The kisan is always right

At Ankalav, near Borsad, it was proved two decades ago in the Mahi project that water can be delivered to every farmer...

At Ankalav, near Borsad, it was proved two decades ago in the Mahi project that water can be delivered to every farmer if the irrigation engineers really try. A hundred kilometres away, Wataman Chowky is the gateway from the Gujarat plains to south Gujarat where SSP water will go. At the third end of the triangle are the villages of Gandhinagar in north Gujarat. Different soils, different rainfalls and different drainages, but all within a hundred and fifty kilometres of my house in different directions; and I now have a weekend place opposite a nature park on the banks of a river 8212; and for good measure an ONGC crude oil pump and the South West Air Command. Some fellows have all the luck.

But, before the kharif, the mood among farmers is pensive. It should not be so: the last few years have been good. Paddy has picked up with good rainfall, SSP waters at present are in plenty. The high yielders, and no hybrids, in paddy and BT cotton made kharif farming a boon. The loan waiver is comme ci, comme ccedil;a, good to some and for others not so much; as the American philosopher Thorstein Veblen said, you are unhappy if the other guy is happier than you and the unhappy ones had repaid a large part of their loan. Still, on that front we are all right.

The problem is the price of rice. The MSP for paddy was always below that for wheat, but then they say that was before you had to buy the seed every year and look at the fertiliser, pesticide and water needs of the new seeds. The SSRI rice is OK, but it needs more labour. Anyway, Saheb, you give us lectures on globalisation, what happens if you have to import? Indeed, the vernacular press is full of the global price of Rs 40 a kg and how the government is saved because we produced grain. Otherwise they would have to import. Why not let us sell to Dubai, they ask. No wonder stocks are being sent to mandis in the north.

Also causing real pain is fertiliser: these are soils where you need potash and phosphates and complex fertilisers that are not there. But, they say, you are not paying. We will pay if it is available. Give us a good price for rice and cotton and we will pay. The kisan is a good policy-maker. The government, two years ago, did not accept my committee8217;s recommendation that the price of nitrogen be raised mildly as the terms of trade improved for agriculture. Now, as I get the skyrocketed price of rock phosphate in Moroccan dirhams, rue the delays caused by the Delhi-based smarties and look for the exchange rate, the fertiliser ministry puts in this lovely ad. It tells us that the indigenous price of nitrogen is Rs 13,000 a tonne, but the world price is Rs 31,000 a tonne and so there is a big subsidy. But three years ago I had asked for the expansion of existing capacities 8212; announced only a few months ago. These create capacities of three million tonnes at a third to a half of the Rs 13,000 domestic price, a saving of Rs 25,000 a tonne on two million tonnes of import.

Who will pay this? Where are the experts who said that subsidies are for domestic manufacturers and shuttled the proposals from one committee to another? The ad also points out that we are largely stuck with imports. If we had saved on nitrogen and mildly raised its price as I had suggested, linked it to improvements to the terms of trade in agriculture, then we could have moved over to nutrient-based supplies and more ensured supplies. Now we will have to ensure the cash for meeting the much larger cost of imports, with the repurchase price of the bonds given as subsidy falls.

The farmer is right. Give him a good price for rice. It is funny to say that the Centre is looking again at what the states are saying. The states have for the last 40 years said the same thing: that is not a reason for delaying a price announcement. Also ensure supplies of inputs. The farmer will, I am sure, pay a small increase which is all that is justified; don8217;t make him suffer for the delay in your decisions of two, if not three, years. Also, please announce the policies for the creation of capacity at least three years after they were recommended so that we don8217;t carry this burden any more than necessary now. Show that economics works. Otherwise, the stocks of today could evaporate, and this time round the world will not be very congenial.

The writer, a former Union minister, is chairman, Institute of Rural Management, Anand yalaghgmail.com