An agricultural emergency

Published: March 29, 2018 - 13:00 Updated: May 2, 2018 - 13:42

The Long March from Nashik to Mumbai not only presented a snapshot of the crisis that engulfs the agriculture sector but also proved yet again the futility of farm loan waiver

 

 

On March 6, when some 15,000 farmers started out from Nashik, the news was buried in the inside pages of newspapers. As they reached Mumbai and the numbers swelled to 40,000, they managed to capture the attention of big media and the masses alike. The next day saw an outpouring of support from Mumbai’s people and the Opposition. There were stories of how the people of the city came out in huge numbers to offer food and water to those who grow our cereals. Pictures, on the other hand, showed the physical rigour the farmers underwent while covering the 180-km distance on foot. 

 

The show of strength the nation witnessed in Mumbai was only the latest in a swirl of agrarian protests that has been erupting in various parts of the country. In fact, the Long March was the second protest witnessed by Maharashtra in a year. Last year saw nine districts in Madhya Pradesh on the boil after five farmers were killed in police firing during a protest in Mandsaur. In Rajasthan, too, a 13-day protest was called off when the government agreed to waive debts up to ` 50,000.

 

In Maharashtra, the images of a red wave descending on a very busy metropolis all the way from Nashik managed to present a snapshot of the crisis with more lucidity than figures projected by economic surveys. The protest also bore testimony to the fact that the tall promises made by the Narendra Modi-led Bharatiya Janata Party (BJP) regime regarding implementation of the MS Swaminathan Committee recommendations, loan waivers and doubling of farmers’ income by 2022 had not been fulfilled in the last four years that the BJP has been in power. In its election manifesto and the budget presented this year, the BJP promised to provide a Minimum Support Price (MSP) of 50 percent more than the production cost but the plan is yet to see the light of day. In fact, the agrarian riots in Madhya Pradesh’s Mandsaur were the direct result of one of the key economic decisions taken by the Modi regime in 2016 – demonetisation. Prices of farm produce had crashed in the aftermath of demonetisation and the government’s inability to pay the farmers in cash had deflated the price of onions, forcing farmers to take to the streets. The BJP is well aware that resentment in the farming community has been brewing. With just one more year to the general election and the Opposition’s eager and unanimous show of solidarity with farmers in Mumbai during the Long March, the Maharashtra BJP government swung into action at great speed and put a swift full stop to a long-drawn protest.
 


The protest also bore testimony to the fact that the tall promises made by the Narendra Modi-led Bharatiya Janata Party (BJP) regime regardingimplementation of the MS Swaminathan Committee recommendations, loan waivers and doubling of farmers’ income by 2022 had not been fulfilled in the last four years that the BJP has been in power.

 

 

While a political crisis may have been averted, the agrarian crisis is far from being resolved and the numbers prove this fact: according to National Sample Survey Office 2013-14 data, at least 50 percent of the total 90.2 million rural agricultural households are in severe debt. In recent times, successive governments have tried to placate angry farmers with loan waivers. But they have functioned more as handouts and have done little to lift farmers out of financial distress. The Maharashtra government announced what it claimed was the largest loan waiver in the state’s history in June last year. And yet, not only did we see a 40,000-strong crowd of farmers on the road demanding waivers again this month but also the Economic Survey for the state showed a sharp contraction in agricultural growth and failed to project a bright picture for the future. 

 

Experts have time and again warned against viewing waivers as a solution by arguing that not all farmers under financial stress approach banks for loans. Those who go to private money lenders end up being outside the purview of the waivers announced by the government. While opinion is divided on whether farm loans should be written off at all or not, there is a consensus on the fact that it can only function as a Band-aid solution and the government cannot run away from its responsibility of looking for other long-term solutions to make farming profitable. As of now, India faces a cumulative loan waiver of ` 3.1 lakh crore, which is 2.6 percent of the country’s Gross Domestic Product (GDP) in 2016-17. According to data analysis by a website, a debt write-off of this scale could pay for the 2017 rural budget 16 times over or pay for building 4,43,000 warehouses, or increase India’s irrigation potential by 55 percent more than the achievements of the last 60 years. 

 

 

There are a number of ways in which the money can be allocated better. With global warming seeing a rapid rise, the rainfall patterns have changed. As a preliminary assessment report tabled in the Lok Sabha this month pointed out, unseasonal rains and hailstorms in February damaged crops spread over 4,76,000 hectares in five states. Nearly three lakh hectares of the affected area were in Maharashtra alone. While climate change cannot be directly linked to farmer suicides, there is data to prove that it leads to lower crop yields, thereby adding to farmers’ inability to repay debt. Although little can be done immediately to reverse the impact of climate change, the government should look to tackle other challenges, like irrigation of farmland, better management of water resources and better insurance for farmers against risk.  

 

 

All things considered, the possibility of the recovery of the agriculture sector seems to be dim. There are also a few harsh truths that need to be told: farming as an activity has only become more expensive over the years with less output, and waivers have placed a huge burden on the back of the economy. There is a need to see indebtedness for what it is –– a symptom and not the root cause of the agrarian crisis. There has been a longstanding need to invest in solutions that will not just alleviate the crisis but also make farming profitable in the long run. If the government is unwilling to offer anything more than loan waivers, it should at least stop raising hopes of doubling farmers’ income 

 

This story is from print issue of HardNews

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