I have said this earlier also, and I do mind reiterating. To
bring any meaningful improvement in the fragile condition of India's farming
community, a comprehensive rural development effort is needed. Any piecemeal
solution like occasional loan waiver shall have almost no sustainable impact.
The traditional farmer welfare measures like periodic hikes in support prices
for certain crops, farm input subsidies, interest rate subvention have not
yielded the desired results.
In my view, a sustainable improvement in Indian farmers'
conditions is possible only under a comprehensive rural development mission. The
mission should address the problem with structural reforms at three levels,
viz., 1. Farm Level; 2. Policy Level and 3. Social Level. All reforms must be
pursued "urgently, vigorously, simultaneously" and in a fully
integrated fashion, for having a meaningfully sustainable impact.
Farm level reforms
At farm level farmers are struggling with a multitude of problems.
The most prominent being:
(b) Low productivity
(c) Vagaries of
nature (frequent droughts & floods)
(d) Poor price
realization
(e) Poor market
access
The measures initiated so far, e.g., higher support prices,
cheaper credit, crop insurance, improved irrigation, cash fertilizer subsidy,
better market access (eNAM, roads etc.) have positive impact on the state of
agriculture in the country. But this may not be sufficient, as it will have
only some incremental impact on the sector. What we need is a set of radical
reforms that would break the linearity and provide much greater impetus to
growth. (also
see here)
The following
ten steps, besides other measures, if taken immediately may help in significantly improving
the conditions at the farm
level:
(i) Enforce land
consolidation by linking subsidies and facilities to a minimum farm size.
Village or Block level farm cooperatives should be encouraged to achieve this
objective. Changes in tenancy rules and allowing large scale leasing by
corporates could be misused to exploit of farmers.
(ii) Digitize all land
titles within 2years. Enforce time bound Panchayat level resolution of all
title disputes preferably through mediation.
(iii) Change government
procurement system. Government should provide all inputs and technical guidance
to the participating cooperatives, and take 50% of the crop in lieu of this.
The balance crop should pay for the labor cost and profit. This will ensure
three things: (1) Guaranteed timely supply of quality inputs; (2) No debt
burden on farmer in case of crop failure. The government can take adequate
insurance for recovery of its costs; and (3) Adequate profit to the farmers.
(iv) The landowners who
have never engaged in farming activity in past two decades should be forced to
give away their landholdings to cooperatives at 50% discount. Anyways these
landowners let out their land on crop sharing basis or nominal lease rental.
(v) Make sure not a single
drop of river water flows into the ocean from India. Develop river linking and
water distribution grid on the models of roads.
(vi) Allow corporates to
develop waste and barren land for farming purposes. For example, many
corporates from India and Arab world may be interested in developing Rajasthan
and Gujarat desert and barren lands for growing dates, palm, aloe etc.
(vii) Set up a price
equalization mechanism through participation of private corporate sector.
Encourage building large scale storage capacities for farm produce. Assure a
regulated return of 10% premium on bench-mark yields, and allow bonds issued by
warehouses as SLR securities PSL assets.
(ix) Take factories to
farms. Encourage industry to partner with farm cooperatives to set up food
processing units at the farms. The farmers' cooperative allots land and
provides farm produce, whereas the entrepreneurs contribute capital and
undertake marketing and sales responsibilities. Both share the profit in pre-agreed
ratio. This should maximize profit of both the industrial enterprise as well
farmers, and create ample employment opportunities close to villages.
(x) Assist the famers in
the water deficient areas to move away from water intensive crops like Paddy, Sugarcane,
Banana etc. Provide them cash incentive, technical assistance, marketing &
sales assistance and necessary inputs to move to less water intensive cash
crops.
I shall share my thoughts and suggestions for policy level and
social level reforms tomorrow.
Thanks for share your blog here .
ReplyDeleteBuy Property Marbella