Harish Damodaran

Double whammy on top of costlier diesel neutralises MSP hike benefits

Agricultural exports from India have started picking up again, which is good news for farmers

One reason for the MSPs not having the desired impact could be the delayed announcement. Farmers usually make sowing decisions before the onset of the monsoon.

The total area sown to crops in the current kharif season so far is not only 9.3 per cent lower than last year’s corresponding coverage, but also below that of 2016 and 2015.

Farmers are getting less for milk, but retail prices are unchanged. Global skimmed milk powder prices are down, as are India’s exports. A way to absorb surplus could be to include milk in mid-day meals scheme.

The catch, however, is that the new FRP of Rs 275 per quintal is linked to a higher basic sugar recovery of 10 per cent of cane. This is against the FRP of Rs 255 per quintal for the 2017-18 season, which is linked to a basic recovery of only 9.5 per cent.

The real problems in these two major farm commodities may surface only after October.

Much of India’s non-basmati exports — which have zoomed from just one lakh tonnes to over 8.6 million tonnes (mt) in this decade — are to African nations.

With China clamping a 25 per cent duty on US soyabean with effect from July 6 — as part of retaliatory measures against the President Donald Trump’s tariffs on some $34 billion worth of Chinese goods — a new opportunity has opened up for India.

The Budget for 2018-19 announced that MSPs would henceforth be fixed at 1½ times of the production costs for crops as a “pre-determined principle”.

In its last year, the Modi government has abandoned its previous conservative policy on MSP hike

The reason isn’t just high global crude prices and a weak rupee, which, far from helping raise additional resources to fund a splurge, is fuelling demands for cutting duties on petrol and diesel.

The more immediate consequence of the resultant uncertainty on the intellectual property rights (IPR) protection regime for GM technology, though, would be felt on herbicide-tolerant or HT cotton.

This is the second such committee set up by the Indian Council of Agricultural Research (ICAR) within three months, on an issue that has taken on political overtones with elections to the MP Assembly slated in November-December.

New RBI data on India’s Balance of Payments (BoP) for 2017-18 show current account deficit (CAD) at $48.72 bn, the highest since the record $88.16 bn of 2012-13. With CAD expected to widen to $75 bn during this fiscal, how vulnerable is the overall BoP position today?

We have, indeed, entered a regime of “permanent surpluses” in most crops — a reality our policymakers are unable to grasp, stuck as they are in the era of the Essential Commodities Act.

With India and China signing an agreement on Saturday to amend a protocol on phytosanitary requirements, which will allow India to export non-basmati rice to China, rice millers see the opening up of the Chinese market for Indian grain as a positive sign in the long run.

Behind the agitation, stagnant income and deteriorating terms of trade for agriculture

The result in the Kairana Lok Sabha seat bypoll, where ganna payment was the main issue, brought forth a crisis born of advances in plant breeding and boost in sugarcane production.