Indian farmers have traditionally looked up to the rain Gods and while there are worries around the “below normal monsoon” forecast this year concerns run deeper on the unsettling war clouds in the Middle East.
Indian agriculture experts feel the “below normal monsoon” by itself is not going to materially impact agricultural production unless compounded by other factors such as supply chain snarls leading to non-availability of fertilisers or rise in fuel prices and imported inflation and the resultant rise in cost of cultivation posing questions around farmer incomes.
Albeit there have been attempts to provide cushion here too, including the excise duty cut on petrol and diesel announced by the government and expectations that in the days to come the government may up the wazoo on financial support or newer subsidies for farmers.
‘No reason for concern’
Therefore, on the larger question of net impact of deficient rains on crop production and on the country’s food security, “there is no reason for concern as the country today has three times the normal foodgrain buffer each year,” says Dr. Sukhpal Singh, professor and former chairperson, Centre for Management in Agriculture (CMA) at the Indian Institute of Management (IIM), Ahmedabad.
He does not foresee any impact on food security and on crop production dipping significantly because “around 45 per cent of the crop production in India has assured irrigation. These would largely cover regions of Punjab, Haryana, Uttar Pradesh, Bihar, Andhra and parts of Madhya Pradesh as also parts of Tamil Nadu and Karnataka and even within Bengal.”
To top it all, some regions have farmers exempt from payment for electricity and water supply. Agri-experts have often pointed to the downside of these freebies since there is little incentive for farmers to opt for the much-needed crop diversification in India. They would rather stick to rice and wheat with assured procurement from the government at minimum support price (MSP) than having to diversify and take market risk.
Although for dry-land areas, shortfall in rains could be a tough call this monsoon for the farmers.
‘Need to stay watchful’
While there may be reasons to take comfort in the comfortable position on food security – rice and wheat in particular, there is always the need to stay watchful of the usual nuances that matter for Indian agriculture. As one expert who did not wish to be named reminds of the eternal fact about agriculture in a large country in India: “Spatial & temporal distribution of monsoon rains have a more material impact than the aggregate; and by extension, incomes of certain cohorts of farmers at micro level could be different from the macro.”
Much therefore now depends on the arrangement for input supply to farmers – be it dealing with supply chain snarls for fertilisers or around lending support to cushion against any fuel price rise in the months ahead. Crucial for a sector that has after several years been finally able to breach the 4 per cent growth rate.