26 June 2017 National Agri Crisis

Demo And Other Demons In The Barn

The fresh farmer fury has a lot to do with demonetisation, bumper crop and a glut
Demo And Other Demons In The Barn
Photograph by Tribhuvan Tiwari
Demo And Other Demons In The Barn

A bountiful harvest this time has left grave sickle marks across those into agriculture. It is, typically, a problem of ple­nty. Even as the government celebrates a record production of foodgra­INS (273.38 million tonnes) and horticulture produce (295 million ton­nes) after two years of drought, farmers in general are in the doldrums. The community is resenting in rising numbers in several states against low price and growing indebtedness.

Some administrations have responded empathetically, but failed to humour the aggrieved. Uttar Pradesh and Maharashtra have promised loan waivers, while Madhya Pradesh has assured to make ‘criminal’ any purchase of farm produce below the minimum support price (MSP). Nothing has calmed the farmers.

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In the aftermath of an early-June police firing that killed five people in Mandsaur in central India, the farmers are in no mood to relent. They are planning different modes of protest. For instance, Rajasthan may witness a bandh with farmers not selling milk or vegetables and even boycotting public transport, according to the Kisan Mahapanch­ayat. “Our aim is to impact the economy,” says the organisation’s president Rampal Jat, after a daylong meeting with fellow farmer leaders. “Good government policies could have stopped middlemen from exploiting us. Politicians, bureaucrats and the middlemen are working in tandem to ruin farmers.”

Demonetisation left farmers with few takers for their bumper harvest. Prices of crops plunged by half in some areas.

Farmer leaders strongly feel the gover­nment policies are aimed at driving the youth, in particular, out of agriculture through bad returns. Yet, rural youth are unwilling to give in easily, claims the Aam Kisan Union. “The youth in rural areas are coming together over two issues: remunerative price and sustainable employment,” says the non-political outfit’s founder Kedar Sirohi, underlining that input costs are going up even as low prices are leading to diminishing output. The scenario clashes with the growing aspiration for better education, healthcare and home, besides a desire to improve farm yield with better seeds and technological inputs.

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Every year, in at least a few states, farmers come out on the streets to seek fair and remunerative price (FRP)—be it for sugarcane, cereals or cotton. Periodically, the government heeds their dema­nds to hike the FRP for certain commodities or raise the MSP for crops like rice and wheat. But as the government data reveals, not even 10 per cent of the farmers get the minimum prescribed prices. Reason: out of 24 commodities for which MSP is fixed, government procurement is done only for a few produces such as wheat and rice, that too only in a few states. The MSP gathers force for commodities like cotton and pulses only in times of extreme price fluctuations like a sharp drop in the prices of lentils like tur and urad in the last few months.

The Kisan Jagriti Manch says the farmers’ stir is an outcome of un-kept BJP promises made ahead of the May 2014 gene­ral elections. “This movement is not led by any leader but by farmers who feel cheated by the government’s failure to keep poll promises,” states Sudhir Panwar, president of the Manch.

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The present NDA government told the Supreme Court that it was not feasible to implement the promised 50 per cent margin over input costs as recommen­ded by the M.S. Swaminathan commission. Even the promised Rs 500-crore price stabilisation fund, initially for all crops, was finally allocated only for onion. That, when its prices plunged and some farmers started tilling it back into soil rather than incur further losses by spending on harvesting. It is the mounting losses, particularly in small-scale farming, that is leading more farmers to voice protest.

The call for farm-loan waiver took root when Prime Minister Narendra Modi went the whole hog with promises galore to win the recent UP assembly elections. Many wondered aloud how the PM can promise loan waiver for one state when farmers elsewhere too were facing similar plight. This further triggered the clamour for loan waiver, though many farm leaders privately admit it is not the solution they are seeking.    

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Ajit Singh Gujar, Rajasthan state leader of Kisan Mahapanchayat, states farmers don’t want subsidies or reham (charity). “The government should just pay our rightful dues,” he says. “We listened to your (government’s) needs and boosted productivity through investment in best seeds.” While farmers like Gujar bought bajra seeds for Rs 400 a kg, the harvested crop is today selling for just Rs 1,000-1200 a quintal in the mandi. “In the ­mandi auction, the middlemen buy the produce below the MSP, yet the government doesn’t take any action,” he stresses.

Government data and expert studies indicate that un-remunerative prices and growing debt burden have driven over 3.5 lakh farmers to commit suicide in the last two decades. There are no signs of farm distress decreasing despite government schemes like crop and wea­ther insurance promising a certain protection. There appears a wide gap bet­ween government schemes and their implementation. Take pulses, for insta­nce. As it sold for over Rs 200 a kg in retail last year, the government encouraged higher cultivation. Yet, ahead of the harvest, large quantities of pulses were imported to create a buffer stock.

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The demonetisation on November 8 last year left farmers with few takers for their bumper harvest. That led to a plu­nge in prices by over half in some areas, while no government agency was ready to step in. It was only on the insistence of some states that the Centre started procurement, bringing some relief to farmers. On the other hand, farmers in Raja­st­han have been waiting for similar government action to prop up the prices of mustard and groundnut months after the harvest. The situation reflects government policies, considering that India depends heavily on imports for its edible oil requirement and yet there is no incentive for oilseed crops.

Dr T.N. Prakash, chairman of the Farmers Commission, Karnataka, says ad hoc government policies and faulty orientation have further complicated agriculture-related issues. At the consumer end till recently, the issues were high prices and food inflation, he notes, even as reasonable profit margin remains a problem for the same commodities at the producer end. Complicating the issue, the pricing is looked at from the farmers’ viewpoint at the state, while the central government always looks at the consu­mer point of view.

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Dr Panjab Singh, president of National Academy of Agricultural Sciences, stro­ngly feels the farmer is always made a target. “The 1990s era of liberalisation and reform bypa­ssed agriculture. Even now we merely do fire-fighting,” he says. Stressing that loan waiver is not a solution as it would lop off 2 per cent from GDP growth as poin­ted out by economists, Singh says currently “our problem is production versus distribution and availability, food security versus food nutrition, and food production versus food protection”. For, annually 10 per cent of foodgrains and around 25 per cent of horticulture produce get wasted due to poor handling and storage.

Prof Mahendra Dev, who headed the Commission for Agriculture Costs and Prices in 2008-10, attributes the present farm crisis to the failure of the market system. It could be rectified if the government steps up procurement of not just pulses but also other commodities like chilli, he notes. “Reduced tariff for imports has hit domestic prices. The government’s attempt to clamp down on inflation through imports has also contributed to the deflation,” says Dev.

Prices of most commodities is half or even less this year partly owing to—as Dev notes—global trends and a weak domestic market infrastructure. In the absence of proper storage, logistics and market infrastructure at the local level, the farmers don’t get the right price when the production is high. Another good summer monsoon is forecast for this year. Yet the government is dragging its feet in announcing the MSP for the kharif crops (till October), normally expected three months before the sowing season, as it helps farmers make an informed choice.

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