Way out of farm crisis

Subir Roy

THE full dimensions of the agricultural crisis facing the country are even now not being realised. Not only does its effects go well beyond the boundaries of agriculture and rural India, posing serious challenges to the entire economic system, solutions which will really work are mostly long term ones. On the other hand, the government has an immediate political problem on its hands and has no option but to go for short-term palliatives which are counterproductive. So, it is critical to understand the systemic risk at play.  

The magnitude of the crisis affecting the world beyond that of the farmer is contained in two factors. The appalling condition of cities and slums created by migration since liberalisation indicates that gainful employment will have to be found in rural India itself for many who would rather go to a city for a job. Otherwise joblessness and urban malfunction will challenge the social fabric of India. This means urgently adopting PURA (Providing Urban Amenities to Rural Areas), the concept created by former President Abdul Kalam. It implies investing in all enablers of non-farm rural economic activity so that rural services can become an important job creator. 

The other and perhaps the most important factor is ensuring that Indian farming is in harmony with the global agenda to address climate change. Farming must become less water and energy intensive, the generation of methane through livestock rearing and intensive farming has to be contained. Not only must farm incomes rise rapidly, but also farm practices must be in line with the strategy to fight climate change.  

It is a cruel irony that the present crisis has been created by a bumper harvest and resultant crash in prices. Good rains, which are a boon and result in abundant harvests, should be sought and prayed for, not looked at with apprehension. A key solution to this is to have adequate storage or godown capacity and farmers selecting crops which are at least partially non-perishable.

Another solution to the problem of periodic oversupply is to have a robust food processing industry which will have substantial over capacity that will be used only once in a while. For example, if there is an oversupply of tomatoes, build up a huge stock of ketchup. But here we come up against current medical advice urging people to consume more of fresh produce as, among other things, processed foods contain harmful chemical additives. 

So, other than grains, the output of crops like potato, onion and tomato has to be either consumed more or less right away or be stored in conditions that add a bit of life. As for leafy vegetables, which are highly recommended, whatever is produced has to be immediately consumed or stored for a little while under refrigeration. We probably need an elaborate social media network which tells consumers to, say, have lots of spinach over the next couple of months, whether they like it or not. It is good for both consumer and farmer. 

Another long-term solution even more difficult to countenance is to bury the Green Revolution. Yes, drill into people’s minds that the Green Revolution is an idea whose time has come and gone. Hence, there is absolutely no reason to talk in terms of taking the Green Revolution to Eastern India. The revolution led to excessive use of water and fossil fuel-based chemical fertilisers. (The supply of both is hugely limited.) Also, focus on cultivation of wheat and rice, backed by assured procurement, has led to decline in soil nutrition and productivity.

The Green Revolution has to be replaced by sustainable agriculture pointing in the direction of organic farming. In Eastern India, the model to follow is that of Sikkim which has gone entirely organic. The way ahead is based on elements like manure from cow dung and pesticides from neem. The Aila cyclone which hit the Sundarbans in 2009 and led to devastation of farm land from flooding by saline water from the sea, has caused a revival of traditional saline-resistant rice varieties. The whole point is that for India and its farmers to be able to look forward to a better day, the nature of agriculture has to change again, the way it did four decades ago. And the bottomline is that this cannot be done in a day.

Even more than having any kind of control over production, the farmer is faced with a huge hurdle over marketing, resulting in an enormous gap of even four to five times between farm gate and fork prices. The need to dismantle the system of mandis run by agricultural produce marketing committees is well known and being addressed. But what is not being simultaneously pursued with sufficient vigour is an alternative system. A small farmer has to be able to sell his produce within a geographically affordable area (he can’t travel with it for miles on end). So, what has to come up is a new supply chain which takes the produce to the food processor, organised retailer or the ultimate consumer. Farmers’ cooperatives is one answer. Again, this cannot be done in a day. 

Finally, the risk to farming is far greater than the risk to, say, manufacturing. A car manufacturer regulates its shifts depending on perceived demand. The farmer can increase or reduce acreage, even leave a field fallow or go in for an additional crop, but these are big decisions, not akin to cutting down factory output by, say, 5 per cent. The major risks the farmer faces revolve round weather and price. Micro and precise weather forecasting can be one mitigation, another can be participating in forward markets or going in for contract farming. Finally, precise and efficient farm or crop insurance can greatly mitigate risk. 

The one area where action can be taken quickly and rewards reaped is water. Minor irrigation, watershed management (creating tanks and bundhs) to preserve rain runoff can be done prior to a rainy season with community participation. Further, the time has come for large-scale adoption of drip technology and sprinklers to lower the use of water. This requires investment for which a robust system of agricultural credit has to be in place. Lowering of interest rates for farm loans, as has already been done, and offering a subsidy for investment in water management can be taken forward. Absolutely the last thing that should be done is waive farm loans which wreaks havoc on the agricultural credit system. 

The writer is a senior journalist