On June 1, the farmers in Maharashtra went on strike for the first time ever. Their agitation saw violence, and angry farmers throwing vegetables and spilling milk on the road. This agitation spread from one state to other, and now the agitation has spread into various states such as Punjab, Haryana, MP, Rajasthan. It is critical for us to analyze the various aspects and facets of this agitation, considering its social, economic and political effects , taking into consideration the agrarian point of view.
The main reason can be attributed to the competitive populism among the states. The UP government having announced a complete loan waiver to its farmers created a sense of disbelief among the farmers of other states.
The other predominant reasons are:
- The year of 2016 saw a bumper crop in India, due to adequate rains. One may feel that this is a good sign for the farmers. But in reality, a bumper crop has adverse effects on the farmer. Bumper crop has led t procurement prices plunging, and a steep fall in the prices of crops, forcing the farmers to sell at throwaway prices.
- Prices of seeds, pesticides have increased, forcing the farmers to sell at rates where they don’t even recover their investment.
Example :- The market price of Soyabean is Rs.2500 – Rs.2700 per quintal, whereas its production cost is Rs.3000 per quintal.
- Demonetization , from November 8 further worsened the scenario for the farmers, whose income source was mainly cash oriented.
Ironically, the Bumper-crop which ought to have been a boon , is proving to be a bane. The National Crime Bureau of Statistics recorder 2982 suicides f farmers in the year of 2016-17.
This is also due to the fact that the traders buy farm products from the farmers at a very low rate and when the MSP kicks in, sell the products at MSP prices, thus getting large margins of profits.
Agriculture is the principle source of livelihood for more than 50% of the population of our country. Thus it is crucial to understand the demands of the farmers, understand their difficulties and expectations from the government. It is crucial to fin efficient solutions for the betterment of the farming community.
The main demands of the farmers were :-
- Ensure crop procurement prices at least 50% above the production prices, as suggested by the Swaminathan Committee, which considers a procurement price 50% above the weighted average of the production cost.
- Compete waiver of loans. Though this is the main reason for the agitation, there is a fraction of the farmers community of the view that if the government provides them with better prices, they would be willing to repay their own debts.
- 100% subsidy of drip and sprinkler irrigation.
- Minimum milk purchases prices at Rs.50.
- States should clear their 7/12 extracts (property documents) of all liabilities.
- Providing pensions to the farmers above 60 years of age.
- Uninterrupted power supply to the farms.
Although these demands may seem to be justified considering the agrarian point of view, we need to understand the political and economic capabilities.
The States are under enormous pressure as the persistent NPA of big industries and their huge outstanding loans with the public sector banks are being condoned.
- Considering the specific state of Maharashtra , we need to understand the following statistics:
- In 2017-18 , the estimated revenue deficit of Maharashtra is Rs.4000 crore.
- The excise revenue dropped by Rs.7000 crore , after the SC ban on liquor sale on highways.
- The 7th Pay Commission will need another Rs.21000 crore for its implementation, with the state’s already commitment to a Rs.40,000 crore Mumbai-Nagpur Superhighway, with various Urban Metro Projects amounting to Rs.1 lakh crore.
- The fiscal deficit as % of GDP is 2.2% from budgeted estimate of 1.54%. The Revenue deficit is 0.63% of GSDP, from the estimation of 0.16%.
- 53% of the farmers are below poverty line.
- 34,000 crore loan waiver announced by the Maharashtra government will further pressurize the already weak economic situation in the state.
The earlier leaderless farmer agitation, has now seen various opposition parties willing to give support, accounting for vote bank politics that follows, by which the actual matter at hand will be sidetracked.
- The state of UP , Maharashtra have waived loans, Punjab following with Rs.1500 crore allotted for loan waivers to small and marginal farmers.
- The discontent among the farmers is due to the lack of co-ordination between the Food, Agriculture and Civil Supplies, and the Ministry Of Commerce.
- The import duty on wheat was waived off just when a bumper crop was on its way. Thus the farmers were forced to sell at a more competitive price, leading to losses.
However, the Government is also taking some measures for the development of agriculture.
- It has time and again emphasized on its commitment at making the crime of buying agricultural products at rates lower than MSP a punishable offense.
- PM Modi announced the Soil Health Card Scheme, wherein the quality of the soil, its nutrients will be provided , along with information of the fertilizers that should be used to help improve the farm productivity.
THE WAY AHEAD:
Bringing back the 31 lakh farmers into the credit system is going to be a difficult task. The ways, which seem more viable are:
- Making the farming community aware of the importance of MSP and its benefits. Most farmers in states other than a few such as Punjab, Haryana do not know the importance of MSP and thus do not abide by the rules mentioned therein. A farmer well aware of his rights will gain significantly more than what he earlier used to get from the traders.
- There is a need for decentralized storages, cold storage chains and there should be food processing at the village gate level to reduce wastage of food in the long term.
- The banks , post Green Revolution encourage only Rice and wheat to be grown, which needs to be rectified.
- Proper harvest infrastructure has to be adequately crated to gain efficient crop returns.
- SHGs should be encouraged, as the loan return rate of such SHGs is good, and may provide with alternative source for the economy at the lowest possible level.
- More encouragement should be given to farmers in engaging in other supplementary occupations such as poultry , fishing and dairy farming.
It is extremely important for us to transform into a more ecologically resilient agriculture, which encourages irrigation, genetically modified crops, bio-pesticides and organic farming.
By Guest Author : Sumedh Lotlikar