president of the All India Kisan Sabha (a Communist Party of India union), organised the eyeball-grabbing and heart-tugging 'long march' of tribals and farmers from Nashik to Mumbai in March last year.
Dhawale says farmers’ incomes have 'halved' in the past five years. He is exaggerating, but has a point. In the past five years, wholesale inflation in food articles has been lower than rural consumer price inflation. Since farmers sell wholesale and buy retail, their incomes have been compressed. Growth in rural wages has also been weak, because demonetisation and the Goods and Services Tax (GST) shrank the construction industry, which absorbs a lot of rural labour. They have taken a hit also from the decline in labour-intensive exports.
According to the financial inclusion survey conducted by the Nabard, the rural refinance bank, the average monthly income of a rural household in 2015-16 was Rs 8,931. Assuming it is Rs 10,000 now (Rs 120,000 a year), agricultural economist Ashok Gulati says annual growth in farmers’ income in inflation-adjusted terms for the remaining four years should be almost 15 percent for their incomes to double. This is impossible to achieve, he says.
But the goal of doubling farmers’ income from the current levels, say within the next six years, is a lofty but worthwhile ambition. In an interview after the Prime Minister’s 2016 announcement, Trilochan Mohapatra, the Director-General of the Indian Council of Agricultural Research (ICAR) called it a 'paradigm shift', Ever since the Green Revolution which began in the mid-1960s, India’s focus has been on increasing agricultural production and keeping food prices low. Agricultural policies have suppressed the incomes of farmers; they have subsidised consumers.
“Until we are given market freedom and technology freedom our incomes will not rise,” says Anil Ghanvat, president of the Shetkari Sanghatana. The Maharashtra-based Sanghatana’s founder, Sharad Joshi, who died in 2015, was a votary of globalisation and free markets. He asserted that farmers wouldn’t need subsidies if their incomes weren’t suppressed.
Ghanvat, an agricultural sciences graduate who practices farming in Ahmednagar district, is disappointed with the government’s reluctance to permit genetically-modified (GM) crop technology. Insect-resistent GM cotton has made India the largest exporter of cotton. GM soybean, he says, would increase productivity (and reduce the unit cost) by curbing losses owing to pest and weed damage. GM mustard recommended for release by the Genetic Engineering Approval Committee (GEAC), the regulatory body, would reduce India’s dependence on cooking oil imports.
Cotton farmers, Ghanvat says, have made their preference felt for GM technology by planting herbicide-tolerant cotton illegally over large tracts. With GM maize, India could compete for markets in the neighbourhood.
The new pest, Fall Armyworm, which is ravaging the maize crop would need GM technology to control it, says Usha Barwale Zehr, the Chief Technology Officer of Mahyco, a seed and GM traits company. But this government has acted at cross-purposes. It is obsessed with traditional and organic farming and reluctant to approve GM technology. Being land intensive, organic agriculture cannot provide enough food for an enlarged population. While remote, hilly and dry land areas that cannot profitably practice chemical-intensive agriculture are suited for it, without marketing support farmers won’t find organic agriculture viable.
The enforced reverence for the cow is disrupting the cattle economy. Pushpendra Singh of the Kisan Shakti Sangh says restrictions on cattle trading have destroyed cattle wealth on a grand scale. Stray cattle have forced extra costs on fencing and crop-guarding on farmers.
Ganvat calls for an end to the distortion in agricultural land market. Currently, only those whose families have practised agriculture in any of the past three generations can buy farm land. They cannot own more than 18 acres of wet land or 54 acres of dry land. This is discriminatory because the ceiling does not apply to non-agricultural land. Consequently, agricultural land values are depressed.
Companies are dissuaded from getting into agriculture. If they did, either by buying farms or leasing them, productivity would rise and the numbers dependent unprofitably on agriculture would shrink.
Barun Mitra of the Liberty Institute had drafted a ‘Farmers’ Manifesto for Freedom.” The institute champions small government and property rights. Agriculture, he says, has been shackled by laws. It is a sector that has seen the least reforms. Rather than enact more laws, like the one to allow long-term farm leasing, Mitra says, we need to repeal the law that makes the tiller the owner of the land.
Ganvat believes nationalised banks have kept unprofitable farmers in business as they are mandated to lend by fiat. Repeated loan waivers have destroyed credit discipline. If the government withdrew from banking, private lenders would move in to finance only those farmers who have the revenue streams to repay their loans.
Good policies but whither implementation?
The Narendra Modi government has crafted some good policies but has faltered in implementation. The migration of mandis to an electronic platform and connecting them nationally was necessary to promote competition and better price discovery. But without developing standards for agricultural produce, and installing assaying, grading and third-party certification facilities at the mandis, remote buying and selling is not possible.
Based on his 33-years of experience in agricultural lending, PVS Suryakumar, Chief General Manager (Karnataka), Nabard, says the agricultural extension service needs a revamp. The Krishi Vigyan Kendras (KVKs) must be well-funded and staffed with motivated people so that they can demonstrate the latest varieties of seeds and the agronomic practices needed to unlock their yield in farmers’ fields. Expecting farmers to visit the KVKs for advice is futile, he says.
State agricultural universities should develop packages of practices that are not broad spectrum but tailored for the agro-climatic zones within a state.
The government’s response to the spike on the prices of pulses shows it can act purposively when faced with a crisis. In the last quarter of 2015, the price of tur shot up to Rs 8,798 a quintal—nearly double the price prevailing in the same quarter the year before. That of urad rose 80 percent between the two periods. The price of a quintal of chana at Rs 8,553 in the last quarter of 2016 was 87 percent higher than the year before.
Following a public outcry over high dal prices, the government directed seed hubs to be set up in the 150 main pulses-producing districts to produce quality seeds of higher-yielding and disease-resistant varieties. Seed varieties that were more than 10 years old were ineligible for subsidy. It helped that researchers had already developed the desired varieties. They only needed policy support to propagate them.
The central and state governments stepped up procurement of pulses to incentivise farmers. From a situation of scarcity, the country is moving “towards self-sufficiency in pulses,” said Narendra Pratap Singh, the Director of the Indian Institute of Pulses Research.
Doubling farmers’ inflation-adjusted income from the current levels, say in six years, will be possible if the government acts in mission mode. Trade distorting and environmentally damaging subsidies will have to be smartly re-jigged to protect vulnerable farmers and make investments in irrigation, roads and electricity. The agriculture ministry will have to be empowered. It should be a coordinator of ministries infused with a common purpose. The minister will have to be a doer with political heft. Otherwise, the promise of doubling farmers’ income will indeed be hollow.
(The author is a senior journalist. He blogs on www.smartindianagriculture.com and tweets @smartindianagri)
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