Budget 2017: Farming facts

I watched the Budget session in a local tea stall in Laxmapur village of Shamirpet mandal, Telangana, with farmers and farm workers around. The moment the finance minister said farmers’ incomes would be doubled, I translated it from English to Telugu (local language) for the benefit of a few of my farmer friends who were around. A women farmer Girijamma, who produces vegetables on 2 acres of land, sipping her tea, jokingly said: “That man (finance minister) doesn’t know what we earn today. How do they know whether our incomes are doubled or whether they halve by 2022?”

Girijamma might be an illiterate poor farmer who does not have much exposure to the word of finance and development, But her words were profound. She highlighted the most important problem: Lack of reliable statistics regarding farmers’ incomes in India.

First, there is no measurement of current income levels of farmers. Where is the question of tracking how it gets doubled? I was reminded of Management thinker Peter Drucker is often quoted as saying that “you can’t manage what you can’t measure.”

The second aspect is lack of reliability of survey methods. We do not have a mechanism to measure income in India except for NSSO surveys. Honestly, with my six years in agriculture, I am more than confident that numbers of one season cannot be extrapolated so easily to multiple years. Unfortunately, there is not enough data on actual cropped area or estimated production area. There is no specific boost in the Budget for improving the quality of income measurement.

The third aspect of this problem is ‘nominal income vs real income’. Say your salary is .₹20,000 per month in the current year. You get an annual increment of 10 per cent. In the next year, your monthly salary will be ₹22,000. If inflation is 10 per cent between last year to current year, there is no increase in real income. As indicated in Report on Doubling Farmer’s Income by 2022 issued by Indian Council for Agricultural Research, the average monthly income of a person from farming increased from ₹ 1,060 in 2003 to ₹3,844 in 2013. This means income got compounded annually at a growth rate of 13.7 per cent. To double the income of farmers by 2022, in nominal (numerical) terms, would require a 15 per cent compounded income growth rate, which is a marginal increase over the achieved increase from 2003 to 2013.

Doubling farmers’ income is an inspiring idea. To measure income levels, innovative big data techniques should be leveraged. Increased banking habit in rural India due to demonetisation should also help in big data collection. The government should democratise the process of achieving this objective of doubling income by sharing the responsibility of reviving agriculture with community organisations such as farmers’ collectives, NGOs and social enterprises. It is our collective responsibility to make farmers’ hard work pay.

The writer is co-founder of Kheyti, a farm tech startup