If we want agriculture to survive

The Budget was expected to provide agriculture with a shot of intravenous adrenaline. What we got, instead, was familiar lines. The finance minister’s offer consisted in the main of agricultural credit, crop insurance and electronic trading platforms. The farmer would dearly love to see electronic trading eliminate middlemen, but when and how would this happen? What is on offer is not some gritty action but expression of intent, which is already old hat. The farmer does, of course, need credit, but how would he pay it back without a decent price for his produce? Insurance, finally, is a complete no-no.

We had hoped that this government would be different, but that hope is fading. There is an uncanny similarity between now and 2008 when P Chidambaram announced loan waiver as the panacea to agrarian distress. “This government,” as he put it, “has stood up and has said: Count on us; we are in favour of farmers.”

His silver bullet might have helped the Congress win the election but did nothing for the farmer. The response of the political class to the farmer’s plight is to play around with loan waiver, subsidies, minimum support prices and distress tourism. Will this government break out of symbolic gestures and political gimmickry to address the real issues?

As a farmer, I want to highlight two issues that are at the core of farmer distress. Neither of them may be new, but they are crying out for attention and need restatement until they are addressed. What the farmer wants, above all, is a fair price for his produce. All kinds of forces stand in the way — control over the movement of goods, the need for certification by government officials that what is being transported is the farmer’s own produce, compulsion to sell to a specified buyer or in a market yard, government-controlled auction centres where officials and buyers are in cahoots, layer upon layer of middlemen who mediate between grower and consumer, and the absence of any credible means of price discovery.

I have grown all kinds of crops, and the problem is the same everywhere. Zoning restrictions force me to sell my sugarcane to the factory in my village. To transport turmeric from my farm to the auction centre 30 km away, I must obtain a certificate from a village official, which comes at a price. When I find a buyer for my bamboo, he wants an official to certify that it was grown in my farm and not stolen from a government forest. When I cut teak trees in my farm to make windows for my house, the forest officer has to certify that I did not fell government-owned trees. The Government is not the farmer's solution. It is his problem.

The countryside is bristling with middlemen. I go through a middleman to sell just about anything, whether it is coconuts, corn, bananas or a cow. The more the middlemen the greater the arbitrage and wider the gap between the farm gate price, which is what I get, and what the end consumer pays. The farmer would be very pleased if he got 40 per cent of what the end consumer coughs up. Twenty-five per cent is closer to the norm.

The farmer has a handicap while dealing with traders and brokers. He cannot get real-time information on the going price whereas they are clued in to the market. Price discovery and market information are critical when prices swing wildly from day to day. The farmer has nothing better than teashop gossip to go by. The Government thinks that access to the net will solve this problem. It won’t.

Just two weeks ago I sold my coconuts for a never-before price. I quoted ₹13 a nut and got it. Six weeks ago I had sold my earlier crop for a mere ₹8 a nut. Price information from the commodities section of BusinessLine was the key, but it does not report on coconut prices every day. So I browse the net and the search engine takes me on a merry-go-round. Finally when I seem to be getting somewhere I open a page and it gives me coconut prices for the year 2014.That is the story for any agri-commodity. The farmer wants a dedicated site that will give real-time price, and that does not exist.

The second issue is labour. Cost is a problem, but the bigger problem is availability. Agricultural labour is a lowbrow activity fit only for those who cannot do any better. No one with any education wants to work in a field. Young people won’t come either. That leaves agriculture with an ageing workforce, mostly women. Men and women commute to urban centres, travelling up to 100 km and ready to work for up to 14 hours for ₹200 to get away from agriculture. Agriculture offers nearly as much and the work is only six hours, but no one wants to come. Agriculture has an image problem.

Labour shortage forces the farmer to cut corners. Take sugarcane, a truly labour intensive crop raised all over the country. During its 12-month life, the crop must be weeded three times, the soil turned over, dry leaves removed, and the culms tied into neat bundles to let sunlight penetrate the crop. With rising cost and growing scarcity of labour all three have now been compressed into one operation. The yield has, as a result, plummeted from over 50 tonnes an acre to less than 40.

The farmer is looking for mechanisation to help him through this crisis, but it does not exist. The only mechanisation I have seen, apart from a paddy harvester, is the tractor that has been around for 50 years. The factory in our village brought two enormous sugarcane harvesters, but our holdings are too small for them. Surely, it is not beyond human genius to fabricate machinery suited to small holdings.

What stands in the way is economics, and not technology. That is where the Government should step in if it really wants to help the farmer. Without a fair price for the produce and meaningful mechanisation, agriculture will go down the chute and doubling farm incomes will remain a pipe dream.

The writer is a labour relations and HR consultant, and farmer