India’s agrarian crisis refuses to go away. If crops do well as they did last winter, when India had a bumper fruit and vegetable produce, farmers are hit by unremunerative prices pushing them into the red. In case the monsoon plays truant or a cycle of drought or floods afflicts the country, the farmers are the first to bear the brunt of the calamity, economically. Till now, the state has tried to deal with the crisis with a series of sops—fertiliser subsidies, NREGA and direct cash transfers. However, these handouts do not seem to have solved the basic problem of farming turning unremunerative.
As India’s agricultural markets are fragmented and highly regulated by colonial-era laws and since a farmer cannot store his goods for a long time, he has little choice but to sell out at distress prices, and he sees losses even as traders rake in a huge profits.
Abolition of the iniquitous Mandi Act, which ties a farmer down to local merchants, and improving a farmer’s access to markets by building rural roads and cold-storage chains are obvious necessities. As are investments in farm infrastructure by way of irrigation works, deepening and cleaning of water storage tanks and ponds, etc.
Yet, the public investment in such works is low. India’s farm sector, which employs about half of its population, also paradoxically contributes just 14.39 per cent of the country’s GDP. India’s paddy output per hectare for instance is an abysmally low 3.1 tonnes, compared to China’s 6.5 tonnes and Vietnam’s 5.2 tonnes. Even neighbour Bangladesh fares better at 4.2 tonnes.
Agricultural output, even in the areas where Green Revolution was significant —western Uttar Pradesh, Haryana and Punjab—has more or less plateaued out. We now need huge investments in research. These remedies are self-evident and have been pointed out by various commissions including the M S Swaminathan Committee. Yet all that we hear after a round of farm distress is talk of just more sops. It is time we treated farming as a business and tried to fix it as one would try fix an unprofitable business.