On Independence Day, we salute our freedom fighters. We also remember Lal Bahadur Shastri who gave us the slogan, jai jawan, jai kisan.
Atal Bihari Vajpayee expanded the slogan to jai jawan, jai kisan, jai vigyan. The present government has an array of slogans for the farmers. Prime Minister Modi has coined so many — swacchh bharat, more crop per drop, har khet ko pani among them — that it is hard to identify the most important one. Slogans are important as they reflect not only the leader’s vision but also help to mobilise the masses.
However, if slogans are not backed by a clear strategy and financial resources, they will fizzle out.
A look at the historic evolution of the agri-food space to identify catalytic contributions by leaders of the day reveals interesting facts. Let us start with the Nehruvian era. The first five year plan (FYP) focussed on irrigation (big dams). The second FYP (1956-61) was driven by Prime Minister Nehru’s economic philosophy of the mixed economy, with the state playing a dominant role, and focused on heavy industry. For food, however, he relied on PL480 aid (mainly wheat) from the US. When India faced back-to-back droughts in the mid 1960s, Shastri realised the folly of this model. For a country that lived “from ship-to-mouth”, two consecutive droughts and a 72-hour suspension of food aid from the US (due to political differences over Vietnam) were enough to ring the alarm bells.
The crisis sowed the seeds of the first major transformational change in Indian agriculture. Nearly 18,000 tonnes of high yielding variety seeds of dwarf wheat were imported from Mexico, and Agricultural Prices Commission (APC), now known as CACP, and the Food Corporation of India (FCI) were created to incentivise farmers to adopt new technology. By 1971-72, India became nearly self-sufficient in basic staples. This transformational change was the Green Revolution.
Shastri also took another transformational decision that changed the course of India’s milk sector, which was to create the National Dairy Development Board (NDDB), with Verghese Kurien as its chairman. The NDDB gave India the White Revolution, which turned the country into the largest producer of milk in the world.
Indira Gandhi went socialist and strangulated grain markets by taking over wholesale trade in wheat in 1973-74 and rice in the following season. She failed miserably and India was forced to import grain again.
The biggest decision thereafter in the agri-food space was taken by Vajpayee when he allowed GM technology in cotton in March 2002 and in the process launched the gene revolution. This made India the second largest producer and exporter of cotton, with net gains of about $55 billion during 2002-2015.
UPA I and UPA II saw the global commodity price boom. Manmohan Singh’s government offered significant increases in minimum support prices. This increased production, stocks and exports to unprecedented levels. India exported more than 60 million tonnes of cereals during 2012-14, and overall agriculture exports touched $42 billion in FY14.
More recently, Modi’s government is seen struggling to revive the agri sector in the wake of back-to-back droughts in 2014 and 2015. In his town hall meeting, Modi acknowledged that Indian agriculture held the key to India’s growth. A week before, in a meeting at NITI Aayog for 15 years’ vision and planning, he stated emphatically that focus on agricultural productivity alone will not suffice, and that we needed a holistic approach including food processing, access to markets etc. Further, he added that the time for incremental changes was over, and that we now needed transformational ideas and policies. He is spot on.
What are PM Modi’s transformational ideas and policies in the agri food space? So far, it has been only slogans and little action. The Indian farmer and farming is limping due to heavy dependence on monsoons. Slogans like har khet ko pani and more crop per drop under the PM’s Krishi Sinchayee Yojana (PMKSY) are nowhere near transformational as they have only paltry resources (Rs 5,767 crore) and fragmented governance across three ministries.
If PM Modi really wants to usher in transformational changes in India’s agri food space, our submission is he focus on just three things.
One, put food and fertiliser subsidies under Direct Benefit Transfer (DBT) to beneficiaries’ accounts. Tie it with deregulating fertiliser prices and imports, and shrink the public distribution system, which is marred by massive leakages (above 40 per cent) and high costs. This will save him save a minimum of Rs 50,000 crore annually, which he should put in water management (PMKSY).
Two, ensure at least all NDA-ruled states carry out genuine agri market reforms, that is, break the monopoly of APMC markets by creating alternative private sector/farmers’ markets, allowing direct purchases from farmers, capping commissions plus taxes at 3 per cent (1 plus 2), abolish or drastically prune Essential Commodities Act (ECA), liberalise retail and e-commerce to create all India markets.
Three, usher in a brown revolution by incentivising precision agriculture. It will help save precious water, fertilisers, maintain soil fertility of Mother Earth, and make agriculture not only sustainable but also productive and profitable to farmers.