Needed, a vision document for agriculture

Ram Kaundinya | Updated on March 20, 2019 Published on March 20, 2019

Cause for concern: Climate change is likely to lower farm yields significantly   -  THE HINDU

Charting the course for improving yield, profits and credit flow will go a long way in mitigating agricultural distress

For a country with half the population dependent on agriculture, India does not have a visionary agricultural policy document that charts out the course of action towards food security, farmer welfare, climate-resilient farming, and environment-friendly agriculture. For populous countries like India, agricultural security is as important as national security. We do not have a well-articulated plan that is accepted by all political parties and all the States. It is important to create such a document. If all can come together for GST, why not for agriculture? An agricultural council, on the lines of the GST Council, should be formed.

Agriculture is a State subject. But in a globally connected agricultural situation, States cannot be expected to develop strategies that optimise returns at the national level and, at the same time, ensure farmer welfare in their States. Agriculture has to be brought under the Concurrent List.

Indian agriculture is moving from a production-driven enterprise to a demand-driven one. It is, therefore, important to understand the demand-side dynamics by involving the end-user industries in planning agricultural production, crop portfolio and supportive policies.

Raising productivity

There is no gainsaying the fact that we have to increase yields. Those who oppose efforts towards this because we have sufficient food stocks now are taking a narrow view of the situation.

Farm yields in India are quite low compared with those in other countries. Increasing the productivity of land is critical in a situation where the demand on land for non-agricultural purposes is growing rapidly. Ensuring good price realisation for the farmer is a separate subject and it should not be confused with the need for increasing yields.

We need to improve our seed quality and agronomic practices using technology. Making crops tolerant to biotic and abiotic stresses by using modern plant breeding methods and biotechnology is of utmost importance. Also, using digital and satellite technologies for precision farming is critical. Farm mechanisation is to be promoted to overcome impending labour shortage.

Climate change is going to impact agricultural productivity and yields may go down by 20-30 per cent. We have to, therefore, develop climate-resilient crops. For this, a predictable policy and regulatory environment is a must.

There is a need to set up an Agricultural Technology Mission to create appropriate strategies and policy framework to bring about a comprehensive technology solution for our agricultural problems. There has to be a a 360-degree view of the situation, and with plans for modernisation of our agriculture and food production systems.

Improving profitability

The solution to farmers’ distress lies in improving profitability, which is intrinsically linked to price discovery. Suppressing farm-gate prices may keep the urban consumers happy for some time but it is not a long-term solution.

Farm-gate prices shouldn’t be raised through artificial interventions by the government but by connecting farmers to markets through electronic platforms. Also, amending the APMC Act by all the States quickly should be high on the agenda.

Farmers should be advised to grow the right crops based on demand dynamics, international stocks/prices and other considerations. Farmers have to be given directional price forecasts at the time of planting crops. Our crop portfolio has to undergo a change to optimise water, improve price realisations for farmers and to meet emerging demand patterns. It is important to create an apex body at the national level to carry out necessary modelling to achieve optimum results on this front.

The Essential Commodities Act must be abolished so as to allow private trade to make large-scale purchase of agricultural commodities from farmers. Our import and export policies should be predictable and based on many factors. These steps will have a huge impact on prices in India and, consequently, on farmers’ profitability.

Rural infrastructure

Allocation of budgets for construction of roads, silo-based warehouses and cold storages closer to villages is essential. Also, a farm energy policy that has a plan to gradually bring renewables like solar, wind and farm-waste into the energy mix is needed.

A scheme to create a network of digital entrepreneurs in villages should be launched. The digital entrepreneur will capture all the farmers’ data and connect them to digital markets to buy and sell. This data can be used by insurance companies and others to offer services and products to farmers. This will also generate rural employment.

Also needed is a scheme to help rural families take up off-farm enterprises to boost their income. This should be supported by a suitable programme to help entrepreneurs aggregate such products and sell them in the target markets. This will create a sustainable business model to strengthen rural incomes.

Access to credit

One of the key reasons for rural distress is the debt trap that the farmers fall into, mainly because of the usurious rates charged by private moneylenders. This happens because banks do not make adequate credit available at the right time. Banks find it hard to lend to farmers due to high operational costs and NPAs.

The government may provide guarantees to the banks for such loans so that the latter can lend without fear. This should replace the current trend of loan waivers which should be avoided at all costs.

Providing credit on time is a major challenge for banks due to the sheer size of agricultural operations. It is time to completely digitise the process of giving crop loans based on digitised land records. This will help in quick and timely processing of applications and releasing money into their bank accounts. When this can be done for urban consumers why should it not be done for farmers? All bank products for farmers must take into account their cash-flow patterns and help them service their debt depending on the cash inflow from crops.

Lack of data on yield losses is a major constraint in providing insurance services to crops. A special product that provides cover to the extent of investments made in case of crop failure and natural disasters needs to be introduced. This will remove a major area of distress for farmers and will not depend on complicated processes to estimate crop losses.

The aforementioned measures will help mitigate the agricultural distress considerably. If there is political will, these meaures can definately be implemented.

The writer is Director General of Federation of Seed Industry of India

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Published on March 20, 2019
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