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| India's killing fields | | | Paranjoy Guha Thakurta
Schemes to pro
vide income insurance linked to crop prices has not yet taken off. The plan to pay farmers if their income falls below a certain minimum level is heavily weighted against the interests of small farmers.
It's a huge story. And it's not getting the kind of media attention it deserves. It's a story about India's farmers. It's a story about the ongoing agrarian crisis in the country in the wake of two successive years of drought. If one looks only at the figures of growth of gross domestic product which tend to make headlines in financial publications, there's no story for agriculture comprises 16-17 per cent of GDP. But this is a blinkered view. The picture is pretty grim and here's why.
At least 270 out of the country's 641 districts spread across 18 out of the 29 states have received deficient rainfall in recent months.
Official data put out by the India Meteorological Department and the Union ministry of agriculture for the period between June and September indicate that the shortfall in precipitation from the normal long-term average is 14 per cent across the country. However, the deficiency is as high as 50 per cent in Nagaland and 46 per cent in Uttar Pradesh, the most populous state where one out of six Indians live. Other states with deficient rainfall include Haryana (38 per cent) Punjab (32 per cent), two of the country's most agriculturally prosperous states, besides states like Bihar (28 per cent), Maharashtra (27 per cent), Kerala (26 per cent), Karnataka (20 per cent) and Telangana (20 per cent).
In 2014, the rainfall deficiency was around 12 per cent and this resulted in a fall in the total output of cereals by 4.7 per cent. Experts believe that during the current fiscal year the rate of growth in farm output would be negligible - possibly around two per cent. Simply put, over half the country is currently experiencing drought-like conditions.
This is the fourth time in more than a century that India is experiencing back-to-back droughts. Half the cropped area in the country is dependent on the monsoon. And even in areas that have irrigation facilities, the situation is far from comfortable. In early-September, water levels in reservoirs were at their lowest in a decade (at 84 per cent of the average). This is particularly worrisome as winter (or rabi) crops are heavily dependent on water from reservoirs and account for nearly half the total output of rice and wheat.
In central Maharashtra, notably in the Marathwada region, the shortfall in rain has been as high as 40 per cent. Nearly 600 people have killed themselves in this region alone over this year. An important reason for the agrarian crisis in the state is the skewed crop pattern is favour of water-guzzling sugarcane.
Ajay Jakhar, who heads Bharat Krishak Samaj, points out in Farmers' Forum (October-November 2015): "Sugarcane farmers consume about half of Maharashtra's water but farm only six per cent of the land. Governments in the past have promoted such policies as political expediency has taken precedence over farmer lives."
What has been done to alleviate the crisis? Various schemes have been announced by the Central and state governments but their implementation has been uneven. Prime Minister Narendra Modi, after having publicly trashed the Mahatma Gandhi National Rural Employment Guarantee Act in the Lok Sabha on March 4, has agreed to allow additional days of work under the Act to families in drought-affected areas.
Diesel and seeds have been subsidised, interventions have been made to save horticultural crops, provide fodder to cattle and allocations under the Rashtriya Krishi Vikas Yojana have been made flexible.
However, schemes to provide income insurance linked to crop prices has not yet taken off.
The plan to pay farmers if their income falls below a certain minimum level, calculated by multiplying the average yield in clusters of villages using the minimum support prices fixed by the government, is heavily weighted against the interests of small farmers. As Mayank Bhardwaj and Ratnajyoti Dutta of Reuters pointed out in their despatch: "...shortfalls would be based not on individual farmers' yields but on those across a wider area, influenced by the higher yields of rich farmers able to afford better fertiliser and pesticide. So a farmer will get only the same compensation per hectare as others who may have had far higher yields."
They added that existing insurance plans based on just crop yields or weather damage barely cover one-tenth of the country's 263 million farmers. Further, payouts are made into bank accounts and large numbers of farmers are yet to come under the ambit of the Prime Minister's favourite scheme for financial inclusion, the Jan Dhan Yojana. Moreover, unlike in countries like the US, in India crop losses are not assessed using satellite imagery or drones but based on estimates made by government officials that are often less than accurate and discretionary.
Whereas inflation on the while has been rather benign thanks to the fall in world prices of crude oil, prices of particular agricultural products have spiked. Over the last year, the prices of a number of pulses (tur, urad, moong and chana dal) have shot up by between 50 per cent and two-thirds, largely on account of a fall in production by nearly two million tonnes from 19.25 million tonnes between July 2013 and June 2014 (the crop year) to an estimated 17.38 million tonnes in 2014-15.
The rise in prices does not match the fall in output. On June 10, the Cabinet approved the import of lentils in "whatever quantity is required". In the days before and after the decision, world prices of pulses shot up by 30-40 per cent.
Unlike pulses, over the last year and a half, the prices of a wide range of agricultural commodities have come down by proportions varying between 25 per cent and 75 per cent. These include cotton, sugarcane, paddy, wheat, potato and rubber. This indeed has been the perennial complaint of India's farmers. When they produce more, prices fall and they don't gain. But when output falls, the government intervenes to protect the consumer (often by subsidising imports) and the farmer loses once again.
This government, like the earlier one, has failed to get its act together by ensuring that various ministries and departments are able to balance the interests of farmers and consumers.
(Courtesy: Asian Age) |
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