The advance estimates of gross value added (GVA) during 2017-18 for the agriculture sector do not leave much cheer. The sector returned a growth of 2.1% as compared with the previous year’s 4.9%. The production of foodgrains too was short by 3.85 million tonnes.
Not that one is alarmed by these figures, given the high base effect; but it is clear that something is going on in the sector that compels a closer scrutiny. The anger among the farmers of the Saurashtra region, or that of the UP potato farmers who threw rotten potatoes all over Lucknow, point to a distinct unease among the farmers of our country.
Farmers’ distress is real and multifactorial. Shielding them from all their pain is well-nigh impossible, but there is still scope to address at least some of their persistent problems. Rural distress is not always due to the vagaries of weather. Several man-made factors contribute to it, chief among them being the farmers’ inability to obtain a remunerative price for their produce.
While the input costs keep increasing, the returns are static and the commodity markets fluctuate violently — often forcing them to dump their produce on the roads or burn it out of rage.
Since the middlemen are all pervasive and firmly entrenched, it may be several years before their insidious influence is diminished. Online aggregation, farmer-consumer direct interface, future trading, etc will not take off so very soon. Technology will most certainly make a difference in the long-run, but the urgency to ground palliative measures in the interim cannot be parried.
Laudable Yet Narrow
It is in this context that the highly laudable initiative of the Telangana government to provide a fixed amount of Rs 4,000 per acre per season to the farmers as ‘investment support’, has to be examined. The government is piloting it in a few villages — an essential step to ensure that the scheme is not maimed in the long-run, and a Cabinet Sub-Committee is tasked to prepare the guidelines for ‘the Agricultural Investment Support Scheme’.
I want to queer the pitch a bit. Given the risky and arduous process of producing food for the people, farmers serve a national purpose and in doing so, they suffer; so they need to be de-risked. Any ameliorative support given to them should not be trivialised or made conditional.
Channelling the assistance as an ‘investment support scheme’ is, to my mind, an unintentionally narrow approach. My concern is that it will eventually narrow down to just two inputs — fertilizers and pesticides — and will in practice be like any other input subsidy scheme. In other words, it appears to be an input subsidy scheme, somewhat rhetorically re-packaged.
Let us just unpack the expression — ‘Investment support’. The average size of the landholding of 62% of the Telangana farmers is below 2.5 acres. And another 24% own between 2.5 acres and 5 acres. The holdings and the financial capacities of 86% of the farmers being so small, what kind of investments can they make?
Costly polyhouses and agriculture machinery are out of bounds for them. So it will all boil down to just three basic inputs – seeds, fertilizers and pesticides. In other words, even if the Sub-Committee recommends highend infrastructure, only three inputs can ever be accessed by 86% of the farmers. When the support is limited to Rs 8,000 per acre/year, why choose this difficult imagery of investment support?
Will a farmer be entitled to clear an outstanding bank loan under the scheme? No. Because repayment is not an investment, by logic. Prima facie, the government’s concern is to preclude the banker from adjusting the farmers’ loan overdues. Till the debt overhang is not cleared, a farmer cannot breathe free. Debt weighs down him the most. So, what is wrong if the farmer chooses to clear his debt with the Rs 8,000 he gets? Or, for that matter what is wrong if he spends it for meeting some of his pressing consumption requirements?
Introducing some kind of cash card to ward off the banker is just not right because that amounts to an implicit hint to the farmers to disregard their moral duty of repaying their outstanding loans. Governments ought to be moral organisations.
The anxiety to avoid the penny-pinching banker will, in reality, push the farmers into the hands of the input dealers, whose pernicious influence and profiteering is just as well known. And the banker is not that unreasonable, after all. Why not hold a meeting under the aegis of the State Level Bankers Committee (SLBC) and work out a formula so the loans are not immediately adjusted and instead, staggered over time? The SLBC’s instructions are binding on all the banks.
So, what am I suggesting? Give the farmer an allowance, unconditionally, in recognition of his service to feed the nation and by gratefully acknowledging all the risks he takes in persisting with farming, season after season. I would rather suggest that it be notified as a ‘Scheme for granting Farming Allowance’.
I have an analogy — I work in Meghalaya, a remote, cold, hilly and border State. Life is difficult out here. But the Government of India compensates me through a Special Duty Allowance, which is 10% of my basic pay. The government never asks me how I will use that allowance. If it ever does, it will be an administrative nightmare for both of us, with no value accrued at the end of the day. How is the farmer any different from me?
The Chief Minister has gone on record saying that a happy farmer is at the root of a happy State. Indeed! A farmer’s choice is his freedom and it is this freedom that will lead him to his happiness. Let us not kill his choice, and thereby his self-esteem.
(The author is an IAS and Principal Secretary to the Governor, Meghalaya. Views expressed are personal)