Farming in...

Farming, therefore, has steadily become an unprofitable occupation, according to the study.

India is a global outlier on this count. Out of 26 countries whose proportion of gross farm receipts was tracked over two years (2014-16), only India, Ukraine and Vietnam had negative farm revenues. India’s problem, however, stretches far back. Total receipts, or gross farm revenues declined 14% on average between 2000 and 2016. Between 2014 and 2016 , this fell by over 6% per year. This points to negative returns for producers.

Significantly, the report cites federal policies as a key reason for holding farm incomes back. In the policy trade-off between prices consumers pay and prices farmers get, government trade policies had the effect of keeping farm incomes low.

The OECD used a set of proprietary policy indicators, including support transfers to the farm sector, which in India’s case was applied for the first time. These broadly measure the total share of transfers from consumers and taxpayers, as a class of citizens, in gross farm revenues.

“Most of these distortions took place during the previous UPA government period when export restrictions and minimum export prices were imposed but were not reviewed when global prices began to fall,” Siraj Hussain, who served as agriculture secretary under the previous UPA government, said. “As a result, India lost the opportunity to export sugar, rice, maize, wheat, even non-basmati rice.”

The study states that India presents a contrast with most other countries studied by OECD because of the prevalence of negative market price support and its size. In the 2000 to 2016 period, producer prices – or prices farmers receive– have remained below those in international markets “for many years and for many commodi-