New Delhi: The agriculture sector, which remained in distress during 2018 as crop prices slumped due to bumper production, will be in the spotlight in the new year as the BJP-ruled central government is set to roll out a big package to assuage the angry farming community ahead of the general elections.
The proposals being considered range from waiving off interest for farmers who repay crop loans on time to lowering the insurance premium and providing income support for meeting input costs, according to sources.
During the year, the Centre did take several measures to address the farmers' issues.
One of the major decisions was to fulfil its 2014 poll promise of fixing the minimum support price (MSP) at least 1.5 times the production cost, even as critics questioned the method adopted to ascertain costs.
The government also announced a Rs 15,000 crore 'PM-AASHA' scheme to ensure that farmers get the MSP as part of its objective of doubling farmers' income by 2022. Various incentives were given to sugar mills to help them clear arrears of sugarcane growers.
Agriculture credit target was raised by Rs 1 lakh crore to Rs 11 lakh crore for this fiscal. Import duties were raised on many goods like edible oils and pulses while exports incentives were given for items like sugar and onions to protect farmers.
Despite these steps, farmers continued to face the challenge of selling their produce at remunerative prices in both domestic and international markets.
In fact, farmers' financial crisis deepened during 2018 as an all-time high production of foodgrains at nearly 285 million tonnes and bumper output of oilseed, sugarcane, cotton as well as horticulture crops led to a decline in market prices. The prices of many crops fell below MSP as well as input cost.
Reports of farmers dumping their produce on the streets or selling at throwaway prices were common through this year. Some cases of suicides were also reported.
Droughts in several parts of states like Karnataka, Andhra Pradesh, Maharashtra, Jharkhand, Gujarat and Rajasthan only aggravated the crisis.
Farmers marched to the national capital more than once this year and held massive protests in many parts of the country to share their plight and make various demands, including better crop prices as well as loan waiver.
While the BJP-ruled central government ruled out a loan waiver, the opposition Congress did promise the same during the state elections held this year.
The Congress achieved success in four states -- Karnataka, Madhya Pradesh, Rajasthan and Chhattisgarh --- largely riding on the promise of farm loan waiver.
The poll promise was implemented within days of the new governments taking charge in these four states, putting pressure on the Centre to take more pro-farmer initiatives.
With general elections due in the next few months, it is certain that the BJP-led NDA and the opposition parties will engage in one-upmanship in wooing farmers and promising dole outs for securing their crucial votes.
The Centre is expected to soon announce a relief package for farmers, while the Congress will, in all probability, promise to waive farm loans at the national level, as it had done before the 2009 general polls.
However, former agriculture secretary S K Pattanayak, who retired recently, did not agree with the prevailing view of the sector being in large-scale distress.
"Distress cannot be there when there is more production. It is a question of some deprivation. Farmers may not have got expected prices," he said.
"There may be distress in pockets because of failure of crops and borrowing at a higher rate. These local problems are not new in the sector and it always existed. That should be isolated from the general distress," Pattanayak said.
Stating that farm loan waiver is not the long-term solution, he said: "If the government has the capacity to give farm loan waiver, it is good. If it is at the cost of cutting the budget elsewhere, then it is not necessarily the best thing to do."
Ashok Dalwai, chairman of a high-level committee on doubling farmers' income, said the government realises that the challenge lies in marketing and has taken several initiatives from the long-term perspective, which will show results in due course of time.
He said farmers distress is a "sensitive subject" and the opposition parties are bound to raise it in an election year.
"But the government has taken several steps. It has done so much that it has to just reach out to the people," Dalwai said.
In short, it looks like politics over agriculture will play out in a big way in 2019 general elections, given that farm sector absorbs half of the country's 1.3 billion population.
Politics apart, farmers will definitely need hand-holding from both the central and state governments as foodgrains production is expected to be bumper in 2018-19 crop year (July-June) as well, limiting any chance of improvement in prices.
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Updated Date: Jan 14, 2019 12:30:21 IST