Agrarian Crisis

Updated: Nov 9, 2019

Agriculture has become a complex sector in India. It is facing crises at multiple levels, which will exacerbate the food quality and security crisis, the environmental crisis and the farm crisis being faced by us.


Problems

  1. Social: Caste-based communities dependent on the stagnating agricultural sector, such as the Jat agitation in Haryana and the Maratha agitation in Maharashtra.

  2. Environmental: the agricultural sector is the worst affected by the current environmental crisis facing the country – be it the crisis of water, climate change or land degradation.


Major Issues in Indian Agriculture

The major issues that implicate the agricultural sector include:

  1. Water crisis in the country

  2. The crisis of climate change, where crops are being experimented upon to make agriculture more “climate-resilient”

  3. Land and soil degradation

  4. Food crisis, due to the use of chemicals and fertilisers, deteriorating the quality of food

  5. Socio-economic dimensions, with the rise of several agitations by social groups dependent on farming, and, inter-state water disputes

  6. Desertification in 90% of states in India

Ground water depletion has become an especially critical area of concern in Indian agriculture.


As can be seen from the map1 below, there are five types of ground water assessment units viz. safe, semi-critical, critical, over-exploited and saline. A substantial portion of our ground water units are marked as over-exploited (the units marked in red).


This has, in recent times, given rise to another big issue in form of inter-state water disputes and the drinking water crisis. For instance, in the dispute between Karnataka and Tamil Nadu over the Cauvery river waters sharing, the issue is the conflict between sharing of water for drinking water purposes and irrigation purposes.


The Green Revolution

The problem, for us, began when we started viewing our critical means of livelihoods as ways to enhance productivity, use technology and derive maximum benefits for ourselves. Thus, very soon we converted our food grain production units into surplus granaries to be used for exporting food grains and began to earn foreign exchange, thereby making a rich class of farmers.


Our fertiliser consumption also kept increasing, going up from less than 1 million tons of total nutrients in the mid-sixties to almost 25.6 million tons in 2014, with fertilisers alone enhancing our agricultural growth by about 50 per cent,4 showing that our agricultural growth and the so-called golden age of Green Revolution came at a dire cost of bad consumption of fertilisers, which proved to be fatal to the quality of our soil and crops and water.

The government is not realising that the agrarian crisis has deep-rooted implications, and, is therefore targeting all the wrong solutions. It is looking towards the kind of high-level technological innovations like GM crops and nuclear treatment which will prove to be fatal.



The agricultural output growth has dropped sharply, sending a warning signal to the government. The government will have to address at least three major challenges:

  1. Drought in about 40 per cent of India (along with the possibility of deficient rainfall due to the impact of El Nino)

  2. Lower prices realised by farmers in the last three years for most crops and ironically

  3. Possibility of price rise of food items.


Possible Solutions


1. Rationalising Subsidies

The issue is the government’s ill-advised subsidy policy which makes no discrimination whatsoever on the various input subsidies to agriculture. When everything from electricity, water, seeds, fertiliser, interest, are given free or subsidised without any limits of landholding or size, it leads to similar cost structures for most suppliers. One possible solution can be by rationalising subsidies. This can be done by restricting subsidies to only those holding 2-3 acres or to the first 2-3 acres only for even for larger farmers. With precise targeting through DBT (Direct Benefit Transfer), it is possible in the current scenario. Or it can be graded like 100 per cent of current levels for 2-3 acres, 50 per cent for 4-8 acres and nil thereafter.


2. Government Finances

The government will save a lot by curbing subsidies going to larger farmers. It can reduce the crops procured under MSP since the market prices would have substantially moved to enhance their incomes. This would have come from consumers who were willing to pay, hence maybe without much pain (other than a one-time price adjustment as inflation).

3. Technology Exchange Programs

The mutual benefit programs with agriculturally advanced nations can really prove to be a game changer for Indian agriculture, as it can have intended benefits:

  1. It will bring the required innovation in our agriculture.

  2. The transfer to modern methods and more efficient farm techniques can help India, like Israeli water management in agriculture.


4. Increasing Agriculture Productivity

Large irrigation schemes focused too much by the state governments consume a greater quantity of resources and benefit only a small portion of the land. It would be much more cost-effective to shift to less capital-intensive minor irrigation and water conservation projects. The funding problem of launching such a programme could be solved by making the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) a vehicle for increased investment in minor irrigation, water conservation and water harvesting projects. Such projects have a higher material content component than is currently permitted under MGNREGA.


5. Foreign Trade Policies

Export-import policies must be made pro-farmer so that they are able to get the full benefits of higher prices abroad. Farmers should be protected from any sudden collapse in world prices by an appropriate adjustment in duties. Similarly, if it is felt that exports need to be moderated, it should be done through duties and not export bans. Farmers complain that the government fails to anticipate world price developments and is also extremely slow in responding.


6. Policy Reforms

To free agricultural markets from the clutches of large traders and oligopoly of large traders, it is important that

  1. APMC Act of 2003, which introduced all-around marketing reform, is implemented genuinely.

  2. National Agriculture Market or eNAM, an online trading platform for agricultural commodities in India is an important step in this direction. The need of the hour is to make it reach every corner of the country.


7. Crop Insurance Schemes

Farmers are frequently affected by natural disasters such as droughts, floods, cyclones, storms, landslides, hails and earthquakes. Though crop insurance schemes like Pradhan Mantri Fasal Bima Yojana covers crop failures, still there is a need for more broad coverage of natural calamities affecting crop produce.

8. Utilising Untapped Areas

We need to pay special attention to the problems of farmers in eastern states. Given fertile land and abundant water resources, these states have a high potential in agriculture. Yet, their productivity in various crops lags behind the national average. Therefore, a concerted effort is required to bring the Green Revolution to these states.


9. Cooperative Farming

There are several variants of cooperation ranging from collective action in accessing credit, acquiring inputs and marketing to production cooperatives that also include land pooling; labour pooling; joint investment, joint water management and joint production.

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