Farm Distress in India

Since the first confirmed case recorded on 23rd March 2014 Ebola outbreak in West Africa claimed 11,315 lives so far. Margaret Chan, the erstwhile Director General of WHO, declared the outbreak as ‘the greatest peacetime challenge that the United Nations and its agencies have ever faced.’ The abovementioned number of fatalities also equaled the average annual suicides of Indian farmers over the last few years. It is enough to comprehend the magnitude of farm distress in one of the largest economies in the world. Unlike Chan, concerned commenters on such situation displayed their attitudes quiet differently. Sanjay Dhotre, MP from the ruling party, suggested, ‘if they [farmers] are dying, let them die.’ Distress in the primary sector of economy coupled with political tempering unsettled the life of more than two-thirds of the Indian population, if not the entire populace. And it should be addressed comprehensively.

The agricultural sector of India is often characterized by instability in growth and income of farmers leading to their woe because of various factors involving production, market and price. Monsoon deficiency along with uneven rainfall is considered to be the primary default for causing instability. Nearly 60% of India including its food bowl states Uttar Pradesh, Madhya Pradesh, Haryana and Punjab received less rainfall last year than the long-period average (LPA) set by the Indian Meteorological Department. Half of India’s agricultural land lacks access to irrigation and therefore tends to depend solely on monsoon. 

Enduring setbacks in air and water Indian agro sector is currently experiencing challenges in land disposition. Latest agricultural census shows the average farm holding size has declined significantly, at 1.6 hectare in 2010-11 compared to 2.26 hectare in 1970-71. Since the number of marginal farmers (with farm holding below 1 hectare) is increasing continuously the total number of farm holdings has almost doubled as compared to 1970-71. Although this increase does not directly affects agricultural productivity but has several impacts on the economy. For example, increasing farm population per hectare will lower the per capita income. Lands which can be brought under cultivation are also limited. Furthermore, rampant urbanization, setting up of large industries and promotion of special economic zones (SEZs) shrink the available lands for agriculture.

Exploring the policy environment we can see gradual increment in prices of inputs such as fertilizers, diesels, electricity and pesticides, whereas input subsidies on fuel and fertilizers are being reduced. Crashing food prices provide poor return to the farmers. Arid growth rate lessens farm income and so does the standard of living of the small and marginal farmers. India’s agricultural growth in January to March quarter of 2018 dipped to 4.5% compared to the growth rate in the same period last year. It is also much lower than the growth rate of the GDP. Inconsiderate growth targets add insult to injury. Despite rapid changes in domestic and global factors, India continues to adopt stereotypical agrarian policies.

The introduction of Minimum Support Price (MSP) and procurement of food grains has provided incentives for raising production. However, MSP lower than the market price does more harm than good. Farmers are seldom able to sell their products at MSP since every village does not have government outlets.

Like other sectors agriculture is also a capital incentive economy. It requires capital input to enhance production as well as marketing. Rural farmers are obliged to borrow money from the money-lenders, traders and commission agents at high interest rates since superficial financial inclusion helps little. In order to pay their debts, the poor farmers are forced to sell their product at whatever price is offered to them. On the other hand, farmers who have managed to get loans from banks often fail to repay and get the burden of indebtedness. 

Soil erosion, lack of extensive mechanisation, inadequate transport and storage facilities, poor implementation of ongoing central and state schemes, slow wage growth (compared to inflation), demonetization, GST are the other causes of India’s farm distress.

As a consequence, farmers commit suicide. Inability to repay growing debt, insufferable poverty and devastated morale make them brace that only option for escape. As per official report, between 1995 and 2014, nearly 300,000 farmers have committed suicide in India. Informal sources suggest that the real figures are 10 times higher. A total of 12,602 persons involved in farming sector committed suicide in 2015. Maharashtra topped the list with 4,291 suicides, followed by Karnataka, Telangana, Madhya Pradesh, Chhattisgarh and Andhra Pradesh. Together, these states accounted 82% of the total count. 

Barring suicides, India has been witnessing protests across several states in last two years. National Capital Region is often clogged with hundreds of thousands farmers demanding to get delivered from their agony. Freakish public demonstrations to unravel their situation stir up disgust against respecting authorities. 

Dr. Pramod K. Joshi, the Director of South Asia of International Food Policy Research Institute (IFPRA), points five ways to reduce farm distress in India – namely, increasing Income, generating employment opportunities, reducing risks in agriculture, developing agri-infrastructure and improving quality of rural life. Those also include increase in crop area, rationalization of farm input cost, incentives for farmers to cultivate certain crops and implementation of better insurance schemes. Notwithstanding these idealistic and verbose remedies, a competent executive is required to put them into action.

Government initiatives, as a result of farmers’ agitation, amount a drop in the ocean of rising distress. Mere hike in MSP (over actual paid out cost and imputed value of family labour, rather than comprehensive cost including rent and interest on owned land and capital), loan waiver, opening (empty) bank accounts, nominal government schemes with swanky acronyms and oral conciliation followed by empty promises hardly make any difference. It is interesting to note that farm suicides in Maharashtra continue despite loan waiver declared last year.

National Council of Applied Economic Research (NCAER), New Delhi based nonprofit think tank of economics, has alarmingly projected that agriculture’s share in the GDP may decline to less than 10% by 2019-20. Currently, the alluded share is toiling at 14%, dropped by nearly 5% in the last eight years. Since 70% of Indian population directly depends on agriculture and its allied sectors, an abrupt dip in primary mean of production may cause more harm than that India is experiencing now. Comprehensive humanitarian outlook in tandem with advanced research facilities provides fruitful policies for farmers. All that is required to implement those policies properly is a compatible executive with reasonable convictions. Anyway, the concluding notes, comprising the derogatory remark made by Haryana’s agriculture minister Om Prakash Dhankar on farmers’ suicide, will help us to apprehend the current situation of our country. Destined to be such executive with reasonable convictions, Dhankar accused the farmers who committed suicides were cowards and criminals…because according to India law, suicide is a crime.