The Hindu Business Line : Procurement levels

It is heartening that wheat procurement has already reached 22 million tonnes so far against the record estimated production of 77 million tonnes in 2007-08 (Business Line, June 14, 2008). Similarly, rice procurement has also crossed 25 million tonnes so far.

The farmers and the Government are to be congratulated for this sterling performance. Such record production and procurement gives the necessary cushion and leverage to meet the grain needs of the country in times of adversity.

India is a country with constant scope for improvement in agricultural practices for which adequate prices of farm produces are sine qua non. Unfortunately, the consumer lobby and the vote-bank politics of providing rice through heavily subsidised prices are acting as disincentives in making agriculture a market-driven profession like any other industry, where costs of inputs, cost of labour, interest on loans raised and profit margins play a role in deciding the ultimate price charged to the consumer.

The freebie regimes and subsidies do not encourage the farmers to go for extensive cultivation as in a period of glut, they are the sufferers due to fall in agricultural prices, which are market-related and not cost of inputs related.

It is imperative to sustain the momentum of record production in the coming years also, for minimum support prices should be inflation-related and should incentivise the farmers to produce more.

Export of surplus agricultural produce must also be encouraged to get adequate prices for farmers in times of glut.

P. E. Muthu Mumbai

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Procurement levels