Cash transfers are fine, but low prices are the problem: Farmers

As low prices continue to plague millions of farms all over the country, farmers and their leaders say cash transfers are fine, but main issue is agricultural prices which make farming unremunerative.

Published: 24th April 2019 03:38 AM  |   Last Updated: 24th April 2019 09:31 AM   |  A+A-

farmers, loan waiver

Representational Image. (File Photo)

Express News Service

NEW DELHI: Ishwar Singh is a worried man. The furrows in his brow below his once white turban have deepened. He planted onions in his two-acre farm near Sonepat this winter and got what he believed was a bumper crop. That should have made him a happy man, but a bitter wrangle at the local Mandi over prices, which he feels are a “conspiracy”, has left him deeper in debt.  

“I had a good crop …. But when I took my produce to the Mandi I got just Rs 600 a quintal. That’s nothing …. I am losing Rs 8,000 per acre at this price. Something is very, very wrong in this setup,” said Singh.  Poll promises of a subsidy don’t interest him as he says “money in hand is believing, promises are neither here nor there.” 

As low prices continue to plague millions of farms all over the country, farmers and their leaders say cash transfers are fine, but the main issue is agricultural prices which make farming unremunerative.

“The farming crisis has deepened. That is why farmer issues have come to focus in this election,” says Rakesh Tikait, Bharatiya Kisan Union (BKU) leader and son of legendary farmers’ leader and BKU founder Mahendra Singh Tikait.  

“Both parties (BJP and Congress) are promising us doles, more sops. That is good. However, the main crux of our problem lies in pricing. Most Farmers now sell their grain below the Minimum Support Price and most crops have no price support system. Look at vegetable farmers. We sold their harvest below cost through most of this winter. How will we survive?”

The year-on-year consumer price index for fruits in March this year has shrunk by 5.88 per cent and for vegetables by 1.49 per cent, according to data released by the government recently. Onion prices in wholesale markets had contracted by 31.43  per cent in March year-on-year.

“The net effect of this price fall has been that middle and large farmers who can afford to do it, have been sowing less, preferring to retain fallow land rather than suffer losses as farm prices  remained low this year,” said Biswajit Dhar of the Centre for Economic Studies and Planning, Jawaharlal Nehru University.

Data released earlier this February by the government at the end of the winter sowing season and just before the harvest showed the area under crops is down from last year’s 634 lakh hectares to 617 lakh hectares. While the area under pulses fell 9.82 per cent, rice area was down 5.68 per cent, and wheat, some 1.37 per cent. Analysts said that even more worrying is that coarse cereals, the staple food of the poor, has seen its acreage shrink by 8.33 per cent.

The fall in this year’s Rabi crop acreage follows a disappointing Kharif or monsoon season. Agriculture distress had seen tens of thousands of farmers blocking the streets of Delhi last winter, record farmer suicides over the last few years turning the issue of farm into a burning political issue. 

“Our major issues are just two — apply the Swaminathan Committee report on agriculture prices and come up with a one-time waiver of crop loans,” said V M Singh, National Convenor of the All India Kisan Coordination Committee.

The MS Swaminathan committee, set up by the previous UPA government, had sought a crop price equal to one-and-a-half times the actual cost of production including the imputed cost of labour, land rent and interest on loans — also called the C2 formula. 

That has not happened as yet.  Instead, a subsidy scheme on the lines of a universal basic income was announced for poor farmers with less than one hectare of land by the BJP-led government. While the Opposition Congress has promised a rival basic income package for the rural poor, who they reckon to account for 20 per cent of India’s population. 

Tikait, who along with Maharashtra’s Raju Shetty and Singh, had led the farmers’ discontent against the government two years ago, said the problem was not only the rate “but the fact that most crops are not covered by it at all.” Although the government announces MSPs for about two dozen crops, it mostly buys only rice and wheat.

That procurement programme too is largely confined to parts of Punjab, Haryana and western UP, limiting the benefit of higher crop prices to only 7 per cent of the country’s farmers.

However, large numbers of vegetable and fruit crops as well as commercial crops where price fluctuations have been high, remain uncovered. 

“The farming crisis is a deep-rooted one and without structural changes many crops are at risk of becoming uneconomical affecting the viability of the farming business altogether,” said Dhar. 

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