Opinion

Lockdown has deepened farm despair

A Narayanamoorthy/P Alli | Updated on April 10, 2020

Steps such as tripling PM-Kisan payout, extending moratorium on farm loans and lifting procurement curbs will help

India is on the verge of an economic catastrophe as the humanitarian disaster from the Covid-19 pandemic unfolds. The country’s farm sector is facing the real heat of the 21-day national lockdown, which is disrupting the entire supply chain of agricultural commodities. An unexpected exodus of migrant farm labourers from many parts of the country has left many farmers bereft, triggering labour shortage and halting harvesting, marketing and procurement operations.

Realising the economic loss and the fact that preparations for the harvesting season would get affected due to the lockdown, the Central government intervened quickly by lifting restrictions on essential services linked to agricultural activities. In a move to put money in the hands of the farmers and, at the same time, ensure that they do not go hungry, the Centre announced an immediate transfer of ₹2,000 to all the eligible farm households under the PM-Kisan scheme. Will this be enough to cover the losses that the farmers are facing currently due to the coronavirus lockdown?

State of agriculture

The lockdown has come in the middle of the crucial harvest season for rabi crops, shattering the hopes of many farmers who lost their crops due to excessive rains and drought during the kharif season and were waiting for this rabi harvest to pay back their loans. For farmers who are in the midst of harvesting wheat, gram, mustard and potato in Madhya Pradesh, Rajasthan, Uttar Pradesh, Punjab and Gujarat, the flight of migrant labourers has spelt trouble.

Despite the Centre’s direction to exempt essential services linked to the agricultural sector from the lockdown, farmers still find it difficult to sell their harvested produce due to the lack of transport and closure of most markets. However, certain State governments have come forward to take some immediate measures to tide over the crisis. In Gujarat, all the APMCs have been directed to resume auctions to keep the supply chains of grains and pulses uninterrupted, while the Punjab government issued a notification on potatoes, allowing their harvest and transportation.

Frustrated over their inability to sell their harvested agri-commodities, farmers producing perishable commodities have yet again resorted to dumping their produce on roads and drains or feeding the cattle. Dairy farmers in Assam and Karnataka are throwing away thousands of litres of milk each day in rivers and streams, while farmers from Kolar district are dumping their ready-to-harvest grapes in compost pits.

In response, the Karnataka government has decided to purchase excess milk procured by the Karnataka Milk Federation and distribute it free to those residing in slums and the poor, through local municipal bodies. The farm sector is undoubtedly staring at a massive and completely new farm crisis.

Beleaguered farm sector

Over the past two decades, farmers have been in distress, with skyrocketing cost of cultivation, poor remuneration from cultivation of crops, widespread farm suicides and indebtedness. Poor remuneration from cultivation even today continues to trigger farmer suicides. Under normal market conditions, the income and consumption expenditure of farmers remain almost the same even today, offering them little hope of having a decent livelihood.

Poor market and procurement infrastructure, MSPs not being fixed in consonance with cost of cultivation, serious limitation to the delivery of agricultural credit and distress sale, particularly during bumper harvest, continue to be instrumental in denying a reasonable price for farmers’ produce.

The yearly onslaught of flood and drought has been ravaging the farm sector, as a result of which farmers are unable to manage their crop cycles, thereby threatening farm income and the country’s food security. The ongoing coronavirus lockdown has added to existing woes, pushing farmers to the brink of despair.

What needs to be done

At this crucial hour, urgent and immediate steps need to be taken to ensure that our agricultural commodity markets and the millions of lives that depend on them are secured and supported to the maximum extent possible.

First of all, farmers should be allowed to harvest and sell the harvested crops without restrictions from any agencies. The relief package announced for the farmers under PM-Kisan is definitely a welcome step that will take care of their immediate cash requirement. But, the size of the stimulus is paltry and is unlikely to be of much help in the event of a medical emergency. It would have been appropriate if the PM-Kisan payout had been equal to the wage rate provided for MGNREGS workers for another three months, which will be roughly about ₹6,000 per month. Any losses on account of disruption in harvesting or markets should be covered under the PM Fasal Bima Yojana and the benefit should be extended to all farmers, including those not enrolled under it.

At a time when the procurement of harvested produce is crippled, a feasible way out is to allow and encourage decentralised procurement at the farm level. Telangana has announced such a scheme where the entire paddy and maize crop will be purchased from farmers at support prices through village-level procurement centres. States such as Madhya Pradesh have used SMS-based pre-registration systems fairly successfully in the past, to try to regulate arrivals and manage logistics. This should be deployed and further strengthened everywhere.

It is also time that the Centre/States considered the implementation of e-NAM (electronic National Agriculture Market), letting farmers or farmer producer organisations (FPOs) to sell the produce from the farm-gate. FPOs can take up the role of aggregating the harvest of farmers, which could then be lifted by the Centre or State procurement agencies. Farmers cultivating horticulture crops are facing bigger problems than the rest in harvesting/selling their crops and, therefore, the government can initiate mobile procurement of these crops with the help of NAFED.

Against the RBI announcement of a three-month moratorium on repayment of loans, which is merely a momentary relief to the farmers, a moratorium for a period of one year, subject to review after control of the pandemic, would be better. Considering the gravity of disruption in the supply chain due to the lockdown, no interest should be charged on farm loans for at least six months.

Charging any cess, levies and taxes from farmers at the market yard can also be stopped for at least six months. Only these arrangements can protect our vast interconnected agricultural production and marketing system, prevent the danger of food insecurity and safeguard the interests of farmers.

Narayanamoorthy is former Member (Official), CACP. Alli is Senior Assistant Professor in Economics, Department of Social Sciences, Vellore Institute of Technology. Views are personal

Published on April 10, 2020

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