Thursday, March 17, 2016

In Poor Health: India Needs To Urgently Push For Agrarian Reforms – Analysis

It is instructive to note that 49.7 per cent India’s population is engaged in agriculture, but that it still has more than 194.6 million undernourished people which constitute 15.4 per cent of the country’s total population. As the sector contributes only 17.8 per cent to India’s Gross Domestic Product (GDP), it points to one phenomenon- agricultural sector in India is facing a policy paradox. According to Prof. M.S. Swaminathan, a famine of livelihood opportunities as a result of poor growth of opportunities for employment in the rural non-farm and off-farm sectors has led to a famine of food at the household level.

High prices are the ultimate signal that demand is outstripping supply and that there is simply not enough food to feed the ever growing population of this already giant country. India faces a number of challenges to agricultural growth including technological fatigue, policy deficits, infrastructural, credit and marketing constraints and water, and soil health related ecological and environmental problems. Public sector agricultural research and development has not adequately addressed the arid or dry land agriculture and neither the need to develop drought and pest resistant crop varieties.

The effectiveness of the agricultural sector is one of the indices that determine whether an individual, community or population is food-secure, and is thus not just a question of economics and trade but of dignity and survival. Agricultural growth is a significant contributor to the economic growth. Developing a long-term stake in agriculture would pay enormous dividends. In order to restore the rich heritage of agriculture, while simultaneously reap the fruits from the backbone of India’s economy, some of the areas of urgent reforms are as follows:

There is definitely a role for input subsidies in agriculture, but it is also true that carried beyond a point, these subsidies distort relative input prices, leading to considerable inefficiencies in input use. This policy prescription of reducing subsidies by raising input prices would likely be criticized as ‘anti-agriculture’ on the grounds that it amounts to a net withdrawal of resources from agriculture. But it needs to be clarified here that the resources thus generated from a reduction in inefficient input subsidies would be used to increase public investment in agriculture, would be economically efficient as it would reduce input price distortions and would encourage agricultural growth.

India needs to invest in best practices in the food and agriculture sector in order to have multiple payoffs for food security, including contributing to the stability of global food markets and providing new employment opportunities in the commercial agriculture sector, as well enhancing the sustainability of vulnerable livelihood systems. Some of these practices include: reducing emissions of carbon dioxide, such as through reduction in the rate of land conversion and deforestation, adoption of alternatives to the burning of crop residues after harvest, and more efficient energy use by commercial agriculture and agro-industries; sequestering carbon, which according to Prof. Rattan Lal (distinguished professor and soil scientist at Ohio State University), can be achieved through improved management of soil organic matter, with conservation agriculture involving permanent organic soil cover, minimum mechanical soil disturbance and crop rotation (which also saves on fossil fuel usage).

Noted experts on agricultural economics, Prof. Prabhu Pingali (Director, Tata-Cornell Agriculture and Nutrition Initiative, Cornell University) and Dr. Ashok Gulati (former chairman of the Commission for Agricultural Costs and Prices, Government of India), if the Indian government prioritizes the encouragement of massive investment, especially on rural roads, agricultural research, and soil conservation, irrigation, then the sector would play an effective role in the economy.

Agricultural mechanization would contribute to a sustainable increase in the yields and cropping intensity, make the environment worker friendly by reducing drudgery and health hazards, contribute to the conservation of land and water resources and to more efficient use of inputs and help reduce produce loss. The challenge is to shift the government’s priorities from heavy support and protection of food staples to promotion of agricultural diversification, processing, and commercialization.

In other words, most farmers would not be able to increase their incomes by only growing cereals when there are already national surpluses, demand growth is slow, and world markets are glutted with the subsidized production of rich-country farmers. Farmers, therefore, must shift into higher-value products to increase their incomes. Therefore, a set of public policies and investments is required to fully unleash this new potential.

Biotechnology will play an increasingly important role in strengthening food, water, and health security systems. The recent widespread public concern relating to GM food stresses the need for more effective and transparent mechanisms for assessing the benefits and risks associated with transgenic plants and animals and suitable institutional structures and regulations for biosafety, bioethics, and bio-surveillance. It is a matter of great pride that Indian Agricultural Research Institute has had a tremendous breakthrough with the development and release of new varieties (in early February 2016) of field crops including wheat, rice, chickpea, pigeon pea and mustard, each of which are not just resilient to several pests and insects, to and abiotic stresses of light, temperature, and water but also have enhanced nutritional quality.

Corporatization of agriculture can have long term benefits like better distributive efficiency, higher private investment, an increase in output, income and exports and a higher multiplier effect, leading to the creation of wealth in rural India. Public policy should facilitate the private investments in rural areas by removing controls on private investment as well as by offering tax concessions for investing in rural areas, in order to improve poor communities’ access to education, market information for farmers and other small businesses, and service information, which would also enable them to fulfil their Corporate Social Responsibility.

One of the keys to successes is the effective functioning of the Panchayati Raj Institutions (PRIs) and the Urban Local Bodies in the country, as enjoined by the 73rd and 74th Constitutional Amendments, respectively. Although agriculture is a state subject, yet most state governments have been reluctant to transfer functions, finances and functionaries to these bodies as provided by the 11th Schedule of the Indian Constitution. According to Prof. Uma Lele (distinguished development economist), the Union government can prod, nudge and nod but the state governments must act.

There remains an ample scope for furthering international collaborations and the history of Indo-US agricultural partnership from the 1950s to mid-1970s for Green Revolution, in association with International Rice Research Institute (IRRI) and International Maize and Wheat Improvement Center (CIMMYT) presents an enormous potential for an Evergreen Revolution, especially targeted towards the east India. The requisite funds for investments might be obtained by reducing some of the huge input subsidies, which could be a win-win strategy for farmers and the government and at the same time could contribute to national economic growth. Once the infrastructure is in place, a Second Green Revolution can definitely be ushered.

With the Union Budget 2016-17 just around the corner, it would be interesting to see the Modi government’s policy priorities for the country’s primary sector; an overwhelming majority of those involved who voted him to power are certainly expectant of radical reform and relief measures. It remains to be seen if the addition of Farmers’ Welfare into the Ministry of Agriculture in August 2015 is just for the namesake or would truly be the pivot of farmers’ welfare.

The need of the hour is a foolproof approach to address agriculture-related issues. It is high time for the policy makers to heed the urgent calling of the agricultural sector for reforms that would raise the farm incomes and employment by stepping up agro-based exports without jeopardizing and indeed by consolidating the food security already achieved. The urgency of reforms and development of India’s agriculture can be summed up in the words of Jawaharlal Nehru, which stand relevant even today, who had said, “Everything else can wait, but not agriculture”.

*Simi Mehta
is a Fulbright Scholar at The Ohio State University, Columbus, Ohio, USA, and a Ph.D. candidate at the US Studies Division of the School of International Studies, JNU, New Delhi, India.


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