We are doing better in agriculture. If the UPA government hadn?t raised the weather corrected growth rate from around 1.5% annually in the 1990s to around 2.5%, the countrywould have been much worse off. But we have to do even better.
First things first. The real problems lie outside agriculture. Indian agriculture cannot cross the hump unless we improve profitability and create the preconditions of a globally competitive environment for the vast majority of our farmers. Take the import of oilseeds, where recent figures suggest two-thirds of demand coming from imports at low tariffs. We would be losing around ten million jobs on account of highly subsidised imports from countries which incidentally argue that these subsidies are WTO compatible since they are environmentally benign, and fix nitrogen in their prairie soils. This kind of policy wrecks incentives for agriculture in dryland and rainfed areas where oilseeds are grown. And then we will spend money on EGS jobs there. Now that the elections are over can we show some policy consistency, fight inflation with macro measures and not on the back of the poorest farmers?
It is obvious to anyone going to a village that the infrastructure needed to increase incomes is not there. Interestingly provision for central government capital formation has gone down in the Interim budget for the first time in the country?s history. The Plan has a fascinating story on turning all this around with public private partnerships and also central, state and local partnerships. The states have all the money they want for consumption subsidies but not for local initiatives on investment, destroyed with ill advised financial restrictions. This is where the stimulus plans also run into bottlenecks. Governments all over the world are using the depression to invest. India remains an outlier as compared with China and others.
Restrictions on agriculture trade and the farmers? freedom are amazing. In a recent field visit, I learnt to my astonishment that grape exports are ?not allowed? from certain districts in the drought-prone areas in western Maharashtra. Many decades ago, building Rajiv Gandhi?s agro-climatic plan in Nagar taluka, I remember a great diversification plan from low yielding bajri/jowar, to high yielder cereals and horticulture including grapes and onions, with water harvesting. A young collector, Sarangi, now Nabard chairman had done it with farmers? groups. We decided to concentrate in some Districts initially. That area is now a horticulture bastion but some sahibs will not allow help anywhere outside selected districts.
During the last year I know of babus stopping paddy land going to aquaculture, stopping groundnut movements out of Saurashtra and of course the classic bans out of paddy in coastal Kerala. We need a systematic movement to destroy this mindset and the administrative power behind it. A beginning can be made by denying central scheme assistance to any district which does it.
We have to repeat that the special infrastructure plan must include strengthening of roads and communications, marketing and processing infrastructure and training for diversification. The monies given for building district plans must provide for all of these in public private and central/state and Panchayat mode. The FAO is absolutely correct in endorsing a point this column has made that markets in India are more diffused than anywhere else and India is effectively more urbanised than our grouchy pundits say. Agriculture now has to be in rural urban continuums of widespread growth and rural development.
Within agriculture, the plan already has big central sector schemes. The Rashtriya Krishi Vikas Yojana (RKVY) resurrects the agro climatic plan we had built for Rajiv Gandhi. The last big plateau in agricultural potential was built then. The successor governments of VP Singh, Narasimha Rao and the NDA paid lip service to it, systematically dismantled the agro climatic plan, and progress was only made by NGOs. The RKVY now stipulates that funds will come only to fill up the gaps if the agro climatic plan is resurrected. I have not seen any real district agro climatic plan available upto now. We need to put in a lot of energy into this.
?The author is a former Union minister and former vice-chancellor, JNU