The Soul Of Small And Marginal Farmers: Get Us Remunerative Prices Only!

It was before the onset of corona pandemic in India when the research students of Banaras Hindu University were surveying farmers of Uttar Pradesh and Madhya Pradesh for their agriculture marketing project oriented towards supply-demand management and development of income maximization strategies for farmers.

Well researched about all agriculture policies and the state-of-the-art agriculture technologies, they were planning to discuss the prevailing grassroots-level problems of Indian agriculture that contributes 41.49 per cent of total employment (source: The World Bank). Doors were knocked from places to places, some agreed to listen while others decided to shy away. Those who entertained asked right off the bat “Kis liye aye hain? Hame ab aur gyan nahi chahiye (Why have you come? We don’t need any more suggestions.”

At first, this seemed idiosyncratic but as the interaction passed by, we realised that their enthusiasm and endurance in farming is debilitating. Many policy reforms and marketing initiatives are not that much effective to improvise socio-economic standards of mainly small and marginal farmers (SMF) in India comprising nearly 86 per cent of total farmer base. Conclusively, the summary of their responses revealed that the need of the hour is not cutting-edge technological implementation but the formation of a more robust mechanism for the remunerative price of their produce.

In business, the bottom line of any organisation is profit-making to sustain in the dynamic market which also holds true for farmers. These SMF majorly rely upon traders at the farm gate or wholesale market (Mandi) for their crop valuation due to poor storage facilities and associated financial capacity to store. Some of the farmers decided next crop cultivation solely based upon previous returns as the major chunk of agriculture returns has to be invested back on the fields. Much of disillusionment for farmers is because of trading of their crop at a high price in the market by traders or stockists that ironically indicated that farmers strive for the development of intermediaries in agriculture supply chain of India.

The Modal APMC Act, 2003, has given liberty to license holding traders in the market to form a cartel and procure at a low rate from farmers. Notably, the issue is not with Mandi Modal Act but with unfavourable outcomes of cartels prevailing in the agricultural market. These stockists shrugged off the stringent law for stock limit by storing bulk purchase from farmers at the house of farmers itself by providing them facilities so that they could trade these procurements at high-value markets anywhere across India.

Now after hearing the voices of farmers, it would be appropriate to discuss ground to newly passed agricultural farm bills by Parliament. The first bill that will endorse more direct trading in India is open the sphere of opportunities for farmers so that they could choose the buyer of their harvest anywhere across India i.e. more negotiation power to farmers. Undoubtedly, this will retch down the revenue of mandi board across India but this will improve the economy of small and marginal farmers provided that they can utilise the provision in a fair fashion.

Because now traders will openly procure from farmers without any boundary restrictions and there is a high probability that their cartel may also properly operation from here on. So, how efficient this bill would be, and would this get us (farmers) remunerative price?

The second bill will open more legal opportunities for contract farming to hedge against volatile agriculture market that will transfer more of risk from farmers to contract farming agencies or sponsors. Union agriculture minister Narendra Singh Tomar has assured that there would be fair and seamless grievance redressal mechanism in case there is any dispute among farmers and contractors. So, will our voices (farmers)have heard immediately in case of a dispute?

And finally, the third bill of essential commodity act has provision for no restriction on stocking limit to allow entry of more industries like Reliance Fresh, ITC, etc so that they could directly procure from farmers at farm-gate. The bill makes it crystal clear that there would always be a government body to supervise misuse of stocking to avoid any ill-treatment of the bill. The effectiveness of this bill will require a transparent well-functioning department else the bill will, even more, aggravate the status quo of farmers. So, would there be any imperative changes due to this bill in our (farmers) status: like better returns, protections against any rapacious traders, more transparent market information?

But as in every marketing transaction, both parties must be satisfied, would there any implication of the above-proposed bill in the consumer market? Would there would any government eye on food price inflation? The ground implementation of these issue of much-needed attention would be clear once the agriculture market will outright adopt these reforms. Price volatility is an indomitable enemy of both farmers and consumers as former one still fetches low share while later one pays a major share of price spread.

At present, there are undergoing numerous researches and policy formation in agribusiness development such precision agriculture, AI-enabled farming, drone technology and crop-climate responsiveness and many more, there would be more research scholars surveying farmers about their problems for the design of better advisories but the voice of farmers even behind the closed doors would be same ---. first, get me remunerative prices somehow and keep these technologies in your research labs. Largescale farmers are usually unaffected from these adversities unless there are any mass-scale calamities because they have access to scientific storage facilities and market access.

But small and marginal farmers having no storage facilities and market access remain with distress sales. These farmers don’t aspire for development such as better seeds, methods to improve productivity, climate-dependent crop plantation planning because there is only voice from them, “Will it surely get the remunerative price?” They have to bear both production and price risk, and how can we expect their expertise to manage both of them on their own when even big corporates come to cropper under risk intensive markets. So, any work in the field of agriculture development shall certainly start will the objective of better remunerative prices and shall be conveyed to farmers only when it could answer the VOICE of Major Indian Farmers.

We would personally like to extend gratitude to Prof. Rakesh Singh and Dr Arun Kumar Deshmukh of Banaras Hindu University for their contributions to the composition of this article.

Chandra Kant Singh is currently a JRF at department of mycology and plant pathology, Institute of Agricultural Sciences, Banaras Hindu University (BHU).

Prateek Kumar Tripathi, MBA graduate, BHU.

(Views are personal, and do not necessarily reflect those of Outlook Magazine)