MSP regime indispensable

PC Bodh

THE ongoing debate over the farm laws is a huge opportunity for Indian polity to find out whether it is the complexity of farming problems or its own crookedness which is responsible for the sorry state of our small and marginal farmers and farm workers.

Despite the stellar performance amid the pandemic, the Indian agricultural sector continues to be crisis-ridden. On an average, over 15,300 farmers and farm workers annually committed suicide from 1995 to 2015; and the trend is still going on unabated.

As a director in the erstwhile Planning Commission, I witnessed a major move by the National Development Council under the leadership of the then PM Atal Bihari Vajpayee to reverse the suicidal downtrend in agriculture. Subsequently, with the arrival of the Manmohan Singh government, the tempo of agricultural development accelerated. The MS Swaminathan Commission was set up with the mandate of delving into the agrarian crisis and recommending policies to resolve it. Though it was the UPA government which unveiled the National Policy for Farmers (NPF)-2007, it didn’t agree to fixing the MSP at 1.5 times the cost of production. It is the NDA government which, after an initial hitch, agreed to implement this recommendation in its fifth year in 2018-19.

The apprehension that allowing the sale of produce beyond the physical boundaries of the Agricultural Produce Market Committees (APMCs) might lead to winding up of the MSP policy is unfounded. The MSP regime is going to stay owing to its success over the decades in serving the national macro-economic objectives of food security and welfare measures for access to food and nutrition. The system remains pivotal to food security and protection of farmers against the vagaries of weather and the market. What’s more, according to the Commission for Agricultural Costs and Prices, the MSP policy can be deployed to correct the crop pattern in favour of wheat, pulses and oilseeds.

Allowing the free sale of farm produce beyond the physical limits of APMCs is intended to protect farmers from their exploitative functioning by exposing them to private mandi competition, as found in the field evidence of agro-economic research studies.

When the NDA government took over in 2014, the 12th Five-Year Plan had been under implementation with 11 formidable National Mission Schemes, addressing all key aspects of agricultural development to achieve 4% growth rate. Since then, there have been significant modifications and improvement to overhaul these schemes to achieve the growth rate, tackle the agrarian crisis, and double farmers’ income by 2022. Green Revolution — Krishonnati Yojana was approved coterminous with the period of the 14th Finance Commission from 2017-18 to 2019-20.

What necessitated the farm laws ever more was the need for making agriculture fully realise its growth potential by liberating farming from hurdles posed by archaic laws and open up ways for enabling them to adopt innovative and dynamic farm management.

According to agro-economic research studies, it is critical to free agricultural markets from corruption and handicaps of exploitative functioning of APMC markets for bringing in private mandis in a big way.

The farm sector reforms have immense potential and relevance in giving Indian farming and farmers a push towards self-reliance. Taking out agricultural produce from the ambit of the Essential Commodities Act would make the free flow of agricultural produce possible across state and international borders, brightening the prospects of benefits across areas to enrich all players in the chain; and provide optimal conditions for farming compatible with global competition.

No policy regime evolves or survives during any one political party’s term and the overall process either evolves further or degenerates. One needs to be guided by the moral responsibility of safeguarding the interests of farmers.

The author is Senior Economic

Adviser to Union Ministry of Agriculture & Farmers’ Welfare. Views are personal

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