On January 28, Prime Minister Narendra Modi promised farmers to double their income by 2022, but the government has already lost half of this time. The BJP cannot hope to form the new government in Delhi without reclaiming the farmer-dense states like Rajasthan, Madhya Pradesh and Chhattisgarh, in the soon-to-be-held Parliamentary elections, which went to the Congress in the recent Assembly elections. With inflation at an 18-month low in December 2018, the Modi government cannot go to the voter, especially the large farmer segment in these states, emphatically. A pointer to this comes from the country’s wholesale and retail inflations, which have dipped to an all-time low of 3.8 and 2.2 per cent respectively.

This has really ruined the “farmer mood”, with farmer groups holding large anti-government demonstrations in places like Delhi and Mumbai. Farmers dumped wheat, potato and onions on the roads as market prices for these important daily consumables crashed and left the farmers bankrupt. Market data since July 2018 unequivocally proves that inflation rate for primary food items has plummeted below zero. The deflation in the wholesale prices clearly indicates farming is a loss making proposition.

The bane of the UPA government was that in 2008-09, when the prices of essential food items galloped, inflation reached double digit figures and the consumer felt throttled. This led to the downfall of the UPA government. What is happening this time round is just the opposite. While the consumer rejoices in the plummeting wholesale and retail price inflation, the farmer is left bankrupt and cheated. He has lost confidence in the NDA government, and the political price it paid is reflected in the electoral rout in Rajasthan, Madhya Pradesh and Chhattisgarh elections.

Global prices of agricultural commodities are plummeting. At a time when the prices of agricultural commodities are globally low and India’s share of export in the agricultural sector, which has been historically low, gets further pushed down, and farmers cannot hope to get encouraging prices even if they try, distress on the farm front will swell, as has been shown in the recent past. To make matters worse, the wholesale price index of agricultural commodities is lower than the cost of important agricultural inputs, principal among them being chemical fertilisers and pesticides, not to speak of the irrigation water (where it comes free of charge with free electricity is not an all-India phenomenon). Between 2004 and 2014, during the UPA regime, the average earning of an agricultural household per month was just Rs 214, while expenditure was Rs 207 per month. In a period claimed to be the recovery phase for farmers, thanks to the 4 per cent plus growth rate in agriculture, a disposable income of Rs 7 per month is not just ironic, but tragic.   

By all counts, the target of NDA, or more appropriately the Prime Minister’s promise to double farmer income by 2022, is simply wishful thinking because the ground reality is totally different. Data from NITI Aayog shows that the current growth rate of farmers income on real price adjusted for inflation is just 3.8 per cent. Hence, it will take a quarter century to double farmers’ income. Farm revenue fell by 6 per cent per annum from the last year of UPA for the following two years of NDA (2014-2016, Indian Council for Research on International Economic Relations, Organisation for Economic Cooperation and Development). From 2001-14 crop productivity grew by 3.1 per cent (NITI Aayog), which means at this rate the farm income will rise by 18.7 per cent by 2021. This number can be taken to 27.5 per cent by adding income from livestock as the government hopes to. With all the potential sources of income combined, it will be not before 2025 that a 107.5 per cent increase can be attained.

A few years ago, a national survey was conducted, which showed unequivocally that given the current agrarian crisis in the country, more than 40 per cent of those who are traditionally engaged in agriculture would wish to opt out if there were other viable economic avenues. Nothing much has been done by the UPA government or the current one to dramatically change this situation. Simply talking about the “cure for all”, that is, propping up the minimum support price, will not help.

There are deep seated endemic problems in Indian agriculture. Take one glaring example for discussion. Most of the current cultivars – products of high intensity, heavy input dependent “miracle dwarf crop varieties” of the so-called green revolution have run out of steam. Of the 328.73 million hectares (mha) of India’s geographical area, as much 140.40 mha have degraded soils, thanks to the mindless exploitation of soil resources by the so-called green revolution. Punjab, “cradle” of the green revolution, is the best example, where high intensity input (primarily chemical fertilisers and pesticides combined with copious water use) farming has left the once fertile soils barren, ground water loaded with nitrate residues arising from unbridled use of urea, making it non-potable and severely depleting soil carbon, the bedrock of soil fertility.

More than 40 per cent of the country’s debt-ridden households depend on farming. With the general election round the corner, the ruling government and the principal opposition (Congress) are scrambling to provide first-aid solutions to the farmer, however ineffective they will prove to be in the long run. The Pradhan Mantri Kisan Samman Nidhi announced in the interim budget, with an allocation of Rs 75,000 crore for 2019-20, is one such “first aid” solution. In this context, one should note that in 2017-18, the price of agricultural produce rose just by 1 per cent, while farmers endured 4 per cent increase in input costs. In 2018-19, the situation worsened as the agricultural products price did not increase at all, while input costs rose by 5 per cent. Indian agriculture is really at a crossroads, better minds and better plans have to be in place to salvage this sinking ship.  

The author is former Professor, National Science Foundation, The Royal Society, Belgium & Currently, Senior Fellow, Alexander von Humboldt Research Foundation, The Federal Republic of Germany and can be reached at drkppnair@gmail.com