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At Farm’s hand

Posted by Ramoo on March 17, 2009

At farm’s hand

An assured income for farmers will make agriculture viable and ensure food security
In his budget speech finance minister Pranab Mukherjee claimed that agriculture, services, manufacturing along with trade and construction were drivers of the country’s growth in the past few years. But actually agriculture should not be slotted in the same bracket as manufacturing and services. Agricultural growth averaged 2.5 per cent in the past five years. This pales in comparison to the 10 per cent growth achieved by manufacturing and services in the same period.
Agriculture, in fact, touched a terrible low between 1997 and 2008 with 182,936 farmers committing suicide—according to government records. The returns from agriculture are paltry in comparison to other vocations. Let us consider some figures. Between 1997 and 2007, salaries of government employees increased by over 150 per cent—we are not even looking at the hikes proposed by the sixth pay commission and the earnings of our mlas increased by 500 per cent, but the farmer could manage only a 25 per cent increase in the prices of his produce. Prices of non-agricultural commodities, meanwhile, shot up by 300-600 per cent. The prices of agricultural inputs went up by 400 per cent.
This disparity has struck the farmer hard. The Arjun Sengupta committee on the unorganized sector reckons that an average Indian farmer’s monthly income is Rs 2,115 while his expenditure is Rs 2,770 every month.
Successive governments have tried to keep agricultural prices low to ensure cheap labour—the rationale being that cheap food will make labour cheap. But the farmer’s bill on other inputs has gone spiralling. The minimum support prices do not ensure a fair return to the farmer who has to spend a fortune on hybrid seeds, GM crops and new generation pesticides. And in any case, the government announces msps for only 33 agricultural commodities and intervenes in market operations only for rice and wheat. So farmers growing other crops are left to the mercy of markets.
The National Commission on Farmers has stated the government should ensure farmers earn a “minimum net income”, and also make sure that agricultural progress be measured by the increase in that income. It should appoint a statutory body—a Farmers Income Commission—to examine the real income of farmers every year across the state.
The government should ensure remunerative prices for agricultural produce. The prices for agricultural commodities should be based on the real cost of production and linked with inflation. msps should be announced before the beginning of each crop season and procurement must be timely.
Today agricultural workers don’t find employment and at the same time farmers cannot afford to pay for labour. The government should provide input subsidy in the form of labour wages (up to 100 days in a calendar year) to farmers to monetize family labour or to pay other farm labourers. This subsidy should include all agricultural operations from sowing to harvesting. It can be operationalized on similar lines as the National Rural Employment Guarantee Scheme, or by extending the scheme to agricultural work. This will also help agricultural workers.
The net income of farmers can be increased by promoting post-harvest oerations at the village level. Agriculture-centered small scale industry can give the rural economy a boost
But these measures will only help partially. It is essential to provide direct cash payment to make up for the shortfall. All cultivators should be given fixed cash support to ensure them a fair living standard. This could be set at Rs 15,000 per family and revised every year by the commission.
If we consider the 9 crore farmer families in the country, the government’s annual expenditure on this support will come to Rs 1.35 lakh crores. If we add the labour wage support, the government’s subsidy bill will go up by another 1 lakh crores. But by spending Rs 2.35 lakh crores, the government can extricate more than 50 per cent of people from the below poverty line trap.

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G V Ramanjaneyulu is with Centre for Sustainable Agriculture, Hyderabad. He can be reached at

Posted in Economix, Opinion pieces, Policies | 1 Comment »

Extraordinary circumstances calls for ordinary solutions

Posted by Ramoo on February 17, 2009

Devinder Sharma

It was a very busy and hectic day for me. Hopping from one TV studio to another, talking to the print media in between, essentially called upon to analyse the interim Budget 2009-10, presented by Pranab Mukherjee today in Parliament.
Extraordinary circumstances call for extraordinary solutions. This is what Mr N K Singh, a former bureaucrat and now advisor to Bihar government, had written sometimes back in an article on economic meltdown. I am sure he may not have then realised that this particular sentence would be used aggressively by the corporate world and of course the electronic and print media — many of them working as their lapdogs — to seek more and more sops from the government. No wonder, this sentence reverbrated throughout the day today in media analysis. The corporate honchos made ample use of it, and so did some of the media.
The reason was simple. The corporate world had expected a series of sops and concessions in the interim budget. The real estate, the automobile sector, the exporters and you name it; they were all in a sombre mood, you could see their sullen faces and you knew what pained them. Mr Pranab Mukherjee had certainly failed them. He surely had upset all their calculations. How could Manmohan Singh’s government not realise that extraordinary circumstances call for extraordinary solutions? Agreed, that this was an interim budget but how would the national economy run in the next four months? How come Manmohan the economist didn’t think about it?
I was feeling amused. I silently looked at their faces, trying to read their expressions. I realised how indignant the rich and elite feel when denied alms from the state treasury. I recall the time when the former Finance Minister P Chidambaram had opened up the state chest for the business class, it was promptly termed as a Dream Budget. They gave him 10 out of 10. Today, they were reluctant to give Pranab Mukherjee even 2 or 3 out of 10.
We talk of the booming economy, of the unprecedented economic growth trajectory. I wonder how many of us know that the net economic wealth of 36 individuals in India is equivalent to one-third of country’s 9 per cent GDP. If ever these 36 families were to migrate to say Switzerland, Indian economy will crash to 6 per cent.
So much for country’s growth. With exports down, manufacturing down, industrial production down, agriculture down, you begin to question what is driving this economic growth.
And that makes me wonder what is this Budget all about. And what are these extraordinary times? Aren’t we already living in extraordinary times? After all, over 200,000 farmers have committed suicide in the past 15 years or so. More than 837 million people, about 77 per cent of the population is living on the edge, somehow asurviving on less than Rs 20 a day. Have we ever given a thought as to how do these millions survive if they are spending less than Rs 20 a day? Do they even manage to get two square meals a day?
The per capita intake of food is going down ever since Manmohan Singh had unleashed economic reforms in his previous avtaar as Finance Minister in 1991. We were told as people earned more their food habits change, they begin to eat less of grains and shift to more nutritious foods like fruits, vegetables, milk and eggs. For several years, mainline economists and agricultural scientists used this argument to defend the fall in food intake, a sure indication of growing hunger and malnutrition. The latest projections of the National Sample Survey Organisation (NSSO) have proved them wrong. The NSSO tells us that not only the food intake is going down, the intake of fruits, eggs and milk is also on the decline.
Aren’t these extraordinary times?
And yet, the former Governor of Reserve Bank of India, Mr Bimal Jalan, told a TV channel that this government and successive governments should make heavy capital investments meaning more money to be made available for infrastructure. What for? To stimulate the economy faced with a slowdown. What a shame, I thought. Why don’t these economists realise (and I know they were never taught this in their colleges) that feeding the poor and hungry too is an investment. The poor and hungry too can stimulate the economy. Give more money in the hands of the poor and you will surely generate more demand, and that is what is required to trigger off the economy.
But who cares? The poor and hungry are nothing more than statistics. When I talk of the poor, the farmers, the unorganised farm workers on the TV programmes, the fellow panelists look at me with disdain. I can see their faces, and I know how uncomfortable it is for them to even listen to me. It happened to me today. But it didn’t upset me. I give a damm to what they think. To me it is an opportunity to voice the voice of the voiceless. And I will continue to do that, for slowly and slowly I find the message is getting across. More and more people call me, talk to me and back my analysis. I realise that this world is full of people with good intent, and they are willing to stand up and walk along you. Truth eventually triumphs.
We surely are living in extraordinary times, and believe me it requires only ordinary solutions. #


Posted in Economix | 1 Comment »

185 farmers committed suicide in State in first half of 2008-09

Posted by Ramoo on November 10, 2008

BANGALORE: The number of reported cases of farmer suicides in the State touched 185 in the first half of this financial year (2008-09).

The State’s agricultural sector has been facing a plethora of problems. Apart from the erratic monsoon this year, the shortage of fertilizers disrupted kharif sowing, leading to a delay in sowing operations in several districts.

The global economic slowdown is likely to depress the prices of cotton, while sugarcane growers are threatening an agitation seeking higher support price for their produce.

Sugarcane growers are unhappy with the procurement price (Rs. 811 a tonne) offered by the Government.

The State has not been able meet the sowing target set for the kharif season (2008). Sowing took place on 65.36 lakh hectares of land against the target of 74.4 lakh hectares, achieving 87 per cent of the target.

As on September 30, the highest number of suicide cases was reported from Hassan district (23).

A large tract of potato crop was destroyed in Hassan district owing to incessant rain during the kharif season. The loss has been estimated at over Rs. 300 crore. Hassan topped the list in the number of suicides by farmers in 2003-04 (69) and 2004-05 (37).

In Bidar district, 20 farmers committed suicide followed by 15 in Belgaum, 13 in Chikmagalur, 12 in Mandya, and 10 each in Bijapur and Chitradurga.

The number of cases reported from other districts are: Haveri – 2; Uttara Kannada – 6; Dharwad – 8; Koppal, Ramanagaram and Raichur – 3 each; Tumkur, Gulbarga, Gadag and Mysore – 7 each; Shimoga – 8; Kodagu – 4; Davangere – 6; and Dakshina Kannada – 1, according to sources in the Government.

Not a single case of suicide by farmers has been reported from six districts. The two drought-prone districts of Kolar and Chikkaballapur, and Bangalore Rural, Bangalore Urban, Chamarajnagar and Udupi districts reported no suicide cases between April and September 2008.

The number of farmers committing suicide has seen a decline from 2000-01, when 2,360 farmers ended their lives.

As many as 708 suicide cases were reported in 2003-04, 271 in 2004-05, 163 in 2005-06, 343 cases in 2006-07, and 340 in 2007-08.

Of the 185 cases reported so far this year, 136 cases have been placed before a committee set up to sanction compensation to the next of kin.

The committee rejected the claims in 62 cases and awarded compensation of Rs. 1 lakh to the families concerned in 23 cases.

The panel recommended compensation in 26 cases while the remaining cases are pending before the committee, according to official sources.

Officials said that investigation of the deaths by the police and the district administration revealed discrepancies between statements made to the police by the relatives immediately after the death and later.

Some natural deaths had been reported as suicide cases to get compensation from the Government, they said.

It is well known that “undue pressure” by moneylenders and some recovery agents of banks forced farmers to commit suicides in most cases.

The volume of business in private lending has increased four-fold during the past decade in the State.

The Technical Group to Review Legislation on Money Lending (headed by retired banker S.C. Gupta), which submitted its report to the Reserve Bank of India, stated that the money lent by moneylenders in the State increased to Rs. 87.70 crore in March 2006 from Rs. 19.22 crore in March 1995.

Posted in Data, Debt burden, Farmers Suicides, Karnataka | Leave a Comment »

UPA neglects Agriculture the most

Posted by Ramoo on October 25, 2008

Submitted by editor on Sat, 10/25/2008 – 18:27

Rajnath Singh
India today is on the brink of a protracted recession. Almost every economic indicator in the country is putting immense pressure on all economic activities in the country and painting a gloomy picture of our economy. Inflation is in high double digits, GDP growth rate is faltering, Industrial growth rate has touched a record low of 1.3 percent and the growth of our agriculture sector has turned bad to worse.

Declining capital formation and steep reduction in public investment in agriculture sector during the UPA rule has led to a complete stagnation of Agricultural growth in India. In other words the UPA Government has proved to be a big disaster on the economic front.

Agriculture is considered a recession proof sector as it does not face decline in demand even in a worsening situation. Being a predominantly agrarian society, India has the potential and resources to deal with any challenge posed by recessionary atmosphere in the world.

Eminent thinkers and economists around the world have started chalking out detailed action plans for agriculture and predicted that food security will be the top agenda of all the Governments in future. It clearly indicates that the world is now awakening to the growing importance of strengthening agriculture sector but the UPA Government’s slumber has deepened further.

By pursuing disoriented and confused economic policies the UPA Government has jeopardized our national food security. No wonder, India’s record on hunger today is worse than that of nearly 25 sub-Saharan African countries and all of South Asia, except Bangladesh.

The International Food Policy Research Institute (IFPRI)’s 2008 Global Hunger Index says that with over 200 million people insecure about their daily bread, Indian scenario is ‘alarming’ in terms of hunger and malnutrition.

According to the World Development Report, “To reduce poverty and hunger, the growth of the agricultural sector is the only solution.” But the higher cost of production without a corresponding increase in prices has made agriculture a non viable profession in India.

In the absence of remunerative prices, coupled with lack of timely, affordable and adequate credit and high interest rates have forced the helpless farmer either to quit farming or to commit suicide. More than five thousand farmers committed suicide in different parts of the country.

The Prime Minister’s ‘Vidarbha Package’ for the farmers has failed to address the key issues. The farmer’s loan waiver scheme also met the same fate as it left majority of the farmers agitated and disgruntled.

Both these schemes have proved to be a cruel joke on farmers and the Congress led UPA Government will have to pay a heavy price for it in forthcoming assembly elections and the General Elections scheduled next year.

The UPA Government has remained unconcerned over the gravity of the situation and adopted a casual approach while dealing with a sensitive subject like Agriculture.

I am happy to note that the BJP ruled states have performed better than the Congress led Governments on the agriculture front.
We have the shining example of Gujarat State before us which registered a remarkable 13 percent growth in agriculture in comparison to meager national agriculture growth of nearly 1.8 percent.

After coming to power the BJP led NDA Government will introduce a paradigm shift in agriculture where it will synthesise the old and the new, and focus on the economics of small land holdings.

The BJP will increase the quantum of public investment in agriculture and mandate banks to earmark 30% of their total loans for credit to the agriculture sector. We will take immediate steps to see that the farmers be given loans at not more than 4% interest for agriculture and allied activities.

The NDA Government at the Centre will implement the recommendations of the National Commission on Farmers and assure the farmer of actual cost of production plus 50% over and above this cost as the MSP for his produce.

BJP led NDA Government will also implement Farm Income Insurance Scheme to ensure guaranteed income to all farmers in the country.

India facing economic terrorism

UPA Government’s soft and weak-kneed approach to deal with terrorist activities is a fact well known. Unfortunately the issue of internal security which warrants national consensus among all political major political parties and other prominent stake holders in our society has become a casualty of UPA Government’s vote bank politics.

During the 42 months of UPA rule terrorists and anti-India forces have galvanised its cadres and gained strength to strike India anywhere, anytime and at will. They have developed a multi-pronged strategy to damage India at every possible level. Recently we have witnessed a big surge in circulation of fake Indian currency notes in the country. It is well thought strategy of anti-India forces to unleash economic terrorism in the country.

Pakistan’s intelligence agency the ISI has pumped in counterfeit currency worth billions of Rupees into India through Bangladesh and Nepal borders. According to recent estimates by a Government panel, fake currency worth 1 lakh 69 thousand crores Rupees are already in circulation.

Fake currency notes have been recently confiscated in many States. Even at the branches of the Nationalised banks and their ATM’s fake currency notes have been confiscated. Counterfeit currency is being used to fund terrorist operations. I urge the present dispensation at the Centre to take effective steps to plug the supply of fake currency notes in India.

The BJP demands the Government that it should come out with a white paper on circulation of fake currency in India.

Posted in Economix, Farmers Suicides, Food crisis, GM Crops, Hunger | 1 Comment »

Agrarian Crisis and Farmers’ Suicides

Posted by Ramoo on October 17, 2008

Source: Agrarian Crisis and Farmers’ Suicides in India

Srijit Misra, IGIDR

The larger agrarian crisis has two dimensions. On the one hand, there is a livelihood crisis that threatens the very basis of survival for the vast majority of small and marginal farmers as also for agricultural labourers. On the other hand, there is an agricultural developmental crisis that lies in the neglect of agriculture arising out of poor design of programmes and allocation of resources and having resulted in declining productivity and profitability. This twin dimensions could also be equated with the developmental discourse where the former is about displacement of people and the latter is about displacement of ideology. The outcome is that planning is not people-centric.
In monsoon India, abundance or paucity of water has always been considered as a major source of agricultural uncertainty. Today, this yield risk could also be because of spurious inputs or inappropriate use of technology. Increasing costs, price volatility, non-availability of credit from formal sources and other risks further compound it. Social responsibility of education, healthcare and marriage instead of being normal activities add to the burden. All these would even put the semi-medium farmer under a state of transient poverty.
An extreme response to this distress is the increasing incidence of farmerss suicides. Between 1995 and 2006, more than 190,000 farmers have committed suicides, 83 per cent of these being males. The suicide mortality rate (SMR, suicide death for 100,000 persons) for male farmers increased from 10.5 to 19.5 whereas that of male non-farmers has more or less remained around 13. The major states with SMR for male farmers greater than the all India average of 18 during 2001-06 are Kerala (233), Maharashtra (53), Chattishgarh (47), Karnataka (39), Andhra Pradesh (35), Tamil Nadu (31) and West Bengal (21). It is to be reiterated that suicide is a symptom of the larger crisis, and its absence does not in any way indicate the absence of a crisis.
It is only in Kharif 2008 that one observes a substantial increase in the minimum support prices of the 16 major crops. In fact, the absolute increase would be almost equal to increments in the entire decade. Though welcome, this vindicates the established fact that returns to agriculture had turned out to be abysmally low. Per-capita per day returns to farmer households from cultivation in 2002-03 was eight rupees. Another recent public policy intervention has been the Rs.70,000 crore debt waiver package. This is just a book keeping exercise and at best will reduce the burden from formal sources. Indebtedness, like suicides, is another symptom.
Risk mitigation has to go beyond suicides and debt. What is more important is to spruce of public investments that will increase returns to cultivation. Skill enhancement and linking of opportunities to local resources are required to spruce up non-farm income. Success of the credit and input markets require effective regulation. There is a case of encouraging technological and financial products that would reduce costs while increasing returns. Institutions that can organize farmers are required.
My earlier blog on a related theme is Indian Agriculture in Doldrums.
Selected Readings:
Bhaduri, Amit (2008), Predatory Growth, Economic and Political Weekly, 43 (16), 10-14.
Government of India (2007), Report of the Expert Group on Agricultural Indebtedness, Chairman: R Radhakrishna.
Mishra, Srijit (2007), Agrarian Scenario in Post-reform India: A Story of Distress, Despair and Death, Orissa Economic Journal, 39, (1 & 2), 53-84. IGIDR Working paper version is WP-2007-001.
Mishra, Srijit (2008) Risks, Farmers’ Suicides and Agrarian Crisis in India: Is There a Way Out? Indian Journal of Agricultural Economics, 63 (1), 38-54. IGIDR Working paper version is WP-2007-014.
Reddy, D. Narasimha and Srijit Mishra (eds.) (2008) Agrarian Crisis in India, Oxford University Press, forthcoming.
This is the abstract of a presentation at a one day international seminar, “Environmental degradation and food crisis – Lessons for India” being organized by Greenpeace India on 24 October 2008 atIndia International Centre, Lodhi Road, New Delhi, India.

Posted in Economix, Farmers Suicides, Food crisis | Leave a Comment »

It’s high time farm pricing got a booster dose

Posted by Ramoo on September 26, 2008

Amrita ChaudhryPosted: Sep 26, 2008 at 0110 hrs IST

Ludhiana, September 25 With theWorld Bank giving a call to shift focus on agriculture to tackle food crisis, data gleaned from Punjab’s villages only add to its urgency.

The national census for the year 1991 showed Punjab as having 11 lakh farming families. Of these, 45 per cent were small or marginal farmers who owned fields measuring less than five acres. This figure in the next census in 2001 slid to 9.7 lakh and the percentage of small farmers to 30 per cent.

In other words, 30,000 farmers on an average quit agriculture each year. The primary reason for this has been the decline in profitability of crops, particularly paddy and wheat—a phenomenon that agricultural experts are trying to tackle along with suicides by farmers. For example, take the case of Gurdip Singh, a small farmer from village Mehla Kalan. Gurdip, who owns two acres of land, says, “I can just manage to raise food grains for my domestic use from these two acres.”

The situation of Avtar Singh, a farmer with 20 acres of land in Alamgir village, is no different. “My inputs costs over the years have skyrocketed while the prices of crops haven’t risen. And what we all forget is that farmer too is a consumer. I have to pay the college fees for my two children, which runs into lakhs per annum. Then there are the medical costs of my family.”

To drive home his point, Avtar Singh says, “A couple of years ago, one of my kidneys was damaged in an accident. I could not afford treatment. I know there will be a day when all my 20 acres will be lost in medical treatment.”

R S Sidhu, head, Department of Economics, Punjab Agricultural University, agrees as he explains, “The data speak so. The best period for agriculture in the recent past was between 1990 and 2000, more precisely till 1995. While the crisis in agriculture began around 1995, it was nationwide then. Now, however, Punjab alone is suffering. Our calculations have shown that while input costs have gone up dramatically, the rise in Minimum Statutory Price (MSP) of crops is very slow and this has resulted in reducing of profit margins for the farmers.

Sidhu adds, “Since 2001-2007 the input costs have risen by 8-9 per cent while the MSP growth has been hovering around 2 per cent. The wheat MSP announced this year (Rs 1,000 per quintal) had brought a relief for farmers and when the picture was easing out the latest news of Rs 850 as MSP for paddy this year is like a bolt from the blue.”

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Posted in Debt burden, Economix, Farm Income, Punjab | Leave a Comment »

Jadhav is running a rent-a-report service: Sainath

Posted by Ramoo on September 14, 2008

After PM’s advisor Naresh Jadhav attacked Magasaysay-winning journalist over his report on Vidarbha farmers, P Sainath retaliates with an equally vitriolic counter attack

Posted On Sunday, September 14, 2008

Deepak Lokhande

Picking up the gauntlet thrown by the PM’s economic advisor and Pune University vice-chancellor Naresh Jadhav, Magasaysay award-winning journalist P Sainath on Saturday tore into him for his claims that the farmers’ plight in Vidarbha is not as bad as it has been made out and said that the V-C was running a ‘rent-a-report’ service for the state government.
As head of the one-man committee appointed by the state government to study the benefits of the Prime Minister’s relief package for Vidarbha farmers, Jadhav had said in his report that Sainath was painting an alarmist picture of Vidarbha and had ‘defamed’ the state by doing so.
Speaking to Mumbai Mirror from Norway, where he is attending an international conference, Sainath didn’t mince words, saying Jadhav’s report was just a ‘whitewash job for the state government’.
“How can criticising a state government mean criticism of the state,” said Sainath, the author of Everyone Loves A Good Drought who had described Maharashtra as a ‘graveyard for farmers’.
“He is running a rent-a-report service. His report is nothing but a whitewash job for the state government. He says Maharashtra is not the worst state, but only the fourth or fifth worst state in the country as far as farmers’ suicides are concerned. He is like a child who tells his father that he is not the last in the class, but fourth or fifth last,” said Sainath.
“Maharashtra is the only state where farmers are addressing their suicide notes to the CM and the PM. In Andhra, they wrote about policies, banks, moneylenders and others, but not the government. Here, they are telling the government we are killing ourselves because of you,” he said.
“In Maharashtra, we are putting our farmers in the pressure cooker and cooking them. And our CM says and I quote, ‘farmers should be grateful I am not prosecuting them as suicide is a crime’,” he added.
The veteran journalist added that contrary to Jadhav’s claims, the Maharashtra government had failed on every parameter, especially under Vilasrao Deshmukh’s leadership. Jadhav had claimed in his report that Sainath had used wrong parameters to

indict the state government.
“The National Crime Records Bureau statistics show that one-fifth of 1.66 lakh farmers’ suicides between 1997 and 2005 were in Maharashtra. Is this figure something to be proud of?” Sainath asked, adding that the farmers’ plight in Vidarbha was the worst in 2006, a year after the prime minister and the chief minister announced separate relief packages.
“The year witnessed the highest ever number of farmers committing suicides since we started keeping records. Of the 17,060 farmers who committed suicides in the country, 4,453 were from the state, which is almost one-fourth. These figures are never rivalled by any other state. The closest figure was in 2004 – around 4,100 ― and guess which state it was? Maharashtra, sadly,” he pointed out.
Countering Jadhav’s claims that Sainath chose wrong states (with less population to compare with Maharashtra), the journalist said even the population parameter didn’t save any grace for the state.
“The increase in the number of suicides (527) in 2006 was four-and-half-times that of Andhra Pradesh that recorded 117 more suicides than in 2005. Is Andhra four-and-half-times more populous than Maharashtra?” he asked.
“It’s amazing that after committee after committee found the situation in Vidarbha grave, Jadhav absolved the government. “The reports by the Tata Institute of Social Sciences, Indira Gandhi Institute for of Developmental Studies, the Planning Commission, NABARD team, state investigators have been more adverse than the previous.
And whatever the parameters or ratings, 34,000 farmers committing suicides…is this something to be proud of?” he asked.
Pained that he was being painted as enemy of the state, Sainath said that if that was what he would get for telling the truth, then he wore it like a badge of honour.
Jadhav could not be contacted for his comments despite repeated attempts.

Posted in Debt burden, Maharashtra, Vidharba Crisis | Leave a Comment »

‘Farmers worse off than lowest-paid babus’

Posted by Ramoo on August 20, 2008

CIFA representation to Prime Minister on Farmers income

Surinder Sud in New Delhi August 18, 2008 08:33 IST

The apex body for farmers’ organisations has stated in a representation to the government that even big farmers were worse off than the lowest-paid government employees. It has charged the government with discrimination against farmers vis-�-vis workers from other sectors.

While the government has taken no more than four months to implement the Sixth Pay Commission report, even going beyond the recommendations, there has been little action on the report of the National Commission on Farmers headed by Dr MS Swaminathan even after 22 months. This commission had suggested measures to ensure that the net take-home income of the farmers was comparable with that of civil servants.

This has been stated in the representation submitted by the Consortium of Indian Farmers Associations to Prime Minister Manmohan Singh. It has quoted from the report of the Arjun Sengupta Commission on unorganised sector workers and some studies by the Planning Commission and other organisations to support its contentions.

The Arjun Sengupta report had said that the average monthly income per household from cultivation was Rs 1,578 a month for small farmers and Rs 8,321 for big farmers in 2003. In comparison, the lowest-paid government employee got the pay and perks exceeding Rs 10,000 a month.

The Planning Commission studies have shown that the income ratio for agricultural workers and non-agricultural workers has deteriorated steadily from 1:1.8 in 1950-51 to 1:2.8 in the period 1978-79 to 1983-84 and further to a whopping 1:5.2 in 1998-99 to 2003-04.

The CIFA memorandum, signed by its general secretary Chengal Reddy, has also referred to a study conducted by the Hyderabad-based NG Ranga Agricultural University to point out that a farmer needed to cultivate 15 to 20 acres (6 to 8 hectares) of dry land to earn an income of Rs 4,000 (equivalent to that of a peon) in Telengana and Rayalseema in Andhra Pradesh.

In the coastal areas of the state, the farmers needed to cultivate paddy on at least 10 acres (4 hectares) to earn the same level of income. The average farm holding in India is less than 2 hectares.

For the plight of the rural people, Reddy has blamed the apathy of the government towards the farmers, as reflected in the fixation of low minimum support prices for crops. He has cited the report of the Parliamentary Standing Committee on Agriculture (report No 41 dated 22 July, 2008) to substantiate this plea.

The report had stated that the prices of agricultural produce received by the farmers were lower than the market prices and were often less than the cost of cultivation. The committee had favoured fixation of remunerative prices for the farm produce.

The Swaminathan Commission had recommended that the MSP should be at least 50 per cent more than the weighted average cost of production. While some relatively less consequential and peripheral suggestions of this commission have been included by the government in its national policy on agriculture, the key recommendations have so far been ignored.

The CIFA has also pointed out that the marginal farmers usually turn landless labourers and the small farmers become marginal farmers during their own lifetime. This amounted virtually to their demotion. The government employees, on the other hand, have been assured at least three promotions during their service.

“Wide, unacceptable disparities in farm and non-farm incomes have occurred mainly because the agriculture produce is underpriced for decades and the surplus amount is transferred to organised sector workers including the government employees, whose productivity does not increase even nominally with successive pay raises,” the representation has maintained.

Posted in Farm Income | Leave a Comment »

Farmers vs peons

Posted by Ramoo on August 20, 2008

Business Standard / New Delhi August 20, 2008, 5:48 IST

By pointing out that the overwhelming majority of farmers are economically worse off than the lowest-paid government employee, the apex body of farmers’ organisations has not unveiled any secret. This has been well known for some time. And although the spate of suicides by farmers in recent years has not usually been by the poorest among them, the severe problems faced by farmers have come into focus. The service done by the Confederation of the Indian Farmers Associations (Cifa) is to dig out some intriguing evidence from reports of various committees and commissions, in order to make its point. Cifa has simultaneously sought to highlight the steadily growing gap between income levels in the agricultural and non-agricultural sectors. This is a matter of special concern, especially considering that the proportion of the population depending on agriculture for subsistence is still more than 50 per cent, while the share of agriculture in GDP has dropped to 18 per cent. By definition, the average income in the non-farm sector will be nearly five times what it is in agriculture. Indeed, Cifa quotes studies done in the Planning Commission to show that the ratio is 1:5.2 — whereas a quarter-century ago it was 1:2.8.

Cifa has alluded to the findings of the Arjun Sengupta commission on unorganised workers to affirm that the earnings of even the bigger farmers compare rather poorly with those at the lowest rungs of the government system. The average monthly income per household from cultivation was reckoned by the commission at a paltry Rs 1,578 for small farmers and Rs 8,321 for the big farmers. By way of comparison, the lowest-paid government employee now gets Rs 10,000 a month. It is an easy point to make after this that while the government has taken no more than four months to implement the 6th pay commission report, and in fact improved on the commission’s recommendations, little action has resulted from the report of the National Commission on farmers, headed by M S Swaminathan, in 22 months.

The important issue is what keeps farm incomes low, and what needs to be done about it. The answer, however, is not what the Swaminathan commission suggested, namely to raise the government’s minimum support prices (MSP) by at least 50 per cent more than the weighted average cost of production. This is a solution that will add to food costs, and cause inflation. It could even result in an increase in the general incidence of poverty, because the primary link to poverty is food prices. Rather, the solution lies in bringing about a structural transformation in the economy, achieving significant productivity gains on the farm and simultaneously reducing the number of people who live off agriculture. That means creating more non-agricultural jobs, which in turn means achieving rapid growth in the sectors and activities that generate the maximum number of entry-level jobs. One obvious answer that this points to is labour-intensive manufacture of simple products, as the Chinese have shown. But this requires a change in the country’s labour laws, which the country’s politicians will not allow. If legislators could see the link between labour laws and the existence of rural poverty, perhaps their attitudes might change.

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Suicide Economy

Posted by Ramoo on April 5, 2008

India is been almost a brand lately, esp. in last 5 years India is shining with all international brands, too many jobs, too much talent and every one in the world trying to lure the youngest population (read market with purchasing power). It’s India Inc. which is 3rd largest economy in the world in terms of purchasing power parity. Sounds impressive! Isn’t it.

When I was in school it was taught that India is agricultural based country and there was a time when India was independent for grains (“Harit Kranti”).

Then came the era when India became back office destination for global out sourcing and customer service. India is a major exporter of highly-skilled workers in software and financial services, and software engineering. Other sectors like manufacturing, pharmaceuticals, biotechnology, nanotechnology, telecommunication, shipbuilding, aviation and tourism are showing strong potentials with higher growth rates. Every thing started looking great! Too many jobs, Indians not only becoming one of the best work force but many entrepreneurs and new age businessmen emerged from India Inc.!! We all proudly said “I’m an Indian”

Everything was going right every rich, becoming rich, educated Indian thought things are great in India there was reverse trend people dumped their jobs in US of A and came to mother land to join better jobs or start a business. VC money started flowing in. Apparently every Indian was happy spending weekends in Mall incurring huge purchase bills, entertainment, amusement and what not. Gucci became god and Tommy became necessity of Time. Wow! Looks great….

But same time there was something happening to that 60-65% population who do farming for their living. 1997 reported 1st case of a farmer’s Suicide in Vidarbha – Maharashtra. More than 50,000 farmers took their lives for various reasons.

The global corporations changed the input economy overnight. Farm saved seeds were replaced by corporate seeds which needed fertilizers and pesticides and could not be saved.

As seed saving is prevented by patents as well as by the engineering of seeds with non-renewable traits, seed has to be bought for every planting season by poor peasants. A free resource available on farms became a commodity which farmers were forced to buy every year. This increases poverty and leads to indebtedness. As debts increase and become unpayable, farmers are compelled to sell kidneys or even commit suicide. In the state of Bihar, when farm saved corn seed was displaced by Monsanto’s hybrid corn, the entire crop failed creating Rs. 4 billion losses and increased poverty for already desperately poor farmers. Rs. 1 Lakh was given by Govt. to some of the families (yeah! That’s the cost of any life in India). I’m sure this money didn’t reach the deserving families either- It’s a different issue we may have to discuss that separately.

I will not give more reasons, facts and figures here because avg. Indian (read urban India which matters advertisers) has less attention span. Media is not doing anything about it as avg. Indian (read above definition) has no time to be concerned about it on weekends and watch it on News and such stories on channels and news papers wouldn’t get any advertisers. C’mon who likes poverty in India Inc. – they are busy in creating story of how one heroine dumped her boy friend for an old jerk.

Here I’m not supporting any “ism” or “ist” side of mine nor do I have any hopes of influencing even a single avg. India. But since it’s my blog and that freedom allows me to at least wonder why there is so much disparity amongst people? Why not at least 40% farmer driving a car of selling their crops in open market on their own terms.

I know avg. India would not even read this post fully as it seems long and he can’t relate to it. But I can’t help it and I’m ashamed that farmer is dying in an agricultural based country.

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