Mar 4, 2013

'Income support not MSP can help with farming woes'

IN A free wheeling talk with GOI Monitor, food and trade policy expert Devinder Sharma favours income support for farmers, attacks FDI and indicates that there is a smear campaign going on against the civil society
Tell us about the farmers' commission which the Karnataka government has decided to set up based on your recommendations.
Farming income
Average monthly income of a farmer is just Rs 2,400 Pic:Sahaja Samrudha
To understand that, let's first talk about all the efforts that have gone into pulling farmers out of poverty. During green revolution, a common parlance gained ground that more you sow, more you produce and hence more your earn. The message found acceptance among farmers who invested a lot of money buying pesticides, fetilizers, seeds and the machinery. However, even after over 40 years of green revolution, the farmers are practically on the poverty line. The NSSO survey of 2003-04 tells us that the average income of a farming family of five members is Rs 2,115. There were only three states above this limit: Jammu and Kashmir, Punjab and Tamil Nadu. That was the first and last time the farm income was measured. I guess the government was too embarrassed with the results to repeat the exercise.
At today's price, the income calculated must be around Rs 2,400. But look at the contrast. The lady who comes to my house for cleaning gets a monthly payment of Rs 2,000 for two hours of daily work. Under the 6th Pay Commission, a peon in government service gets a minimum monthly salary of Rs 15,000. But a farmer plus his family who work much longer hours in their fields get just Rs 2,400 a month. The minimum support price (MSP), which was termed a classic way out, is only helping 30 per cent of the farming community because 70 per cent farmers don't have surplus to take to the mandis.  But even if they hardly have anything to sell, they at least produce food. Let's say tomorrow they stop producing, the country would be forced to import that much quantity of food. In other words, they are producing economic wealth for which they should be adequately compensated.
If you look at agriculture globally, on one hand there are highly subsistence farming in developing countries like India and on the other there is highly subsidised farming in rich countries like US, Japan etc. The only way to bail out subsistence farmers is to provide them with direct income support as is being done in the rich and industrialised countries. Former Karnataka Chief Minister B S Yeddyurappa took notice of these suggestions of mine and discussed the issue in detail. Now present Chief Minister Jagdish Shetter has announced the policy. The good thing is somebody has taken this initiative and now I am sure there will be a dynamo effect with farmers' unions mounting political pressure in other states too. In my understanding it will be a game changer which will be highly beneficial for the farmers. Also, this will lead to reverse migration thus reducing pressure on our cities.
What are the things the proposed commission needs to look into?
The farmers' commission has to sort out several things. The direct income defined should be location specific as agriculture cost varies according to areas and factors like size of land, soil quality, productivity et al. Also, the money should not be given for farmers to sit idle.All these factors have to be woven into before the direct income support is announced. This way when the consumer demands cheaper food, it won't impact the farmers. They will be insulated from the market demand.
You have been opposing FDI which is being widely promoted as something which will bail out farmers by removing middlemen.
This hope that with FDI in retail, middlemen will go and farmers' income will rise is just a mirage. Another concept now being promoted is commodity trading which is claimed to help farmers realise the price. However, if these two mechanisms were working, the farmers in US, which is the home for Walmart and commodity trading, would not have been paid Rs 12.50 lakh crore subsidy between 1995-2009. Let's take the example of cotton which is a major crop.  It's the income support, not walmart or commodity trading, that makes cotton farmers of US economically viable. A 2005 analysis tells us that the total production of cotton was worth 3.9 billion dollars but the farmers were paid support of 4.7 billion dollars. On top of it, textile industry was paid 187 million dollars to buy that subsidised cotton. So, the US farmers became “efficient farmers”. On the other hand, farmers in West Africa and India's Vidarbha region were priced out and became “inefficient farmers” not because of productivity but lack of subsidy. When Brazil took the US to World Trade Organization's dispute panel, US lost the case but instead of cutting down its domestic subsidies, it started providing 147 million dollars support to Brazillian farmers.
We are hearing divergent voices on the draft food security bill. What was the traditional system India had to deal with food insecurity?
The proposed food security law is just a political gimmick for the elections. It is an extension of the highly-inefficient public distribution system we already have. More of the same is not the answer. Instead we have to look out newer ways to check pilferage and also feed the hungry.
In 1996, when I was researching for my book 'The famine trap' I got to know about a cluster of villages in Kalahandi, Odisha, which had never seen hunger in last 20 years. Now Kalahandi, as we all know, is called the hunger and starvation belt of India but within this desert what I found was an oasis. The villagers were following a traditional system of 'sharing and caring', remnants of which can be found in several states of the country. In Bihar, it is called 'Gola' system. The villagers form a consolidated fund and buy grain from the farmers to be stored at one place.. Anyone in need of food can approach the committee and take the quantity of grain needed with the condition that he will return the amount plus a rate of interest during the next harvest when he would most likely get some manual labour work in the fields. The Kalahandi villages had this system running for last 18-19 years and they had a surplus of 200 quintal grains. There was no hunger and the neighbouring 20-25 villages had also picked up the concept. At the time of cyclone, these villages were not dependent on government rehabilitation. When M S Swaminanthan got to know about this, he also visited the villagers and the government took note. It adopted the idea but gave the supervisory powers to block development officers (BDOs) and the scheme flopped. That clearly shows how government can mess up a good programme.
Today we have 6.4 lakh villages out of which over 5 lakh villages produce food, rest being cash crop areas. However, we still have people going to bed hungry in these villages. India accounts for one third of world's hungry. This problem can be solved if we ensure that our villages become self reliant in food security through local production, local procurement and local distribution just like the Gola system. It will also reduce pressure on PDS which can then cater to more vulnerable areas hence requiring less expenditure and lesser corruption. However, our leaders don't want that to happen because if people learn to be self reliant, they won't require the government doles. And we all know, doles come handy for elections. This policy started at the time of Britishers who wanted everything in their hands so that people are always dependent on them.
Whenever we talk about India's policies, it is said they are dictated by international organisations like WTO and World Bank dominated by developed countries. Why have we not been able to strengthen our position over the years?
When World Bank gives you loan, it comes with 150 conditions which you or I won't get to see but the government has to address them. These conditions have led to the policies which the country is following now or since whenever we started taking loans. Besides World Bank, we also have WTO, IMF, groups like G20 and other international financial institutes. They are all part of the same design. If you go through past G20 declarations, you will see that what was prescribed there is what India is doing. At WTO, India is one of the countries taking a tough stand against the dominant powers because civil society back home is pushing for that. Otherwise India would have been sold out by now.
The civil society has most often been accused of taking extreme positions on policy matters. Do you agree that just like any other field, everything is not white with activism too?
The idea of civil society being always critical and always taking extreme position is a clever strategy to present an image to the public that civil society is not their supporter or fighting for their cause. But I can tell you by and large those standing against the system are doing it genuinely. They have odds stacked again them.  Now, when it comes to opposing policies of the government or the corporates, we do it only after a thorough research.
Take the example of agriculture. Punjab government has signed an MoU with Monsanto for setting up centres of excellence in the state. If we stand against this, we are labelled as “anti-farmers.” But tell me, if after 45 years of green revolution, Punjab's farmers are committing suicides, 19 people die of cancer daily, soil has been devastated beyond measures and water table has plummeted to dangerous levels, how can we term it development? Government and companies have vested interests which is why they will keep on promoting the same. Who should be paying a penalty for all the damage that has been done? An engineer is punished when a bridge build by him falls down, a doctor is punished for medical negligence, why can't we ascribe responsibility on agricultural scientists, corporates and economists because of whom people are dying. How can they get away for using bodies as stepping stones for growth?
There are definitely black sheep in civil society too like there are in every sector but we have to understand that civil society is not a homogeneous clout. There are several corporates which form foundations and they are also part of the civil society. But most of the time they are just doing a lip service. It's not easy to stick your neck out and those are braving it must be appreciated.

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