Agriculture in India dates back to the Indus Valley Civilization. South India had farming even earlier to that period. India is primarily an agrarian economy by any definition. According to a recent survey, the country has 90.2 million agricultural householdswhich consists of 58 percent of the total population.Agriculture contributes some 27 percent to the GDP.The primary sector provides employment to a little over 70 percent of the population.Agriculture covers more than 50 percent of the total geographical area of India. Sadly there are some 86 percent marginal farmers in India with small and tiny land holdings. Demographically, agriculture is the broadest economic sector.In 2013 India exported $ 38 billion worth agricultural products.Thus India became the 7th largest exporter to 120 countries.
It plays a critical role in the overall socio-economic fabric of India.In 2018, agriculture employed more than 50 percent of the workforce and accounted for nearly 20 percent of the GDP.
India is witnessing a very different type of mega farmer drama enacted in the national Capital of the country. It is unfortunate and at the same time an eye opener to all stakeholders and particularly to Government.
The Joint Farmer Movement (SKM) is a Federation of 500 farmer organizations, spearheading the agitation based on agricultural discontentment in India. It is of paramount importance as the latest number of farmer suicides stands at 3. 75 lakhs. Sordid vested interest groups are trying to depict it as only a local protest of farmers form Punjab and Haryana.In fact it’s the collective voice of some 14 crores of farmers from the whole country.The recently enacted Farm Bills is the core issue. The new regime would adversely affect the system of procurement under MSP, among others.It may become a ground for the free play for corporates. The demand for ensuring farm prices at least 50 percent more than inputs cost is the real issue. Would it be implemented, is the moot question! The inclusion of the rental value of land in the inputs cost is another issue. Agriculture must remain environmentally sustainable and at the same time remunerative for the producers. The current protest is therefore, neither ill-informed or motivated by external forces as alleged.Nonetheless, Hon Amit Shah did never brand it as a politically motivated agitation.
let us now examine the 3 farm bills in detail.
Liberalisingaccess to agricultural produce markets is the first close to be understood. Removing the existing barriers of storage of produce is the second bill. The third one is about facilitating contract farming.
We must understand the background of the farmer concerns to begin with. The total area under food crops run into millions of acres in India as pointed out earlier. States like Punjab and Haryana together account for nearly 35% of the land under cereal crops. In Punjab alone nearly 100 lakh acres are under food crops.Out of this nearly 99% is irrigated. Tubewells and borewells constitute the major source of irrigation. The average area of a farmer under plough –average holding size-is around 10 acres. In Punjab alone some 75 lakh acres is cultivated under Paddy and another 70 lack acres under wheat, apart from maize and cotton .Very interestingly much of the sought after basmati rice is cultivated in some 15lakh acres. The productivity per acre in Punjab for paddy- rice and wheat is nearly 7 to 9 tonnes each per acre. Compared to international standards, Punjab is quite at par with the others. Nearly 100 lakh tonnes of rice and 130 lakh tonnes of wheat are procured by FCI every year. The major share of central pool of the Government of India is accounted by Punjab alone. If you take it at the national level the Punjab farmers contribute nearly 35percent to the Food Corporation of India. FCI pays to Punjabi farmers Rs.60,000 crores per annum.This means on an average Punjabi household makes a littleover Rs 23,000 per month from agricultural operations. In a way that explains the higher standard of living even in the villages in Punjab.
Why the farmers are scared of the new Farm Laws? The major concerns of the farmers include the following namely minimum support price. Would the farmers be forced to market the marketable surplusto the private traders. Would they face distress sales?
Another concern is once the supported and controlled marketing system becomes weaker or obsolete, the private sector may take the farmers for a ride. Currently the APMCs—Agricultural Produce Marketing Committees- are doing a commendable job.
There are some 6700 APMCs in India covering a wide spectrum of agriculturalactives. Taking into account the number of districts at 781 in India, for catering the needs of 14 crores of farmers, logically we need 42,000 APMCs.
In the absence vibrant and effective MPMCs, the farmers market in distress markets their marketable surpluses. For instance while the MSP of paddy is Rs 18, the Assam farmer sells it for Rs 5 to 6 and goes as seasonal migrant workers in states like Kerala, who owns and operates 20 to 30 acres of paddy growing land in his home village.This is another topic of a case study.
Admittedly the APMCs are to be revamped for making them leakage free. Here the government should have focused ,instead of going for introducing many bills in Parliament.Sadly it is forgotten that agriculture is a state subject under the constitution of India. The union government has no mandate to legislate on agriculture.
The supply of power and the provision of free electricity to the farmers maybe another setback to the farming communityunder the new law. Stubble burning , immediately after the harvest is considered as a big environmental challenge and it attracts heavy penalty on the farmers. Unless bio degradable waste management is practiced on a large scale within the minimum possible time , this problem remains a major challenge.One must understand that within 45 days after the harvest of paddy , the farmers in Punjab sell approximately 150 lakh tonnes of Paddy . These markets have got well established infrastructure facilities like quality control, packaging, etc.Surely the APMCs needs much more strengthening.
In fact this is an amazing act in collective marketing. Farmers in Punjab remind us a success story ofconnectivity and collective bargaining power . It is an amazing case study material for IIMs or even Harvard. In Punjab, rural and semi urban areas are experiencing great activity boom during the sowing season and the harvesting season. Post-harvest technology is in its highest form ensuring maximum returns to scale in agricultural operations.
The farmers are extremely disturbed when they think about the sudden departure oforganised markets . The sudden non-operational situation of Food Corporation of India is totally unimaginable. Surely the farmers have every reason to be upset .
The Way Forward
After having seen the murky state of affairs culminating in the form of farmer agitations of unprecedented magnitude, some policy road map should counsel the policy makers in New Delhi.
- The only way forward is to take farmers into total confidence without attributing motives. Again the state shall not resort to regressive methods to handle farmer agitations .
- Honesty, transparency and sobriety must counsel the government to ensure development oriented all-inclusive approach, welfarism and social justice .
- Peoples participation in the governance is a must for the acceptance of any reforms.
- Repeal of all the three Farm Laws is the only way out. We must understand there were instances in the history like the repeal of British Corn Laws to guide us.Forget not the constitutional provisions . Agriculture falls within the purview of States jurisdiction to legislate laws.
- Appoint expeditiously a task force consisting members of the Farmer Organisations, state governments, NGOs, Think Tanks, APMCs, Union Government representees and the like. The TOR may be drawn up by the farmer organisations, NGOS and Think-Tanks representatives . Our own think-tank, namely SDF—Sustainable Development Forum- is only too happy to facilitate the work of the Task Force.
- The most inhumane of all provisions of the act is the deprivation of the right to appeal for a farmer! Let us therefore, give a decent burial to this farm law. Let the darkness exit with decency. Only meaningful regulations in the form of acts aimed at the common good of the largest majority exhales darkness.
Note: I am immensely obliged to many international professionals like Mr K P Kannan , Former ADB Director; Dr.John Akkara, Former NDDB Scientist; Mr PV Mathew, Former NDDB Management Expert and Mr Harwant Singh , Former General Manger of PNB for sharing their views on a draft note on the theme.