On March 28, 2021, Dr Ramesh Chand, Member (Agriculture) of the Niti Aayog, said that if the Agriculture Acts are not implemented soon, the target of doubling the income of farmers by 2022 would not be achieved. He said that the government was ready to discuss these laws with the farmers section by section. Farmer leaders should consider this offer.
He said that the solution to this problem could be found only by giving and receiving something and if the farmers persisted on their demands then it would be difficult to find a way forward. He also said that the government has made a good alternative for the farmers not to implement these laws for a year and a half.
The UPA government had constituted a committee headed by Dr Ramesh Chand in April 2013 to review the procedure adopted by the Commission for Agricultural Costs and Prices while making recommendations of Minimum Support Price (MSP) of different crops to the Central Government. The committee submitted its report to the Central Government on April 1, 2015.
The recommendations made by the committee headed by Dr Ramesh Chand regarding the MSP of agricultural commodities far exceeded the suggestion made by Dr MS Swaminathan to pay 50 per cent profit on the total cost of production (C2) due to which Dr Ramesh Chand’s recommendations were considered pro-farmer at that time and were also appreciated by the farmers’ organizations.
In addition to the other recommendations of this committee, it was recommended to pay 10 per cent extra on MSP in view of the risk involved in agricultural production and its management functions. The committee suggested that to consider the labour charges of the head of the household he/she should be considered as a skilled labourer. The committee also recommended that to pay the gap between MSP and market prices is the responsibility of the government. These recommendations were considered pro-farmers.
Apart from these recommendations, according to the committee, it is not possible for the farmers to meet their needs due to non-availability of remunerative prices, which leads them to commit suicide due to debt burden. In this regard, the committee had expressed the view that farmers need protection from market forces (looting).
Dr Ramesh Chand became a member (Agriculture) in the Niti Aayog set up after the Planning Commission was abolished by the NDA government and now he is advocating market forces to double the income of farmers.
The first question regarding doubling the income of farmers by 2022 is that on March 28, 2021 Dr Ramesh Chand is pushing for speedy implementation of the three Agricultural Laws enacted by the Union Government. Prime Minister Narendra Modi made this promise in a speech on February 28, 2016 in Bareilly. At the time of his promise, he had not laid down any condition for enactment of any new law relating to agriculture.
When inquired about the income figures of farmers in the Lok Sabha, it was found that the government does not have such figures. Based on the 2011-12 estimates of the National Sample Survey (NSS) to know the income of farmers for the year 2015-16, the annual income of an Indian farming family for 2015-16 was estimated at Rs 96,703 which works out to Rs 8,059 per month for a family of five and Rs 1,612 per capita per month or around Rs 54 per capita per day.
In order to double the income of farmers in the six years from 2016 to 2022, their income has to increase by 10.4 per cent per annum. Lack of access to accurate income figures for farmers is a major problem. The data from the NSS, one of the Union Government’s own offices, was the subject of newspaper discussion on the declining income of farmers during 2018. The government later withheld the release of the figures.
Gross Value Added in the agricultural sector (Agriculture GVA) can be used to estimate the approximate growth of farmers’ income in India. Since 2016, when the farmers’ income has been promised to double in six years, there has been an increase of 24.5 per cent in the last five years, and according to Dr Ramesh Chand, this increase may be 3.5 per cent in the coming year.
As per the promise made by the Prime Minister to double the income of farmers by 2022, the six-year increase would be 100 per cent, compared to only 28 per cent achieved during the first five years. Farmers and other working classes in the country are struggling for the repeal of the three Agricultural Laws enacted by the Central Government.
The serious consideration in this regard is that even if these laws are implemented immediately, in the remaining one out of six years, how will the private markets increase the income of farmers by more than 75 per cent when their aim is to increase the profits of the businessmen and not the benefit of the farmers?
In 2016, and even now, statements are being issued by the rulers to double the income of farmers. There are some very important questions in this regard. According to the government’s own data, the per capita income of farming families during 2015-16 was Rs 54. If the Central Government keeps its promise, the per capita income will reach Rs 108 by 2022.
An income of Rs. 108 does not even cover the cost of three meals a day, while basic necessities of life include food, clothing, housing, education, health care, clean environment and social security. Per capita income represents the average income.
Often the average figures conceal more than what these reveal. All the farmers in the country do not belong to one category. Different categories of farmers include marginal, small, semi-medium, medium and large farmers. According to the Centre’s own data, around 68 per cent of the farmers in the country have less than 2.5 acres of land and around 18 per cent have 2.5 acres to less than five acres of land.
These figures make it clear that around 86 per cent of the farmers in the country fall into the categories of marginal and small farmers and the remaining 14 per cent fall into the categories of semi-medium, medium, and large farmers. The category-wise break up of farmers makes it clear that the income of marginal and small farmers will not double even after doubling the income of farmers. In addition to these facts, there are considerable inter-regional variations in the income of the farmers.
About 50 per cent of the country’s population depends on agriculture for livelihood. This population includes farmers, farm labourers and rural artisans. Different research studies conducted in different parts of the country have revealed the fact that the income of marginal, small, semi-medium and medium farmers, farm labourers, and rural artisans is so low that they have to bear the burden of debt.
What to think about repayment of debt, they are not even in a position to pay the interest on their debt as they have to take loan to keep the stove burning for merely two time meals.
The worst of the different farming sections are landless farm labourers and rural artisans as the increasing trend of mechanization and the use of herbicides in the agricultural sector are rapidly reducing their employment. Both these sections have no means of production other than selling their labour. These two sections are the two poles at the bottom of the agrarian economy ladder that are more prone to wear and tear, and more likely to be beaten.
In this regard, it is important to consider the fact that even in the promises made to the farmers to double their income, these two sections were completely neglected, while increasing their income should be the first priority.
The Covid-19 pandemic has reminded us that human beings can survive without cars, bunglows, airplanes, phones and the like, but bread is essential for their survival. The well-being of the farming community is essential for the survival of the human race. Overcoming economic, political, intellectual and other types of pollution is essential to make the lives of farmers, farm labourers, and rural artisans comfortable.
In order to overcome the growing economic and other inequalities in the country, the corporate economic development model must be replaced by a people and nature-friendly economic development model. To control political pollution, it is necessary for the people to unite and question the politicians and force them to fulfill their promises.
And, in order to control intellectual pollution, pro-people economists have to compile relevant statistics, conduct major studies and expose the so-called intellectuals who are fabricating data for conclusion-oriented studies to please the government and the corporate world in the hope of getting meaningless petty benefits.
About the author:
Gian Singh is the former Professor, Department of Economics, Punjabi University, Patiala
This article first appeared in Counterview: Doubling of incomes? Niti Aayog view ‘hides’ the plight of 86% small, marginal farmers on April 04, 2021.