Time for big-bang agricultural reforms
The government is making serious efforts to make agriculture a thriving economic sector
This year’s annual budget has set afoot the initiative to implement the promises that NDA government had made while being sworn in, bringing radical changes in the agriculture and making it a profitable profession. The Prime Minister Narendra Modi has even assured to double the income of farmers by 2022 and the flurry of schemes announced by him has guaranteed that the target can very well be achieved.
Indian agriculture is poised for a stupendous growth; at least the Economic Survey 2015-16 that was tabled in the Parliament insists so. Although it has predicted a moderate growth for overall economy, Survey’s assertion on radical transformation of agriculture sector assumes greater significance as it will ensure the sustainable development of our farmers.
The agriculture experts are saying that it the high time for the country to adopt high yielding Genetically Modified (GMO) crops, stepping up pulses and oil seeds output with an increase in investments for improving irrigation, and expanding the coverage of Minimum Support Price (MSP) mechanism among farmers.
Because of experiences under the previous regime, there are good reasons for some of the public apprehensions on GMOs; therefore, the regulatory process in India needs to evolve in order to address the concerns so that they do not spring up mid-way while adopting high yielding technologies.
Two consecutive drought years has brought the focus on expansion of the acreage under irrigation while adopting the relevant technologies for efficient use of water through suitable pricing.
Fulfilling our motto of providing food security to everyone, Indian agriculture has become cereal-centric and as a result, regionally-biased and input-intensive, consuming generous amounts of land, water, and fertiliser.
Since more than 58 percent of the rural households depend on agriculture directly as their principal means of livelihood, government has already taken major steps to address issues related to soil and water resources that are critical for improvement in agriculture production.
The central government of India recognises the importance of micro irrigation, watershed development and ‘Pradhan Mantri Krishi Sinchai Yojana’; thus, it allocated a sum of Rs 5,300 crore for it. The Department of Agriculture and Cooperation under the Ministry of Agriculture has inked agreements with 52 countries including the US, which would help in areas such as research and development, capacity building, food processing and plant protection, among others.
The NDA government has also taken steps to improve soil fertility on a sustainable basis introducing the soil health card to support the organic farming scheme ‘Paramparagat Krishi Vikas Yojana’. Other steps include improved access to irrigation through ‘Pradhanmantri Gram Sinchai Yojana’; enhanced water efficiency through `Per Drop More Crop’; continued support to Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and the creation of a unified national agriculture market to boost the incomes of farmers.
The Economic Survey has acknowledged the steps taken by government in modernizing the agriculture. Centre had allocated Rs 25,000 crore for the Rural Infrastructure Development Fund (RIFD), Rs 1,500 crore for the long-term rural credit fund, Rs 45,000 crore for the short-term cooperative rural credit finance fund and Rs 25,000 crore for the short-term Regional rural bank (RRB) refinance fund. It also marked an ambitious target of Rs 8.5 lakh crore of agriculture credit during 2015–16.
One thing that needs dire improvement is the procurement policy which is disproportionately focussing on crops such as rice and wheat instead of pulses and oilseeds. While Minimum Support Price (MSP) exists for most farmers for most crops in principle, its realistic impact is quite limited for most farmers in the country.
This has resulted in buffer stocks of paddy and wheat to be above the required norms, but also caused frequent price spikes in pulses and edible oils, despite substantial imports of these commodities.
The Economic Survey, a sacred document for agriculture experts, has predicted the sector to generate better momentum in the next few years due to increased investments in infrastructure such as irrigation facilities, warehousing and cold storage.
Factors such as reduced transaction costs and time, improved sea-port gate management and better fiscal incentives would contribute to the agriculture’s growth. Furthermore, Food Corporation of India should outsource its stocking operations to various agencies and it may hand over all procurement operations of wheat, paddy and rice to Andhra Pradesh, Chhattisgarh, Haryana, Madhya Pradesh, Odisha and Punjab as they have sufficient experience and reasonable infrastructure for procurement.
Some of these recommendations were also made by Shanta Kumar Committee that was formed by Modi government last year for restructuring the Food Corporation of India and make our Targeted Public Distribution System better.
The writer is an avid contributor on agricultural economy. He is Secretary at Uttan Krishi Sanshodhan Sanstha, an Agricultural Diploma College in Thane & Member of Task Force IT in Ministry of Shipping, Highways, Road Transport , Government of India