impact of political dominance on agriculture

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ACKNOWLEDGEMENT:

We are grateful to Mr Rajesh Jha for providing us with an opportunity to do a project upon

Impact of Political Dominance on Agriculture. This project has greatly enhanced our

learning and deepened our understanding of Economic Reforms in India by giving us an

insight into the practical aspects of this field.

We are deeply indebted to our seniors and colleagues, whom we approached during the

course of our project, without whose valuable guidance and constant encouragement the

project could not have been accomplished. We would also like to acknowledge all the

farmers we surveyed, who readily provided their whole-hearted support and gave us the

information required.

Last, but not the least, we would like to thank PEC University of Technology, for including

such an interesting yet essential course in our syllabus and for providing us the basic

infrastructure required to do the project.


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Table of Contents:

Acknowledgement

1. Abstract

2. Introduction

3. Research Methodology

4. Historical Background

5. Literature Review

6. Analysis and Survey Findings

7. Limitations and Challenges Faced

8. References


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INTRODUCTION:

India lives in villages and agriculture is the soul of the Indian Economy

-M.K. Gandhi

Since time immemorial, agriculture has been the backbone of Indian Economy. Even today,

when industrialization has transformed India to a great extent and urbanisation is picking up

speed, more than 58% of the Indian population depends on agriculture for livelihood,

although its contribution to the national GDP has reduced to 14.2% [1]. Agriculture holds a

prime position in India, not only due to employment, but also due to the fact that food

security in a country like India which has a gigantic population of 1.24 billion [2], is a huge

challenge. Thus, agriculture has been a sector of priority in the Five Year Plans.

It is not surprising that agriculture is so widespread in India. India lies in the temperate zone,

with a favourable climate to grow a diversity of crops. The cultivable land in India today is

182.39 million hectares [3]. Despite the fact that the cultivable land is continually decreasing

and the climatic fluctuations are more prevalent, the agricultural productivity (of Kharif food

grains) as of 2012 were estimated to be around 118.86 million tonnes [4]. Today, India

stands second worldwide in farm output. The increase in agricultural productivity can be

attributed to the advent of Green Revolution and the various government policies and

programmes introduced.

The Green Revolution started in India in late 1960s. Within a decade, it changed Indias

status from a food deficit country to one of the leading agricultural nation. Green revolution

took place in two waves: First wave, which aimed at making India a self-sufficient nation and

the Second Wave, which started in the 1980s, focused on increasing the rural income and

alleviating poverty. The first wave was largely confined to the production of wheat and was

limited to the northern region because of which it did not contribute much to the increase of

nation GDP. Second Wave, on the other hand, involved almost all the crops and covered the

entire nation. Green Revolution successfully introduced the HYV (high yield variety) seeds

and fertilisers into the Indian Agriculture. Also, it brought a major portion of the cultivable

land under irrigation. Green Revolution thus proved to be a major breakthrough in the history

of Indias economic development.


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Though there was a major turnaround in 1980s, in 1990s the agricultural growth slowed due

to which government introduced policies that sought to sustain progress by increasing

producer support and improving the targeting of food subsidies on low income consumers.

From then on, a lot of policies and national programmes have been introduced by government

to favour both agriculture and the farmers. However, there have been a lot of cases recently

where partisan politics hampered their growth. Farmers have been troubled by the erratic

regulations of the ruling government and the barriers imposed by them on different things.

Ruthless land acquisitions by the government have emerged as a major concern. Sometimes,

it was the clashes between the ruling and the opposition parties that harmed the farmers and

their livelihood.

In this project we aim to study both- the favourable impact of government policies, beginning

from the green revolution to the policies introduced till date, on the agricultural production

and plight of farmers and the declining growth of agriculture sector in the selected area if

study due to partisan politics.

We have narrowed down our area of study to two states- Punjab and Madhya Pradesh.

Punjab, the state which emerged as heartland of Indias green revolution, has been a leader in

agriculture. Not only it has achieved irrigation coverage of 95 per cent of the net sown area, it

also has a cropping intensity of 185 per cent and 98 per cent HYV coverage. The state's

agricultural production sector is highly capital-intensive and mechanised. It has 7.44 lakh

energised tube wells, 3.87 lakh tractors and 66,000 combine harvesters. It also has the highest

consumption of electricity, fertilisers and the highest number of tractors (28) per unit of land

(1,000 acres) in the country [5].

However, farmers are not much benefitted from this. Even though the food prices are rising

in the market, farmers hardly see any increase in income. In fact, in cases of delayedmonsoons, government does little to help the farmers. Elections fill them with hope, but the

hope is short-lived because the words remain words and little action is seen. The debts keep

on rising and consequently, farmers suicide. The production is not planned. In absence of

good warehousing and cold-storage facilities, much of the produce rots.

Madhya Pradesh, is another leader when it comes to agricultural production. It has 5 crop

zones, 11 agro climatic zones to suit production of almost any crop. The favourable

combination of soil type, rainfall, sun, light and temperature suits the production any new


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crops. The cropping intensity is 135% and 28.5 % of the net sown area is under irrigation. It

is also progressing in sections like animal husbandry and agri-food processing [6]. But here

as well, farmers are the sufferers, the problem of land acquisition is very prevalent and the

government has done little to address that.

Further in the report we will take up the policies and programmes by government in detail,

after throwing some light on the Green Revolution. The negative impact of politics has been

brought up through a series of case studies. Also, we will present a brief on how the crop

prices are determined.

RESEARCH METHODOLOGY:

The research for this project was carried out in two segments:

1. Primary Research2. Secondary Research

The research was carried out to fulfil the objectives of the project, which are listed below.

The project aims to:

1. Analyse the impact of political factors on agricultural productivity.2. Study the effect of various government policies on Indian agriculture through case

studies.

3. Study how crop prices are determined.Primary research of the project was carried out to interact with the farmers and verify our

findings of our secondary research. Also, with the help of primary research we sought to

delve deeper into the topic and look for the real scenario engulfing the farmers. To carry out

the primary research, a survey questionnaire was created so as to define the scope of our

research. The questions were not too specific, so as to obtain the farmers viewpoints clearly.

The final survey questionnaire is attached below.

For survey, the cotton belt region of Punjab i.e. Malwa was selected. There were two reasons

of selecting this specific region: 1. the political crisis in agriculture is prevalent in this region

and 2. Feasibility of carrying out research. About ten farmers were surveyed.


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To understand the scenario completely, a secondary research was done. This helped us to

gain knowledge about the agricultural scenario in India through different aspects. For this

various reports by the state government and the Ministry of Agriculture was referred to study

the statistics. This gave us an insight into emerging problems and the possible causes.

Next, a detailed study of various policies and programmes regarding agriculture was done.

The policy drafts as well as related reports were studied. For this we referred the government

sites and complete policy reports. This helped to scrutinize the aims of the policies and the

drawbacks they posed. Since Green Revolution formed an integral part of Indian agriculture,

a study on how it shaped todays agriculture scenario was also carried out via various reports

and articles on the topic. Further, since our area of domain was limited to Punjab, Green

Revolution in context of Punjab was also thoroughly examined.

It was important that we gain a good backdrop of Punjab Crisis; hence the history of Punjab

agriculture was extensively referred. Books and journals related to this topic were studied to

get a grasp of the issues that were already prevalent and were possibly emerging due to the

existing politics.

Once the government policies were thoroughly examined and historical background

understood, attention was turned to the conditions of the farmers and how government

policies were affecting them. To study this, news items in the recent times were examined

related to states where agriculture is dominant. Articles referring to various farmer related

issues such as Ban of Exports on Basmati, The Potato Glut, Micro-Financing problems,

Maize trials and power crisis were studied. Not only that, the expert comments and related

articles were also studied to get a clear picture of it.


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Survey Sheet

Name: ____________________________________

Place: _____________________________________

Q1. How long have you been engaged in farming?

Ans._______________________________________________________________________

___

Q2. What is the area of land you own?

Ans._______________________________________________________________________

___

Q3. Do you receive any subsidy on crop seeds or fertilizers? If yes, then elaborate.

Ans._______________________________________________________________________

___

Q4. Do you get free electricity and tube well facilities? If yes, then elaborate.

Ans._______________________________________________________________________

___

Q5. Do you think introducing FDI is in favour of farmers?

Ans._______________________________________________________________________

___

Q6. Do you think subsidies are any benefit to farmers?

Ans._______________________________________________________________________

___


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Q7. What is the current market price of wheat, cotton and rice? Do you think the prices are

apt from a farmers perspective? If no, why and what do you think shall be the prices?

Ans.__________________________________________________________________________

___________________________________________________________________________

___

___________________________________________________________________________

___

___________________________________________________________________________

__

Q8. Are all of your family members engaged in agriculture?

Ans._______________________________________________________________________

___

Q9. What is the annual agricultural profit after all your expenses?

Ans._______________________________________________________________________

___

Q10. Any other incidents/Comments you can relate to?

Ans._______________________________________________________________________

___

___________________________________________________________________________

___

___________________________________________________________________________

___

___________________________________________________________________________

___


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HISTORICAL BACKGROUND:

Punjab was only one of the two provinces that were partitioned when the formation of

independent nation-states of India and Pakistan was announced by the colonial rulers in 1947.

Punjab thus became a border-state, located on the periphery on India. The state was

peripheral to India not only geographically but also socially and culturally. Notwithstanding

its peripheral location, Punjab has always been an important region in the political and

cultural imagination of the nation. As mentioned above, until recently Punjab was viewed as

the most dynamic and progressive state of the country, particularly for its successes in the

agrarian sector.

The Green Revolution was successful in other parts of India as well, but it was Punjab that it

primarily came to be identified with. The available statistics on various indicators of

agricultural growth speak for themselves. Of all the states of India, Punjabs growth rate was

the highest during 1960s to the middle of 1980s in agriculture. Annual rate of increase in

production of food grains during the period 1961-62 to 1985-86 for the state was more than

double of the figure for the country as a whole. The per centage of high yielding varieties

(HYV) of seed in the total area under food grains in Punjab was as high as 73 per cent in

1974-75 (all India 31 per cent) and 95 per cent in 1983-85 (all India 54 per cent). WhilePunjab had 17,459 tractors per hundred thousand holdings, the all India figure was only 714.

The same holds true for most other such indicators (x). These achievements have also been

very widely recognized. The opening lines of the recent World Bank report on the state, for

example, summarize Punjabs achievements quite well:

Punjab is Indias most prosperous and developed state with the lowest poverty

rate. At the end of the 1990s, more than 94 per cent of Punjabs citizens were above

the poverty line, 70 per cent were literate, 94 per cent of the six year olds were

enrolled in primary schools, 72 per cent of children under twelve months were

immunized, 99 per cent of households had access to safe drinking water, and the

average life expectancy of its citizen was 68 years. The remarkable development

record of Punjab can also be inferred from the fact that it has already achieved, or

is well on track to achieve, most of the Millennium Development Goals (MDGs).

According to Indias National Human Development Report (2001), Punjab was

ranked second only to Kerala in terms of the overall level of human development


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among the major Indian states. Most citizens of Punjab have thus already achieved

a level of socio-economic status that the majority of Indian citizens are unlikely to

experience in their lifetime (World Bank 2004: 3).

Apart from the prosperity that the success of Green Revolution in the 1960s and 1970s

brought to the people of Punjab, it also played a very important role in solving the gargantuan

problem of food scarcity of the country. The state rightly came to be known as the food

basket of India. The official website of the state government proudly claims that Punjab

produces 22 percent of the countrys wheat (12.7 million tons), 9 percent of rice (6.8 million

tons) and 24 per cent of cotton (0.3 million tons). It contributes 60 to 70 per cent of wheat

and 40 to 50 per cent of rice to the central pool.

The decade of 1980s was a critical period in contemporary Indian history. Punjab witnessed a

powerful ethnic movement during the 1980s. The movement for Khalistan, a separate Sikh

nation, generated a sense of crisis, which was felt much beyond Punjab. Though Sikh

militancy declined during the early 1990s, it had far reaching consequences for the society

and economy of Punjab.

While the 1980s was, in a sense, a creative period for Indian society when many fundamental

assumptions around which the post-colonial Indian nation was being built were questioned,

for Punjab and for the Sikhs it was a traumatic phase. Fifteen long years of militancy and the

manner in which the Indian State handled the Punjab crisis not only caused bloodshed and

sufferings, it also quite fundamentally altered the popular image of the region. From a region

known for its economic vibrancy and progress, Punjab began to be seen as a crisis ridden

state, a region with serious problems of law and order and political unrest and therefore not

suitable for safe investments.

Interestingly despite all problems, even during the 1980s the agrarian economy of Punjab

continued to progress. The income of the primary sector of the state economy grew at an

average of 5 per cent per annum while the corresponding figure for India as a whole was

around 3 per cent. The real implications of the crisis were to be felt in the following decade,

during the 1990s, when the economic priorities at the national level witnessed a major shift.

GLOBALISATION AND INDIAN AGRICULTURE:


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It was perhaps for the first time in the post-independence period that there had been criticisms

of the policies and programmes that the first democratic government of independent India

had initiated under the leadership of Pandit Jawaharlal Nehru earlier also, but they emanated

mostly from conflicting ideological positions of different leaders or political formations. The

strikingly new feature of the 1980s was that unlike before, the challenge this time came from

below, from those who were supposed to benefit from development, or whom the

independent Indian State had promised a better life.

The most obvious issue in this category is the marginalization of the rural people in general

and of those dependent on agriculture in particular. It is not only ideologically that agriculture

experienced marginalization in the popular imaginations of the Indian people over the last

two decades; its share in the national income has also declined considerably. Though a large

majority of Indians continue to live in the countryside, the share of agriculture to the national

income has come down to less than a quarter. The growth rates in agricultural sector have

also been much slower than other sectors of the economy.

Declining significance of agriculture, one would think, is quite natural, and perhaps a

desirable process. With development of industry and modern servicing sectors, it has

happened everywhere in the world. However, there is something quite unique about the

Indian experience. Unlike other regions of the world, marginalization of agriculture in the

Indian economy is not being accompanied by a similar degree of shift of population to non-

agricultural employment. Given that India is a democratic country such a reality becomes

even more challenging. Though liberalization and globalization were important turning points

in the recent economic history of India, the crisis of Punjab agriculture, as mentioned

above, was already evident by early 1980s, and had become a political issue in the state.

Acknowledging that all was not well with the state of affairs in Punjab agriculture, the stategovernment in 1985 appointed a committee under the chairmanship of Professor S.S. Johl, an

agronomist, to look into the problems of the agrarian sector.

In the report submitted in 1986, the Johl committee expressed concern about stagnating

productivity levels and deteriorating environment due to the cropping pattern dominated by

paddy-wheat rotation. The committee recommended that if agriculture in Punjab was to be

made sustainable, the farmers will have to be encouraged to diversify cropping pattern,

switching over from high-volume and low-value crops to low-volume and high-value crops.


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However, given the overall political atmosphere in the state at that time, no concrete steps

could be taken to implement the report.

The available official data on employment patterns in Punjab has begun to reflect the process

of shift from agriculture very clearly. As shown in figure below the proportion of cultivators

in the total number of main workers in Punjab declined from 46.56 in 1971 to 31.44 in 1991,

and further to 22.60 by 2001. While the share of cultivators has been consistently falling, that

of the agricultural labourers had been rising until the 1991 Census. However, over the last

decade, viz. from 1991 to 2001, even their proportion declined significantly, from 23.82 to

16.30. In other words, though nearly 70 per cent of Punjabs population still lives in rural

areas, only around 39 per cent of the main workers in the state were directly employed in

agriculture.

Introduction of liberalization and globalization during the early 1990s further increased

pressure of the agrarian economy. The new economic policy advocated withdrawal of the

state from economic sphere, leaving it to the logic of market forces. While it might be a good

thing for the industry to be allowed to freely import the latest technology from abroad or have

a competitive atmosphere, leaving the agricultural sector to vagaries of free market could

prove disastrous. Small landholders cultivate most of the land in India and they often have to

borrow from various sources for investments in the cultivation of cash crops. The cycle of

agricultural production is such that virtually the entire farm yield comes to the market

42.56

35.86

31.44

22.620.11

22.1623.82

16.3

1971 1981 1991 2001

Proportion of main workers engaged in agriculture in

Punjab

Cultivators Agri. Labourers


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in public parks. The farmers were obviously depressed and angry, perhaps more depressed

than angry! As a newspaper report states:

Though the farmers anger is coming to a boil, his attitude towards the government

officials is, surprisingly, the very reverse. With folded hands, he pleads with them to

lift his produce, at times virtually falling at their feet to grant him a remunerative

rate. A telling symbol of the vice-like grip that the market binds him in.

Farmers were at the mercy of officials! It is blood and toil for six months and we

cannot afford to annoy the officials. The money we earn during these days will

provide for our family during the next six months as well as help us purchase

fertilisers for the forthcoming wheat crop, a farmer in the Khanna Mandi, Asias

biggest grain market, told Bajinder Pal Singh, a newspaper reporter.

However, not all of them could wait or bear the humiliation. There were several reports on

the front pages of local newspapers during the month of October 2000 of the small and

marginal farmers taking the extreme step of committing suicide out of frustration and

humiliation.

Marginalization of agriculture has had many far reaching implications for the farming

population of the region and elsewhere. There has been a general stagnation of agricultural

sector over the last decade or so. The available analyses show that by early 1990s, paddy and

wheat had already reached peak level of productivity in Punjab. According to the Economic

Survey of Punjab 2003-04, the primary sector of Punjab economy registered a negative

growth at the rate of minus 2.38 per cent over the preceding year (2002-03). The share of

agriculture sector to the gross state domestic product has also declined significantly from

33.06 per cent in 1993-94 to 22.43 per cent in 2002-03.


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LITERATURE REVIEW

Green Revolution:

Let us first look at briefly the overall economic development process of the country since

independence in 1947 until the present day. India suffered a relatively low economic growth

rates around 3.5 per cent per annum until the late 1970s, with a large fluctuations due to the

influence of the agricultural sector growth which largely depended on the monsoon situation.

Indian economy then experienced some improvement in the 1980s because of the

governments liberalization policies (but not in a full-scale) under the Rajiv Gandhi regime

and a relatively high growth rate attained by the agricultural sector in the decade. And finally,

after the full-scale economic liberalization in 1991 the economic growth rates in India

accelerated to a very high level (usually more than 6 percent, and 3even more than 8 percent

after the mid-2000s) until recently. It is notable at the same time that the agricultural sector

growth started to clearly lag behind the GDP growth since the 1990s, which indicates that

the Indian economy was plunged into a new developmental stage after the 1990s where

widening disparity between agricultural and non-agricultural (or between rural and urban)

sectors is one of the major problems for the economy. Now let us look into the agricultural

sector development in India by dividing the whole period from the independence to the

present time into several periods.

1. Until the mid-1960s

It is well known that the agricultural sector of British colonial India, especially the crop

sector, was totally stagnant or even a negative growth was recorded in the entire first half of

the 20th century. This pattern, however, was reversed at the independence in 1947. The food

grains (which is defined in India as cereals plus pulses) production registered a high growth

in India at 4.13 per cent during 1951-52 to 1960-61 on average. Both the sown area

expansion and the crop yield increase were contributed to the growth. However, the growth

rate of the agricultural sector was decelerated during the period. The priority of the

governments agricultural policy was primarily given to institutional reforms such as the land

reform and the promotion of farmers cooperatives. As a socialist nation India strongly

promoted a heavy industrialization, especially after the second Five Year Plan (1956-57 to

1960-61), leaving the agricultural sector relatively neglected.


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Severe two years consecutive droughts attacked India in the mid-1960s. Agriculture recorded

a large negative growth and India faced a serious food problem. Since the share of the

agricultural sector in GDP was still very high at about 50 per cent, the slump of agriculture

hit the economy as a whole and even the political regime itself. India was obliged to import

as much as 10 million tons of food (mainly wheat) for the two years.

2. From the mid-1960s to the end of the 1970s

The serious economic and political crisis which India faced in the mid-1960s triggered the

big conversion of agricultural policy of the government; i.e. it emphasized technological

innovation and started to introduce new agricultural technologies from abroad. And it was a

fortunate coincidence for India that the mid-1960s was the time when new seed-fertilizer

technologies started to diffuse in the tropical developing world. In particular, it was luckily

found that the wheat HYVs (Mexican semi-dwarf wheat varieties) developed in CIMMYT

in Mexico were quite suitable for the climate conditions in the northern India such as Punjab.

And the most important factor which promoted the dissemination of the new technologies

was the diffusion of private tube-wells which exploit groundwater.

Thus the new seed-fertilizer technologies, especially for the wheat crop, started to

disseminate very rapidly in northern India and within a decade or so India attained food self-

sufficiency except for some drought years. It can be called the first wave of the Green

Revolution in India. However, Indian economy as a whole had to experience a bitter lost

decade during the mid-1960s to the mid-1970s mainly due to the shortage of foreign

exchange for the import-substituting industrial sectors (Ohno, 1999). It was because India

had to continue to import a large amount of food for several years and it also had to import

chemical fertilizers (and agricultural machineries) for the development of agriculture. In sum,

India had to pay a huge cost for the sake of the negligence of agriculture at the time until themid-1960s, which is considered to be a typical case of the Ricardian Trap in economic

development.

The first wave of the Green Revolution in India had another limitation from the viewpoint of

overall economic development in the country. Because the diffusion of the Green Revolution

was confined to wheat crop and in northern India such as Punjab, Haryana and the western

part of Uttar Pradesh, it could not raise rural income and alleviate rural poverty in a wider

area. Rural India continued to be poor except some particular spots.


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As a result of the rapid production growth of wheat, which was a minor crop in India at the

time of independence, however, the production of wheat exceeded that of the coarse cereals

(such as jowar, bajra, ragi and maize) by the end of the 1970s in India (Figure 3, Figure 4).

3. During the 1980s

The decade of the 1980s witnessed a very favorable growth rates in the agricultural sector,

including almost all the regions of the country and almost all the important crop sectors. The

rapid increase of rice production during the 1980s, which is an important staple food in

eastern and southern India, was especially essential for the development of hitherto

poverty-struck rural areas in India.

The most important factor behind the overall rapid growth of the agricultural sector in

India was a widespread diffusion of private tube-wells (especially small-scale shallow tube-

wells). The diffusion of tube-wells in formerly rain-fed areas (or unreliably irrigated areas by

government canals) enabled to grow HYV wheat instead of rabi crops such as pulses in the

dry season (rabi season), and in the monsoon season (kharif season) the yield of rice was

increased substantially by switching the varieties from traditional to modern types (HYVs).

Thus the highly productive rice-wheat cropping pattern was established in a wide area of

rural India, especially in the Gangetic Basin. Furthermore, in some places with a plenty of

rainfall such as West Bengal, double cropping of HYV rice was widely disseminated.

There had been a controversy in India among economists regarding the reason why new

agricultural technologies were not accepted for long in eastern India, in sharp contrast with

northern and some other parts of India. It was argued by some Marxist economists that the

semi-feudal mode of production system in eastern India (represented by agrarian structure

with small numbers of big landlord and large numbers of indebted poor sharecroppers) was

ultimately attributed to it.

However, if we investigate the factors which critically determine the diffusion of the new

seed-fertilizer technologies, it is evident that one of the key factors was the diffusion of

private tube-wells. Therefore the key question is why especially in the eastern India the

introduction of private tube-wells was delayed until the 1980s. One of the answers may be the

shortage of capital in the hand of farmers to purchase private tube-wells, because in eastern

India there were in general only small-scale poor farmers. In other words, it can be


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hypothesized that after the 1980s the real price of tube-wells declined so that even the

relatively poor farmers in eastern India could purchase tube-wells. Another factor may be the

delay of rural electrification in eastern India, because irrigation cost is much cheaper by

electric tube-wells than diesel-driven tube-wells

On the other hand, extreme land fragmentation in eastern India with a lack of successful land

consolidation program was often attributed to the delay of the diffusion of tube-wells.

However, the experiences in eastern India in the 1980s suggested that this hypothesis was

totally wrong; i.e. tube-wells did rapidly diffuse even under the extreme land fragmentation.

And under the land fragmentation the water sales market (groundwater market) for irrigation

was widely emerged and developed.

In sum, rural India witnessed a widespread agricultural development in the 1980s due mainly

to the diffusion of private tube-wells. Especially the most important thing was that rice

production, which was the main staple food in eastern and southern India, increased rapidly

and contributed to raising rural income and alleviating poverty. The real wages of agricultural

labourers in India had started to rise and also rural poverty started to decline for the first time

in the long history of the country.

Lastly, it should be noted that in India not only rice and wheat increased their yield levels

dramatically during the period of the Green Revolution, but also coarse cereals accomplished

a continuous and substantial increase of their yield (Figure 8). According to Figure 8, the

average yield of coarse cereals increased from less than 500 kg/ha in the 1950s to more than

1000 kg/ha in recent years, although sown area experienced a rapid decrease from the

beginning of the 1970s due to the continuous decline of demand for human consumption. At

present, as indicated in Figure 9, although demand for coarse cereals for human consumption

became minimal except some spots (rural and urban Karnataka, rural Maharashtra, ruralGujarat and rural Rajasthan), demand for animal feed is increasing, especially in the case of

maize and jowar (sorghum).

4. After the 1990s

Indian economy was plunged into a new developmental stage after the 1990s. First, the

critical period for the preparation of full-scale non-agricultural sector development was over

until the end of the 1980s, when broad-based agricultural development based on the secondGreen Revolution was happened. Second, however, since India turned to the stage when per


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Government Policies:

The Ninth and Tenth year plans saw an agricultural growth rate of 2.44 per cent and 2.30 per

cent compared to 4.72 per cent in Eighth Five Year Plans. So that the agricultural growth

were back on the track, as agriculture was an important sector in India, with the respect to

both food security and livelihood, new policies catering to this sector were introduced by the

government. Some of them are explained below:

National Agriculture Policy:

National agricultural policy was introduced on July 28th, 2000. The National Policy on

Agriculture seeks to actualise the vast untapped growth potential of Indian agriculture,

strengthen rural infrastructure to support faster agricultural development, promote value

addition, accelerate the growth of agro business, create employment in rural areas, secure a

fair standard of living for the farmers and agricultural workers and their families, discourage

migration to urban areas and face the challenges arising out of economic liberalization and

globalisation. Over the next two decades, it aims to attain:

Features of NAP 2000:

1. A growth rate in excess of 4 per cent per annum in the agriculture sector;

2. Growth that is based on efficient use of resources and conserves our soil, water

and bio-diversity;

3. Growth with equity, i.e., growth which is widespread across regions and

farmers;

4. Growth that is demand driven and caters to domestic markets and maximises

benefits from exports of agricultural products in the face of the challenges

arising from economic liberalization and globalisation;

5. Growth that is sustainable technologically, environmentally and economically.


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National agricultural policy encouraged private participation- which included contract

farming. This encouraged the capital and technology inflow into the sector. Further,

through liberalisation, the competitiveness increased and that led to quality

production. It also led to tax reforms. Instead of subsidies, tax concessions were

given. Due to capital inflow, there was a subsequent improvement in the infrastructure

and transportation facilities. National agricultural policy also aimed to protect the

multinational patents rights and plans to evolve the National Livestock Breeding

Agency.

National Policy for Farmers:

National policy for farmers was introduced to help in rejuvenating the farm sector

and bringing lasting improvement in the economic condition of the farmers. The needfor policy orientation was seen because more than 60 % of the population was

dependent on agriculture for livelihood, resulting in low per capita income in the farm

sector. Consequently, there is a large disparity between the per capita income in the

farm sector and the non-farm sector. Therefore, it was essential to deal with those

issues which impact the income levels of farmers.

Background:

The Government had constituted National Commission on Farmers in 2004 under the

chairmanship of Dr. M.S. Swaminathan. The terms of reference of the Commission

included, inter alia, methods of enhancing productivity, profitability and sustainability

of the major farming systems in different agro-climatic regions of the country and

suggesting measures to attract and retain educated youth in farming and working out a

comprehensive medium term strategy for food and nutrition security.

Main provisions:Important provisions and features incorporated in the National Policy for Farmers,

2007include the following:

(a) Human Dimension: Focus to be on the economic well-being of the farmers than

just on production and productivity and this is to be the principal determinant of

Farmers policy.

(b) Definition of Farmers: Expanded to include all categories of persons engaged in


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the sector so that they can be extended the benefits of the Policy.

(c) Asset Reforms: To ensure that every man and woman, particularly the poor, in

villages either possesses or have access to a productive asset.

(d) Income Per Unit of Water: The concept of maximizing yield and income per unit

of water would be adopted in all crop production programmes, stress on awareness

and efficiency of water use.

(e) Drought Code, Flood Code and Good Weather Code: To be introduced in drought

prone areas, flood prone areas and in arid areas respectively so as to maximize the

benefits of monsoon and to be prepared for likely contingencies.

(f) Use of Technology: New technologies which can help enhance productivity per

unit of land and water are needed. Biotechnology, information and communication

technology (ICT), renewable energy technology, space applications and nano-

technology to provide opportunities for launching an "Evergreen Revolution" capable

of improving productivity in perpetuity without harming the ecology.

(g) National Agricultural Bio-security System: To be set up to organize a coordinated

agricultural bio-security programme.

(h) Inputs and services-Soil Health: Good quality seeds, disease free planting

material, including in-vitro cultured propagules and Soil health enhancement hold the

key to raising small farm productivity. Every farm family to be issued with a Soil

Health Passbook.

(i) Support Services for women: When women work in fields and forests the whole

day, they need appropriate support services like crches, child care centers and

adequate nutrition.

(j) Credit & Insurance: Credit counseling centers to be established where severely

indebted farmers can be provided a debt rescue package to help them out of debt trap.

Need for both credit and insurance literacy in villages, Gyan Chaupals to help in the


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task.

(k) Setting up of Farm Schools in the fields of outstanding farmers to promote farmer

to farmer learning and to strengthen extension services.

(l) Gyan Chaupals to be established in as many villages as possible to harness the help

of Information and Communication Technology.

(m) A comprehensive National Social Security Scheme for the farmers for ensuring

livelihood security by taking care of insurance needs on account of illness, old age,

etc.

(n) Minimum Support Price (MSP) mechanisms to be implemented effectively across

the country so as to ensure remunerative prices for agricultural produce.

(o) Market Intervention Scheme to be strengthened to respond speedily to exigencies,

specific crops to be identified.

(p) Community Foodgrain Banks: To be promoted to help in the marketing of

unutilized crops.

(q) Single National Market: To develop a Single National Market by relaxing internal

restrictions and controls.

(r) Expanding Food Security Basket to include nutritious crops like bajra, jowar, ragi

and millets mostly grown in dryland farming areas.

(s) Farmers of the future: Farmers may adopt cooperative farming, create service

cooperatives, undertake group farming through self-help groups, establish small

holders' estates, adopt contract farming and create farmers' companies. This is

expected to increase productivity, efficiency of small farmers and would create

multiple livelihood opportunities through crop livestock integrated farming systems as

well as agro processing.


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4% annual growth in agriculture through development of Agriculture and its allied sectors (as

defined by the Planning Commission (India)) during the period under the 11th Five Year Plan

(200711).

The scheme is essentially a State Plan Scheme that seeks to provide the States and Territories

of India with the autonomy to draw up plans for increased public investment in Agriculture

by incorporating information on local requirements,geographical/climatic conditions,

available natural resources/ technology and cropping patterns in their districts so as to

significantly increase the productivity of Agriculture and its allied sectors and eventually

maximize the returns of farmers in agriculture and its allied sectors.

A State is eligible for funding under the RKVY if it maintains or increases the percentage of

its expenditure on Agriculture and its Allied Sectors with respect to the total State Plan

Expenditure, where the Base Line (which will move every year) for this expenditure is the

average of the percentage of expenditure incurred by a State Government for the previous

three years on Agriculture and its Allied Sectors minus any funds related to Agriculture and

its allied sectors that it may already have received in that time under its State Plan.

Newspaper Clippings In lieu of Farmers Plight:

Although, as can be seen above, the government has done much to achieve accelerated

growth in agriculture, little has been done to improve the conditions of the farmers, in spite of

a national policy for farmers. The Clippings have been explained in the subsequent pages:
http://en.wikipedia.org/wiki/Planning_Commission_(India)http://en.wikipedia.org/wiki/States_and_Territories_of_Indiahttp://en.wikipedia.org/wiki/States_and_Territories_of_Indiahttp://en.wikipedia.org/wiki/States_and_Territories_of_Indiahttp://en.wikipedia.org/wiki/States_and_Territories_of_Indiahttp://en.wikipedia.org/wiki/Planning_Commission_(India)


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1.BAN ON EXPORTS OF NON BASMATIThe decision of government to exercise a ban on exports of wheat and nonbasmati

remained for a long time of 4 years when it was recently lifted in September, 2011.

This ban added to the plight of farmers and they remained at the mercy of markets.

Price of rice fell; farmers started selling their lands and fled to foreign countries

hoping for a better life there. Such decisions of government hit farmers very badly

whose only source of income is their crop [7].


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2.POTATO GLUT : LOOKING BEYOND THE MARKETSIn December 2011, newspapers were full of reports of the massive potato glut that

forced the farmers to dump the harvested crop on roads. Saddled with 2.5 lakh tones

of unsold harvest from

the previous season,

and in anticipation of a

bumper crop next

fortnight, the market

slumped. Against Rs

800 per quintal lastyear, farmers were able

to realize merely Rs

100-150

this year

[Reference].Such steep

fall in prices brought

gloom in the potato

belt.

There have been

suggestions in the

newspaper editorials to

solve this glut like

provide additional cold

storage space; encourage public/private investment for processing potatoes into chips

and French fries; and finally some setting up plants for manufacturing vodka.

Analyzing these suggestions will help one understand that none of them is efficient.

For example, large retail giants prefer importing frozen potato fries than manufacture

them here. A vodka manufacturing plant would not require any big quantity that can

make a significant difference to the production [8].

Times Of India dated Dec 16, 2011 by I.P Singh


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There is an urgent need for government to understand market and take decisions

intelligently. A map shall be made to understand the nations requirements for a

particular crop. Production area shall be regularly monitored and an alarm shall be

sounded as soon as the production exceeds the requirement. To achieve all this, there

is an urgent need to educate farmers. Multiple cropping shall be encouraged to reduce

dependence on one crop and reduce risk. Moreover, government should have

facilitated export of potatoes in such a state of crisis.

3.WHY WOULD MONSANTO UPROOT ITS OWN BTMAIZE TRIAL IN BIHAR?

This brings us to the a major scandal in the name of science, and involving the

multinational seed giant Monsanto, India's apex regulatory authority -- Genetic

Engineering Appraisal Committee (GEAC) and the umbrella farm educational and

research organization --

Indian Council for

Agricultural Research

(ICAR). Indian science

is riddled with massive

corruption.

In a letter addressed to

the Environment &

Forest

Minister Jairam

Ramesh,Nitish Kumar

has accused the

multinational seed

corporation Monsanto,

the GEAC and ICAR of

conniving to begin

trials of GM maize in


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his State even before it had got clearance from the environment ministry and without

informing the state government either, reports Times of India (Mar 15. 2011).

Interestingly, this is not the only scandal that has come up. For a long time,thousands

of farmers in Madhya Pradesh, Uttar Pradesh, Chhattisgarh, Rajasthan, Bihar and

Jharkhand have been left in the lurch. They had planted urd and til crops in a large

acreage, and to their dismay no grain formation took place in the standing crop.

Unable to bear the economic loss, at least four farmers have reportedly committed

suicide. Thousands of farmers have been pushed deeper into economic distress. They

had also expressed their indignation by holding demonstration and protests at a

number of small towns but havent got anything more than an official promise to

provide them adequate compensation.

What India needs right now is a Seed bill replacing the non-efficient existing one,

which must provide for a minimum economic liability that the seed companies must

undertake in event of a crop failure [9].

4.MICROFINANCE CRISIS


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There is no denying that micro-finance proved as a killer to the farmers in Andhra

Pradesh. It looks very attractive to give small credit at a cheaper rate to build the

capacity of the poor and thereby alleviate poverty. In reality, it does the opposite.

How can this be of any benefit to farmers when they are being given small loans up to

Rs 10,000 on an exorbitant annual interest rate of 24%?

In the cities, we can buy a car on a loan at an interest averaging 6-7%. House loans up

to Rs 20 lakh are available at 8 % interest. Why should then the poorest of the poor be

charged 24 % for a small amount? This is nothing but crime.

It is very difficult to pay back with such a high interest rate for a normal person. So,

one can imagine the plight of a poor farmer [10].

5.POWER CRISIS, HIKE IN DIESEL PRICES, BUT MOREOR LESS SAME CROP PRICE WOES FARMERS

In the midst of power

crisis in Punjab,

Farming is the most

affected sector

because of load

shedding, as paddy

growers are

complaining of not

getting promised eight

hours of power supply

for crop sowing in

kharif season. Due to

lack of electricity,

farmers use generators

and with the hike in


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diesel prices, it would add to the production cost of the farmer.

Over 70 per cent farmland in Punjab depends on artificial irrigation. Most of the

farmers in the state use tractors to plough their field and generators run on diesel for

irrigation. Farmers say the hike will increase the input costs up to 2000 rupees per

acre on an average. For an average farmer with few acres of land who finds it difficult

to feed his family, it becomes so difficult to cope up with these situations.

Due to problems like water and power crisis, farmers suffer from increase in

production costs while the market prices of the crop remain more or less the same.

This keeps them at loss when already they are in very poor condition[11].


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Analysis

After going through the secondary as well as the primary research we have reached the

following conclusions:

1. India has become self-sufficient but after the globalisation the growth of agriculturehas been declining. The policies look after the productivity but has merely managed to

stabilise the growth rate

2. Even though schemes and policies have introduced for the farmers, their conditionsare not good. They dont get good prices for their crops, due to which most of the

families are not able to meet the basic necessities of life.

3.

Government keeps introducing erratic policies based on poor market speculation likeban on exports which hinder the growth of the farmer. In fact, government should

properly analyse the agricultural land and draw out a crop map to specifically know

the nationwide requirement of a articular crop.

Survey Findings

Q1. How long have you been engaged in farming?

Ans. All the farmers have been engaged in farming whole their life.

Q2. What is the area of land you own?

80%

15%

5%

Area of Land owned by Farmer

Farmers having 4 - 5 acres of land Farmers having 10-15 acres of land

Farmers having more than 25 acres of land


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No farmer was satisfied with the current prices of the crops. When asked the reason, farmers

gave a very apt comparison. Wheat price has increased from Rs. 600 to Rs. 1200 in 3 4

years. The price of cotton in 1993 - 94 was 8001000 per quintal and in 10 years, it has just

increased to 4000 per quintal. If one compare this increase in cost of crop to that of increase

in products like cloth, bread it is huge. Whatever may be the international price of crop, not

much difference is seen in the price that we get.

The apt prices of three crops according to farmers were:

Wheat2000 per quintal

Cotton7000 - 8000 per quintal

Rice1700 - 1800 per quintal

Q8. Are all of your family members engaged in agriculture?

Ans. 80-85% of the families has agriculture as their sole source of income. The rest of them

have sent their wards for higher studies. Some of them are also looking to sell their lands and

shift to other modes of income.

Q9. What is the annual agricultural profit after all your expenses?

Ans. Farmer with 4 -5 acres of land make an annual profit of around 2 lakhs sadly on a

property worth Rs. 1 crore. This is a very poor condition and most of the farmers of Punjab

are in this condition. They cant afford the basic necessities of life.

A farmer with 10 12 acres of land can fulfill the basic necessities of life and the families

with more than 25 acres of land are in good condition. However, there number is very less.

Q10. Any other incidents/Comments you can relate to?

Ans. One incident which the farmers of village Khedi near Muktsar mentioned was when

government reached out to farmers 5 years back for buying their lands to build a thermal

plant there. Company quoted the price of land at 25 lakhs which was quite good price for land

at that point. It turned out that company delayed the buying of land and no contractor was

ready to take up those farms for cultivation under the fear of company confiscating the land at


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any point leading to loss of crop. This bothered the farmers for a long time since they had no

source of income.


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References:

1. Annual Report 2010-2011, Department of Agriculture & Cooperation, Ministry ofAgriculture, Government of India.

http://agricoop.nic.in/Annual%20report2010-11/AR.pdf

2. Source: World Bank3. Cultivable Land in India Shrinking, March 2012, The Hindu Business Line

http://www.thehindubusinessline.com/industry-and-economy/economy/article1576256.ece

4. India 2012 Kharif food production estimate at 5-year high: Agriculture Ministry, Sep 2012,Commodity Online

http://www.commodityonline.com/news/india-2012-kharif-food-production-estimate-at-5-

year-high-agriculture-ministry-50493-3-50494.html

5. Crisis in Punjab Agriculture, Sukhpal Singh, Economic and Political Weekly.6. Sector Profile: Agriculture and Food Processing, TRIFAC, Madhya Pradesh

http://www.mptrifac.org/PotSector/Agriculture&FoodProcessing.pdf7. SME Business Services Limited8. Farmers Carpet Jalandher roads with potatoes, Times of India [2011]9. Withdraw Nods for Field Trials for BT Maize By GARGI PARSAI from The Hindu dated March

9, 2011

10.Small loans add upto Lethal Debts, Erika Keintz, Hindu (2012)11.Why Diesel Prices Hike has Punjab Farmers Worried, Sabyasachi Dasgupta dated September

14, 2012 from NDTV
http://agricoop.nic.in/Annual%20report2010-11/AR.pdfhttp://agricoop.nic.in/Annual%20report2010-11/AR.pdfhttp://www.thehindubusinessline.com/industry-and-economy/economy/article1576256.ecehttp://www.thehindubusinessline.com/industry-and-economy/economy/article1576256.ecehttp://www.commodityonline.com/news/india-2012-kharif-food-production-estimate-at-5-year-high-agriculture-ministry-50493-3-50494.htmlhttp://www.commodityonline.com/news/india-2012-kharif-food-production-estimate-at-5-year-high-agriculture-ministry-50493-3-50494.htmlhttp://www.commodityonline.com/news/india-2012-kharif-food-production-estimate-at-5-year-high-agriculture-ministry-50493-3-50494.htmlhttp://www.mptrifac.org/PotSector/Agriculture&FoodProcessing.pdfhttp://www.mptrifac.org/PotSector/Agriculture&FoodProcessing.pdfhttp://www.ndtv.com/search?q=Sabyasachi+Dasguptahttp://www.ndtv.com/search?q=Sabyasachi+Dasguptahttp://www.mptrifac.org/PotSector/Agriculture&FoodProcessing.pdfhttp://www.commodityonline.com/news/india-2012-kharif-food-production-estimate-at-5-year-high-agriculture-ministry-50493-3-50494.htmlhttp://www.commodityonline.com/news/india-2012-kharif-food-production-estimate-at-5-year-high-agriculture-ministry-50493-3-50494.htmlhttp://www.thehindubusinessline.com/industry-and-economy/economy/article1576256.ecehttp://agricoop.nic.in/Annual%20report2010-11/AR.pdf


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impact of political dominance on agriculture

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