Time to get back to the fields

The Plan Appraisal in spite of the Information Act is still confidential, so let us figure out what the Planning Commission said. The agricultural growth rate above three per cent annual since the mid-seventies is around one per cent in the 8217;90s. Agricultural employment is not growing. Profitability of Indian agriculture collapsed by around 14 per cent since the early nineties. Investment went down. The story on government investment in agriculture is bad. According to the CSO, public capital formation in agriculture at 8217;93-8217;94 prices jumped up after almost a decade in 8217;75-8217;76 and the era of food imports was soon over. In 8217;76-8217;77 government investment was Rs 5,566 crore. It is shocking as we have been saying that this level was not achieved in any year since 1991 and is probably at around Rs 5,000 crore now. Increasing investment is critical, since the distinguished scientist, R.S. Paroda, showed that the last real effort at expanding capacity in a big way in the late eighties when we reached abilities to produce around 200 million tonnes of grain and are not very far away since. Worse, since profits are falling, the farmer is not investing more. He invested Rs 15,374 crore in 2000/8217;01 and was below that level ever since.

To raise investment by the farmer and to diversify agriculture 8212; the only way to reduce poverty in rural areas in a big way in a WTO rule determined economy 8212; we must configure and implement a road map for each crop, to improve profitability. We must raise investment in water and also in small projects which have collapsed. We have to revive markets and reach credit to the farmer at lower interest rates. These, together with suitable tariffs, will complement, if not be a substitute for, the earlier system of procurement prices which is ineffective in major crops like cotton and oilseeds on account of imports. Farmers who can compete globally spend at least around six to ten per cent more per kilo produced so that their yields and quality matter in world markets. Support is necessary to make this happen more often.

In a trading economy, imports are natural, but unintended imports must be avoided in a highly distorted global economy. Since the Planning Commission is known for its integrity, it will tell us that it is wrong to say that imports don8217;t matter. By 8217;02/8217;03, imports of edible oils stood at 95 per cent of domestic production. Imports of cotton were over a fifth of production in 8217;01/8217;02 and have fluctuated around that to a sixth since. Tariffs are well below bound levels. If we have large, unintended imports in major non-grain commodities, there cannot be any diversification and the rot will continue. In commodities like cotton we must export textiles, so a suitable system of automatic setoffs must be there for exporters.

Above all, the Appraisal will I hope tell us that we have developed technologies like hybrid paddy with yields of above seven tonnes per hectare, but have not spread them and with M.S. Swaminathan heading the Agriculture Commission we must do it now. Metro commentators were busy running down the economics of the seventies and eighties last week. In spite of sceptism at home and abroad, in 1975 the PM supported the first real plan for self reliance, pumping in money into the biggest private sector in India 8212; agriculture: even after the budget of that year was passed. In the eighties the message was different. Develop and indigenise technology for agriculture, but above all give the farmer the incentives, for otherwise the technology will remain on the shelf.

The low stocks of grain tell us that we should not neglect grains, but with our technology and B-tech revolution must release areas for diversification and income growth. The past is to be remembered not for nostalgia but to underline that we must grow again with our sunshine and one of the world8217;s most hard working peasantry. The long night of over a decade must give way to the dawn8230;