Are Indian farmers children of a lesser god?

For the Indian farmers, it is hoping against hope  -- Daily Mail picture

Some days back I read an interesting news report. A national general secretary of a political party told the striking sweepers in Punjab that BSP supremo Ms Mayawati had regularised the services of the safai karamcharis in Uttar Pradesh. They are now provided with a basic salary of Rs 18,500 per month. This is certainly good news. A few weeks later, the ruling UPA Govt announced a 10 per cent hike in dearness allowance (DA) for 5 million central govt employees and another 3 million pensioners beginning Jan 1 2014. This was a second double digit hike in a row. It is expected that this time, 50 per cent of the DA hike will be merged with the basic pay. Another good news.

It doesn't end here. A front page news report in Economic Times Feb 3 2014 (Aam Aadmi out of hand, UPA to now woo workers http://bit.ly/1im7A0s) says more sops are likely to be showered on workers in the days to come. Call it election bonanza, but the fact remains that several employment benefits like gratuity, provident fund, bonus and healthcare are now being enhanced. What is on the card includes: 1) Minimum monthly pension of Rs 1,000 for 8.87 crore EPF account holders 2) Raising monthly ceiling for mandatory PF contributions from Rs 6,500 to Rs 15,000 3) Salary ceiling for gratuity contributions may be raised to Rs 15,000 a month 4) Parity in benefits for contract workers and regular employees 5) Minimum guaranteed bonus for workers even if the employer is making losses.

In addition, the report says the ceiling cap for Employees State Insurance Corporation (ESIC) health benefits is also expected to be increased from the existing Rs 15,000 per month to Rs 25,000 per month. This would bring an additional 5 million employees to be the beneficiary of the health security. For the workers in unorganised sectors, constituting 82 per cent of the total workforce of about 40-crore plus, the plan is to increase the health insurance slab to Rs 30,000 per household. Yes, this too is good news.

I still don't have the figures for how much the financial burden would be on the State exchequer. But I am sure you will agree that it would be quite substantial.

Now while all kinds of financial sops are being thrown at the employees and no one is cribbing about the fiscal deficit anymore, I wonder why no one is talking of the dire need to provide immediate financial help to country's 60-crore farmers (which effectively comes to 9.5 crore families). When it comes to farmers, Govt says it can't provide any financial support to such a large population. And that makes me ask a question: Are farmers the children of a lesser god?

Further reading: Farmers need direct income support
http://devinder-sharma.blogspot.in/2009/02/farmers-need-direct-income-support.html

Squandering Rs 75,000-crore in the name of self-employment. Why not provide direct income support to farmers instead?

Why can't improved skills be imparted to farmers to make them gainfully self-employed, and eventually turn them into entrepreneurs. 

I have always said that there is hardly any relation between common sense and economic sense. At a time when Prime Minister's Employment Generation Programme (PMEGP), launched in 2008, has already established 2.21 lakh self-supporting business units, and has created 20.34 lakh person employment opportunities as per Govt claims, the UPA Govt is planning to launch Rs 75,000-crore action plan to provide self-employment opportunities to 7-crore households in rural India over the next 10 years.

Rs 75,000-crore for 70 million households. In other words, each year the UPA Govt plans to invest Rs 7,500-crore in helping self-help groups that will help people become self-employed across rural India. According to a news report in Economic Times (Nov 29, 2013) UPA's Rs 75,000 crore self-employment plan for 7cr rural homes (here is the link: http://bit.ly/1ijXznG):"Funds would be given to self-help groups (SHGs) to impart training to the rural poor to take up skilled and semi-skilled jobs. The idea is to scale up their skills so that they become eligible for concessional credit from financial institutions."

There is already a National Skill Development Agency, the Prime Minister's National Council on Skill Development and the National Skill Development Coordination Board. 

Now, isn't this interesting. Under the new programme, being planned just before the 2014 elections, Rs 75,000-crore is to be spent over 10 years for 7- crore (or 70 million) households. For a year, it comes to Rs 7,500 crore. As per the plan, the Govt would spend Rs 15-crore per block in each village, comprising 10-12 rural households, over the next 10 years. 

Wouldn't it make economic sense if the UPA Govt was to simply distribute Rs 1-crore to each of the rural family? I am sure every one in this country would be able to spend Rs 1-crore in a manner that it makes them gainfully self-employed for all times to come. It will be a dream project for a majority of rural India. And if we were to go by Rs 1-crore per family, imagine how many would be able to immediately join the Crorepati Club.    

Knowing this is not going to happen, the UPA Govt's plan seems to be to allocate this huge amount primarily for collecting some more votes. Everyone knows that much of the amount would be siphoned-off, but then that is how the Govts operate -- turning a blind eye to rampant corruption.  

Anyway, if the idea is to spend so much for enabling people to get gainfully self-employed. Then why not begin with farmers. As per Indian Census 2011, there are 119 million (11.9 crore) cultivators, which means farmers who own land, and there are more than 2,000 farmers who quit agriculture every day (See this report: India losing 2,000 farmer every single day. http://www.ibtimes.com/india-losing-2000-farmers-every-single-day-tale-rapidly-changing-society-1232913). These are also the people who are self-employed and need not only improved skills but also financial support to turn farming economically viable. These are also the people who produce food for the country and are primarily responsible for ensuring food security. 

Admitting that farming has become an economically unviable profession, the Govt is making all efforts to see that those who quit agriculture are gainfully employed elsewhere. The continuing agrarian crisis is also leading to enhanced rural-urban migration. Why doesn't the Govt therefore provide Rs 75,000-crore to the farming community in a way that it becomes an assured monthly income for them? If the farmers become economically viable, the domino effect will be felt across various sectors of the economy. Why don't we therefore put the money where we need it most? Why let the money be squandered under a Govt programme as has been the experience over decades? But then, didn't I say in the very beginning: there is no convergence between common sense and economic sense !

Further reading: As in the West, Indian farmers too need direct income support. http://bit.ly/1agO4vk

As in the West, Indian farmers too need direct income support

Chatting with Ashok Kumar from One World South Asia, Policy Analyst Devinder Sharma explained how flawed policies goad Indian farmers to suicide.

Action Aid organised a national consultation in New Delhi and public hearing on the issue of framers' suicides. The farmers’ consultation brought together experts and policy analysts to evaluate the progress of government initiatives to respond to the ongoing agrarian crisis.

Chatting with Ashok Kumar from One World South Asia, Policy Analyst Devinder Sharma explained how flawed policies goad Indian farmers to suicide.  Excerpts from the interview: 

OneWorld South Asia: What do you have to say on the status of Indian farmers in the country?
 
Devinder Sharma: India is witnessing the worst agrarian crisis all across the globe. It is a crisis because in the last 15 years more than 2, 95,000 farmers have committed suicides.  But these are the farmers who had the ‘courage’ to die. But there are others who are also living in the same state but they do not have the courage to die. It certainly does not mean that the latter are doing well.

OWSA: What do you think is the root cause of such a condition of the farmers?

Sharma: Over the years, the policies have been so designed that agriculture has become unviable and uneconomical in India. The problem is because of the economic policy followed over the years which is pitted against the farmers. So, the effort is to move people out of agriculture to the urban areas. Unfortunately, the mainline economists think that if you want to have economic growth, the way we measure our GDP, then it can be done by following those countries which have reduced their population engaged in agriculture. So, the entire thinking is unless we remove these people out of agriculture there will not be economic growth in this country.

OWSA: Where do you think have we gone wrong, precisely?

Sharma: The basic thrust is to make farming unviable and the force the farmers out to urban areas, which is a very flawed policy in pursuit of economic growth and is actually a path to disaster. What has happened in Europe or America cannot be followed in India. In a country which has 60 per cent of its population involved in agriculture the kind of paradigms which worked in the West cannot be implemented here.

OWSA: How could we resolve this situation which seems to be going out of hand?

Sharma: Mahatama Gandhi had said that a country like India needs production by the masses and not for the masses. Farming has to be made viable.  According to Gandhi, we should strive for economic growth by making farming profitable. Time has come when the government should set up a separate farmers’ income commission which decides the per-family or per acre family of the farmers with the help of several other inputs like the variety of soil, water availability and other factors. It is shocking to learn that a farmer earns around Rs 2000 to Rs 3000 in a month while the monthly salary of a lowest government employee is Rs 15,000. Government should strive to do away with this gap and ensure that the minimum income of a farmer at least matches that of the lowest government employee. We need to provide an assured minimum income of Rs 15,000 per month to the farmer. And, then we can see a shift taking place to sustainable agriculture.

OWSA: How farming in this country can be made viable?

Sharma: We have tried many formulae to improve the viability of farming. We are also trying to implement Foreign Direct Investment (FDI) in retail which has earlier not worked in Europe or America. But, I think we should go for sustainable farming. We have to bring in our country, what has been done in the West.  Farming in these countries is viable because farmers are provided with direct income support.  India also follows the same agricultural model (Application of fertilizers and machines) followed in the West with the difference being only of scale (of land holdings). Therefore, we also need to provide the same kind of support to farmers provided in those countries. Our farmers our dying because we do not give them direct income support.

Source: One World South Asia, Nov 30, 2012
URL: http://southasia.oneworld.net/peoplespeak/like-west-indian-farmers-need-to-be-given-direct-income-support-expert#.ULjgoCLYHMx