THE alarm bells are ringing at a time when the world is fast moving from agriculture to industrialization, from farming to corporate agriculture. With small farms being gobbled up by big agribusiness, farm land increasingly being diverted for industrial purposes, and international focus shifting from staple foods to cash crops and bio-fuels, the world is now in the throes of an unprecedented food crisis.
The era of cheap food is over. The battle for food and fuel will further add to global hunger. Take for instance international food prices: wheat prices rose by 300 per cent during 2003 to early 2008; in 2007 alone, they shot up by 92 per cent. Rice and corn prices have also spiked. The Food and Agriculture Organisation (FAO) food prices index rose by an unprecedented 40 per cent in 2007. Since India began importing wheat in 2006, prices have shot through the roof, forcing the country to buy at $390 a tonne in August 2007. Wheat futures also increased by 70 per cent.
At the same time, food stocks globally have plummeted. Wheat stocks, for instance, in 2007 stood at 10.7 million tonnes, down from 19.7 million tonnes in 2001. Similarly, rice stocks tumbled to 7.1 million tonnes from a high of 13.6 million tonnes in the corresponding period. Indications for the future are equally dismal. Even if one has money, the fact remains that there is not enough food to buy.
No wonder, food riots were witnessed in 37 countries. Several countries, including the United States, Japan and Russia have rationed rice supplies. In Asia, where 97 per cent of the world’s rice is grown, the increasing unavailability of rice in the market is turning into a political crisis. With Vietnam, Thailand and India, the three major exporters of rice, practically stopping exports there was panic all around. The alarming food situation of 2008 is still afresh in memory.
With many more rice exporting countries banning exports, and much of the crisis emanating from the growing food dependency that WTO promulgates, the fundamental question that needs to be asked is who actually needs the Doha Development Round? Why doesn’t the world draw a lesson from the present food crisis and stop international trading? After all, what is required is to do just the opposite – to enable countries to become food self-sufficient rather than importing food.
From food self-sufficiency to market economy, India has come a long way since the days of the green revolution. When some 20 years back the World Bank/IMF tied up credit under the structural adjustment policies with market-oriented agriculture development, domestic policies began to change. India today is shifting from producing staple foods (crucial for food security needs) to cash crops that meet the luxury demands of the developed countries. In the process India is being forced to dismantle state support to food procurement, withdraw price support to farmers, and relax land ceiling laws that enable the corporate sector to move into agriculture.
As I flip through the pages of the World Development Report 2008 (WDR) published by the World Bank, I realize how meticulously the corporate takeover of Indian agriculture has been planned. The language used in the report may be fancy and seductive, but the message it conveys is crystal clear. Amidst the talk of sustainable agriculture and restoring soil fertility, it also places emphasis on providing appropriate training to the rural population to move them out to the cities. It talks of encouraging land rentals, and thereby for agribusiness companies to gradually take over farming. Contract farming, food retail chains and corporate agriculture are the ways suggested for making agriculture more competitive.
This reminds me of what a former vice president of the World Bank and the then chairman of the Consultative Group on International Agricultural Research (CGIAR), Ismail Serageldin, had warned way back in the mid-1990s. Addressing a conference at the M.S. Swaminathan Research Foundation in Chennai, he quoted a 1995 World Bank study, which predicted that the number of people migrating from the rural to urban centres in India by the year 2015 would be equal to twice the combined population of UK, France and Germany.
The combined population of UK, France and Germany is close to 200 million. In other words, 400 million are expected to be taking the distress migration route. It now dawns on me that the 1995 World Bank study was not intended to be a warning. It actually laid out a roadmap that was subsequently strengthened in the annual reports from the World Bank. The WDR only takes us to the final step. With the process to exacerbate the exodus from the rural to the urban centres already in place, it now suggests setting up industrial training institutes where farmers could learn to be factory workers.
Facilitating the farm-exit process is a plethora of national policies that are either being amended or recast at a frantic pace. Ever since economic liberalization was ushered in 1991, every policy worth the name is being either amended or recast. The underlying objective of most policy prescription for vital sectors like seed, water, biodiversity, forest and tribals, environment, biotechnology, trade, food safety and so on is crystal clear – pave the way for control by the private sector.
Let me illustrate. Prime Minister Manmohan Singh had sometimes back addressed a full meeting of the Planning Commission. He had stressed on a speedier amendment of the Agricultural Produce Marketing Committee (APMC) Act to ‘allow for contract and free marketing, organized retailing, smooth flow of raw materials to agro-processing industries, competitive trading and adoption of innovative marketing system’, so that these are in tune with the demand of the domestic food industry. This move is also aimed at integrating Indian agriculture with the global economy, something that is spelled out by the World Trade Organisation (WTO).
An Indo-US Knowledge Initiative in Agriculture is being put in place without first ascertaining the reasons behind the terrible agrarian crisis, much of it the result of imposing environmentally unfriendly technologies as the government plans to embark on a ‘second’ green revolution. Coming at a time when the commerce ministry is on a fast track to bring in special economic zones, Indian industry is moving ahead to set up ‘rural hubs’ that will displace a large population of farmers. All this and more is being done but it hardly has anything to do with revitalising agriculture.
Indian agriculture is in dire need of a revival, but a revival that does not exacerbate the existing crisis, further exhaust the soils, and make farming completely unsustainable. Any meaningful revival plan has to structure around the following five broad principles, incorporating the listed agenda points:
Sustainable farming: Indian agriculture faces an unprecedented crisis in sustainability. Food grain productivity is on the decline. The green revolution areas are encountering serious bottlenecks to growth and productivity. The dry-land areas (comprising nearly 70 per cent of the cultivable lands) continue to drown in misery and apathy. Excessive mining of soil nutrients and ground water have already brought in soil sickness. Indiscriminate use of chemical pesticides has done serious harm to the environment, human health and ecology.
There is therefore a need to immediately:
a) Draw a balance sheet detailing the collapse of the green revolution. We need to know what went wrong with agriculture so that we do not repeat the same mistakes. A post-mortem of the green revolution is absolutely necessary.
b) Investments and increased outlays for agricultural research that is based on external chemical inputs like fertilizers and pesticides need to be phased out. Instead, financial allocation should be made for reviving low-input agriculture, which uses cheap and locally available technology and in turn improves production, reduces cost of production and protects the environment.
c) Draw a map of the soil health of India. In future, all crop introductions should be based on soil health. If a crop (including cash crops) has the potential of destroying the soil fertility and thereby accentuating the sustainability crisis, that cropping system should not be allowed.
d) The role of technology too needs to be ascertained. Pesticides were promoted blindly on rice, for instance. The International Rice Research Institute in the Philippines now says: ‘pesticides on rice were a waste of time and effort in Asia.’ But meanwhile, pesticides usage has already taken a huge toll, and pushed farmers in a debt trap. There is an urgent need to either stop or phase out the use of pesticides.
e) Agricultural research must reorient itself to learn from the existing sustainable farming models. The FAO has accepted that organic farming systems are as productive as chemical based farming systems.
f) Water productivity and efficiency has to be the hallmark of agricultural research based on local conditions. Agriculture universities need to be directed to bring about a paradigm shift in future research priorities.
Dry-land farming: Despite the former Prime Minister Indira Gandhi’s emphasis on dry-land farming, there has been little respite for the resource-poor farmers. This is essentially because the entire thrust of dry-land research was to bring in an external model of green revolution in which the dry-land farmer, who manages to survive against all odds, would fit in. Little effort was made to improve the existing technology base under numerous location-technology specifications.
The increased emphasis on water harvesting notwithstanding, the reduced availability of water is emerging as a major social and economic crisis. In addition, the cropping pattern has to be evolved keeping in mind water availability. Unless the cropping pattern is rectified no initiative to protect and preserve water resources will be effective.
a) Investments in rainwater harvesting need to be immediately shifted to the revival of the traditional forms of water conservation – ponds and tanks.
b) Fodder cultivation, crop planning according to water needs and availability and an emphasis on local breed of cattle (and improving its productivity, rather than importing exotic breeds) need to be encouraged.
c) Dry-land crops like coarse cereal, pulses and oilseeds require adequate policy measures that bring shine to these forgotten grains. Imports under bilateral trade agreements must protect the dry-land crops.
d) Farmers in the rain-fed areas need to be insured against drought. This can be ensured by making it mandatory for the foreign insurance companies to invest at least 40 per cent of their funds for farm insurance. The existing insurance system for goats in Karnataka should be applied to cattle.
e) Hybrid crops require almost double the amount of water than high yielding crops. Unfortunately, much of what is cultivated in the dry-land regions of India are hybrid varieties – in cotton, rice, maize, coarse cereals and vegetables. All these crops are water guzzling and have compounded the crisis in sustainability. Hybrid crops need to be banned in the rain-fed areas.
f) The experience with tractors for small and marginal farmers in North India has not been very encouraging. Once a symbol of progressive farming, tractors in Punjab for instance, have now become synonymous with farmer suicides. There are 70 per cent more tractors in Punjab than what is required. This is because of the easy availability of bank loans for the purchase of tractors by small farmers. The Punjab Farmers Commission has asked the state government to ban the sale of tractors to small farmers. However, universities in central and southern India are now signing MoUs with tractor manufacturers to promote sales. This need to be re-evaluated in the light of the Punjab experience.
g) Seed village banks need to be linked to sustainable farming systems. India has a huge plant genetic wealth that is location specific and therefore meets local requirements. Seeds villages should encourage the sale and promotion of traditional varieties.
h) Pulses and coarse cereals are a part of the average diet. Yet, pulse production has remained static. Pulses are also a crop of the marginal lands, requiring less water and replenishing soil nutrients. There is a need for re-launching the technology mission on pulses and providing farmers with small processing units to turn it into ‘daal’. Similarly, coarse cereals must also receive impetus. Both these crops need adequate price support.
Farm incomes: Growing indebtedness in agriculture is forcing an increasing numbers of farmers to end their lives. This unsavoury phenomenon is a manifestation of declining farm incomes and rising costs of production. No wonder, the average national monthly income per family as per NSSO stagnates at a paltry Rs 2,115, almost hovering around the poverty line.
a) Effort should be made to increase farm incomes. There is a need to immediately provide farmers with a ‘minimum take-home’ income.
b) Schemes that encourage banks to provide easy credit facilities to farmers need to be spelled out. Rural women end up paying 24 to 46 per cent by way of interest, even in the much hyped micro-credit and finance programmes. This is four times the rate of interest charged in the urban areas. There is a need to ensure that micro-credit is also available at four per cent. Incidentally, some states like Karnataka have reduced farm interest to four per cent. Cooperative credit must get priority over moneylenders.
c) Banks should be directed not to confiscate the movable and immovable property of defaulting farmers. Nor should they be put in prison.
d) On top of it, agriculture credit has to be extended to sustainable farming systems. So far the banks are only providing credit for technology oriented farming systems, which is responsible for the destruction of the natural resource base. Farm credit needs to be extended to organic agriculture, for which an organic bank need to be created by NABARD (on lines similar to technology credit that goes through the private Rabobank).
Multiple cropping: An emphasis on commodities approach during the green revolution encouraged monocultures, loss of biodiversity, encouraged trade in a select few agri-commodities, distorted domestic markets, and disrupted the nutrient availability in soil, plant, animals and for humans. Trade in agri-commodities have added to increased food miles which contributes to global warming and has also exposed farmers to price volatility. The need is to revert to the time-tested farming systems that relied on mixed cropping and its integration with farm animals, thereby meeting the household and community nutrition needs from the available farm holdings.
a) Contract farming can compound the agrarian crisis. Contract farming encourages companies to go in for intensive farming systems thereby destroying the soil productivity and adding to increased water mining. Contract farming should only be allowed if it meets the parameters of environmental security and does not exacerbate the crisis emanating from the second generation environmental impacts. All contract farming approvals must be based on farm sustainability parameters. Contracts must specify that the company will return back the land to the farmer (which it takes on lease) in the same fertility conditions existing at the time of signing the contract.
b) Corporate agriculture must be discouraged. All over the world, agri-business companies have displaced farmers. This cannot be allowed in India, which supports 650 million people on the farm. Industry should supplement agriculture, and not displace farmers.
c) The thrust should be on traditionally high yielding and locally adaptable seeds.
d) There is an urgent need to revitalize cooperative farming.
Marketing: Providing an assured and remunerative market for agricultural producers cannot be left to market forces. The food policy imperatives of the public distribution system and announcing procurement prices before the crop season have to be further strengthened. Agri-processing too needs to be strengthened, but not at the cost of the domestic producers. Food processing sector should be directed to use the abundant raw material available within the country.
A number of manufacturing units, for instance, have already begun to source agricultural raw material, including oranges, grapes, popcorn, peas and so on, from America and Europe. Domestic production in these crops is going waste. Future trading in farm commodities must stop because it has failed to play an effective role in price discovery. Export-oriented agriculture is dependent upon highly intensive farming and should be discouraged. India can create a strong niche in the international organic market, which is sustainable and economically viable.
Procurement needs to be extended to coarse cereals, pulses and oil-seeds to provide farmers an incentive to produce more. Food procurement operations, linked to the announcement of assured prices for agricultural commodities, are the two planks of the ‘famine avoidance’ strategy that India had adopted and should not be dismantled. Once the government withdraws from announcing procurement prices for agricultural commodities, it is under no obligation to purchase the surplus that flows into the mandis. Farmers would thus be left at the mercy of the trade and market forces, and if past experience is any indication it simply means rendering the farming community vulnerable to exploitation. This would result in undermining the country’s food self-sufficiency.
The biggest crisis afflicting the marketing of farm produce is an inability to manage the agricultural surpluses. It is here that the policy planning effort has to be redirected with an effort to ensure that the surplus does not become a national liability. Farmers have repeatedly and in different parts of the country been dumping tomatoes, potatoes and other fruits onto the streets to express their frustration at the lack of adequate marketing infrastructure. The marketing approach has to be different for the rural and urban areas. It is here that cooperative marketing can provide an answer, and should be immediately applied.
In essence, it is not the growth in agriculture that is of paramount importance. What is crucial for the nation is to ensure that every tear in the eyes of the food producer – annadata – is wiped away. Only then can the country make the process of growth really ‘inclusive’.