To rebuild agriculture, make MSP a legal right for farmers.

Pic courtesy: Reuters

After the sudden withdrawal of the three contentious farm laws last week, the debate has now shifted to whether there is a need to provide farmers with an assured Minimum Support Price (MSP) or leave them to face the vagaries of the markets. While protesting farmers are demanding MSP to be made a legal right, fears are being expressed that any such move will lead to an economic crisis.

In the heated deliberations that have followed in the media, what is lost is the need to come to grips with the severity of the continuing farm distress that has prevailed over the past few decades. Looking beyond statistical figures, what is not being appreciated is that these are not just numbers; it is human lives that we are talking about. With or without the proposed farm laws (which have now been withdrawn) the challenge is how to pull these millions out of abject poverty and hunger. Take for instance the report of the Economic Survey 2016 which had shown the average annual income of a farmer in 17 States of India, which means roughly half the country, at a paltry Rs 20,000. In other words, farmers in half the country were somehow surviving on less than Rs 1,700 a month.

More recently, the report of the Situational Assessment Survey 2019, released in September, points to a severely distressed agriculture. Accordingly, the average income of a farmer from crop cultivation alone (not adding non-farm income) comes to a meager Rs 27 per day. This is at a time when the country harvests a record 308 million tonnes of foodgrains and another 325 million tonnes of fruits and vegetables. According to the FAO, in a report released in Mar 2021, the gross value of food production in India stands at $ 400,722, 025 million. With farmers producing so much of economic wealth for the country, what remains unexplained is why the annadata is living in misery.  

Using the outdated market principles, mainline economists would shift the blame on low crop productivity, and the absence of market dynamics that does not allow for price discovery. Let’s first take a look at the productivity dimension. In Punjab, the food bowl of the country, the total crop productivity (of wheat and paddy crop rotation in a year) exceeds 11 tonnes per hectare, which is among the highest in the world. And yet, Punjab has turned into a hotbed of farmer suicides. Every third farmer in Punjab is living below the poverty line, and had a record 16,600 farmers and farm workers committing suicide in the 15 year period, between 2000 and 2015. This only shows that despite high productivity levels, farm crisis persists.   

If you are still not convinced, let’s look at America. At the risk of sounding repetitive, it needs to be known that despite high productivity levels across crops and regions, and the prevalence of free markets in agriculture for over a century, US farming is fast heading towards extinction. In 2020 alone, farmers were saddled with a bankruptcy of $ 425 billion, and the median farm income had remained in the negative for more than a decade. The rate of suicide in rural America is 45 per cent higher than urban centres. A report in Down to Earth magazine shows that almost 40 per cent of the farm income is coming from federal subsidies.

In these trying circumstances, when markets have failed everywhere to increase farm incomes, the belief that markets would do wonder for Indian agriculture is utterly misplaced. Another argument that I often hear is that given the small landholdings in India (86 per cent holdings are less than 5 acres) farmers will be unable to get a higher price given the lack of bargaining power. Well, if that is so I fail to understand why in Australia, where the average arm size exceeds 12,000 acres, have 25 per cent farms closed down in the past 30 years. The rate of suicide among male farmers in Australia is twice that of other sections of the society. In France, in early March, farmers had hung suicide dolls on trees outside Parliament to draw attention to the severe agrarian distress that farmers were faced with.

Given the distressing experience of markets failing to buttress farming in the developed countries, the demand for making MSP a legal right for Indian farmers makes great economic sense. What the farmers are asking is not for the government to purchase the entire produce, but to ensure that no trading takes below the MSP announced. This is what even the Commission for Agricultural Costs and Prices (CACP) had suggested in one of its recent policy reports. It is not a welfare measure as some economists are suggesting, but is the real reform that agriculture is crying for. Studies have shown that the additional economic burden will not exceed Rs 1.5-lakh crore to Rs 2.5-lakh crore per year. But more importantly, the surge it will provide to country’s economy is something that has not been talked about.  

Considering that nearly 50 per cent of the workforce is employed in agriculture, a vibrant agriculture will certainly lead to higher economic growth. Since only six per cent farmers get the benefit of MSP, and remaining 94 per cent farmers are dependent on markets, making it obligatory for the trade to buy at the price announced will mean higher returns for the farmers. If the 7^th Pay Commission, which benefited the government employees, could be seen as a booster dose for the economy, higher income in the hands of the farming population will create a huge rural demand, thereby acting as a rocket dose for the economy. With more purchasing power, the industry would also stand to benefit. At the same time, a guaranteed price to farmers will help bridge the growing inequality that the country is witnessing. 

A guaranteed price has the potential to provide stable income for farmers, and help restore dignity in farming. That’s the freedom Indian farmers desperately need. Reducing the pressure to create more employment opportunities in the cities, making MSP a legal right is the only pathway to rebuild agriculture and thereby achieve the Prime Minister’s vision of Sabka Saath Sabka Vikas. 

Source: Farmers Protest Anniversary: Make MSP a legal right to rebuild agriculture, writes Devinder Sharma. Financial Express. Nov 26, 2021. https://www.financialexpress.com/india-news/farmers-protest-anniversary-make-msp-a-legal-right-to-rebuild-agriculture-writes-devinder-sharma/2376420/

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Farmers are also wealth creators

Pic courtesy: frontline.thehindu.com

We all know it by now. Agriculture was the saviour during the gloomy days of the pandemic. Not only that an individual household got its regular supply of food during the lockdown, and those who could not afford were supplied with free rations, but agriculture also kept the wheels of economy moving. At a time when the economy had slipped by 23.9 per cent in the first quarter of the 2020 financial year, agriculture was the only bright spot registering a gross-value added (GVA) growth of 3.4 per cent. 

All through the year, agriculture provided a solid foundation. Despite the Covid-19 disruptions, and at a time when all other sectors of the economy were struggling, desperately counting the emerging green shoots, the country achieved a record foodgrain production of 308.65 million tonnes. The bumper harvest reaped in 2020-21 was higher by 11.15 million tonnes over what was achieved in the previous year. In addition, the country also produced 329.9 million tonnes of fruits, vegetables, and aromatic and plantation crops, including spices; around 204 million tonnes of milk, and 36.10 million tonnes of oilseeds. 

Simply put, farmers produced economic wealth for the country. Not only during the pandemic, but what needs to be appreciated is that year after year, farmers have toiled hard to bring food to our table. From a stage when India was living in a ‘ship-to-mouth’ existence, and that was not too far distant in the mid-1960s, the role Indian farmers have played in turning the country food self-sufficient is widely recognised. Agriculture has taken a quantum jump, increasing food production six times in seven decades, between 1950-51 and 2020-21. 

A vibrant agriculture is what sustains a growing economy. But to believe economic growth alone can address issues of hunger and malnutrition is nothing short of delusion. As the UN Food and Agriculture Organisation (FAO) itself acknowledges that ‘economic growth is necessary but not sufficient to accelerate reduction in hunger and malnutrition’, a study published in the scientific journal The Lancet shows a reduction in malnutrition by a maximum of 6 per cent even if the economic growth soars by 10 per cent. On the contrary, a well-fed nation builds up an efficient and productive manpower which is required to attain a higher economic growth. 

Since 1950-51, if measured in terms of population growth, four more India’s have been added. From 359 million in 1950-51, India’s population has multiplied roughly four times to 1.4 billion. Agriculture not only kept pace, defying the predictions of the Malthusian catastrophe, but has also produced an unmanageable surplus. Not only producing enough to feed the nation, the rise in the per capita availability of foodgrains, fruits, vegetables and milk also helped in meeting the challenges of malnutrition and hidden hunger. That hunger still persists in some parts of the country is not because of any shortfall in food production but is the outcome of the twin problems of access and distribution. 

If growth and prosperity is the central theme of Adam Smith’s seminal work An inquiry into the nature and cause of the Wealth of Nations, it has to be accepted that the remarkable transition in Indian agriculture is what has essentially not only added but led to the wealth of the nation. As the second largest producer in the world of essential foods like wheat, rice, fruits, vegetables, and crops like cotton and groundnut and being the largest producer of milk, jute and pulses, the long strides taken by farmers to shatter all records however has not translated into higher incomes. Growth, in this case, has not led to prosperity on the farm. 

The invisible hand that Adam Smith talked about has actually failed to provide living incomes for farmers, not only in India but across the globe. One doesn’t need to apply sophisticated economic models to find out how farm incomes have actually been squeezed over the years, and how free markets have sucked income from farmers. Instead, as the citation for this year’s Nobel Prize in Economics admits: “.. Conclusions about cause and effect can be drawn from natural experiments.” Agreeing, I feel there is no need for economists to hold econometrics studies when conclusions can be drawn easily from the available evidences. 

FAO has estimated India’s gross value of crop production in 2018 (report released in Mar 2021) at $ 289, 802, 032 million, and that of gross food production at $ 400, 722, 025 million. When it comes to the gross value of agricultural production at current prices, India stands second in the world, next to China, with a gross value of $ 418, 541,343 million. Now before you get lost in the maze of production statistics, what is important to ascertain here is the enormous economic wealth that farmers produce and eventually what agriculture sector generates. 

In other words, farmers too are wealth creators.   

It therefore requires a change in economic thinking, which has traditionally banked on the assumption that only businesses – small and big – are wealth creators. The obscene wealth inequality that prevails is the result of this outdated economic thinking. Otherwise I see no reason why at a time when gross value of agricultural production since 1999 has grown at an average annual rate of 8.25 per cent, farmers should be at the bottom of the ladder. In America, the share of a farmer in every food dollar in 2018 has plummeted to just eight per cent. In India, the latest Situation Assessment Survey for agricultural households computes income from crop cultivation at only Rs 27 per day.  

There is enough evidence to show how free markets have devastated farming across the globe. This has to change. It can only happen when we begin to treat farmers’ not simply as primary producer but also as wealth creators, and ensure their contribution in wealth generation is adequately compensated. To sustain billions of farm livelihoods across the globe, and to celebrate the role farmers play in wealth creation, a beginning has to be made by guaranteeing an assured and profitable price for farmers. #

Source: Farmers need assured price for sustenance. The Tribune. Oct 21, 2021. https://www.tribuneindia.com/news/comment/farmers-need-assured-price-for-sustenance-327252?fbclid=IwAR0mBapW307jBEgSuqnoX-a5YjrYkbylg0AUOFpB22PrkIZfej1iMXhY2mw

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When Prof David Pimental said: "99.9% pesticides go into environment, only 0.1% hits the target pest."

Amidst a hurricane of lawsuits that the agrochemical multinational Bayer-Monsanto faces in America and elsewhere over its herbicides Roundup and Dicamba alleged link to cancer, a joint investigation by Unearthed, a journalists research group founded by the Swiss NGO Public Eye and Greenpeace UK found that India tops the global chart with nearly 59 per cent of the pesticides sales being of ‘Highly Hazardous Pesticides’. Japan follows up with 52 per cent; Brazil with 49 per cent; US with 36 per cent and UK sells only 11 per cent of these.  

As per a report in The Guardian agrochemical companies haves disputed this data. Bayer has specifically termed it ‘misleading’ but has still not countered it with its own data. Meanwhile, CropLife International, a powerful lobby group of the agro-chemical industry, claims only 15 per cent of its products are Highly Hazardous, 10 per cent that can be ‘used safely and responsibly’. Nevertheless, according to the World Health Organisation (WHO) and the UN Food and Agricultural Organisation (FAO) Highly Hazardous Pesticides (HHT) are defined as “pesticides that are acknowledged to present particularly high levels of acute or chronic hazards to health or the environment according to internationally accepted classification systems.”

This reminds me of a discussion I had with Nobel laureate Norman Borlaug sometimes in the mid-1980s. To a question what he had to say about Rachel Carlson’s path-breaking book Silent Spring, considered to have spearheaded the environment movement, Borlaug said that she was an ‘evil force’ and ‘these are the kind of people who don’t want hunger to go away’. He then explained that pesticides are like medicines. Farmers have to use them carefully taking all the precautions. What Borlaug said could be debated at length but it certainly formed the basic strategy for the Green Revolution wherein pesticides were used to save crops from pest damage. But over the years, as pesticides became more pervasive in environment,  innumerable studies have shown the use and abuse of chemical pesticides leading to environmental damages, ecological imbalances, pest resistance and contamination of the entire food chain. More recently, the UN Human Rights Council has said that pesticides have “catastrophic impacts on the environment, human health and society as a whole.”

“It’s a myth,” Hilal Elver, the UN Special Rapporteur on the right to food told The Guardian: “Using more pesticides has nothing to do with getting rid of hunger. According to FAO, we are able to feed 7 billion people today. Production is definitely increasing, but the problem is poverty, inequality and distribution.” The report further said: “Chronic exposure to pesticides has been linked to cancer, Alzheimer’s and Parkinson’s diseases, hormone disruption, developmental disorders and sterility.” 

After the International Agency for Research on Cancer (IARC) published a report linking Glyphosate (the active ingredient in RoundUp herbicide) to cancer in humans, a flurry of lawsuits in America were unleashed against the use of the toxic pesticide. While Monsanto (which has since been bought over by Bayer) claimed that regulatory agencies worldwide, including European Commission and US Environment Protection Agency, do not point to a link between Glyphosate and cancer, a large number of cancer victims nevertheless began filing legal cases. As per the latest count, an estimated 42,000 (and still counting) lawsuit have been filed so far, several legal sources say that the number of plaintiffs may have already swelled to over 100,000 by now.

Not only against Glyphosate, the lawsuits now have also moved on to another herbicide Dicamba. On Feb 15, a US federal court awarded a Missouri farmer $ 265 million in damages for the destruction wrought to his peach orchard. The farmer charged the two big agrochemical companies – Bayer and BASF – for wrecking havoc to his orchard from Dicamba herbicide sprays done by his neighbour that drifted to his field. The herbicide was being used by his neighbour for Dicamba-resistant cotton that drifted to his peach orchard ‘curling leaves and killing trees’. Another more or less similar 140 lawsuits against Dicamba now await the companies.

But it’s the legal action against Glyphosate that is being keenly watched. So far, in three trials against Glyphosate, the jury has awarded $2.3 billion in damages to four plaintiffs. Although the damages were later reduced to $ 190 million, the judgements mostly pertain to the failure of the company to adequately warn consumers of cancer risks posed by the herbicide. It was first in Aug 2018 that a San Francisco jury had awarded Dewayne Johnson, a gardener, $ 289 million in damages, which was later, reduced to $ 78 million. He suffered from non-Hodgkin’s lymphoma and claimed that he used different Glyphosate formulations in sprays. Since then three more plaintiffs have been awarded in two cases heard.

In India, a Down to Earth magazine says on an average 10,000 pesticide poisoning cases are reported every year. The National Crime Record Bureau (NCRB) had recorded 7,060 deaths from accidental pesticide poisoning in 2015, which highlights the grave danger pesticides poses. The fact that the nearly Rs 20,000-crore pesticides industry is expected to grow at a rate of 8.1 per cent till 2024, clearly shows how crucial it is to fix the regulatory holes. The proposed Pesticides Management Bill 2020 expected to be placed in Parliament will perhaps not only tighten the regulations, and make industry pay for the health damages it causes; but also look beyond keeping the tens of thousands of lawsuits in mind.

If only the world had listened to forewarning that the eminent Prof David Pimental of the University of Cornell had issued five decades back, in mid-1970s, perhaps much of the damage could have been averted. I still recall the title of his scientific paper: “99.9% pesticides go into environment. Only 0.1% hits the target pest.” Knowing that pesticides are poisons, and with less than 1 per cent of chemicals effective against pests, the world could have certainly evolved safer alternatives. Who will take that blame?

But equally important, if 90 per cent of all food eaten in the city of Copenhagen is organic, there is no reason why city dwellers cannot opt for healthy pesticide-free food. That’s a true smart city. #

The hazards of pesticides. The Tribune. Feb 26, 2020
https://www.tribuneindia.com/news/the-hazards-of-pesticides-45295?fbclid=IwAR243Lmmng1WWg8IXGq0Ed0WLYiY6isxyWUhrDItJXdqA_fY_lTwCiAbNS0 

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