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A Bridge Too Far


tructural change and out-of-the-box thinking are required to realise Prime Minister’s vision vis-à-vis agriculture, says K R Sudhaman
K R SUDHAMAN | Issue Dated: December 5, 2016, New Delhi
Tags : Prime Minister Narendra Modi | Monsoons | Green Revolution | Harsh Kumar Banwala |

Prime Minister Narendra Modi recently unveiled a seven-point strategy to double the income of farmers by 2022. This is a welcome development as agriculture, though an important component of India’s economic development strategy since independence, has not achieved the desired progress, partly because of systemic and inherent problems. It is a plausible and possible target, but one has to be skeptical as it looks impossible to achieve in the short span of six years. In a democratic set up, which has slow polity and different pulls and pressures, achieving such targets needs a herculean effort.

India is endowed with a conducive climate, and one of the most fertile land-masses in the world, particularly the Gangetic plains. Yet, the average yield is one of the lowest in the world. This is not the only dichotomy, there are many more. India has the largest ground water irrigated area in the world, yet nearly two-thirds of nearly 1.6 million hectares of cultivated land is dependent on the weather god – monsoon.

India is among the few countries which has monsoon as a season, being a tropical country and a peninsula, surrounded by two monsoon active seas and Indian Ocean. It starts with the South West Monsoons in Kerala and gets deflected by the Himalayas to come back as North East monsoon down south in Tamil Nadu. This is a unique phenomenon. Yet India has a long way to go in agriculture despite big strides made in the farm sector during the seventy years of Independence.

A modest target of achieving average 4 per cent agriculture growth annually has not been realized so far. The closest India came to this target was 3.6 per cent average annual growth during the 11th five year plan ending 2012, partly because of good and dispersed monsoon for most of the five years.

India has 60 per cent of its land area as cultivable land as compared to 35 per cent of China and 25 per cent of United States. Yet United States has more arable land than India because of modern agriculture and China produces more food grains than India because of much better yield. China has less area under cultivation in food grains, consumes less fertilizer and yet produces more than the double that of India. China produces over 570 million tonnes of food grains annually against India’s 250 million tonnes.

India is among the top countries in use of fertilizers and production of wheat, cotton, rice, fruits and vegetables, milk, pulses, sugarcane and so on. Yet our agriculture is still in a pathetic condition, with farmers' income none too encouraging, land getting increasingly fragmented despite large sections of the rural population moving to urban areas. The main reason is poor water management, and dependence on monsoons. There is much wastage of water and fertilizers as farmer education and training is very poor. India grows water guzzling sugarcane in areas like Karnataka and Maharashtra where it should not be grown and not in areas like north Bihar, which has perennial problem of floods. Rice should not be grown in Punjab and yet it is grown there as returns are good. As a result of this wrong cultivation, ground water level and soil quality has deteriorated in many parts of the country.

Due to politics, the government has not been able to solve the simple Cauvery water issue for over a century. Similar is the case with several other river water disputes among states; and in such scenarios, water management has only become worse.

The problem is one of mind-sets. Several positives that the country is endowed with in agriculture are not being fully exploited due to haphazard development of agriculture. A difficult food situation forced India to achieve a Green Revolution in wheat in the 1960s. Subsequently came the White Revolution in milk and then in cotton production with the introduction of BT cotton. But many other crops where India could achieve much more are ignored because of vested interests. Simple solutions like introduction of genetically modified seeds are not being done to improve yield manifold and thereby raise farmers’ incomes. This is because of false propaganda being carried out by political parties on GM seeds without any scientific reasoning.

Only time will tell if Prime Minister Modi succeeds in this massive challenge, through good strategy, well-designed programmes, adequate resources and good governance.

Modi rightly listed his seven strategies: focus on irrigation, provision of quality seeds and nutrients based on soil health of each field, besides large investments in warehousing and cold chains to prevent post-harvest crop losses. Promotion of value addition through food processing and creation of a national farm market, removing distortions and e-platform across 585 stations have also been proposed.

Nabard Chairman, Harsh Kumar Banwala said Modi’s strategy has evoked interest among a variety of stakeholders – the farming community, scientists, economists, and political commentators, besides the general public. Many schemes have been floated in agriculture during the five-year planning cycles, generally aimed at enhancing production and productivity which would indirectly enhance farmers’ incomes. The policies were usually farm-centric and not farmer-centric. This is one of the reasons why there is farmers’ distress despite the fact that our country has achieved a commendable position in food production.

There is a need to go beyond food security and think of income security. Sixty per cent of marketable surplus in food grains is produced by top 10 per cent of rich farmers. Ninety per cent of farmers hardly produce any marketable surplus. As a result, there is no income security to them despite high MSP. High MSP leads to high food inflation and this hits them hard as well.

For achieving Modi’s objective, Banwala said India will have to devise micro-level action plans to augment farmers’ income from all sources and not just from crop cultivation. Farmers’ income can be improved if and when productivity goes up, the cost of production comes down, and we ensure agricultural commodities produced get a remunerative price through a transparent price discovery mechanism. An integrated approach has to be taken at micro level.

Also, localized solutions are needed rather than a universal approach. Land laws need drastic changes, bank funding has to improve, rural infrastructure has to be created, post-harvest losses have to be reduced, multi-brand retail has to be encouraged, food processing encouraged, and skill of farmers have to be improved. These cannot be done overnight and six years is too short a time.

India’s irrigation-covered crop area was about 22.6 million hectares in 1951, and it has increased to a potential of 90 mha at the end of 1995, inclusive of canals and groundwater wells. However, the potential irrigation relies of reliable supply of electricity for water pumps and maintenance, and the net irrigated land has been considerably short.

According to 2001-02 agriculture census, only 58.1 million hectares of land was actually irrigated in India. The total arable land in India is 160 million hectares. According to the World Bank, only about 35 per cent of total agricultural land in India was reliably irrigated in 2010. These are real problems how government proposed to solve this problem as every state has a problem with neighbouring states with regard to waters. The grand linking of rivers in the country has remained only a dream as lot of politics is played by every state and centre.

Once Principal Economic Advisor in Finance Ministry Dipak Dasgupta was asked what the problem of Indian agriculture is. He said in one word that Indian agriculture has to become “smart”. 

A lot has been done in the last 70 years but the cutting edge development has not happened. The reason has been that a holistic approach has not been taken so far for the development of agriculture. The holding is getting fragmented, Technology has been inadequately utilized. As a result, 60 per cent of the population, still dependent on agriculture accounting for less than 15 per cent of GDP. Average farm productivity is one of the lowest in the world in most of the crops though India's yield of various farm products in pockets has matched the best in the world. This is a paradoxical situation.

If the distribution of monsoon is good, then India’s farm production is good but not because of improved productivity through technology. This season has been the best in the last three years, with only a third of the districts seeing deficiency compared with almost half in fiscal 2015 and 46 per cent in 2014. Importantly, most of the deficient districts are either well-irrigated or not important agriculturally, according to Crisil report. This may bring good agriculture growth this year but the question is are we on an increased farm growth path on a sustainable basis. The answer is clearly no and we are far from it.

Few in India die of starvation, as used to happen in the past during the British Colonial rule. Farmers now commit suicide because of crop failure or due to not getting remunerative price for his produce. High input costs and injudicious use aggravate his problems. Fruits and vegetables go to waste in large quantities because of no development of markets, cold storage and difficulties in inter-state movements. Also, timely credit is not available to farmers. Dismantling the archaic and obnoxious APMC act will benefit farmers besides doing away with ad hoc import-export policy on agri-commodities.

Disguised unemployment is rampant in agriculture in India and it becomes more pronounced during difficult years. One important solution could be to encourage development of rural industries so that sizeable farmers could move out of agriculture and thereby helping farmers to increase their per capita income. This required development of MSME clusters all over the country and that is not happening.

The NREGA programme is a welcome development to help distress farmers during difficult years. But the scheme has been abused badly by middlemen and money has been siphoned off by local politicians. The leakage is so much that it has not served the purpose it is meant for.

These are hard realities of Indian farming; but Prime Minister Narendra Modi's government has at last taken some positive initiatives after it got a drubbing in the Bihar elections. The people in rural Bihar made their voices heard that India is not shining for them yet. The misery of poor farmers is real and one only hopes that the government is able to come out with solutions on a war footing, which at the moment looks far-fetched considering the enormity of the problem.

Now technology is there. In an era of internet, communication is so easy that government can achieve wonders though e-farming and e-learning. Modi has taken a good initiative in crop insurance to end the misery of farmers.

Modi's e-portal initiative announced recently will create national agriculture market, helping farmers get remunerative price for his produce as farmers need no longer sell his produce only in local mandis. There will be much better price discovery for his produce if properly implemented. Encouraging food processing parks in length and breadth of the country will not only bring rural prosperity but also help farmers' get more income.

These are good moves, but the devil is in their implementation. It certainly will have to be a humongous effort to make Indian agriculture smart and prosperous. Like the government’s programme on smart cities, there has to be a massive programme on smart agriculture as well. The need of the hour is a second green revolution, which has not happened in the last 50 years.

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Issue Dated: Feb 5, 2017