Why are the farmers marching into cities?

Farmers from various parts of the country are repeatedly marching to the cities. They have this year marched into Mumbai and Delhi to highlight their plight. They perhaps feel that prosperous city dwellers and the Governments residing there are not showing sufficient empathy and responding to their pleas. Could it be a sign of a disastrous situation finally reaching a boiling point?

The Indian farmer has been in distress for the last several years, caught between depleting landholdings, uncertain weather, rising cost of inputs, inability to find markets, thus getting low returns with rising risks. Demonetisation further compounded the misery as cash was the primary means of transaction and moving away from it reduced liquidity.

All these challenges have not diminished his spirit to toil and that is manifested in all round rise in production of various crops and India remaining a self- sufficient country for most of its food needs.

Various schemes addressing soil health, crop insurance, irrigation,a national e-market and price support have been introduced but their implementation and impact will take a long time to be visible while the misery of the farmers continues unabated. The tools that have the best optics and are increasingly brought out as a solution are raising Minimum Support Prices (MSP) and waiving farm loans.

While these measures do provide temporary relief from pain for certain number of farmers and specific regions, they have failed to nourish Indian agriculture practitioners back to health despite repeated deployment.

Farmer & the Government

Agriculture as an occupation is getting less rewarding across the world as it has lagged the growth in returns that other occupation/profession/enterprises have been generating. This situation is exacerbated in India and other developing economies where a large percentage of the population and the most vulnerable sections are dependent on agriculture.

Indian Agriculture between late 60s and 90s witnessed a few revolutions that made significant impact on agriculture production. The Green, White and Yellow revolutions addressed supply deficits in specific crops or commodities. An ecosystem of appropriate technology, resources, supply chain and market access / consumer reach were created to overcome the supply deficit. These initiatives had focused on driving self sufficiency in cereals, milk and oilseeds and delivered farmer prosperity in the regions they were implemented.

That they were successful is evidenced by the continuing self- sufficiency in cereals and milk though oilseeds after reaching self-sufficiency in 1992-93 went into continuing deficit as rapid growth of Palm Oil in Indonesia and Malaysia, Soyabeans in South America and Sunflower in the Black Sea region took the competitive advantage away from India.

Indian agriculture in this period was a collaborative effort of God, Government and the farmer –it’s no coincidence that colloquially they are all called “Anndata”.

However, the success of these efforts created a mindset which continued to focus on food scarcity and farmer protection, celebrated increasing production even if it meant using more resources irrespective of the ecological impact. This is now coming to haunt Indian agriculture and the farmers engaged in it.

The 90s saw the opening up of the economy in India and around the world, which led to rapid growth and had its impact on global food consumption and changed dietary habits. This also brought the monster called the market forces in the existing mix of impactors. Globalisation caused linking of economies, cultures and food habits. As trade and tariff barriers were brought down, the world of agriculture became a battlefield where the most efficient were the winners.

New challenges

Indian agriculture and its stakeholders, used to operate in a controlled and supported environment, were simply not ready and equipped to deal with the rapidly changing scenario. The 2000s had its share of silver linings in the form of significant increase in production of corn, cotton, fruits and vegetables, poultry and milk, but in all these efforts the focus remained on producing more without either a mindset or ecosystem to support the marketing of the produce.

As the world adopted more technology to improve productivity, uncertain weather patterns became a common occurrence rather than an exception and markets became a bigger driver of prices than the government. Indian farmers’ efforts started showing diminishing returns and all the ills that had been concealed in rising commodity price cycles began to impact the farmers as the markets receded.

With dwindling landholdings for every successive generation of farmers, the old mindset of crop choices, coupled with poor capacity to deal with markets and little ability to break controlled market access, and devoid of any major technology breakthrough, the Indian farmer has continued to toil for poorer results even as he has witnessed growing prosperity and development around him.

The risk to reward equation has continued to worsen against the farmer and he has little option of changing his job. With nowhere to go he keeps going back to the government for support.

So where do the solutions lie? certainly not in unilateral raising of MSP or waiving off loans, which apart from providing a safety net have outlived their role as a panacea for bringing prosperity to the farmer. Solutions lie in harnessing the very forces that have caused the distress namely, technology, industrialisation and market forces.

These forces have to be seen as opportunities to be used to reduce risks, convert commodities to food and build access to the most favourable markets. These however can be leveraged to advantage only through a very supportive and forward-looking policy framework with an approach that is as proficient in dealing with surpluses as it has been in dealing with deficits, devoid of fears of scarcity and equipped with agility of response.

Technology is available and needs to be deployed to reduce risks for the farmer in areas of weather prediction, soil improvement, dry land farming, seed, pesticides, fertilisers, irrigation, farm equipment and delivering services in form of financing, crop insurance and agri extension. Solutions exist and have been proven. The pace of their universal application, however, has been slow and often caught up in regulatory and administrative contradictions.

Industrialisation entails linking agriculture to food processing, investment in improving supply chain efficiencies to improve access to markets, reduce wastage and improving the conversion ratio of agriculture to agri-business. This has its own contradiction as processed food consumption continues to be discouraged while food processing is being encouraged.

Managing Marketing

Managing the marketing of produce is perhaps where the biggest opportunities lie but despite significant debates and discussion, farmers’ access to the markets remains controlled. Production has to be aligned with the needs of consumption with unhindered access to the markets. Farmers need to be educated and equipped to deal with the market, which is potentially the whole world, a job where greater trust with protective measures need to be placed in the private sector. Choice of crops have to be more strategic to serve not just the domestic but also the global markets.

All the solutions listed above and many more have been under discussion and had selective implementation over the years but if the state of the Indian farmer continues to worsen, it denotes failure of the system, lack of concerted effort or insufficient will to implement. This is exemplified by lack of decision and action in areas of seed technology, land leasing, APMC, FDI in retail to name a few.

It is ironical that the Indian farmers are revered collectively as providers of food for the nation, but the individual farmer is left voiceless and helpless to fend for himself against the odds that continue to mount against him.

The marches to the cities indicate that farmers, who are no longer willing to remain faceless, buried in the rural backyards are organising in groups to come to the cities to shame the people and the governments they feed through their produce and votes.

It is time India realised that it owes a suitable response to the plight of its farmers by taking a more holistic view and urgently required actions to address his challenges. The farmer needs to be equipped to produce more and efficiently, facilitated to read and reach the markets economically and freed from the shackles that hold him back from realising the best value for his crop.

Benefits of a thriving agriculture go beyond a prosperous farmer. Increased food supply, when distributed well with aid of technology and targeted distribution, helps eliminate hunger. Diversified crops, specifically traditional grains, fruits and vegetables combined with food processing and efficient supply chain make dietary diversification affordable and address challenges of large scale malnourishment, a scourge that can undermine the future of the young population that is expected to yield the demographic dividend for India.

Increased activities related to agriculture create opportunities for generating employment off the farm in rural areas addressing the growing challenge of unemployment being faced today.

With so much to gain, it is important that with a sense of urgency all stakeholders come together to create a rainbow of revolutions to lift Indian agriculture from its current state of despair to glory.

Siraj Chaudhry is former Chairman and currently an advisor to Cargill India, the Indian arm of Cargill Inc., a global leader in agriculture and food