What do farmers really need and what are they demanding: Not in sync


The farmer leaders are demanding: an assurance that their farm produce will be procured whether in APMC or outside at minimum support price [MSP]; in the contract farming there should be a more helpful mechanism to resolve disputes and prevent companies reneging on their promised price in the event of oversupply.  Further, they want assurance that various charges of procuring their products will be minimized.   

During 2019-2020, the total value of the agricultural output was around Rs.40 lakh crores and the MSP operations were around Rs 2.5 lakh crore, less than 5 per cent  If we exclude the perishables, only 6 – 8 per cent farmers sell their products at MSP and 5 -6 per cent is the total value of the grain procured through MSP.    If such is the case, why are farmers unhappy?  An important unsaid dimension of the entire debate is that traders don’t merely procure but also lend informal debts to the farmers.  How should we reframe the debate?

Our first concern should be a reduction in the cost of cultivation.  Whether we like it or not, the fact remains that paddy/wheat rotation has not only sapped the fertility of the soil, but also lowered the groundwater table, increased the real cost of pumping groundwater, despite excessive subsidy in water and electricity, excessive use of water leading to leaching of nutrients,  and increase in the cost of other farm operations.  Excessive water also leads to excessive weed growth for which farmers spray various herbicides even though those are banned abroad.  It is strange but true that the cancer train brings patients from Punjab to cancer hospitals elsewhere is too well known to be repeated here.  The farmworkers, 100 % of them and small and marginal farmers who often do labour on their farms don’t use any safety gear to save themselves from pesticides.   The organic carbon in the soil hardly is 0.5 per cent ideally it should be 2% in sustainable farming.  Micronutrient deficiency is well known which affects the quality of micronutrients in the grain and accordingly in our body.  The consequences of deficiency of micronutrients on our health are well known.  None of these issues is being raised by the contending parties in the current debate.  How do we bring order and a semblance of fairness not just to the current generation of farmers but also to the future generation of farmers who deserve good groundwater, healthy soil, diverse land use and augmented agrobiodiversity?  Indeed, the Bill as they have proposed will not correct the structural problems of profitability, productivity and sustainability decline in agriculture. 

With more choices for the farmers, the competition among buyers may improve the prices.  But Bihar’s example does not prove it in the case of Maize and many other crops. If various atta/wheat flour brand owners start buying from farmers, they will get better quality of grain and consumers will get better quality of the flour.  Some of the large Indian companies have established wheat flour brands by doing the same thing.   There is no reason why other sellers of atta or rice will not do the same.

It is well known that cartelization takes places even in the mandis.  There is nothing that can prevent that to happen among the large-scale buyers comprising Indian or multinational companies.  The first application of anti-trust laws in the US had taken place against a cooperative company Sunkist dealing with oranges. There is no regulatory assurance to farmers that cartelization in procurement by large buyers will be regulated and prevented. It should be done. On the contrary in India, Amul has created an extraordinary example of more than 80% transfer of the final price they charge the consumer to the producer.   This is higher than what European cooperatives or corporations do where they hardly transfer 30 – 40 per cent.  As is often said, in most sectors cooperatives have failed.  But, they must succeed and one way to achieve that is transparency, accountability and responsibility.  No matter, which party the board of directors belong to on Amul Board, they broadly trust the professionals in safeguarding the interests of the farmers.  Despite having a political board, political interference is minimal except in one district cooperative in Gujarat.  The farmers’ producer organisations/associations or companies can also do contract farming and thereby overcome the vulnerability of individual small farmers and negotiate with the strength of their membership with large buyers. There is a need for an empathetic hearing of farmers’ anxieties in this context.

During our Shodhyatras in Haryana and Punjab, we did not notice practically any farm level processing units during the route of walk-in Jallandhar and Mahendragarh districts.   It is ironical that despite all the agitation that we are witnessing, farm leaders are not asking for more and faster support for setting up processing units.  The story of Rajasthan’s success in oilseed production cannot be delinked from the establishment of a larger number of oilseed processing plants after the technology mission on oilseed. It is very heartening that increase in MSP amount of oilseeds and pulses is far higher than in the grains.  It is a clear signal that farmers should diversify.  By growing more area under oilseeds and pulses, we will increase the profitability of farmers, reduce water and power consumption significantly, reduce chemical inputs and help India overcome malnutrition and improve the health of the people.  If we produce more than what we need, the export markets are far more buoyant for oilseed and pulses than for grains.  

To summarize, farmers need higher income, better infrastructure both for storage and transportation and farmers lobby are silent on that.  They are not asking for a much larger decentralized and distributed facility for the storage of not just grains but also fruits and vegetables.  It is ignored that fruits and vegetable growers are far more vulnerable because of the perishable nature of the community than grain producers.  And yet their voice is not heard.  Around half the agricultural production is of fruits, vegetable, milk, fish, pulses, etc. 

There is a need to broaden the debate urgently so that diverse voices are heard, informed arguments are made and with greater policy flexibility more efficient outcomes follow.   NITI Ayog should take initiative in organizing a debate on farmers’ plight and need for greater support to people who feed the country.  The divergence between what farmers need and what they are demanding needs to be bridged with more evidence-based arguments, more patient listening and greater willingness on all sides to give and take in the larger interest of sustainable farming, sustainable soil and water use and healthy production for consumers and safe working conditions for farmers. 


Visiting Faculty, IIM Ahmedabad & IIT Bombay and an independent thinker, activist for the cause of creative communities and individuals at grassroots, tech institutions and any other walk of life committed to make this world a more creative, compassionate and collaborative place