Relevance : GS Paper III
The farm problems
- low agricultural prices
- poor farm incomes
- Low productivity in agriculture
- supply side factors
- declining average size of farm holdings
Prices And Incomes
- The rise in prices for agriculture was much lower than general inflation in recent years.
- Market prices for several agricultural commodities have been lower than those of MSP.
- In the absence of an effective price support policy, farmers are faced with a loss in income.
- Ways to deal with prices and incomes:
- Schemes such as ‘price deficiency compensation’, ‘open procurement system’ ‘price deficiency’, etc. may compensate farmers when prices decrease.
- Rythu Bandhu Scheme (Telangana) and the KALIA scheme (Odisha) can serve as models.
- Market reforms combined with trade policies favourable to export.
- Unified national market is needed for farmers to get better prices.
- Agriculture has to go beyond farming and develop a value chain.
Low productivity
Ways to enhance productivity
- Basics such as seeds, fertilizers, credit, land, etc should be taken care of.
- Investment in infrastructure and research and development are needed.
- Efficiency in water management in both canal and groundwater that is important.
- Technology can help to reduce ‘yield gaps’ and thus improve productivity.
- Shift from rice and wheat to millets, pulses, fruits, vegetables, livestock and fish.
Land size
- Shrinking size of farms is also responsible for low incomes.
- Consolidation of land holdings is important to raise farmer incomes.
- Farmers can voluntarily come together and pool land to gain the benefits of size.
- Through consolidation, farmers can benefit both in input procurement and output marketing.
Conclusion
Farmers’ distress is due to low prices and low productivity. We need a long-term policy to tackle the situation.
