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Will The Farmer Woes Dominate 2019 Elections?

Will The Farmer Woes Dominate 2019 Elections?

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Tasneem Kabir   Farmer

The Legitimate Desk: With the Congress having taken over the three states of the Hindi-speaking belt viz. Madhya Pradesh, Rajasthan and Uttar Pradesh in their respective State Assembly Elections, what has come to the fore is that the farmer’s woe management has been a prime concern of the manifesto of most contending parties, with the Congress having presented the most glittering promises.

But before we look at how impactful of an agenda supporting the farmers would be in the 2019 General Assembly Elections, we must find out just why the Indian farmer is constantly under pressure, with the excess of it often times culminating in suicide.

The foremost issue with Indian agriculture is instability: it largely depends on monsoon. As a result, production of food-grains fluctuates year after year. A year of abundant output of cereals is often followed by a year of acute shortage.

This, in its turn, leads to price income and employment fluctuations. Next, It is believed that large parcels of land in India are owned by a- relatively small section of the rich farmers, landlords and money-lenders, while the vast majority of farmers own very little amount of land, or no land at all.

Moreover, most holdings are small and uneconomic. So the advantages of large-scale farming cannot be derived and cost per unit with ‘uneconomic’ holdings is high, output per hectare is low. As a result peasants cannot generate sufficient marketable surplus. So they are not only poor but are often in debt.

Additionally, due to the growth of population and break-down of the joint family system, there has occurred continuous sub-division of agricultural land into smaller and smaller plots. At times small farmers are forced to sell a portion of their land to repay their debt.

This creates further sub-division of land. Sub-division, in its turn, leads to fragmentation of holdings. When the size of holdings become smaller and smaller, cultivation becomes un-economic. As a result a major portion of land is not brought under the plough.

Such sub-division and fragmentation make the efficient use of land virtually impossible and add to the difficulties of increasing capital equipment on the farm. All these factors account for the low productivity of Indian agriculture.

That being said, in a largely agrarian society like India, addressing issues of the farmers is imperative for the political parties, lest the farmers’ unions run rampant in protests.

The NDA tenure within the span of 2014-2018 has been dismal, the most reverberant of its repercussions being the large-scale march-cum-protest with the Opposition and activists leading lakhs of farmers from across India to the doors of the Parliament House in Delhi. A pamphlet distributed by the activists detailed their grievances.

It said that farmers got only Rs 5 per kilo for tomato while consumers pay Rs 30. It also featured similar instances of difference in rates for moong dal, apples and milk. “Our life is also cheap. In the last 20 years, over three lakh farmers have committed suicide,” it read at the end, along with the sobering statement that the farmers did not intend to cause inconvenience to the people of Delhi and didn’t wish to disrupting traffic, but were here to convey their pressing grievances to the government.

To have sparked a protest so dramatic even international fora covered it, the NDA has to have done something wrong. Farmer groups during the aforementioned march termed the incumbent National Democratic Alliance (NDA) government at the Centre “the most anti-farmer” in the history of independent India, saying its budgetary announcements were just grandstanding, with little action or money to back them.

The most significant setback for farmers was the Centre making lumpsum promises that it knew it couldn’t keep, yet went on fifing about them, to put the welfare spotlight on them. Consider the Centre’s promise of revising Minimum Support Price on a cost plus 50 per cent formula that it reneged on.

Not only was the formula not implemented, it was conclusively affirmed in the Supreme Court that it was unworkable! Next, we find that the NDA isn’t willing to carry its own sacks, and constantly seems to, under the banner of decentralisation, pass the buck as and when it can, to absolve itself of any prospective public backlash – The government, far from increasing public investment in agriculture, failed even to maintain existing levels.

It actually passed on the burden of expenditure to State governments, leading to an overall decline in public expenditure in agriculture in GDP terms. Similarly, the government shifted the debt-relief burden to States, which are doing a shoddy job of the loan waivers announced.

This is despite the fact that much of the agrarian crisis can easily be attributed to the Central government’s policies! Thus, the vicious cycle isn’t allowed to close and die out, for the initiators of the farmers’ worries aren’t willing to fully address the issues amidst finding ways to reduce its spending.

In a major debunking of lies, the Green Paper issued by farmers during the protests at the Parliament made clear that the very foundation of the NDA’s election to power in 2014 was based on a flawed statistic: Calculations made by farmer organisations showed that the performance of the preceding UPA government was far better.

According to them, in 17 out of the 20 major crops, the net returns at MSP during the four years of NDA government were significantly lower than the net returns at MSP under UPA-II.

This makes the unfulfillment of the promises by Modi all the more blatant, because the crux of his argument (prior to the 2014 elections) was that the net returns of farmers were low during UPA and needed to be raised significantly! Factually speaking, there is no constituency that the PM has failed in greater measure than farmers. Agricultural growth over the past four years has been at its lowest since economic reforms began.

At a growth rate of 1.9%, the promise of doubling farmers’ incomes seems like an insensitive taunt. To put this in context, the average growth rate of agricultural income under UPA was 4.2%.On the one hand; different agricultural commodities (pulses) were imported in bumper years. On the other hand, import duties for wheat were cut down to zero.

These measures forced a sharp decline in already low farmers’ incomes since they had to slash prices to find buyers for their produce. To compound this further, agricultural exports fell by over $9 billion. This is a failure of policy making that borders on criminal negligence.

With the failure of the NDA government in the Agriculture sector having put in perspective, and the farmers forming a significant fraction of the voting body, farmers’ issues are bound to form a meaty chunk of the various campaigns as well as party-manifestos in anticipation of the 2019 Lok Sabha Elections.

Pollsters have predicted that the picture that the Agrarian sector presents is one that points towards the overthrow of the NDA in 2019. Yet, this analysis is faulty of being placed in vacuum, for even after being aware of the woes of the farmer; there are other issues that plague the voters: familial party loyalty, caste-promoting party loyalty and even loyalty to a particular leader.

Psychologically speaking, a voter is largely driven by factors other than the unbiased result of the Government’s output, which is not helped much by the fact that about 30% of the population of India is illiterate.

Hence, making a demarcation of who will come to power and who will not, remains a hard nut to crack, but the odds are definitely looking better for the UPA.

Having said that, the more pertinent topic of deliberation remains not who should come to power, but what the ones in power should do to in the coming years, starting 2019, to alleviate the agony of the Indian farmer.

First off, the setting up of a Farmers’ Income Commission or a similar body to regulate the farmers’ credit should be put in place. There is also a need to create a credit guarantee fund to help non-land-owning tenant farmers, share croppers and agricultural workers access institutional credit. Another vital issue is that of the MSPs.

While the government has announced the MSP for 14 kharif crops, it primarily has procurement operations (or buys directly from farmers) for paddy (in the kharif season) only. This basically means that all farmers do not have access to the government’s minimum support price, as all farmers don’t grow paddy.

Further, even in case of paddy, the procurement operations vary across different parts of the country. They are very good in some parts and almost non-existent in others. The Commission for Agricultural Costs and Prices (CACP) studied the wholesale prices of paddy between April 2016 and February 2018.

It found that, in Uttar Pradesh and Assam, two states which contribute 17% of to the overall paddy production in India, prices were below the MSP during the “peak market arrival period of October to December 2017”.

The Commission also found that “prices in West Bengal, Punjab and Haryana were above the MSP, mainly due to good procurement system that is in place in these states.”Once the government was seen paying the MSP in a particular region, the private players had to pay more to attract farmers to sell to them.

Further, in a state like Punjab, which has excellent procurement operations for paddy, the MSP system has led to a situation where paddy is being grown in large quantities in a semi-arid region, although production of paddy requires a lot of water! Of the total rice procured by the government for the central pool in 2016-2017, 27% came from Punjab. In 2015-2016, this had been at 25.7%.

Hence, the question that needs to be asked is, why is a semi-arid region is growing so much rice? Given the fact that very little rice gets consumed in the state, almost all the rice produced, is available for sale. The government of India procures more than 70% of this.

The larger point is that the farmer in the state has a readymade buyer in the Indian government and so, the system as it is, incentivises him to produce more and more rice, even in a semi-arid region. With such instances of grave misuse of the ideology of the MSP, yours faithfully believes that it is time for it to be revisited.

We have seen an alternative in the manifesto of the Telugu Desam Party (which defeated the Congress hands down in Telangana): The manifesto promised waiver of up to Rs. two lakh agricultural loans. It said Rs. 10,000 crore would be allocated in the budget for a market intervention scheme for the benefit of the farm sector.

Bonus, in addition to the minimum support price, would be announced for major crops, it said. Farmers would also be given an annual investment support of Rs. 10,000 per year per crop, thus eliminating dependence on produce, season and the various players that hamper growth of the farmer in the rigidly competitive market.

All in all, we find that the social and geographical conditions of India put the farmer under distress, which is further aggravated by four years of an unsatisfactory government at the centre.

With a dip in the agricultural output as percentage of GDP in India, farmers are seen courting the idea of a fresh government at the Centre. Lastly, MSPs, which form the backbone of the farmer-oriented welfare of the Centre as well as State, needs a major revisiting and we ought to look for more sustainable schemes that eliminate misuse.

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