Mandeep Singh Azad and Manmeet Motan
While India remains one of the fastest growing major economies in the world, the sharp slowdown in economic growth in the last few years has been cause for major concern. A country that has made significant investments in high-tech and education is grappling with a complex set of circumstances that will require multiple measures to bounce back. Meanwhile, the Indian economy has been confronted with high inflation levels, and the country’s currency, the Rupee, has plummeted against the US Dollar. It is not only desirable that the Indian economy reverts to its 8 percent to 9 percent growth trajectory sooner than later, the growth should also be inclusive, given the fact that a significant proportion of India’s population lives in poverty. India’s poor make up one-third of the people living in poverty around the world.And most of the country’s poor reside in rural areas where agriculture is a way of life. The vast expanses of fertile land, a large pool of agricultural scientists, and hard-working farmers make India the second largest agricultural producer in the world. Yet, India’s farm productivity remains low, and the farmers remain poor.
Most farmers have small holdings; they lack information on the global supply-and-demand conditions that affect local prices; have limited access to crop management know-how, and weather forecasts that impact agricultural operations. Access to such information could help transform their low-yielding plots to highly productive farms. Making matters worse, Indian farmers are at the receiving end of an expensive, highly fragmented supply chain with underdeveloped infrastructure. Largely controlled by unscrupulous middlemen, these value chains plough back only a small share of the consumer price to the farmer. Together, these problems keep the farm incomes low, and lock the farmers into a vicious cycle of low income, low investments, low productivity and low income.
In a bid to double farmers’ income in next 5 years, the government has allocated Rs 35,984 crore to the farming sector. This development comes to provide farmers with income security and a unified agriculture market scheme to enhance farmer access to markets. The Government, in FY17, has an all-time high target of Rs 9 lakh crore for agri credit and has proposed Rs 5,500 crore for Crop Insurance Scheme. Also, under the Rural Sadak Yojana, net allocation of Rs 19,000 crore has been made for the year. The Government will also implement Online Procurement System under Food Corporation of India. Not just this, there will be unified agricultural marketing e-Platform to connect better with the wholesale agriculture markets. Additionally, 4 new schemes—’Pashudhan Sanjivani’, ‘Nakul Swasthya Patra’, ‘E-Pashudhan Haat’ and National Genomic Centre for indigenous breeds— have been introduced to enhance dairy farming in India at Rs 850 crore. The government is further looking to promote organic farming through ‘Parmparagat Krishi Vikas Yojana’ and ‘Organic Value Chain Development in North East Region’. Furthermore, the finance ministry has provisioned Rs 15,000 core for interest subvention for agriculture loans and creation of new infrastructures for irrigation as a value addition to farm-market connectivity. Govt. announced allocation of Rs 17,000 crore to Accelerated Irrigation Programme Benefit (AIPB) for FY17.With an initial corpus of about Rs 20,000 crore, a dedicated Long Term Irrigation Fund will be created in National Bank for Agriculture and Rural Development (NABARD).
The farming community had been most expectantly watching Budget 2016 given the massive losses from a double whammy of deficient rainfall and unseasonal rains. The steep drop in farm income had been a drag on overall economic growth. Finance Minister announced allocation of Rs 17,000 crore to Accelerated Irrigation Programme Benefit (AIPB) for FY17. Another programme for sustainable management of ground water resources will be given an estimated cost of Rs 6,000 crore and will be implemented through multilateral funding. Under the Soil Health Card scheme, 14 crore farm holdings will be covered by March 2017 and 2,000 model retail outlets of Fertilizer companies will be provided with soil and seed testing facilities during the next three years.
Govt will spend Rs 850 crore in a few years on animal husbandry, cattle and livestock breeding. New health care scheme with Rs 1 lakh cover for each family to be initiated
PM has called for entrepreneurship amongst SC and ST. For this Cabinet has approved Rs 500 crore through ‘Stand Up India’ shceme to promote SC, ST and women entrepreneurs.
3,000 medicines stores under Prime Minister Jan Ausidhi Yojna to be started. Rs 2000 cr to be allocated for LPG cylinders to women members of poor families Rs 87,765 cr allocated for rural development in this Budget. The govt is implementing unified agricultural market scheme for farmers to access markets easily with e-platform.
Modi’s landslide win in 2014 raised hopes he would draw a line under India’s socialist past, cut welfare and reduce the Government’s role in business.In its first two years in power, the NDA Government splurged on roads and railways at the expense of welfare programmes in the hope of creating an economic stimulus. Modi’s gamble was that infrastructure investment would yield dividends for the poor and the rural community. Rising rural distress after back-to-back droughts and a heavy defeat in Bihar have upset that calculus. Four in 10 Indians rely directly on farming for their livelihoods, the government estimates.The emphasis on irrigation and crop insurance schemes in this year’s budget comes on the back of consecutive monsoon failures, and after the centre faced flak for ignoring the distress in rural India.While 2014 saw a deficit of 12% in the June to September south-west monsoon, last year (2015) recorded an even worse deficit of 14% with more than 10 states declaring a drought.The centre spent nearly Rs.13,000 crore in drought assistance to states during 2015-16.While repeated crop failures led to a spate of suicides across the country, farm incomes were also hit by low prices of key crops like rice, wheat and cotton, and lower exports due to a global slump in commodity prices.Reviving the farm sector was a major challenge for finance minister Jaitley as sectoral growth rate of agriculture nosedived to minus 0.2% in 2014-15, from 4.2% in 2013-14. For 2015-16, the growth rate is estimated to be a dismal 1.1%, and is likely to be revised downwards if winter crop yields take a hit.
Agriculture sustains nearly half of all households in India and needs a new paradigm, said the 2015-16 Economic Survey released last week. The survey urged the Government to spend on efficient irrigation technologies, support less water intensive crops like pulses and oilseeds, create a national market for farm produce, and revamp the dismal research and extension services.
In 2014, the National Crime Records Bureau of India reported 5,650 farmer suicides. The highest number of farmer suicides were recorded in 2004 when 18,241 farmers committed suicide. The farmers suicide rate in India has ranged between 1.4 to 1.8 per 100,000 total population, over a 10-year period through 2005.The main reason of this increase number of suicides is low farm income due to drought and crop failure .So it is very important to consider this problem of farming community in order to save our producers for producing food fo present and future generation.
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