Close to the recent hike in the minimum support price (MSP) for kharif pulses, including tur or arhar, by almost 30 per cent, by the Cabinet Committee on Economic Affairs headed by Prime Minister Manmohan Singh, comes the report that a Working Group of Chief Ministers has suggested that Indian companies be encouraged to buy land abroad to grow pulses, in order to meet the domestic demand.
At the same time, the government has decided to pay an additional Rs 500 per quintal for pulses sold by farmers to the government purchase agencies. In other words, Rs 500 per quintal is the bonus for growing pulses and selling it to the government. "The additional payments to lentil farmers will cost the government between Rs 1,000 to Rs 2,000-crore. But it will not impact retail prices because it is in excess of MSP and purely on government account," a report in The Hindustan Times said today.
Accordingly, the country's pulses output is struck at 14-15 million tonnes, against a rising annual demand of 18-19 million tonnes. The rise in prices of pulses were primarily responsible for the unprecedented food price spiral last year.
Why is that India is unable to produce more pulses? After all, an additional 3 to 4 million tonnes, looking at the demand and availability gap, should not be much of a problem. Pulses have time and again been accorded priority, and there is a National Research Institute on Pulses at Kanpur, which along with other research centres have developed more than 400 improved varieties, than why is that despite all efforts pulse production refuses to go up?
Several decades back, the then Agriculture Minister Balram Jakhar, had first suggest contract farming of pulses in Africa. His suggestion was that India could ask its agribusiness companies to lease out land in some African countries, grow pulses, and then ship it back to India. In fact, I had raised my voice against the move, and my views were seconded by Dr M S Swaminathan, and the suggestion was finally dropped.
The recommendation by the Group of Chief Ministers, headed by Haryana Chief Minister Bhupinder Singh Hooda, is equally harmful. Only a few days back, I had commented on the move to encourage pulses cultivation in Latin American countries [See my blog: http://devinder-sharma.blogspot.com/2010/05/south-america-is-new-destination-for.html], and now I find the Hooda committee saying that "Indian companies can be encouraged to buy land in countries like Canada, Myanmar, Australia and Argentina for growing pulses under long-term supply contracts to Indian canalising agencies. Similarly, such arrangements can be made with ASEAN countries for securing oilseed supply."
The Working Group was formed in April this year, and also includes the chief ministers of Punjab, Bihar and West Bengal. "We should seriously consider these options (of buying land abroad) for at least 2 million tonnes of pulses and 5 million tonnes of oilseeds for 15-20 years," the draft report prepared after June 7 meeting at Chandigarh, recommended.
All such fanciful ideas are cropping up at a time when common sense has disappeared from public policy. Cultivating pulses abroad and then shipping it back to India is one such idea. At a time when farmers in India are passing through a terrible distress, with more than 40 per cent farmers wanting to quit agriculture if given a choice, I thought boosting domestic production of pulses and oilseeds could be one mechanism to make farming more profitable.
The hike in the minimum support price for kharif pulses is one mechanism to bring some sense of economic attraction for the farmer to opt for cultivating the lowly pulses. But price alone cannot do the magic. If higher prices alone can increase production, the task would have been achieved long ago. The fact of the matter is that higher prices have to be backed by an enabling environment for the farmers to invest in pulses or oilseeds. And this is where India has failed the farmers.
Even after the heady days of Green Revolution, what is not being realised that the production of wheat and rice (the two most important staples) went up not only because of the high-yielding varieties but because the policy makers had put together two-planks of what is called a 'famine-avoidance' strategy. Assured prices through the instrument of MSP became an attraction for the farmer who would normally be squeezed out by the trade at the time of the harvest. At the same time, the government set up a procurement system which ensured that whatever flows into the mandis (and is not purchased by the private trade) would be bought by the Food Corporation of India (FCI) and other government agencies.
This means that farmers got an assured price and an assured market. They knew that their efforts would not go abegging. And no wonder, production of mainly four crops -- wheat, rice, sugarcane and cotton -- has gone up. These are the only four crops where the market is assured, whether through the FCI purchase or by the sugar companies etc., and production of these crops has been on the rise.
Pulse production has not increased primarily for the same reason. Even if the farmers were to increase the production of pulses, there is no assurance that their produce will be procured. Often farmers growing pulses have to resort to distress sale in the absence of an assured market. In fact, India does not have any mechanism (barring a few ad hoc measures like asking Nafed or Markfed to step in) to ensure that pulses are religiously procured.
Therefore, instead of encouraging Indian companies to lease out land abroad, the emphasis should be to identify the regions where pulses production needs to be encouraged within the country, given the suitable climate and the options that farmers have, and then set up a series of mandis. For instance, why can't parts of semi-arid Rajasthan, Madhya Pradesh, eastern Uttar Pradesh, West Bengal, and even Punjab be identified for production of pulses.
This is the time to rescue Indian farmers. Any move to shift cultivation of crops off-shore is fraught with dangers, and has unforeseen socio-economic and political implications. The increase in procurement prices has to be accompanied by an assurance that whatever farmers produce will be procured. Just do this, and be ready for a bountiful supply of pulses all the year around.