Neither giving farmers an economic price nor taking care of crop losses.

In the midst of the widespread damage to standing crops from unseasonal rains, a National Crop Income Insurance Scheme has been introduced on a pilot basis. What is being perceived as a long-term solution to the prevailing agrarian crisis, and is being pushed as an insurance against weather-related disasters as well as provide an assurance against any income shocks will only end up acerbating the crisis.

The cure being suggested is worse than the disease itself.

For nearly 25 years, I have watched with dismay the reluctance on the part of successive governments to provide for any meaningful crop insurance plan for farmers. While in urban areas, Insurance companies have appropriate plans to provide cover for every individual, house and automobile, for farmers the crop losses are assessed only at the block level. A farmer at best can get compensation for an average crop loss suffered in a block even if his own loss in his crop field is several times higher. This is primarily the reason why farmers have never been enthused to take a crop insurance package.

If your car gets a hit, you can claim the damage. If your house is burnt down, the insurance company will pay a compensation irrespective of whether other houses in the colonies suffered or not. Why then an average in a block or a taluka is taken as a measure for crop losses suffered by a farmer in a village is something I have never been able to understand. It is simply the failure of the government to make it obligatory for the insurance companies to provide per unit coverage to farmers that has left the farming community helpless.

So when I first learnt about a new income and crop insurance scheme being introduced, my curiosity was obvious. This scheme – called the National Crop Income Insurance Scheme (NCIIS) – has been launched on a pilot basis in one district in each of the States. As the name suggests, the scheme is designed to provide income security as well as insurance against crop losses suffered from any eventuality. Killing two birds with one stone, isn’t it?

Let’s first look at the insurance against price fluctuation. The scheme is basically an alternative to the Minimum Support Price (MSP) system that prevails, and which the government wants to dismantle. The Economic Survey 2015 makes it explicitly clear that already fruits and vegetables have been withdrawn from the APMC mandis and the next target is to take out wheat and rice from its purview. Fixation of MSP for 24 crops will continue under the new system but the government will withdraw from procurement. For the time being, this scheme is for those areas that don’t get the benefit of MSP.

The guaranteed income at a time of fluctuating prices that the farmers will get under the new insurance scheme would be to a maximum of 20 per cent of the loss a farmer suffers. To work out the guaranteed yield or a threshold yield, the average yield for past 7 years in a district is calculated. In other words, if the wheat MSP is Rs 1450 per quintal, and the farmer gets only Rs 900 by selling it openly in the market, the assured price that the farmer will get is Rs 900 plus 20% of the gap between market price and MSP. Against Rs 1450, a farmer under the new insurance scheme can expect a maximum of Rs 1110 per quintal. The price that a farmer gets would be still lower considering the way a threshold price is calculated.

In case of yield losses from natural calamities, compensation would be based on 70 per cent of the average loss in a district. If a farmer’s yield is 4 tonnes/hectare, and indemnity being 70 per cent, the compensation would be worked out based on 2.8 tonnes only. If the MSP for wheat is Rs 1450, and the average yield is calculated as 2.8 tonnes/hectare, the compensation that a farmer gets will automatically be less than his actual loss. In other words, crop insurance too does not meet farmers per unit losses. If after 25 years of indecision, this is what the government has come up with, only gods can save farmers. #

Source: New Crop Income Insurance Scheme -- a cure worse than the disease.

ABPLive. Mar 31, 2015. goo.gl/stlcaX

Land Acquisition: The battle for land will intensify

Protesting farmers spending the night at Parliament Street in New Delhi. March 18. 

For the past three days, thousands of farmers from across the country, and owing allegiance to Bharti Kisan Union, are staying put at Jantar Mantar in New Delhi. With distress written large on their faces, they are hoping that the government they voted for would at least have the courtesy to listen to them. Their anger is over an unjust law that they fear will forcibly evict them from their meager land holdings, and also they came hoping to seek some assurance from the powers that be for ending the continuing agrarian distress that they are living with.

A fortnight earlier, nearly 5,000 tribals under the banner of Ekta Parishad had also marched to New Delhi to join the two-day protest by Anna Hazare and others against the land acquisition bill. But with indifferent State machinery, and with an equally indifferent middle class, they found they had no sympathetic ears to allow them to even share their sufferings. Not even the national media, barring a few exceptions, took notice.

The disconnect between the middle class in the cities and the poor and marginalized in the rural areas, including 600 million farmers and the landless farm workers, is now becoming loud and distinct. For all practical purposes, the divide between India and Bharat that has been talked about for long is now clearly visible.

It is primarily for this reason that the debate over land acquisition fails to move beyond growth and development. In the race to build more infrastructure, the cries of poor and marginalized who are struggling to make the two ends meet gets drowned. The tribals who walked all the way to New Delhi or the farmers who are protesting at Jantar Mantar and also at a number of places across the country are therefore being considered as a hindrance in the development process. They are a roadblock, the sooner they are removed, and faster will be the pace of development.

For several years now, since the time economists/planners began telling us that land is an economic asset and it is unfortunately in hands of people who are inefficient, there has been literally a scramble by business and industry (driven by real estate) to procure as much as possible. The World Bank is backing this strategy, and if you have read the World Development Report 2008, you would know what I mean. It calls for land rentals, and setting up a network of training centres to train the displaced farmers to become industrial labour.

No wonder, the UPA government has made budgetary provisions for setting up 1,000 Industrial Training Institutes (ITIs). Former Prime Minister Manmohan Singh himself had called for a population shift, moving out 70 per cent of the farming community into urban centres. This is what the World Bank had wanted India to do way back in 1996. It had wanted India to move 400 million people – twice the combined population of UK, France and Germany – to be moved out of the villages in the next 20 years, by 2015.

It’s all therefore part of a global design. All over the world pitched battles are being fought across nations by the poor and deprived, who fear further marginalisation when their land is literally grabbed by the government on behalf of the industry. It first begins by deliberately turning agriculture into a losing proposition as a result of which farmers, in most places, are keen to move out provided they get a better price for their land. Once this happens, it is much easier to drive out the farmers from their land holdings.

But it’s not as simple as it appears to be. Land being the only economic security for the poor, they put up a tough fight. In China, as Fareed Zakaria wrote in Newsweek sometimes back, 75,000 land conflicts, which means almost 250 protests a day, most of them bloody, happen every year. A recent report states that 28 lakh villagers have committed suicide in China in past 10 years. About 80 per cent of them did so because of forcible land takeover. Rural China has been on a boil all these years. In India, there were 260 land protests in 165 districts in 2013-14. When the new land bill comes into force, I foresee the battle over land intensifying in India. India will soon turn into a land of thousand mutinies.  #

Source: Land Acquisition: The fight for land will only intensify.

ABPnewstv Mar 20, 2015. http://goo.gl/wKQXOJ

It's time Prime Minister listens to farmers' Mann Ki Baat

While we wait with abated breath to listen to you on Mar 22, I thought it appropriate to share my Mann ki Baat with you. I am not sure whether my thoughts will in any way influence your decision making, but at least I can share the plight and suffering of farmers – an outcome of deliberate economic policies over the years to keep me impoverished – with you. Knowing that you believe in sabka saath, sabka vikas I am hoping that you will not abandon the saath of 60-crore farmers in a quest to ensure vikas for a few.   

You know it very well that the path to economic growth in India passes through its 6.4 lakh villages. Mahatma Gandhi had always talked of gram swaraj. In your election campaigns, you had quoted extensively from Mahatma Gandhi and promised to make agriculture economically viable. You had promised to provide 50 per cent profit to farmers over and above the cost of production. Whichever part of the country you campaigned, you talked about the terrible agrarian crisis. You talked of sugarcane farmers. You talked about cotton farmers. You reiterated again and again on the need to bring in more prosperity to the farm.

Farmers are now asking whether what you promised to them was also a chunavi jumla.   

Soon after you became Pradhan Mantri in May 2014, a shortfall in monsoon had hit farming operations. Instead of rescuing farmers with an economic package, the government merely increased the minimum support price (MSP) for rice by Rs 50 per quintal, a rise of 3.8 per cent against an inflation rate of 7-8 per cent. For wheat in rabi season, the procurement price was also raised by a paltry Rs 50 per quintal. At a time when government employees get 107 per cent DA, does it not mean that farmers are being penalized for food inflation?    

On top of it, the Food Ministry has directed the State governments not to provide any additional bonus to farmers. Procurement of rice and wheat is now being aggressively restricted, in Chhatisgarh and Madhya Pradesh only 15 quintals per farmer are being procured while the rest is to be left to the exploitation by markets. Instead of expanding the network of APMC mandis the government is dismantling the existing ones. Punjab Chief Minister Prakash Singh Badal has warned of a civil war within the country if MSP is withdrawn.

An international crash in commodity prices in 2014 has hit farmers. Cotton, sugarcane and basmatifarmers have suffered a huge blow as a result. Prices have slumped by 40 to 60 per cent. As if this is not enough, unseasonal rains have devastated the standing crop in various parts of the country. More than 500 farmers have committed suicide in Telengana, Vidharbha and Marathwada regions since the beginning of this year, and there is an unprecedented gloom prevailing in the countryside.

According to the 2014 National Sample Survey Organization (NSSO) the monthly average income of a farming family is only Rs 3078 from farming operations. Some studies estimate that nearly 62 per cent farmers depend on MNREGA to augment income, and almost 58 per cent farmers go to bed hungry. While the employees unions are demanding a minimum monthly basic salary of Rs 26,000 for a chaprasi in the 7^thPay Commission, a farmer is left to survive on a pittance. Why can’t we have a Farmers Income Commission that provides for an assured monthly take home package? Why should farmers alone be made to bear the burden of keeping food inflation low?

Agriculture crisis is not because of lack of technology but because of the deliberate effort to keep farm incomes low. BJP manifesto had opposed the introduction of genetically modified (GM) crops, but the government now appears to be aggressively pushing GM crops in the name of ‘more crop per drop’. There is no GM crop which increases crop productivity, and what is little known is that even in America, GM crops have failed to withstand the raging epic drought that continues for the 4^th year in California and Texas. ‘More crop per drop’ is possible only with non-chemical agriculture, not with GM crops.   

It is also being said that industry has to be provided with finances and tax holidays so as to generate revenue that can be used for agriculture and rural development. This thinking must change. A farmer is not a burden on the society. Neither do the poor lack entrepreneurship. It’s only that they are being denied an enabling environment. A poorest of the poor women in a village wants to buy a bakri. She gets a loan of Rs 8,000 from a micro-finance institution at 24 per cent interest, which effectively becomes 36 per cent on weekly repayments. On the other hand, Tata’s get a massive soft loan for their Nano car factory at an interest of 0.1 per cent. If only the poor women had got the loan at 0.1 per cent I bet she would be driving a Nano car at the end of the year. Similarly, there are some 25-crore landless farmers in our country. They are also hard working, and toil endlessly. If only the government could provide them 1 or 2 acres each, you will see the economic turnaround they bring.

Evicting farmers from their meager land holdings and teaching them skills to become industrial workers is what the World Bank had told India to do way back in 1996. It had wanted 40-crore people to be moved from rural to urban areas in next 20 years, by 2015. World Development Report 2008 had asked India to hasten the process by going in for land rentals. Further, Niti Ayog deputy chairman Arvind Panagariya has acknowledged in an article that if farm land is not acquired forcibly how the industry and infrastructure will get cheap labour. Pradhan mantra ji, please don’t relegate farmers to the level of dehari mazdoor. Neither do they want to pull rickshaw in cities.

Farmer’s land is his only economic security. They can turn it into an economic dream if you provide them even a fraction of the support that is doled out to the industry. In past 10 years, Rs 42-lakh crore has been given as tax concessions to the industry. In 2015 budget, Rs 5.90 lakh-crore was given as tax exemptions. Such a massive dole has failed to generate employment, and failed to increase industrial output. If only Rs 2-lakh crore a year was given to agriculture, and spent meaningfully, it would have not only created gainful employment for millions but taken vikas to every part of the country. That will truly be sabka saath, sabka vikas. #

Land Acquisition: Let's have a land audit first.

In the days to come the battle over Land takeover is only going to be intensified, both in Parliament as well as on the streets. As various farmer organizations get ready to storm Jantar Mantar on Mar 18, and Anna Hazare planning a padyatra from Mar 30, the government itself is getting ready to face the tough challenge in Rajya Sabha where it lacks the numbers.

While the Lok Sabha passed the LandAcquisition bill with 11 minor amendments, most of these already existing in the 2013 law, the painstaking defense by Rural Development Minister Birender Singh has failed to cut much ice. In the shrieking debates and the deafening noise that preceded and still continues, the real issues behind the need for a law that allows forceful takeover of land have disappeared from public scrutiny. In this article I am trying to analyse some of the main arguments that have been floated to justify land acquisition without the consent of the farmer.

I hear again and again that the availability of land is coming in the way of development. Projects worth Rs 4-lakh crore are held up because of non-availability of land. While the government has failed to provide a list of projects that have been held up, Economic Survey 2015 does not list land as a limiting factor for infrastructure projects to take off. It states that the projects are held up because of unfavourable market conditions, and lack of investor interest. Secondly, if land availability was a factor I don’t see any reason why over 576 Special Economic Zones should have failed to perform.

A CAG report says that out of the 45,635.63 hectares of land notified for the development of SEZs, actual operations took place in only 28,488.49 hectares or 62 per cent of the land acquired. Neither did the SEZs create employment nor did it lead to manufacturing or industrial growth. And remember there was no environment clearance hurdle nor was there any social impact assessment required. Moreover, with all kinds of tax holidays, estimated to be in tune of Rs 1.75 lakh crore, the SEZs failed to perform. In a scathing comment, CAG says “Acquisition of land from the public by the government is proving to be a major transfer of wealth from the rural populace to the corporate world.”

I don’t think the government even knows how much of land already acquired is lying vacant. An investigation by a TV channel found that nearly 45 per cent land acquired in just five States is lying unused. In Orissa, for example, 3799 acres acquired for TISCO steel plant in Gopalpur in 1995 has still not been used. 

In any case, the government is eyeing 17 lakh acres of surplus land lying with public sector undertakings. With so much of land already available, I don’t see any reason why the available surplus land is not first put to proper use.

Further, the argument that the 2013 law needed to be changed since the Chief Ministers wrote against it is simply amusing. Let us not forget that the Chief Ministers of the coal mining States also opposed open auction of the coal blocks. But after a Supreme Court order cancelled 204 coal blocks, the auctions that are underway are likely to bring in revenue of Rs 15-lakh- crore. I wonder why in a market economy, where free enterprise is being promoted, the private sector can’t be asked to bid for land in open auctions taking the prevailing market price as the base price.

A study by IIT Roorkee estimates that in past 50 years some 50 million people have been displaced by ‘development projects’. With the oustees of Bhakra dam and Pong dam still not rehabilitated, land conflicts have erupted primarily because the government forcibly takes over land for the private entities in the name of ‘public purpose’. As several CAG reports have found out that the land acquired has finally gone into the hands of real estate firms who have made fortunes.

In 2013-14, a study by Washington-based Rights and Resources initiative found 252 conflicts over land acquisition. A Newsweek article sometimes back had pointed to 75,000 land conflicts, most of them bloody, in China every year. A recent report states that 28 lakh villagers have committed suicide in China in past 10 years. About 80 per cent of them did so because of forcible land takeover. Lawmakers in India therefore need to be doubly concerned about the resulting socio-economic unrest.

Actually, the commodification of land is part of a global design. Globally, an area equivalent to the cultivable area of China and India has already been acquired by private capital. For India, it was in 1996 that the World Bank had asked to move 40-crore people – twice the combined population of UK, France and Germany – from the rural to the urban areas in next 20 years, by 2015. In 2008, the World Development Report of the World Bank had asked India to hasten the demographic shift by going in for land rentals. It is primarily for this reason that agriculture is deliberately being starved of resources, and farmers’ income is being kept low to force them to abandon farming and migrate.

Pitting agriculture against industrial development is a faulty debate. At a time when jobless growth is the norm anywhere and everywhere, industry cannot absorb even a fraction of the growing workforce. In past 10 years, between 2004 and 2014, only 1.5 crore jobs were created despite a high growth rate. Encouraging entrepreneurship in the rural areas and providing land to the landless is therefore the only sensible way to revitalize the economy. If the drought-prone village of Hibre Bazaar in Maharashtra can now boast of 60 lakhpatis, I see no reason why it can’t be the norm in the rest of the country. #