After Dec 11, agriculture has been pushed to the center stage of Indian politics. But will it usher in a new renaissance?

The writing was on the wall. The anger that rural Gujarat voters had exhibited in last year’s Gujarat Assembly elections, edging the ruling BJP overwhelmingly in the Saurashtra region, was a clear pointer to the serious agrarian distress that prevails in the hinterland. Failing to keep a tab on the rural pulse, and unable to assuage the growing farmers anger that was spilling on to the streets, the electoral debacle in the predominantly agricultural belt of central Hindi heartland – Madhya Pradesh, Chhattisgarh and Rajasthan – was already scripted.

Interestingly, while Congress romped home riding on the promise of farm loan waiver and a higher procurement price for paddy, K Chandrashekhar Rao in neighbouring Telangana swept the Assembly polls riding the popularity of a direct income support scheme Rythu Bandhu for farmers. Under the novel investment scheme, the first of its kind in the country, land-owning farmers will get a support of Rs 8,000 per year, to be split in two -- Rs 4,000 each for kharif and rabi crop season. Benefitting nearly 58 lakh farmers, Telangana government has made a budgetary provision of Rs 12,000-crore for this scheme for 2018-19. The direct payment amount has since been raised to Rs 10,000 per farmer, and soon thereafter Jharkhand has been quick to follow up by launching a similar scheme providing Rs 5,000 per acre.

The speed at which the newly elected Congress governments in Madhya Pradesh, Chhattisgarh and Rajasthan implemented the farm loan waiver promise clearly shows the political urgency the party felt it needs to accord to agriculture. While Madhya Pradesh has waived outstanding farm loans to a maximum of Rs 2 lakh per farmer, which is expected to cost Rs 35,000-crores, Rajasthan and Chhattisgarh have announced a full loan waiver costing the state exchequer Rs 18,000-crores and Rs 6,100-crores, respectively. More than 8.3 million small and marginal farmers stand to benefit from the loan waiver when fully implemented.

Undeterred by the warnings being issued by economists, bankers and planners saying that farm loan waiver will upset the balance sheets and set in a bad precedence, Congress President Rahul Gandhi has warned “My message to farmers is that this country belongs to you and the Congress and other opposition parties will work together to ask Prime Minister Narendra Modi to write off your loans. We’ll not let him sleep until he waives your loans. If Modi doesn’t act, the Congress will do it 100%.” 

His argument is backed by sound reasoning. After all, when corporate bad loans to the tune of Rs 3.16 lakh crore between April 2014 and April 2018, were written-off, there was no hue and cry from the economists or bankers. Travelling through the rural belt before the elections, angry farmers did confront me at a number of places asking if huge loans of corporate can be written-off why not for farmers. In fact, their anger was specifically directed at former Chief Economic Advisor, Arvind Subramanian, who had gone on record saying that corporate loan write-off leads to economic growth. On the other hand, when farm loan waivers were first announced in Uttar Pradesh after the Yogi Adityanath government was sworn in, former RBI governor Urjit Patel had said that it will upset the national balance sheets and lead or moral hazard.

Nevertheless, the clear electoral verdict in the Hindi heartland has finally brought agriculture to the centre stage of Indian politics. Agriculture has emerged on the top of the political agenda, and the message has gone loud and clear. It is probably for the first time that the electoral verdict has brought in a visibly renewed confidence among the farming community. Rising above the divisive electoral policies that kept them split on the basis on religion, caste and ideologies, they now feel their collective electoral strength. The recent election results have shown them the power to topple governments. This is a major factor that will certainly influence the 2019 general elections.

After all, in a country which roughly has 50 per cent population engaged directly or indirectly in farming, farmers are finally in a position to be a lot more assertive. For over four decades now, real agricultural incomes have remained frozen. A recent OECD study has shown farm incomes have remained static in India for the past two decades. Earlier, an UNCTAD study had shown farm gate prices across the globe, factored against inflation, had remained static between 1985 and 2005. A recent Niti Aayog study has concluded that real farm income had only grown at less than half a percent, 0.44 per cent to be exact, in the five year period between 2011-12 and 2015-16 despite the fact that production had gone up steadily.  

Farmers in reality are being penalised to grow food. Barring a few exceptions, they have been consistently paid less than the cost of production over the years. To maintain food inflation under control, the entire economic burden has been conveniently passed on to farmers. To be born in debt and live in debt all through his life is virtually like living in a hell. Credit pe credit, was the only way to survive, and the debt kept mounting. Such is the economic deprivation that prevails, that even the Economic Survey 2016 stating that the average income of a farming family in 17 states of India or roughly half the country stands at a mere Rs 20,000 per year failed to shock the nation. With policies and economics failing farmers, the emergence of farmers on the political horizon is the only way forward. Only time will tell whether this political turnaround will usher in the new renaissance. #

After Dec 11, farm crisis on top of political agenda. Deccan Herald. Dec 23, 2018

https://www.deccanherald.com/specials/sunday-spotlight/after-dec-11-farm-crisis-top-709477.html

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Direct Income Support is the need of the hour

Riding on the popularity of the Rythu Bandhu scheme, which provides Telangana farmers with a direct income support of Rs 8,000 per acre per year, Chief Minister K Chandrashekhar Rao romped home sweeping the electoral verdict in recent Assembly elections. Encouraged by the positive response, and knowing it could pay him rich dividends, he had raised the amount to Rs 10,000 per year just before the elections.  

The first of its kind in the country, and what essentially began as an exercise to work out an input subsidy scheme to offset the cost of seed, fertiliser and pesticides, the Rythu Bandhu scheme has finally turned into a direct income support for the debt-ridden farming community. Under the novel investment scheme, land-owning farmers will get a support of Rs 4,000 each for kharif and rabi crop season. Benefitting nearly 58 lakh farmers, Telangana government has made a budgetary provision of Rs 12,000-crore for this scheme for 2018-19. More than the budget provisions, what makes this scheme effective is the way it was implemented. Within a month the land records were put in order, and the distribution of money has been as per the promise. Buoyed by the public response, and the appreciation it has received from a wide array of experts, economists and others, KCR is now keen to replicate it across the country. “This will require an additional Rs 3.5-lakh crore. It shouldn’t be a problem allocating the amount for farmers. It will be fruitful for them,” he said.

It is a question of priorities. Finding financial resources for a terribly distressed farming community should not be a problem, if the intent is clear. According to the 2016-17 NABARD All India Rural Financial Inclusion Survey, Telengana (79%), Andhra Pradesh (77%) and Karnataka (76%) are among the top in the chart in the list of States with highest indebtedness. That farmer’s had expressed their gratitude for a slender income support of Rs 8,000 per year, which narrows down to roughly Rs 666 per month, is only a reflection of the acute rural deprivation that prevails. This shows the urgent need to pullout majority households from indebtedness. Writing-off outstanding loans is one way to address the complicated issue, providing direct income support is perhaps less distorting and more beneficial in the long run. After the loan waiver, direct income support followed by a more comprehensive assured income programme must begin. 

Several years back, when I first called for providing farmers with direct income support, mainline economists had laughed it off. At a time of globalisation and economic liberalisation, where markets ruled the roost, a number of questions were thrown up. It has taken some years for the people to grasp the implications, understand what I meant, and while the idea was sinking in, KCR certainly set the ball rolling. There are gaps but with the passage of time the scheme will get better. I am sure tenant farmers will subsequently be included, and there will be mechanisms to draw out absentee landlords and government/private sector employees who also hold agricultural lands. 

Telangana’s example was soon followed by Karnataka in a much truncated form. Just before the last Assembly elections in May, the outgoing Karnataka Chief Minister Siddaramaiah launched a new scheme, called Raitha Belaku, extending a direct income support of Rs 5,000 per hectare for dryland farmers, with an upper cap of Rs 10,000. The scheme entailed an expenditure of Rs 3,500-crore every year, and around 70-lakh farmers would directly benefit, he had claimed. And with news reports of Congress toying with the idea of providing Rs 3,000 per month by way of income transfer to small and marginal farmers in Madhya Pradesh, I am sure assured farm income will eventually become a norm rather than an exception. Even in Punjab, considering that every third farmer is below the poverty line, direct payments for marginal farmers should be tried.

Agriculture has been on the receiving end for over four decades now. As per Economic Survey 2016, the average income of a farming family in 17 States of India, which means roughly half the country, stands at a meagre Rs 20,000 a year. According to Niti Aayog real farm incomes in the five year period, between 2011-12 and 2015-16, grew at less than half a percent every year, 0.44 per cent to be exact. No wonder, the rural landscape remains equally depressing – falling incomes, mounting rural indebtedness, rising farm suicides, unmanageable glut at the time of harvest, and swelling rural to urban migration. At a time when tax concessions to the tune of 5 per cent of GDP are given to big business, public investment in agriculture has remained as low as 0.3 to 0.5 per cent of GDP.

With declining farm incomes and public sector investment shrinking over the years, agriculture has been a victim of a deliberate bias in economic thinking. For all practical purposes, agriculture is considered to be a non-economic activity. The macro-economic policies are heavily tilted against agriculture. While farm loan waivers, for instance, are considered to be a drag on the national economy, it is believed that huge corporate write-offs lead to economic growth. Unlike farm loan waivers, which become a State government’s headache, the corporate loans are the responsibility of banks and are seen as non-performing assets (NPAs) of the banking sector.

Direct income support will to some extent help in addressing these glaring disparities. At a time when farmers face extreme volatility in markets at times of harvest, and price distortions because of unwanted imports, direct payments will act as an agricultural safety net. It has to be accompanied by several initiatives in agricultural reforms, including redesigning credit, markets and cropping patterns and finally leading to an assured monthly income package to make an everlasting impact. 

To begin with, two steps are important:

 1.  Farm loan waivers too needs be clubbed with bank NPAs, and should be treated the same way as corporate write-offs. Since both the corporate and the farmers take loans from the same banks, how can the default by farmers become a State’s headache, which is expected to provide for loan waivers thereby adding on to its fiscal responsibility? While at the same time corporate bad loans are treated as a bank's headache? Why not treat farm loans as also bank's responsibility? Freeing up farm waivers will give State governments more room to provide for direct payments and to enhance farm incomes.

       2.  The Commission for Agricultural Cost and Prices (CACP) which fixes the MSP for 24 crops, needs to be now renamed as Commission for Farmers Income and Welfare with the mandate to ensure an assured monthly farm income of at least Rs 18,000 per month per family. This should be based on the average income derived from direct payments, MSP, FPOs etc, at a district level and the balance should be paid by income transfer.  #

Direct payment to farmers is a safety net. The Tribune. Dec 20, 2018.
https://www.tribuneindia.com/news/comment/direct-payment-to-farmers-is-a-safety-net/701050.html?fbclid=IwAR1XMZR5etyN73eficpO81b7optg7Ecw64qcqEUQ9w8jYC4bVAGae43zoDc

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Onion price crash: It's a bloodbath

Pic: LiveMint

Shreyas Aabhale is a young farmer from Sangamner in Ahmednagar district in Gujarat. This 21-year-old farmer was aghast when he found that he had earned only Rs 6 after selling 53.14 quintals of onions. In frustration, he sent a cheque of Rs 6 to Chief Minister Devendra Fadnavis. A few days later, another farmer, Chandrakant Bhikan Deshmukh, from Andarsul in Yeola tehsil in Maharashtra was able to sell onions at a price of 51 paise per kg. As a mark of protest, he also sent a money order of Rs 216 to Chief Minister Devendra Fadnavis. This is what he had earned after deducting mandi charges, and the transportation cost.

Both of them were probably inspired by Sanjay Sathe from Nashik in Maharashtra who had earlier sent a money order of Rs 1,066 to the Prime Minister’s Disaster Relief Fund. This is all he had earned, after deducting the expenses he had incurred, selling 750 kgs of onions. He received another shock when the Prime Minister’s Office returned the money order he sent, probably unable to accept the contribution in view of the shock waves the news had already created.

As onion prices are tumbling, a real bloodbath is being enacted on the farms. In Lasalgaon mandi, the biggest trading centre for onions in the country, prices had crashed to Rs 100 to Rs 300 per quintal. On an average, farmers were getting not more than 15 per cent of the cost they had incurred in cultivation. Unable to bear the shock, two farmers in Nashik district had reportedly committed suicide.  

In Neemuch mandi in Madhya Pradesh, onion prices had crashed to 50 paise per kg. In several other instances, irate farmers had thrown onion on the streets and some had heaped onions on the roadside giving it free to people passing by. The same is the story for garlic. Last year, the farmers of Hadoti, which comprises four districts of Kota, Bundi, Baran and Jhalawar in Rajasthan, shifted to garlic, a lucrative crop. In March when the crop was harvested, a glut in the market saw prices crash to Rs 1 per kg, making it unviable to even transport the crop to the mandi. Newspaper reports say the abysmally low garlic prices forced five farmers to commit suicide in the same belt.

Subsequently, garlic prices crashed in Madhya Pradesh mandis too forcing farmers to dump the produce in frustration. Some even emptied their bags in wells and ponds.

The plight of onion or garlic growers is no exception. A few months earlier, 65 per cent drop in wholesale prices of tomato in Nashik market forced a number of farmers to dump tomatoes on the roads. This pattern of price crash is nothing new. For past three years in a row, reports of angry farmers throwing onion, potato, tomato and other vegetables like peas, cabbage, cauliflower etc on the streets have appeared regularly. In fact, a video of an angry farmer sitting on a roadside and breaking pomegranate in exasperation one after another for not getting a price that covers up his cost of cultivation has already gone viral. It shows how severe and widespread is the malaise of price crash after a bountiful harvest ruining in the process tens of hundreds of farm livelihoods.     

What do you expect farmers to do when open market prices fall to considerably less than the Minimum Support Price? In the month of November alone, prices for farmers across the board dropped between 15 to 25 per cent approximately. Even in the case of paddy, where the government steps in to procure surplus paddy at the Minimum Support Price (MSP), prices dropped by 20 per cent. Some studies have shown that out of the 23 agricultural commodities for which the MSP is announced every year, excess production of 21 crops actually lead to an unmanageable surplus as a result of which the prices crashed.

Attracted by higher prices and favourable weather conditions, farmers put in their best to achieve record production. But their excitement is short-lived. Price crash across the country over the last few years, for instance has left farmers in the lurch. While it is perfectly alright to blame the ad hoc export import policy for the failure to find a stable market for exports, the promise of a Market Intervention Scheme (MIS) has failed to rescues loss making farmers. In fact, the assurance of launching Operation Green – on the lines of Operation Flood – aimed at market intervention for the TOP crops – an acronym for tomato, onion and potato -- at time of a price drop still remains on paper. It is time to think that if an effective cooperative system could be evolved for the highly perishable commodity – milk – there is no reason why India cannot envision a similar strategy for other perishables.  

In the US, when private markets fail to rescue farmers from a price crash, the US Department of Agriculture (USDA) had time and again moved in to manage the surplus. In 2016, when there was a crash in market prices, the USDA procured 11 million tonnes of cheese worth $20 million from farmers. “This commodity purchase is part of a robust, comprehensive safety net that will help reduce a cheese surplus that is at a 30-year high, while moving high-protein food to the tables of those most in need,” the then Agriculture Secretary Tom Vilsack had said

Earlier too, the USDA purchased 10 million pounds of strawberries, and directed the procurement to schools as well as to the needy. It purchased $6 million of fresh tomatoes in 2011 to help growers faced with oversupply. I wonder why India’s Ministry of Food and Civil Supplies is unable to buy in bulk tomato, onion and potato from farmers in a similar manner. Why can't the perishables be immediately moved to areas which are food insecure? After all, how can one explain food being thrown on streets at a time when 200 million people go to be hungry every night.

Not that US has been able to address the price sump every time a glut takes place but since 2002, the US Farm Bill provides for income support to farmers under what is called ‘price-loss coverage’ system. In 2014, the income support helped peanut growers emerge out of the crisis emanating from a price crash. Unlike the Market Intervention System in India, which is essentially aimed at consumers when food inflation soars, the US has instead put in a strong safety-net mechanism for farmers. #

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With high productivity, assured irrigation, a higher MSP and loan waivers in progress, why are Punjab farmers dying?

At a farm widow congregation in Punjab 

A day after the massive farmer protest in New Delhi, hundreds of farmer widows had assembled at Mansa in Punjab. I sat there listening to the heart-rending testimonies of several farm widows, among the hundreds who had assembled at Mansa. In the land of Green Revolution, to see and meet hundreds of farm widows was not so easy. As they stood to narrate their painful stories, more often than not they just stood in front of the mike, said a few words and wept. The silence that followed said everything.

There is hardly a day when I don’t find news reports of farmers committing suicide. A study conducted jointly by the Punjab Agricultural University, Ludhiana; Punjabi University, Patiala; and the Guru Nanak Dev University in Amritsar had in a house-to-house survey put the alarming death toll figures at 16,600 in the 17 year period, between the year 2000 and 2017. In other words, roughly 1,000 farmers and farm workers have taken the extreme step of ending their life every year in the agriculture frontline State. As the serial death dance on the farm continues unabated, another study by the Punjabi University estimates that one in every three farmers in Punjab is living below the poverty line.

As the widows narrated their agony and enormous struggle, as to how they were coping with the huge void left behind by the only bread-earner in their family, I sat wondering why had Punjab, often called as the food bowl of the country, turned into a hotbed of farmer suicides. Why nearly 98 per cent of the rural household were in debt, and 94 per cent of these households had reported more monthly expenditure as compared to their gross incomes. In other words, the rural households in progressive Punjab were living in debt. To live in perpetual indebtedness, and that to year after year, generation after generation, is the worst humiliation that any human being can suffer. Former Prime Minister Charan Singh had rightly remarked that a farmer is born in debt and dies in debt. What he did not say was that living in indebtedness all through your life is akin to living in hell.  

 

Listening to the farm widows, I tried to put the puzzle in place. If providing an assured Minimum Support Price (MSP) for crops, writing-off of outstanding farm loans, and expanding the irrigation network is primarily the recipe for ensuring farm prosperity then Punjab already has these in place. With 98 per cent assured irrigation, meaning that every farm gets an assured irrigation supply, and with the highest productivity of cereal crops – wheat, rice and maize – in the world, why is it that hundreds of farmers are still forced to commit suicide every year? If productivity and irrigation were the answer to the prevailing agrarian crisis then there is no reason why Punjab farmers should be dying. This only shows that the reasons behind the terrible agrarian crisis that prevail lie much beyond crop productivity and irrigation.  

On top of it, Punjab has a very extensive and elaborate system of procurement of food crops. With a huge network of APMC mandis and purchase centres, Punjab has the best infrastructure for procurement of crops in the country. It also has a vast network of rural roads linking the mandiswith the villages. With mandis and rural link roads in place, whatever stocks are brought to these purchase centres and if it meets the quality specifications are purchase at the fixed support price. Over 98 per cent of the wheat and paddy that is brought to the mandis by farmers is purchased at the fixed price. Farmers are able to sell their produce at the officially declared Minimum Support price, which is much higher than the prevailing market prices. That’s the reason why truckloads of paddy are illegally transported all the way from Uttar Pradesh and Bihar to be sold in Punjab mandis.

In addition, Punjab has also announced a farm loan waiver for a maximum of Rs 2-lakh per small and marginal farmer. Although the electoral promise was to waive all kinds of outstanding loans drawn on cooperative, private and nationalised banks, the State has so far promised to waive roughly about Rs 9,000-crore of farm loans of small and marginal farmers. Of which, approximately Rs 1,000-crore worth of farm loans have been waived off so far. In Maharashtra, against the initial estimate of Rs 34-lakh worth of farm loans to be waived, an estimated Rs 14-lakh crore is now planned to be struck out. Similarly, in Uttar Pradesh, Karnataka, Tamil Nadu and Rajasthan where only a fraction of the promised loan amount is being actually waived. The problem is that despite the election promises the State governments do not have the resources to provide for writing-off the entire outstanding farm loans.

Each of the farm widows reeled out an amount of farm loan, varying between Rs 2-lakh to Rs 12-lakh that their deceased husbands left behind. And that made me wonder how come the economic situation had reached such a despicable levels despite Punjab offering the best of rural infrastructure, irrigation and technological advance.

Punjab, therefore offers an excellent case study to understand, re-strategise and formulate a set of agricultural reforms that are more meaningful and effective. A set of reforms that actually go beyond the rhetoric and lay out a roadmap for the future where the society doesn’t have to treat the small and marginal farmers as a national burden. Instead of treating them as abandoned people, the challenge should be to ensure how the rural masses base could benefit from as well as become part of economic growth. That’s why I have always been saying that the time has come to move away from price policy to income policy. The need is to provide farmers with an assured monthly income, which is not only WTO compatible but also provides economic security to farmers. The demand should be to convert the CACP into a Commission for Farmers Income and Welfare with the mandate to assure a monthly living income of at least Rs 18,000 per farm family. That will be the beginning of Sabka Saath, Sabka Vilas. It’s time to think again. #

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India must keep agriculture out of RCEP

Map of the RCEP trade block --   From the web

At a time when the call for deglobalisation is gaining momentum and increasing protectionism has lead to pulling down of global growth in merchandise trade for the second quarter this year, India’s foray into the Regional Comprehensive Economic Partnership (RCEP) treaty, a mega trade agreement between 16 countries of Asia-Pacific region, is being seen as an overtly risky adventure. More so at a time when agriculture is passing through a terrible agrarian crisis and manufacturing sector continuous to limp.

The latest round of negotiations that ended at Singapore in mid-November abandoned the proposal of reaching a basic agreement by the end of this year, and set a new goal for reaching a final conclusion by the end of 2019. This is primarily because India, Thailand and Indonesia are scheduled to go for general elections next year, and none of these countries is willing to bite the bullet before the formation of the new government. The news agency Nikkei quoted an Indian diplomat as saying: “if a basic deal on lowering tariffs was announced, the government in New Delhi will collapse.”

Seeking greater commitment to liberalise trade, RCEP is a mega trade agreement between 10 Asian countries and their six FTA partners – Japan, South Korea, China, Australia, New Zealand and India. This trading block, when the treaty comes into place, will cover 45 per cent of the global population and account for 25 per cent of global GDP and a whopping 40 per cent of global trade. The treaty has been under negotiations for six years, and is focused on three pillars – goods, services and investment. When signed, the RCEP will turn into world’s biggest trade block.

Since India’s trade deficit with the RCEP countries exceeds $ 100 billion, which is roughly 64 per cent of the total trade deficit, India is looking forward to bridge the yawning trade gap in the years to come. But given the huge trade deficit that India has with China, Korea, Indonesia and Australia, and given the huge domestic market that India will provide by eliminating import duties and bringing these to zero on a majority of the tradable goods will invite flood of cheaper imports. Already several Ministries have raised the red flag, and domestic industries, including steel and metal; pharmaceuticals, food processing and dairy have expressed serious concern.

The RCEP framework entails providing zero duty on 92 per cent of the tradable goods, with another 5 per cent added over the years. This is what the ASEAN nations and Japan, countries with which India has free trade agreements, are insisting; the three other major non-FTA partners are seeking elimination of import duties on 80 per cent products with an inbuilt margin of plus and minus 6 per cent. As per reports India is willing to provide tariff concessions on 72 to 74 per cent of goods to China, Australia and New Zealand. It has sought 20 years to remove these tariffs. But with China, it wants still more time to eliminate duties for which negotiation are underway.

Over the past few decades, especially after the World Trade Organisation (WTO) came into existence, rich countries have been seeking steep reduction in farm subsidies and demanding more market access. What was attempted initially under the WTO was subsequently pushed aggressively under the free-trade agreements (FTAs) and numerous bilateral agreements. While a number of studies have shown how reduction in import duties have turned a majority of the developing countries into net food importers, destroying in the process millions of farm livelihoods, the implications of the proposed RCEP treaty on India’s food security have been least studied. What makes the implications more worrisome is that the RCEP negotiations are being held in secrecy, with not even the industry and NGOs being allowed to participate.

Isn’t it strange that six years after the RCEP negotiations began India is now initiating studies to understand the implications and potential losses from the proposed trade agreement? It has belatedly entrusted the task to Centre for Regional Studies, New Delhi and IIM, Bangalore. Meanwhile, several experts and industry representatives, including steel and pharma, have expressed uneasiness. According to Jayan Mehta, senior general manager of Amul dairy cooperative, 15-crore livelihoods engaged in dairy farming will be severely hit from the current RCEP negotiations.

Let’s examine what is at stake. With production exceeding 176 million tonnes this year, India is the biggest producer of milk in the world. Presently, the imports of milk and milk products are allowed with an import duty ranging between 40 to 60 per cent. This provides enough protection for the local dairy industry to build its level of competitiveness. At a time when US/EU dairy industry is in a terrible crisis, opening up the flood gates will inundate India with cheaper milk flowing in from Australia/New Zealand. Let us not forget that while Australia which has only 6,300 dairy farmers; and New Zealand with 12,000 dairy farmers are pushing in aggressively to protect the economic interests of their small dairy farming community, India is willing to put the dairy sector on the chopping block.  

At a time when reduction in import tariffs have already flooded the country with edible oils, turning the country into world’s second biggest importer, and the zero duty import of pulses in the past three years have caused a steep fall in farm gate prices for farmers, opening up for imports of wheat from Australia, which has been wanting India to lower import duties for several years now, will be the final nail. Coupled with the WTO pressure to restrict MSP payments for public stockholding, it will only destroy India’s ability to retain food sovereignty and erode farm livelihoods.  

Still worse, such floods of imports coming in food crops, plantation crops, fruits and vegetables as well as in processed foods will strike a severe blow to Indian farming already reeling under distress. Member countries on the other hand are already seeing tremendous trade opportunities. Australia’s Trade Minister Simon Birmingham, who was in New Delhi last week, said almonds exports from Australia have grown five-fold in the past decade and items such as these showcased the opportunity to diversify the trade basket.  

I therefore wonder why agriculture can’t be kept out of RCEP. After all, if US President Donald Trump could pull out of the ambitious 12-nation Trans-Pacific Partnership (TPP) treaty to save American jobs, India too needs to protect its food security built so assiduously over the decades. Let’s not forget that importing food is akin to importing unemployment, and a vibrant agriculture has the potential to revitalise the economy more so at a time when the country is faced with jobless growth. #

India must keep agriculture out of RCEP. The Tribune. Dec 5, 2018.
https://www.tribuneindia.com/news/comment/india-must-keep-agriculture-out-of-rcep/693433.html

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