Events & Issues

New Delhi, 30 November 2009

Recovery Path

AGRICULTURAL GROWTH VITAL

By Dhurjati Mukherjee

It is heartening to note from recent reports that France and Germany have returned to the growth path which means that now four of the world’s five largest economies and six of the top 10 are not in recession. Most economists had predicted both France and Germany  to face a decline of about 0.3 per cent in their GDP for the second quarter (April-June, 2009), but they surprised the world by announcing a growth of 0.3 per cent. Japan too has climbed out of the recession while China and India are already growing at healthy rates. However, the UK, which is the seventh largest economy and Italy the 10^th largest remain in recession like the US.  

As far as India is concerned, the current year has not been all that encouraging. While surveys have revealed that most industrial sectors have shown positive growth, the cumulative shortfall of around 30 per cent rainfall has definitely affected agricultural production and the GDP has been restricted. In fact, 2009 may be declared a drought year, affecting the rural population in a big way.

The Union Finance Ministry had recently stated that the economy would expand by around 6.5 per cent in the current fiscal despite the insufficient monsoon and the somewhat adverse impact on agricultural output. The growth rate may steadily pick up and accelerate to over eight per cent in 2010-11 and nine per cent the following year. Experts believe that the growth rate this year would have been much higher had the country witnessed normal or near-normal rainfall.

According to the Planning Commission, agriculture production is likely to fall by 14 per cent (15-16 metric tonnes) – the third highest fall in foodgrains production since 1964-65. But these are conservative estimates and actual figures may be more. The rainfall deficit of around 25-26 per cent was the highest-ever in recent times but its impact would be less as around 46 per cent of farm land has been under irrigation as against 40 per cent in 2001-02.

Its effect on the agriculture sector poses a big problem for the Government but the situation could be salvaged if the rabi crops was protected. There are reports that the kharif crop had been affected in 58 districts of U.P. and 38 districts of Bihar and also in Punjab and Haryana which, in turn, has already led to increasing prices of foodgrains. Obviously, this would affect the poorer with inflation moving upwards.

There is need to analyze how much of the country’s population would be directly affected in such a situation. The inflationary conditions, which may accentuate with lower yield of staple crops may primarily affect the rural sector and the farming community in particular who form the majority in the country. However, buffer stocks of rice and wheat are quite adequate to have helped see the year though.

It is important and heartening to note that a food security mission has been launched to raise production in respect of rice by 10 million tonnes, wheat by 8 million tonnes and pulses by two million tonnes over the next five years. This is most needed as around seven million children die of hunger every year, around 63 per cent of them go to bed hungry and 47 per cent suffer from chronic malnutrition.

In recent years, a large number of people died of starvation or malnutrition in the poverty-stricken regions of Orissa, Rajasthan, Madhya Pradesh, Gujarat, Chhattisgarh, Maharashtra and Himachal Pradesh. Such procedures confirm that the procedure being followed to benefit BPL families through the public distribution system or through the NREGS programme has not been successful to make a big dent.

The situation is manifest in the FAO report which had earlier resolved to reduce the number of the undernourished to half by 2015. However, the latest report on world agriculture observed that the target would not be met even by the 2030, principally because populous nations like India’s record has been far from satisfactory.

It may be relevant here to point out that D. Bandyopadhyay, a former Secretary to the Union Government, who has served on many panels of the Planning Commission questioned whether sustainable 9 per cent GDP growth would solve the problem of ensuring two square meals a day to the entire population? Unfortunately, the development model being followed was one of exclusion and not of inclusion and therefore the common man was not deriving any benefits from this growth trajectory.    

Experts have been holding consultations on the need for a second green revolution, which must reach the farthest corners of the country and that financial inclusion of the small and marginal farmers should be ensured by providing the technological inputs to increase or diversify their production and add value to the products. Moreover, it could be based on genetically modified (GM) technology referred to as “gene revolution.” However, its products must be safe. 

Indeed, sustained agricultural development is necessary through a variety of measures which should not only look into innovative technology for increasing production and productivity but also ensure resource conservation, soil health and water planning. Additionally, dryland farming needs to be encouraged as water resources are becoming scarce day by day and there is need to experiment on crops that need less water. Development of farmers’ cooperatives as is being done in Gujarat and Maharashtra could too help. The Government should not only invest more in the agricultural sector but should ensure that subsidies are not reduced, given the special situation of our country unlike others in the West which are moving away from agriculture.      

Regrettably, while the Indian Council for Agricultural Research (ICAR) has huge funding, its research is not percolating to the desired grass-root level. Moreover, the emphasis on agricultural science and training and extension to farmers has not been sufficient over the years. Worse, farmers are not getting quality seeds and the benefits of research (lab-to-land facility) is virtually non-existent in most parts of the country.

Not long ago, the International Assessment of Agricultural Knowledge, Science & Technology for Development (IAASTD) report, modeled on the Inter-governmental Panel on Climate Change, showed what the future holds for us. As our population continues to grow and incomes rise, sustainable increases in production will be required, prompting greater emphasis on diversification and increasing agricultural productivity. Though the Government is a signatory, it has done little on this front.      

While the nation may focus on high growth it simply cannot ignore agriculture if grass- root development and food security has to be ensured. The planners must remember that the majority of the working population is still dependent on agriculture and will continue to do so for decades. Rural economy must be strengthened through agriculture and agro-based industries, which could generate employment, ensure food for farmers and usher in the necessary transformation. Recall, an estimate by eminent economist C. Rangarajan in 1982: a mere one per cent increase in agricultural output led to a 0.7 increase in national income and that most part of this reached the grass-root level of rural India and benefited the farming community. -- INFA    

 (Copyright, India News and Feature Alliance)