With the current government having been in power for four years now it’s time to try and analyze why one of our biggest sectors which employs around 47% of the nation’s work force [1] has still not hit the pinnacle it was supposed to. The first factor that comes into play here is India’s misfortune of having two consecutive drought years. 2014 and 2015 both saw scanty rainfall and farmers around the nation were hit with very poor harvests. This was a time when all sectors especially the agrarian sector needed active intervention and positive reinforcement from the government. However what followed in 2016 was the unprecedented demonetization scheme that absolutely scrambled the economic equilibrium of India. It is not my position to comment on whether the demonetization scheme was wrong or right but one of the most crucial aspects of every great policy is time. In this case it goes without saying that the demonetization was pulled off in one of the most vulnerable times for our agrarian sector and it simply could not keep up to the unprecedented changes affecting the nation. The Goods and services tax that was implemented shortly after also was not able to usher the agrarian sector back to it’s former glory. With farm exports dwindling at a worrying 3.1% rate between 2016 and 2018, the GST’s ambitious efforts to restructure the nations rate system and introduce new state of the art technology and software for data proves to be inconsistent with the immediate needs and ambitions of the nation’s farmers. The GST scheme with some further provisions and alterations so as to not enforce new software and invoice systems on the farmers and small retailers could have been the boon or positive intervention the small players of the Indian economic scenario needed. The current government at the beginning of it’s tenure had started several agrarian schemes like Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) and Pradhan Mantri Fasal Bima Yojana (PMFBY) [2] . Also, a new different kind of scheme called e-National Agriculture Market (e-NAM). The jury is still out on the verdict of whether these schemes can be called a success, as in the first 2 years the agriculture GDP growth was a mere 1.7%. In the subsequent year it was a wholesome 6.3% [3] , but the average still stands at only 2.4%. In my opinion the only agrarian scheme that can be called a success is the e-NAM. Connecting over 585 regulated mandis across 14 states on an electronic platform and further announcing that 22,000 more markets are to be added shortly is a huge deed in such tumultuous economic times. Surprisingly the much talked about policy in Pradhan Mantri Fasal Bima Yojana (PMFBY) has still not yet delivered on it’s ambitious promises. The yojana had laid out an assortment of milestones which should’ve been accomplished by now. Multiple changes in the previously planned budget allocations have negatively impacted the fulfilment of it’s goals. Inconsistency in agrarian policies have added to the farmer’s plight and prevented any form of alleviation of distress.
The factor of Indebtedness still remains as one of the major causes of concern. The number of indebted agricultural households has increased to 52% from 48.6% (around 4.68 crore households), along with an increase in average amount of outstanding loan (Rs 47,000 in 2013, compared with Rs 12,585 in 2003) [4] . It is seen that a vast majority of farm suicides are of tenant farmers and moreover, they don’t get to avail of agri-credit from institutional sources since banks continue to seek pledging of land titles even for short term crop loans. The current agrarian policies have potential, but they must be tweaked to alleviate the farmer’s immediate distress and only then move towards big picture agendas. The central government must work in consonance with every state government now more than ever. Any decision like declaring an annual debt relief package of sorts or setting up of statutory Farmers’ Income Commission [5] to ensure basic living incomes to all agricultural households is the need of the hour.
[1] Ashok Gulati & Hussain, Three years of Narendra Modi government: In Agriculture, the policy mix is right but implementation poor ( 30 october,2018) https://www.financialexpress.com/opinion/three-years-of-narendra-modi- government-in-agriculture-the-policy-mix-is-right-but-implementation-poor/639360/
[2] Green Paper on Farmer, Farming and Rural Economy, ( 30 October, 2018), http://www.kractivist.org/wp-content/uploads/2018/01/Kisan-Green-Paper-Jan30-2018.pdf
[3] Four years of Modi govt: ‘Problem of plenty’, agriculture slowdown challenges for NDA, Hindustan Times, ( 30 October 31, 2018) https://www.hindustantimes.com/india-news/four-years-of-modi-govt-problem-of-plenty-agriculture-slowdown-a-challenge/story-bpPzYsS1GiXFY88NvqWhMI.html
[4] Green Paper on Farmer, Farming and Rural Economy, ( 30 October, 2018), http://www.kractivist.org/wp-content/uploads/2018/01/Kisan-Green-Paper-Jan30-2018.pdf
[5] Anmol Nayak, Modi Government Is the Most Anti-Farmer One in the History of Independent India, Say Activists, The Wire, (30 October, 2018), https://thewire.in/agriculture/modi-government-is-the-most-anti-farmer-one-in-the-history-of-independent-india-says-green-paper
This article is written by
Arinjoy Chaudhury of
Symbiosis Law School, Pune
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