No Golden Harvests
After the farm laws debacle, the focus has been on raising storage capacity and digitisation of co-ops to boost farmer incomes, which are still below par
YEAR LONG PROTESTS BY SOME FARM UNIONS HAD PUT PAID to big-ticket reforms in the agriculture sector in November 2021, forcing their withdrawal. With that, the plans to open up corporate investments in the farming sector also went out the door. The Centre has now moved on to strengthening the network of cooperatives and FPOs (farmer producer organisations) across the country to build an agri-centric ecosystem. But this will take time to find its feet. Meanwhile, the numbers are worrying: some 42 per cent of the population is dependent on agriculture to make ends meet, the sector contributes about 17 per cent to the GDP annually, while annual growth averages out at a measly 4 per cent.
The ministry of agriculture was allocated Rs 1.26 lakh crore in 2022-23, almost five times the allocation in 201314 (Rs 27,700 crore). Even after all this, the sector is expected to grow at just 1.8 per cent in 2023-24, a steep fall from the 4 per cent growth in FY23. In February 2016, Prime Minister Narendra Modi had raised the bar, promising to double farmers’ incomes by 2022. At the time, the average monthly income per agriculture household was Rs 8,059. In December 2022, a report tabled in Parliament says average monthly income was just Rs 10,218. To double real incomes, produce prices had to increase at a rate of over 10 per cent, but they went up by just 2.5 per cent. Getting this done requires structural changes; mere hikes in MSP will not do. Lack of storage capacity in the country, and not enough convergence of private processors with growers, has also hampered the latter. For the poorest farmers, there’s now an income support scheme via PM-KISAN (Rs 6,000 annually), while subsidies run across the board to cut input costs.
The NDA regime has focused on digitalisation of cooperatives to bring in more transparency in operations and integrate them into the decentralised storages. In FY24, Rs 968 crore was earmarked for this. In 2021, the Reserve Bank of India laid the roadmap for usage of the electronic-Negotiable Warehouse Receipt (e-NWR), so that public sector banks can enter the segment and provide financing to the farmers (against these receipts). Efforts are on to set up massive decentralised storage capacity, too, many of which will be covered with e-NWR.
For the next government, the big task will be to convince farmers to diversify crop patterns, while also ensuring that they are paid ably and on time. This will require the strengthening of the farmgate-to-processing infrastructure, complemented with a comprehensive agricultural policy that understands the demands of all players and assures logistics. The enhanced storage capacity in the country will then add to the confidence of the farmers. ■
Farmers must get remunerative prices for their produce. Strengthening the cooperatives and digitalisation of the commodity markets is the way forward -ASHWANI MAHAJAN National co-convenor, Swadeshi Jagran Manch