THE HINDU BUSINESS LINE
Financial Daily
from THE HINDU group of publications

Friday, December 08, 2000

• AGRI-BUSINESS
• BANKING & FINANCE
• CORPORATE
• INDUSTRY
• INFO-TECH
• LETTERS
• LOGISTICS
• MACRO ECONOMY
• MARKETS
• MONEY
• NEWS
• OPINION
• VARIETY
• INFO-TECH
• CATALYST
• INVESTMENT WORLD
• MONEY & BANKING
• LOGISTICS

• PAGE ONE
• INDEX
• HOME

Opinion | Next | Prev


Pricey delay

IT IS THAT time of the year when, after the harvest and marketing of kharif crop, farmers start planting the rabi (summer harvested) crop. Indeed, rabi sowing -- be it of wheat, pulses or oilseeds -- has made considerable progress in large parts of the c ountry. But the distinct lack of enthusiasm among farmers is palpable; and it is not without reason.

Drought conditions in the western and central regions following failure of the last round of South-West monsoon and the lack of adequate soil-moisture have already created tremendous concern. For the second year in a row, there has been a sharp fall in r ural incomes. Small and marginal farmers have started to migrate, seeking greener pastures. The plight of the livestock is worsening by the day. The situation has been compounded by the falling farmgate prices of a number of commodities, leading to lou d protests from growers across the country. Without doubt, the contribution of agriculture to this year's GDP growth will be considerably lower, if anything.

All this should have spurred the Centre and the State governments to tackle the agricultural situation on a war footing and prompted them to take steps to at least partially offset the kharif losses in the rabi season. But there is little evidence of any activity, despite the known gravity of the situation. There is no decision as yet on the minimum support price (MSP) for the rabi crops and for the sugarcane crop of 2000-01. The farmer is expected to make his own judgment and decide on the crop to rais e. The Commission for Agricultural Costs and Prices (CACP) has done its duty and submitted its report to the Government quite some time ago; but the decision-making on this vital aspect of the economy has become tardy at the political level. Sadly, the d elay in the MSP announcement has become the feature over recent years and has perhaps even come to be accepted as normal, though it is an undesirable trend. It also makes nonsense of the Government's statement that ``assurance of a remunerative and stabl e price environment is considered to be one of the basic foundations for increasing agricultural production and productivity''. It is obvious that the Government has ceased to view the MSP as an effective instrument to influence the cropping pattern and help farmers with the choice of crop to grow. Indeed, there is growing suspicion that the delay in taking a decision on the MSP, particularly in the case of wheat, may be for political reasons.

It is not inconceivable that New Delhi should be feeling uncomfortable in announcing the MSP at the beginning of the sowing season for fear that at the time of harvest it may be forced to make compromises, if recent history is any guide. Possibly, the po licy-makers do not want to take chances. Given the fragility of the country's agricultural economy and its vulnerability to internal and external pressures, the Government should accord to agriculture the primacy it deserves. The constitutional position is that agriculture is a State subject; but the least the Centre can do is play a more serious, pro-active role in guiding agricultural growth. A decision on the MSP for rabi crops has been delayed; but let it not be delayed any further.

Related links:
Food policy in a total mess

Comment on this article to BLFeedback@thehindu.co.in

Send this article to Friends by E-Mail


Next: Tale of two chads
Prev: `Food scarcity situation is inevitable' -- Mr E. Chandrashek...
Opinion

Agri-Business | Banking & Finance | Corporate | Industry | Info-Tech | Letters | Logistics | Macro Economy | Markets | Money | News | Opinion | Variety | Info-Tech | Catalyst | Investment World | Money & Banking | Logistics |

Page One | Index | Home


Copyrights © 2000 The Hindu Business Line.

Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line.