Harvesting miseries

In the aftermath of unseasonal rains, hailstorm and strong winds that ripped through the wheat-growing belt in March-April, there appears to be a renewed focus on agriculture. With Prime Minister Narendra Modi repeatedly telling the nation that he is aware of the terrible agrarian crisis in which farmers operate, it appears that the thrust of the economic reforms has shifted to agriculture. 

So much so that at the launch of a television channel exclusively for farmers, the Prime Minister asked farmers to increase foodgrain productivity in order to raise farm incomes. In addition, he has time and again reiterated his government’s intention of helping the poor with the launch of a few insurance schemes, which will provide accidental and life coverage.

But, when it comes to raising farm incomes, the Prime Minister hasn’t spelled out any definite programme or approach to provide an economic bailout package to farmers. Ever since the Modi government assumed office, farmers have been at the receiving end — first from the drought in kharif 2014 that led to a drop of 12 per cent in production; and then by unseasonal rains in March/April that left farmers battered. With El Nino likely to show its fangs, climate experts are pointing to an extended period of drought in the coming monsoon season. 

With just Rs50 per quintal increase in the minimum support prices for wheat and rice, and considering a global crash in prices of agricultural commodities that left cotton and basmati gasping, I was expecting the government to come up with at least Rs1.5 lakh crore economic bailout packages for farmers. After all, if Rs3 lakh crore bailout packages can be extended to the industry after the economic meltdown of 2008-09, farmers, too, need financial support when the chips are down globally. I don’t understand why one sector of the economy should be discriminated while the other walks away with all the benefits.

This assumes importance at a time when farm incomes are being deliberately kept low to ensure food inflation does not rear its ugly head and also to provide cheaper raw materials for the industry. Some years back, in the early 1990s, I read a report of the Commission for Agricultural Costs and Prices (CACP), the body that determines the minimum support prices for agricultural commodities. This report for the kharif season clearly stated that cotton farmers were deliberately paid 20 per cent less price for over 20 years so as to keep the textile industry economically viable. In other words, what we are never told is that actually it is the cotton farmers who had  been subsidising the textile industry all these years. 

A few months back, cotton prices crashed from Rs4,500-Rs5,200 per quintal to about Rs3,200 per quintal. Since the cotton farmers had subsidised the textile industry all these years, I had expected the rich and powerful textile industry to come to the rescue of cotton growers in this hour of need. This could have been the best PPP model the country would have seen. But it didn’t happen. Farmers were left to count their losses. 

The 2014 report of the National Sample Survey Organisation (NSSO) tells us that the average monthly income that a farm family derives from farming activities is a paltry Rs3,078. To make ends meet, a farm family has to work in some other non-agricultural activities, including MGNREGA. That makes for an average of Rs6,000 per family per month. No wonder, 58 per cent farmers go to bed hungry, and 76 per cent want to quit agriculture if given a choice. The primary reason is the policy to keep farm prices low to avoid any repetition of the onion prices hitting the roof. In other words, farmers are being penalised for keeping food prices low for consumers. This is gross injustice. 

It is primarily for this reason that agriculture appears to be a losing proposition. Planners and policymakers, therefore, advocate that farmers be moved out of agriculture. Forcible land acquisition is being justified in the name of a better economic future for the farmers. I have heard the Finance Minister say time and again that he is supporting industry simply because the revenue he gets from the industry is what can be invested in rural areas. Industry has been given tax concessions to the tune of Rs42-lakh crore in the past 10 years, beginning 2004-05, to prop up industrial growth, manufacturing output and boost job creation. Nothing of the sort has happened in agriculture. 

This skewed economic thinking is leading to policies that push farmers out of agriculture to swarm into the cities. It is expected that in another 15 years, by 2030, nearly 50 per cent of India’s population would be living in the urban centres. These cities and towns would occupy approximately 2 per cent of the country’s geographical area. To me, this is not only economic madness, but also speaks volumes about the lack of political and scientific vision. With such massive translocation of population, living in the cities will be like staying in ghettoes. Already, 60 per cent of Mumbai’s population lives in slums, and these slums occupy 8 per cent of Mumbai. 

The economic approach, therefore, has to change. It should aim at making the rural areas economically viable. Instead of pushing the rural population out of agriculture, the thrust should be to provide gainful employment in the countryside. It has to begin with providing the right kind of economic incentives to farmers and others living in the villages. Farmers, too, are entrepreneurs, and the younger generation in villages, too, can become start-ups. All they need is policy support. This has to be accompanied by public sector investments in the villages. So far, the effort has been to keep the countryside starved of resources. In the 12th Five-Year plan, only Rs1.5 lakh crore has been invested in agriculture. This is a pittance considering 60 crore people directly or indirectly survive on farming. How long can India afford to keep farmers impoverished?

The author is a food policy expert