Your columnist has been concerned with the general acceptance of the fact that India should target a 4% growth in agriculture. There is a fundamental flaw in the argument because having lost out to China in the manufacturing sector, there is no way we can become a world class economy on the strength of the services sector alone. Indian agriculture must record a double digit growth if we have to assure a good quality of life for the vast majority of our people. The true value of agriculture produce has neither been captured, nor have the farmers and farm workers been given adequate credit for this. Treating agriculture work as ‘unskilled’ is just one example. Let anyone who has not stepped into the soil try his/her hand on a plough, or even a power tiller for that matter ! It will be obvious that the task is both skilled and strenuous. We must also remember that While growth in services sector can, and will far exceed growth in agriculture, there is a limit to the number of sustainable livelihoods in services. Moreover if services are dependent on economic growth abroad, the country will never be able to insulate itself from the upswings and downturns of the global economy.
India has the intrinsic strengths to merge as the global hub for seed production – but this is a sector that we have ignored. We are looking at the seeds sector to meet our domestic demand, whereas we should be targeting the world market . We have the added advantage of being able to offer the widest possible range of seeds – from cultivars grown on farmers field under rain fed conditions to hardened saplings from Tissue culture labs. In this edition of AgriMatters ,your columnist is shooting from the hip to solicit ideas to get a quick critical response to his initial thoughts on the subject. AgriMatters will also be posting this for wider discussions on the net as well.
A vision for the Agriculture Sector
Our purpose is to stimulate growth in agriculture and ensure sustained increase in farmers income. The growth rate in agriculture should , be around 10%, and at least 2 % higher than the GDP growth rate always. Conventional wisdom that manufacturing and services sector will always have a higher growth rate makes sense for economies where rate of displacement of entrepreneurship and labour from agriculture is high, but in the Indian context, even to envisage 60 % people growing at 4% (which is half the GDP growth rate of the country) will certainly lead to greater disparities, and loss of entrepreneurship in this sector.
Growth in agriculture production and productivity, together with transparent price discovery and transaction mechanisms for primary producers can ensure higher incomes for over sixty percent of India, which in itself will address issues of rural poverty and capitalization, which is currently being addressed by multiple programmes like MNREGA and RKVY. The structural transformation in this sector must precede, or at least keep pace with other sectors , and this will be possible only if some really bold and innovative steps are taken. As in the case of every visioning exercise, let us raise some fundamental questions :
Enhancing Agricultural Production
- How is production organised – can interventions be made to transform the factors of production – land, seeds, nutrients, water and pest /weed management? Can we take up one district from the five highest and five low productivity states and saturate every possible parameter to understand how production can be enhanced if all factors are in shape?
- How do farmers access each of these factors ? Are land related transactions making entry/exit options in agriculture difficult? How do we compare entry/exit options with reference to countries like China, Israel , and France and Vietnam- all of which are recording substantially higher growths in agriculture .
- Can we delink ownership of land from loans to farmers? Our KCC is designed for cereal crops only. Can we facilitate rural capitalization , including consolidation of land holdings (up to the ceiling limit) by giving long term loans for farm equipment and protected cultivation at 4% simple rate of interest.
- How can we ensure best quality seeds – and at costs which are comparable to exemplars – can we encourage progressive farmers and agricultural graduates to establish seed companies ? Should we encourage commercial agriculture to address the issue of seeds? Given the range of agro climatic zones and the wide diversity of crops in the country, what will it take for us to become the global hub for seed industry. Profits in agriculture do not come from core agriculture – but from activities associated with enhancement of production . Should we not encourage entrepreneurship in this sector especially because agriculture is the largest private sector enterprise in the country.
How do we reach out to the farmer, especially because the extension machinery has broken down in most states. The T&V system of one extension worker for every thousand families is a virtual impossibility given the fact we now have 13 crore farm families in the country. Rather than increase numbers , can we invest on competencies . Can every officer of the Ag Department at the Block level have two to three jeeps and mobile vans for soil testing, along with laptops, camcorders, mobile phones and a decent budget for extension. Rather than increase numbers of extension staff, let us invest in the ‘capacity building of staff’, and encourage lateral movement from universities to agriculture departments and vice versa. Can we look at extension services from NGOs /agribusiness firms with three different revenue models : subsidising revenue costs , subsidising capital and revenue costs, and full cost recovery model for commercial growers. Government would then provide the infrastructure – seed farms, equipment hubs, financial services, terminal markets, weather based information services, the universities would focus on research and extension services in select areas( problematic soils, sensitive eco-systems) and professional extension services which keep pace with the latest research and development . With a 24X7 dedicated channel , Kisan call Centres and linkages to the Information kiosks being set up under the NeGP.