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New Delhi, 15 January 2025  

Farm Distress

GOVT REDRESSAL STEPS VITAL

By Dhurjati Mukherjee 

The farmers’ problem remains quite complex with the Delhi Chief Minister Arvind Kejriwal and other opposition leaders alleging that the condition of farmers was never as bad as it is under the BJP regime. Farmer-leader, Jagjit Singh Dallewal’s hunger strike since November 26, demanding legal guarantee to procurement of crops at minimum support price (MSP), regrettably continues, despite Supreme Court urging a resolution. 

Kejriwal called for a nation-wide strike recently as, according to him, “over 700 farmers ended their lives due to debt”. Though many experts believe that the government should announce something in the coming budget, it appears that the situation may not be easily resolved.However, the new year started with some good news for the sector with the Centre coming out with a draft national policy framework on agriculture marketing suggesting states move towards a unified national market for agriculture produce through single licensing/registration system and single fee. 

Allowing setting up of private wholesale markets, permitting wholesale direct purchase by processors, exporters, organised retailers, bulk buyers from farm-gate, declaring warehouses and cold storages as deemed markets, allowing establishment and operation of private e-trading platform and rationalisation of market fee and commission charges are some of the key suggestions to reform the agriculture market. 

Though some UTs/states have started adopting one or the other such measure, the draft has aimed at uniformity across the country and pitched for constituting an “empowered agricultural marketing reform committee”. The draft emphasised that the key idea behind the proposal is to “build a vibrant marketing ecosystem” in the country wherein farmers of all categories find a market of their choice to realise best price for their products. 

The other significant news is the extension of the crop insurance scheme by the government by a year, enhancing its outlay for five years to Rs 69,515 crore while also approving the Rs 825 crore Find for Innovation and Technology (FIAT). Moreover, to help farmers get soil nutrients at existing rates, the Union Cabinet also gave go ahead to a one-time go ahead special subsidy of up to Rs 3850 crore for Di-Ammonium Phosphate (DAP). 

Officials said that the enhanced allocation for crop insurance will help take care of risk coverage of crops from non-preventable natural calamities across the country till 2025-26 through the Pradhan Mantri Fasal Bima Yojana (PMFHY) and the Restructured Weather-Based Crop Insurance Scheme. Added to this, FIAT is expected to be used for large-scale technology infusion in implementation of the schemes. 

In spite of these positive developments, almost all states are facing a shortage of subsidised fertilisers like NPK according to their requirements. It is understood that the Union government has gradually reduced the allotment of this fertiliser in the past few years as the Centre has been giving handsome subsidies to this particular fertiliser. As a farmer is required 4 bags of fertiliser to grow crops on each bigha, he/she would have to spend Rs 5880 on NPK. The expenditure would go up to Rs 6960 for a bigha if he uses any alternative to this fertiliser, which may be burden on small farmers. 

Meanwhile, in November last year, the Supreme Court appointed high-powered committee stated in its interim report that stagnancy of agricultural production for three decades coupled with spiralling debts in Punjab and Haryana have created a distressing situation for farmers. The panel would examine further whether legal sanctity to MSP could boost productivity. It is estimated from the report that the debt of farmers increased manifolds – in Punjab it was Rs 73,673 crore and in Haryana, it was Rs 76,530 crore in 2022-23. 

“Declining net farm productivity, rising production costs, inadequate marketing system and shrinking farm employment have contributed to the deceleration in farm income growth. Small and marginal farmers along with farm workers, are the most affected and vulnerable segments of this economic squeeze”, the committee observed, and which is a major problem in the country. The report further said Punjab has not escaped the ‘suicide epidemic’, evident among farmers in some other states. The state witnessed 16,000 suicides by farmers, mostly small and marginal and landless farm workers between 2000 and 2015. 

Delving into the past, it may be said that neo-liberalism created lot of problems for the peasantry. It curtailed subsidies in agriculture, it opened up agriculture to world market fluctuations, it curtailed institutional credit to agriculture, to wound up public extension services, it increased cost of fertilisers and chemicals and other inputs marketed by MNCs etc. Thus, neo-liberalism not only split the class alliance and caused a hiatus between the urban middle class and the peasantry but also actually pitted them against one another. 

Recently, another favourable development is the forecast that the agricultural sector may recover strongly with growth accelerating to 3.8 percent in the current fiscal from 1.4 percent in the previous year, supported by favourable monsoon and improved rural demand. One cannot deny that a little more attention can improve the conditions of the farming community and bring a turnaround in their earnings. 

But what is necessary at this juncture is that the government must give more attention to the needs of small and marginal farmers. The hiking of the farmers’ dole that is being talked about by around Rs 3000 or Rs 6000 annually due to rising input costs and strong inflationary pressures could stabilise rural incomes and support consumption growth, which is increasingly being driven by rural demand.  

Renewed efforts are necessary to make agriculture remunerative by promoting cash crops, setting up peasant cooperatives and agro-based industries. This resulted in the rural economy suffering in a big way. It cannot be denied that the prospects of agri exports as also the role of agriculture is helping in improving the conditions of the rural mass but the ruling dispensation has, over the years, not taken any significant step in transforming agriculture. 

There is need to critically examine the problem of farm distress and trying to make agriculture remunerative. To start with, some districts should be identified where cash crops could enhance incomes of farmers. It is not that this cannot be done but considering the prospects in agriculture and agro-based industries and its export potential, this needs to be explored by the government. 

In fact, a section of analysts wants the government to come out with a plan to promote agro-based industries in a big way and also try to redress the problems of small and marginal farmers. the national agro market is a step in the right direction as also the extension of the crop insurance scheme, both of which should help farmers. The healthy growth of the sector can become a reality in the coming years, but only if the government is serious and engages with the farmers to improve their lot. Urgent intervention is critical. ---INFA 

(Copyright, India News & Feature Alliance)