Farm prices panel for efficient water use

The Commission for Agricultural Costs and Prices (CACP) has made a pitch for encouraging water use efficiency in agriculture. As part of its non-price policy recommendations for kharif 2015-16, the crop advisory body has suggested that States fix quantitative ceilings on per hectare use of both water and electricity.

The farm sector accounts for about 83 per cent of all water used in the country. Therefore judicious use of water in agriculture will have significant impact on the overall availability of water.

“However, most of the State governments have been content with subsidising electricity for pumping irrigation water, which leads to inefficiencies. The Commission recommends economy in water use in agriculture by fixing quantitative ceilings on per hectare use of both water and electricity,” CACP said in its latest report.

Further, it also suggested incentivising the judicious water usage.

“If some farmers are able to use water/electricity less than the ceilings fixed for them, they should be rewarded by cash incentive equivalent to unused units of water/power at the rates of their domestic resource costs. This would encourage farmers to use drip irrigation and would enhance production per drop of water,” the advisory body said.

Sops for judicious use CACP’s recommendation assumes significance as water is increasingly becoming scarce in India with high opportunity costs.

“It is, therefore, imperative to augment the water productivity, that is, water intake per kg of production,” it said.

For example, West Bengal consumes 2,605 litres of water to produce a kg of rice compared to 5,337 litres being guzzled by Punjab.

The efficiency gap with respect to consumption of water in Punjab (the most efficient in terms of land productivity) is over 51 per cent. This shows that the most efficient State in terms of land productivity is not the most efficient if other factor of production viz. water is factored into, CACP added.

Nafed under fire Besides, the advisory body has also recommended strengthening procurement in eastern States and restructuring of National Agricultural Co-operative Marketing Federation of India (Nafed).

“Nafed has not been performing its main objective function of procurement of oilseeds and pulses over the years which deters farmers from diversifying to these commodities. A large number of farmers in Gujarat, just as an example, sold groundnut in 2014, at least 10 per cent lower than the MSP, bear a testimony to this. It shakes the confidence of farmers in price support mechanism and explains in great measure their reluctance to diversify from paddy/wheat to oilseeds and pulses, the crops in which the country is deficient,” it observed.

Stressing upon the need to put in place credible procurement machinery for pulses and oilseeds, the two commodities that India is import dependent, CACP said: “there is an urgent need to restructure Nafed to enable them to accomplish their objective function.”

Such a move would help farmers diversify into pulses and oilseeds and will reduce skewed production pattern.

Rejig procurement agencies Though procurement agencies such as Food Corporation of India and Nafed have been in the existence for over 50 years and 30 years respectively, the benefits of minimum support price bypass a large section of farmers, rendering the pricing policy and procurement operations ineffective.

According to Situation Assessment Survey (NSS 70th Round), only 2.57 million households were benefitted directly from procurement of paddy during 2012.

The procurement of oilseeds and pulses is far worse. Nafed, for instance, procured only 3.21 per cent of Kharif oilseeds in the last season.

This calls for giving wide publicity about MSP and procurement agencies on radios, television and vernacular languages in popular local dailies, at least 15 days before the start of procurement operations so as to reach farmers far and wide.

“Furthermore, to instil confidence among farmers on procurement of their produce, a legislation conferring on farmers the right to sell their produce to the Government at MSP be brought out,” CACP observed.

'Look East' Further, the advisory body said that Eastern belt of the country gets neglected in so far as procurement is concerned.

For instance, there was almost negligible procurement of rice in Assam during 2013-14, even though it contributed 4.6 per cent in the total rice production.

The situation in other eastern States such as Bihar, West Bengal is somewhat better than that of Assam but not good enough when these States are compared with Punjab.

Low procurement and weak marketing infrastructure has affected the market prices in these States which have been lower than MSPs. The perpetual neglect in procurement needs to be corrected on priority.

The Commission recommends strengthening of market infrastructure and procurement system in the eastern belt to the level prevailing in Punjab and Haryana.

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