Deep Dive

Doubling farmers’ income: It’s still a long road ahead

Radheshyam Jadhav Pune | Updated on May 10, 2021

The agricultural sector emerged a silver lining amid the adversities of Covid-induced lockdowns last fiscal year   -  The Hindu

The ‘robust’ show amidst the pandemic notwithstanding, the agri sector is still beset with a plethora of problems

Bharat Patil, Baba Sawant, Sammad Kanwade and many other farmers in the Sangli district of Maharashtra are still not able to understand the hullabaloo over “resilience” and “growth” in the agriculture sector during the Covid-19 pandemic.

India’s agricultural sector was touted as a silver lining amid the adversities of Covid-induced lockdowns last fiscal, with farming and allied activities clocking a growth of 3.4 per cent during 2020-21 (first advance estimate).

But despite the headline growth numbers, Sammad, who is a small vegetable grower farmer, says that he and his friends have actually struggled to survive lockdowns and restrictions imposed by the government to curb the spread of the pandemic.

The Centre’s project to double farm income also appears to be making very slow progress.

 

Key issues

The government constituted an Inter-ministerial Committee in April 2016 to examine issues relating to the doubling of farmers income. The Committee submitted its report to the government in September 2018 with the strategy for doubling of farmers income by 2022.

The Committee said farm income has to grow at 10.4 per cent, at constant base-year prices, to achieve the target.

A NITI Aayog policy paper by Ramesh Chand states that past strategies for the development of the agriculture sector had focussed primarily on raising agricultural output and improving food security. “The strategy did not explicitly recognise the need to raise farmers’ income and did not mention any direct measure to promote farmers’ welfare. The experience shows that in some cases, growth in output brings a similar increase in farmers’ income but in many cases, farmers’ income did not grow much with the increase in output. The net result has been that farmers’ income remained low, which is evident from the incidence of poverty among farm households,” the paper added.

In March this year, the government was asked in the Rajya Sabha whether it has conducted any annual surveys to measure farm and farmers’ income in the country.

The Ministry of Agriculture replied that the “latest” result of the Situation Assessment Survey of Agricultural Households conducted during NSS 70th round (January 2013- December 2013) was available. Various questions regarding doubling of farmers’ income were asked in the recent Parliament Session, but the government just explained its various schemes for farmers instead of specifically revealing the numbers as far as growth in farmers’ income over the last few years is concerned.

Not surprisingly, thousands of farmers like Salim still await doubling of their income, hoping that the government brings a paradigm shift in its policy.

 

‘Formula’ under cloud

The data presented by the Ministry of Agriculture and Farmers Welfare to Lok Sabha in March this year show that the government is banking on annual Budget allocation, foodgrain production, MSP and procurement to increase farmers’ income.

Compared to the Budget allocation of ₹21,933.50 crore in 2013-14, the Budget allocation for the Department of Agriculture has been increased by more than 5.5 times to ₹1,23,017.57 crore in 2021-22. The government insists that increased foodgrain production is helping farmers earn additional income.

The government has increased the MSP for all mandated kharif, rabi and other commercial crops with a return of at least 50 per cent overall India weighted average cost of production from 2018-19.

While MSP payment to farmers for pulses has increased by 95.93 times during the last five years (2016-17 to 2020-21) in comparison to the period from 2009-10 to 2013-14, MSP payment to farmers for oilseeds and copra has increased by 10.80 times during the last five years (2016-17 to 2020-21).

But farmers question the cost calculation formula and allege that the actual production cost is much more than what has been factored into the formula.

Under the PM-KISAN scheme, the government provides ₹6,000 per year in 3 equal instalments and a total of ₹1,15,276.77 crore has been released so far to 10.74 crore farmer families.

About 23 crore farmers have enrolled under the Pradhan Mantri Fasal Bima Yojana (PMFBY) and over 7.6 crore farmer applicants have received claims of over ₹90,927 crore.

During this period, nearly ₹17,510 crore was paid by farmers as their share of premium against which claims of nearly ₹90,000 crore have been paid to them. Thus, for every 100 rupees of premium paid by farmers, they have received ₹520 as claims, according to the government. But in many States, farmers complain that their claims for compensation are not entertained and they continue to face losses.

Institutional credit for the agriculture sector has increased from ₹7.3 lakh crore in 2013-14 with a target to reach ₹16.5-lakh crore in 2021-22. The ₹1-lakh crore Agriculture Infrastructure Fund (AIF) has been launched to provide medium to long-term debt financing for investment in viable projects for post-harvest management infrastructure and community farming assets.

The government is providing soil cards and promoting Farmer Producer Companies, organic farming and start-ups.

A Micro Irrigation Fund of ₹5,000 crore has been created under Nabard. The government has also rolled out various schemes for micro-irrigation, agricultural mechanisation and E-NAM.

 

Ground reality

Bheek nako, ghamache daam hawe (we don’t want alms, but the price of our sweat),” used to be refrain of late Sharad Joshi, founder President of Shetkari Sanghatana, and its current present President Anil Ghanwat repeats the slogan. “For over 40 years, Shetkari Sanghatana has been advocating that farmers must get the freedom of access to markets and technology. Farmers’ income would be doubled only and only when the government stops interfering in the market,” says Ghanwat.

Bharat Dighole, President, Maharashtra State Onion Grower’s Association, agrees. He says that farmers don’t suffer losses because of ups and downs in production but because of the government’s “anti-farmer” policies. “The moment market price of onion or any other agri produce starts going up, the government intervenes and bans export and starts import. We have seen this happening frequently in the case of onions. In such circumstances, how can farmers’ income be doubled?” he asks.

Published on May 09, 2021

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