Many countries experiencing rapid growth and rising prosperity, which may even be over a few decades, have at some point got stuck in a “middle-income trap”. Punjab’s farm economy can be said to have been suffering this fate for quite some time.
The seeds of the granary state’s postcard rural affluence story from the 1960s were literally sown by high-yielding varieties of wheat and paddy. Kalyan Sona and Sonalika released in the mid-Sixties, followed by HD-2285 and HD-2329 in the early Eighties, raised average wheat yields in Punjab from 1.2 tonnes to over 3.7 tonnes per hectare between 1960-61 and 1990-91. IR-8 (introduced in 1966) and PR-106 (1977), likewise, pushed up per-hectare yields in paddy from 1.5 tonnes to 4.8 tonnes.
The breeding efforts of the Indian Agricultural Research Institute and Punjab Agricultural University scientists were accompanied by investments in rural link roads, electrification, tube-well and canal irrigation, organised farm credit —and, of course, APMC (Agricultural Produce Market Committee) mandis. Metalled roads in 98% of Punjab’s 12,188 villages by 1980, APMC yards within bullock-cart distance and government procurement at minimum support prices (MSP) ensured that the increased production from the new semi-dwarf varieties, responsive to fertiliser and water application, also translated into higher incomes for farmers.
In the process, a new post-Green Revolution agrarian middle class — not “rich” or “kulak” farmers, as armchair experts would believe — emerged in Punjab. This was a middle class that was confident and very sure of its future in agriculture. And like all middle classes, it was aspirational and identified its interests with that of India (Bharat, in this case).
That rural middle class is now waging war on New Delhi — the same Establishment that once propelled its rise. Its fight isn’t about upward mobility — agriculture can no longer be a conduit for that — but defending past gains. 📣 Follow Express Explained on Telegram
The average monthly income of agricultural households, according to the NABARD’s All-India Rural Financial Survey in 2016-17, was the highest in Punjab. At Rs 23,133, it was more than 2.5 times the national average of Rs 8,931 and ahead of Haryana (Rs 18,496) and Kerala (16,927), with Uttar Pradesh (Rs 6,668) and Bihar (Rs 7,175) far behind. But this is still the familiar “middle-income trap” that Brazil, Mexico, Argentina and other large Latin American economies hit in the 1960s — failing to transition and break into the rich league.
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Punjab’s failure on this count is mainly attributable to the plateauing of yields. Since 1990-91, its average per hectare yields have further gone up from 3.7 to 5.2 tonnes for wheat and from 4.8 to 6.5 tonnes for paddy. There have also been new blockbuster varieties such as PBW-343, HD-2987 and HD-3086 in wheat, and PR-121 and PR-126 for paddy. But the genetic yield gains from them aren’t comparable to those from the early Green Revolution varieties.
Yields apart, the Punjab farmer is facing pressures from rising input costs — be it of labour, fertilisers, crop protection chemicals or diesel. Some of these cost pressures have been absorbed by the government through subsidised urea and free electricity for irrigation, though they have exacted their own heavy price by way of soil degradation and groundwater depletion. The government has also persisted with MSP hikes and procurement of grain from the state’s 154 primary APMC mandis and attached sub-yards/seasonal purchase centres. There was really no choice when India desperately needed Punjab’s grain.
Today, the government does not feel the need to buy much from Punjab. Economists, too, see it as an unnecessary fiscal burden. The feeling of being unwanted and cavalier disregard for their concerns can be an affront to any proud middle class.
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