Economic
Highlight
New Delhi, 27 July 2020
Farming Trade Ordinance
SCRAP IT, MAKE FARMER
KING
By Shivaji Sarkar
Indian agriculture is a complex mix. It has
myriad problems and the solutions suggested are often not practical.
Interestingly, the largest beneficiaries of the food dole to 80 crore poor are
the producers of the food grains!
It is a dichotomy. Often, in terms of
agriculture, privatisation, private investment and handing it over to private
hands become the policy plank. More this is being discussed and “reformed”
through ordinances, the government is getting enmeshed in it by direct benefit
transfers, Rs 6000 pension for farmers and dismantling their mandis (local
wholesale markets) under the agriculture produce committees (APMC), easing
Essential Commodities Act and facilitating contract farming.
There is apparent policy confusion. The first
major agriculture reform was the Green Revolution, creation of mandis
and setting up the Food Corporation of India (FCI) for procurement, creating
buffer stock and distribution. It has its pluses and some minuses too. Except
at purchasing level, the government is not involved.
Farmers still are making their own
investments, may be now through bank support extended by the kisan credit card
or simply bank loans. Government institutions selling seeds, fertiliser or
other support do it at commercial rates and a bogey had been created that the
farmers are dependent on the government. The mandis despite many flaws
served them well and assured payments. The mahajan (money lender) system
popularly enshrined by cinematic character Sukhi of Mother India found their roles limited, but not eliminated.
The Sukhis are still there for smaller
tillers who still do not find it easy to have bank support. The new ordinances
are euphoric about a pan-India market – a complex and expensive system,
“larger” involvement of private sector, a euphemism for multinational
involvement in the farm sector, which is operating for almost two decades
through various “cash and carry” wholesale trade across the country. Some
Indian firms too have entered the scenario. In Kashmir, some companies have
monopolised the apple trade through their leased orchards; in other places
motley groups manage partially grape, orange, mango and spices trading.
Many have emerged as parallels of FCI. But
farmers have concern. They become their pawn and alternative support is
difficult once a contract is signed. The ordinances for demolition of this
alternative are concern for many farmers’ organisations. Again it is all
private investment that most official functionaries take pride in. That is the
plus and minus. The plus is “investment”. The minus is it creates a larger
chunk of farmers looking for direct government support for their survival.
The COVID-19 lockdown has opened up the
chinks. The government is trying to correct it through enormous stock, it built
in FCI warehouses through the years of toil. It is distributing food grain
worth Rs 1.5 lakh crore for free till at least November 2020, from April
onwards for over 60 per cent of the population.
Despite years of deliberations, the nation
has got into the same quagmire of government support to farming instead of
promoting individual farmer’s capabilities to be self-sustaining. The APMC mandis
have flaws though it is a robust system. Since it is still an ordinance, the
policy makers need to relook for removing the flaws but prevent its demolition.
The ordinance should for now not be enacted into statutory law.
Over the years corporate cartels have created
lobbies to control the base of Indian economy – agriculture. It is
profit-oriented, not a bad word, but at the cost of sustenance of the farming
community. The farmers need monetary support all through the year. They need
small credits. This is provided by the buyers at the mandis and adjusted
against the final sales. The payments to farmers are assured in the system.
Yes, this creates a kind of bondage too. There are instances of it being
exploited as well.
The pan-India market is there in the mandis
as well. Many farmers have taken their produce from Punjab to sell at Bihar mandis
for better price. The present ordinances try to legalise that but creating
monolith of large corporate players. Politically it suits various operators as
election funding in bulk is assured. Practically, the nation is creating
convoluted system, where the involvement of the government at micro level would
increase.
Economically and financially it may be
populist but certainly not profitable either for the farmers or the nation.
There is another apprehension. Sizeable sections of the farmers may be
controlled through Vikas Dube-type goons creating severe law and order issues –
in short perpetuation of more powerful Sukhis and dumping more costs on
the State.
So India neither needs a full corporate
system, nor full privatisation nor full government involvement. Agriculture
remains complex. Giving it to the corporate may have long-term impact on food
security about which the nation has false sense as granaries overflow as per
1960s model.
India has gone far ahead of it. Now the farmer
is not just food grain producer. He produces poultry, meet, dairy products,
vegetables and fruit. He has yet to grow into nutrition supplier – the next
level – to have a healthier nation.
Farmers will need to be supported – through
finance or credit, policy interventions that turn them into competitors by
increasing their power to sustain. The potato, tomato or onion farmers have
none of it. The government needs to set up monitoring systems with able experts
from the community, market experts and scientists. The fluctuation in
production from high like potato in 2019 to low now or low production of onion
in 2019 to high now cause price crash or volatility. A perspective plan in each
such crop will remove the need for seeking government support. Crop production
needs zone wise planning.
The MNREGA, subsidies, doles cannot be permanent solution – economic, financial
or political. The combination has created severe dependence on the government.
Indian agriculture has remained in the private sector and will remain so. But
through judicious planning, advice and policy intervention, individual farmers
have to be empowered to create a national syndrome of independent
entrepreneurs.
The NDA-II under Narendra Modi has array of
experts and visionaries. It needs to put them together to evolve a farming that
would be strong and other sectors dependent on it. The government should remain
an observer but not a direct player. And for now let us redo the three June 5 Ordinances
for a better future. ---INFA
(Copyright,
India News & Feature Alliance)
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