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EducationWhat Rural India Wants?

Agricultural Exports can lead to Farm Income Growth

The history of agriculture in India dates back to the Indus Valley Civilisation. India ranks second worldwide in farm outputs. As per 2018, agriculture employed more than 50% of the Indian work force and contributed 17–18% to country’s GDP.

India broke into the top 10 list of agricultural produce exporters in 2019 with a sizeable share in the export of rice, cotton, soya beans and meat, according to a World Trade Organization (WTO) report on the trends in world agricultural trade in the past 25 years.

In 2016, agriculture and allied sectors like animal husbandry , forestry and fisheries accounted for 15.4% of the GDP (gross domestic product) with about 41.49% of the workforce in 2020. India ranks first in the world with highest net cropped area followed by US and China.

The economic contribution of agriculture to India’s GDP is steadily declining with the country’s broad-based economic growth. Still, agriculture is demographically the broadest economic sector and plays a significant role in the overall socio-economic fabric of India.

The total agriculture commodities export was US $3.50 billion in March – June 2020. India exported $38 billion worth of agricultural products in 2013, making it the seventh largest agricultural exporter worldwide and the sixth largest net exporter. Most of its agriculture exports serve developing and least developed nations. Indian agricultural/horticultural and processed foods are exported to more than 120 countries, primarily to the Japan, Southeast Asia, SAARC countries, the European Union and the United States.

It has become one of the world’s largest supplier of rice, cotton, sugar and wheat. India exported around 2 million metric tonnes of wheat and 2.1 million metric tonnes of rice in 2011 to Africa, Nepal, Bangladesh and other regions around the world.

Grapes, Pomegranates, Mangoes , Bananas, Oranges account for larger portion of fruits exported from the country while Onions, Mixed Vegetables, Potatoes, Tomatoes, and Green Chilly contribute largely to the vegetable export basket.

After remaining stagnant for the last three years, the export of agriculture and allied products during 2020-21 grew 17.34 per cent to $41.25 billion. In 2017-18 and 2018-19, they hovered around $38 billion, thereafter declining to $35.16 billion in 2019-20.

However, inspite of such large number of profits India make in terms of agriculture, Why do farmers still starve for life ? The question becomes even more significant by the current situation that has been observed by whole world that is “THE FARMERS PROTEST”.

The topmost agenda and the much-needed attention from the Government today is addressing the farmers’ needs. In the recent years, crop failures, indebtedness, non-remunerative prices and low returns had taken, unpleasant shapes leading to protests in several parts of the country.

What makes it worse, is the absence of adequate information on farmers’ income. Some researchers have tried to fill this gap by using proxy indicators to analyze the factors that can influence farm income. As studies suggest, in non-subsidized agriculture, the real income of farmers depends primarily on crop productivity, commodity prices, and production costs. If this is true, increased production by adopting several measures to boost productivity should have enhanced farm income.

On the contrary, we have seen years of record production, but depressed prices leading to agrarian distress. Again, if protecting prices were the solution, in FY18, the Minimum Support Prices (MSPs) for the 24 crops were fixed at 1.5 times the production cost should have supported the growth.

Yet in mandis, farmers failed to realize as much as the declared MSPs. The key question thus arises – is the domestic market large enough to allow the market forces determine the prices that can ensure stability in farm income?

Several researchers tried to bring in the dimension of expanding markets for farmers. Linking agricultural production to export markets is viewed by many as one of the best means to increase farmers’ market and enhance income opportunities.

The National Sample Survey Office states that 50 percent of Indian farmers are in debt. The survey states that 26 percent of farmers take help from moneylenders and the rest 42 percent who have bigger landholdings go to banks.

Farmers need half of what they grow to feed their own family as well. They sell the other half to private traders who are also called middlemen; they charge a hefty commission to the farmers to bring his produce to the market. 

Aside from that, other farmers sell the produce to procurement agencies who offer them the Minimum Support Price in return. 

Now, given the fact that a farmer makes somewhere around Rs 4000 – Rs 6000 on a monthly basis, the loan becomes a heavy burden on not just the farmer but his family as well. In case you didn’t already know, farming is a family business and almost each and every member participates in it.

The ideal situation for a farmer is to have at least 1 hectare of land to make ends meet. However, the present situation is where 65 percent of farmers have less than that, every 2 out of 3 farmers are unable to feed their families.

We experience inflation every now and then but do we ever stop to wonder how much of it actually goes into the farmer’s pocket?

The truth is a farmer only gets pennies for their produce.

In India, 58 percent of rural households make their living from their agriculture produce. An average household earns somewhere around Rs 6,400 per month. 

Now, taking into account the high demand and supply of fruits and vegetables in the country, it is extremely difficult to comprehend how a farmer earns as less as Rs 6,400 on a monthly basis.

Moreover, if people attempt to raise their voice they are suppressed by either calling them anti- nationals or just by ending their lives.

Problems other than this also includes:

  • insufficient Water Supply.
  • Less Use of Modern Farming Equipment.
  • Over Dependence on Traditional Crops.
  • Poor Storage Facilities.
  • Transportation Problems.
  • High Interest Rates.
  • Government Schemes are yet to reach Small Farmers

Furthermore, aid to farmers is given only on paper work which then vanishes when it comes to actual implementation those schemes include:

  1. Direct transfer of capital by the government to the farmers which has already got initiated by PM under the Jan Dhan Yojna.
  2. Agricultural Marketing through means of modern technology like mobile phones will be another step forward.
  3. Educating farmers about techniques to avoid soil erosion and increasing harvests through means of using suitable fertilisers by reaching out to them through means of advanced technology will also be a big step forward.

However, if such schemes are truly implemented than the country’s agricultural prosperity along with farmers satisfaction would reach tremendous height.

Farmers are not earning a profit from their produce. According to a survey of 23 crops for investment and income during 2004-2014, except a few,

“A farmer is no longer making any money in this Country”.

(Data source ~ Wikipedia, apnikheti.com, bighaat.com, WTO, scroll.in, mint.com, ndtv)

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