Agricultural Development: Enhancing Productivity with Land, Finance, Seeds, Water

Agricultural Development: Enhancing Productivity with Land, Finance, Seeds, Water #

 

Agricultural Development: Trends and Dynamics in India #

Agriculture is a primary economic activity that includes growing crops, fruits, vegetables, flowers and rearing of livestock among others. 

According to the World Bank data, the number of people employed in agriculture is steadily falling down: 55% (2011) to 42% (2018) The share of agriculture in the total GDP is falling down, but not steadily – about 15-17% 16 cr Indian workers are in agriculture & allied sectors at present. The growth rate of agriculture has been zig zagging due to El-Nino led drought years.

 

Agriculture & allied sectors (livestock, forestry, fishing)	2014 -15	2015-16	2016-17	2017-18	2018-19	2019-20
Annual Growth Rate (%)	-0.2	0.6	6.3	5.0	2.9	2.8
Share in total GDP (Crops>Livestock>Forest>Fishing)	18.2	17.7	17.9	17.2	16.1	16.5

  

UN-SDG 1	End poverty in all forms.
UN-SDG 2	Eliminate global hunger, protect indigenous seed and crop varieties, doubling agriculture productivity and small farmer incomes by 2030

    

Agricultural Development in India: Ministry Structure and Initiatives #

Ministry of Agriculture and Farmers Welfare is made up 2 departments and implements National Policy for Farmers (2007) 

1. Dept of Agriculture

• Department of Agriculture, Cooperation and Farmers Welfare
• Statutory Bodies/Boards – Coconut Development Board, National Cooperative Development Corporation, Protection of Plant Varieties and Farmers’ Rights Authority, Registrar of Multi State Cooperative Societies.
• Attached Office – National Rainfed Area Authority.
• CPSE – National Seeds Corporation Ltd. (NSC)
• Autonomous / Cooperative bodies: NAFED, Small Farmers Agribusiness Consortium (SFAC). Various boards / institutes for horticulture, plant health management, Agro marketing etc.

2. Dept of Agro Research Extension

• Department of Agricultural Research & Education
• Autonomous body: Indian Council of Agricultural Research (ICAR)
• Central Agro universities at Imphal (Manipur), Pusa (Bihar), Jhansi (UP).

Ashok Dalwai committee on Doubling farmers’ income by 2022-23 compared to 2015-16. Manmohan Singh govts. The target was 4% annual growth rate, Modi Govts. a 2x income target would require a 10% annual growth rate in agriculture.

  

Strengthening Animal Husbandry and Fisheries: Ministry Structure and Economic Dynamic #

This ministry was newly set up in 2019, with two departments.

1. Dept of Fisheries
2. Dept of Animal Husbandry And Dairying

Statutory à National Dairy Development Board (NDDB)

Sir Arthur Lewis’ Dual Economy Model # Economic development results in laborers moving away from agriculture to the more productive industrial sector, & the agriculture sector becomes a less important part of GDP.

Note – Previously above subjects were under the aegis of Agri ministry.

Optimizing Agricultural Productivity: Key Agricultural Development  #

• Agricultural Development
• Land
• Credit/ Finance
• Seeds
• Water
• Fertilizer
• Insurance
• farm mechanization

Enhancing Agricultural Productivity: Land Input Challenges and Solutions #

• While India accounts for more than 17% of the world population, we have barely 2.5 % of the world.
• Agriculture is a purely land based activity. Size and quality of land has a direct bearing on agriculture productivity and farmers’ income. Land ownership also serves as a social value & security against credit.

Challenges	Rising population Division of land among heirs leads to fragmentation of landholdings. Small sized-farms are not conducive for farm-machinery results into poor productivity.
Solution	Small-marginal farmers should be encouraged to join manufacturing / service sector jobs Selling their land to big farmers which could facilitate land consolidation Cooperative and Corporate farming

  

Land Reforms is the government led division of agricultural land and its reallocation to landless people. Land Acquisition means Govt acquiring private land for industrial or infrastructure development.

   

Agricultural Development: Nurturing Land reforms in India after independence #

• Zamindari Abolition
• Vinoba’s Bhoodan movement and Gramdan movement
• Ceiling on Landholding i.e. fixing maximum size of land holding that an individual can own.
• Laws to protection of tenant farmers
• National Land Records Modernization Programme (NLRMP-2008) by the Department of Land Resources under the Rural Development Ministry. Because digital land records help reduce court cases related to sale or inheritance & help keeping track of land ceilings.
• Forest Rights Act, 2006 – which gives ‘Patta’ (farm land ownership title) to the forest dwellers, if the given family was cultivating that forest land for the last 75 years.

Land is a state subject, so Union circulated Model Agriculture Land Leasing Act, 2016, which: Protects land owner from illegal occupation by tenant farmer Helps tenant farmers get bank loans using leasing agreements as proof.

  

Optimizing Agricultural Development: The Crucial Role of Seeds #

• Since we can’t drastically increase the area under cultivation, agriculture yield (amount of crop produced in a given acre of land) depends greatly on seed quality.
• For best yield, hybrid seeds must be replaced every year, and non-hybrid seeds must be replaced every three years. But in India, seed replacement rate is less than optimum because of:
  • New seeds are not affordable and
  • Not available to all farmers. So, the government has approved 100% automatic FDI in seed development.

Seed village concept: Group of farmers in a village given training to produce seeds of various crops so they can fulfill seed demand of their own & neighbouring villages.

  

Seed bank / Seed vault is a depository that stores seeds to:

• Preserve genetic diversity
• Supply seeds during natural calamities and unforeseen conditions.
• The Agro Ministry gives funding for the above two initiatives.

Draft Seeds Bill 2019 aims to replace the Seeds Act, 1966, to regulate the quality of seeds for sale, import, export. But since it’s in the draft stage.

 

Q. Which one of the following best describes the main objective of Seed Village Concept? (CSE-2015) Encouraging the farmers to use their own farm seeds and discouraging them to buy the seeds from others. Involving the farmers for training in quality seed production and thereby to make available quality seeds to others at appropriate time and affordable cost. Earmarking some villages exclusively for the production of certified seeds. Identifying the entrepreneurs in villages and providing them technology and finance to set up seed companies.

 

Biofortification: is the process by which the nutritional quality of food crops is increased. E.g. ICAR developed CR Dhan 310– a rice variety that has higher protein & zinc content than traditional rice. Germans developed Golden rice for Vitamin A.

 

Green Revolution:

• Green revolution refers to the large increase in food production with the help of High Yielding Variety (HYV) of hybrid seeds.

Phase-1:	Mid 1960s up to mid 1970s → focus on wheat, rice and more affluent states such as Punjab, Andhra Pradesh and Tamil Nadu.
Phase-2:	Mid-1970s to mid-1980s → HYV seeds were spread to a larger number of states. They also focused on crops apart from wheat and rice.

 

Intellectual Property in Agricultural Development: Pepsi vs. Potato Farmers Disputes #

• The 1970’s Indian Patents Act doesn’t give patents to seeds / plant varieties. But,
• 2001’s Protection of Plant Varieties and Farmers’ Rights Act grants Intellectual Property Rights (IPR) to plant breeders, researchers and farmers who have developed any new plant varieties
• Pepsi supplied FC5 potato hybrid varieties to Indian farmers. It has a lower moisture content so it is suitable for making Pepsi-Lay’s potato chips. Later, the contract expired and farmers continued to grow this variety (& selling to other chip makers).
• 2019: Pepsi filed a complaint against Gujarat Farmers. Later, Pepsi withdrew the complaint.

Genetically Modified (GM) Crops: Revolutionizing Agricultural Development in India #

• Hybrid seeds are developed by cross-breeding / cross-pollination with other plants.
• Whereas, Transgenic / Genetically modified seeds are developed by transferring selected genes from one organism into another. E.g. Bacterium Bacillus thuringiensis genes inserted in cotton → Bt. cotton → if bollworm pests eat it, it’ll die by the toxin crystals in Bt. cotton plant.
• GM-Regulation à Environment Protection Act 1986 (EPA) → Genetic Engineering Appraisal Committee (GEAC) conducts studies, and recommends approving a GM crop in India → Environment ministry gives final permission.
• 2017: GEAC recommended the environment ministry to allow GM-Mustard in India.
• 2018: however, GEAC did ‘U-turn’ on its previous recommendation saying further studies required before allowing GM-Mustard in India.
• Thus, so far, the Environment ministry has allowed only Bt. Cotton (a non-food crop) cultivation in India (2002).

Challenges to GM Crops: Addressing Biosafety Concerns and Intellectual Property Issues in Agricultural Development #

• Biosafety concerns GM food crops may be unsafe for human and animal consumption. They may harm the soil bacteria & bees → harm to entire food web and biodiversity. GM crop may eliminate the wild/indigenous species by cross-pollination.
• American company Monsanto’s Bollgard technology is used for developing Bt Cotton seeds. So, Indian Bt-cotton seed production companies have to pay a type of royalty to Monsanto, called Trait fees. Govt of India decides the ceiling on Trait fees.
• Monsanto also owns a patent over Terminator gene technology i.e. when such seeds are planted, they’ll produce crops only once. Their resultant crop’s seeds will be sterile → Farmer forced to buy new seeds from the company for every season. Terminator gene seeds are not allowed in India.

Responsible Adoption of Agricultural Development: Economic Survey 2017 Recommendations on GM Crops #

We’ve a robust regulatory framework with GEAC. So, mischief is unlikely so we should allow GM crops with following precautions:

• Allow GM seeds which don’t have Terminator Gene or high cost.
• Allow GM seeds that have following properties:
  • Disease, pest & drought resistant
  • Longer shelf life
  • Shorter crop duration
  • Non-food / Tree format crops.
• To prevent MNC monopoly on GM seeds, we’ve to encourage domestic companies.

Balancing Agricultural Development: Weighing the Pros and Cons of GM-Crops in India  #

Conclude in Favor:	India needs self-sufficiency in agriculture because of: SDG goal of zero hunger Economic goal of low food inflation. GM-crop can help in this regard, so a positive consideration should be given GM adoption in India.
Conclude Against:	India is a signatory to Cartagena protocol to protect biodiversity. SDG Goal (2.5) also requires all nations to protect the genetic diversity of plants and animals. Given the aforementioned concerns, GM crops should not be introduced in India without due diligence.

  

Agricultural Development and Water Management: Tackling Challenges in Irrigation #

• The supply of water to crops at different intervals is called irrigation.
• Challenges à While India accounts for more than 17% of world population but we have barely 4% of world’s water resources.
• India is a water stressed country. More than 50% of agriculture depends on rainfall. Only four months of monsoon & if El-Nino we receive even less rainfall. → 2014 & 2015 drought → food inflation.
• Irrigation water productivity is defined as the ratio of the crop output to the irrigation water applied. To produce 1 kg of rice, Indian farmers use 3,000-5,000 litres of water, whereas Chinese farmers manage it within 350 litres of water.
• MSP, heavily subsidized electricity, water and fertilizers = 60% of water is consumed by water intensive crops like paddy and sugarcane.
• By 2050, India will be in the global hot spot for ‘water insecurity’.
• To earn double income, a farmer must cultivate multiple crops annually. But the majority of farmers face water shortages so they can’t do so.

Agricultural Development: Navigating Water Resources through Ministries and Departments #

Min. of Water Resources, River Development & Ganga Rejuvenation consists of: 

Dept	Description
Attached / subordinate offices	Central Water Commission Ganga Flood Control Commission Bansagar Control Board (Son River) Central Water and Power Research Station Central Soil and Materials Research Station
Statutory Bodies	Betwa River Board, Brahmaputra Board under respective Acts. Various water dispute tribunals under Inter-State Water Disputes Act, 1956 Under Environment Protection Act, 1986 National Ganga River Basin Authority (NGRBA) → 2006 replaced by National Ganga Council chaired by PM Central Ground Water Authority.
PSU	Water and Power Consultancy Services Ltd (WAPCOS) National Projects Construction Corporation Ltd.
Autonomous Bodies	National Institute of Hydrology Krishna River Management Board Godavari River Management Board

  

Jal Shakti Ministry: Consolidating Water Resources and Sanitation for Integrated Management #

2019-May: Government formed Jal Shakti Mantralaya by merging following ministries:

1. Ministry of Water Resources, River Development and Ganga Rejuvenation
2. Ministry of Drinking Water and Sanitation

Now Ministry#1 and Ministry#2 have been made ‘Departments under the Jal Shakti Ministry.

Enhancing Agricultural Development: National Rural Drinking Water Programme (2009) #

• National Rural Drinking Water Mission
• Nodal à Drinking Water Dept. Centrally Sponsored Scheme → Core Scheme = NOT 100% funded by Union. (50:50)
  • To provide every rural person with safe water for drinking, cooking & domestic needs.
  • Additional focus on areas affected by Arsenic, Fluoride & chemical contamination; Encephalitis disease etc.
  • 2019: NRDWP subsumed under a new scheme namely Jal Jeevan Mission (JJM).

Agricultural Development Enhancement: Pradhan Mantri Krishi Sinchai Yojana (2015) #

• Nodal à Agro Ministry (2015).
• Core Scheme à Not 100% Funded by Union.
• Aim à To improve the irrigation coverage, reduce wastage of water, using 4 pillar strategy:

1. Accelerated Irrigation Benefit Programme (AIBP)→ Requires Jal Shakti Ministry to finish the ongoing national irrigation projects at a faster pace.
2. Watershed Development → Setup water harvesting structures like check dams, Nala bund, farm ponds, tanks etc. Encourage traditional water storage systems such as Jal Mandir (Gujarat); Khatri & Kuhl (H.P.); Zabo (Nagaland); Eri & Ooranis (T.N.); Dongs (Assam); Katas & Bandhas (Odisha & M.P.).
3. Har Khet ko Pani → To distribute water to each and every farm.
4. Per drop more crop → Improve the water usage efficiency through Micro-irrigation devices such as drips, sprinklers, pivots, rain-guns.

Fertigation:	Mixing water-soluble fertilizers in drip system → fertilizer delivered into the root system → reduced wastage of fertilizers.
Mulching:	It is a simple process of covering the bare soil with straw, wood chips, shredded bark etc. to reduce the water evaporation, soil erosion and weed growth.

   

Challenges in Micro-Irrigation Adoption: Cost and Wildlife-Induced Damage #

High cost of purchase. Trampling by elephant, boar, nilgai etc. damages the equipment, but repairmen are not available locally and repair costs are not covered in crop insurance. So less adoption.

Namami Gange Yojana (2015) #

• To make Ganga pollution free in the next 5 years through Sewage / Effluent Treatment Plants, Information, Education & Communication (IEC) etc.
• Nodal à Water Resources Dept.
• Central Sector Scheme = 100% funded by union
• 1986: Ganga Action Plan by PM Rajiv Gandhi.
• 2009: Ganga was declared the ‘National River’, & National Ganga River Basin Authority (NGRBA) setup under Environment Protection Act. Initially the authority functioned under the Environment Ministry but later transferred to the Water Resources Ministry.
• 2015: Modi repacked previous schemes / initiatives under ‘Namami Gange’.

Jal Kranti Abhiyan (2015) #

• Nodal à Water Resources Dept.
• In every district, 2 villages facing acute water shortage are designated as ‘Jal Gram’ and efforts are made to turn them into ‘water surplus’ villages.
• This is not a separate scheme. ₹ ₹ is mobilized from other schemes like Pradhan Mantri Krishi Sinchayee Yojana, NRDWP, MNREGA etc. to create dugwells, watersheds, artificial recharge tanks etc. water assets.

Jal Shakti Abhiyan (2019-July) #

• Nodal à Jal Shakti Ministry’s 2 phases to conserve water.
• Phase1: from 1st July, 2019 to 15th September, 2019.
• Phase2: from 1st October, 2019 to 30th November, 2019 for States receiving the North East retreating monsoons.
• They will focus on following areas to conserve water:
  • Rainwater harvesting, Renovation of traditional water bodies/tanks, bore well recharge structures, watershed development
  • Water reuse, intensive afforestation.

Water Schemes → Jal Jeevan Mission (2019-Aug) #

• Nodal à Jal Shakti Ministry
• Objective à Har Ghar Jal (piped water supply)
  • To all rural households by
  • To Cities with million+ population will be encouraged to achieve it in current year (2020) itself.
• Focus on rainwater harvesting, groundwater recharge and using household wastewater for reuse in agriculture.
• Previous scheme NRDWP scheme subsumed into this new scheme.
• Funding à Government aims to spend ₹ 3.60 lakh crores in this by converging with other Central and State Government Schemes and using their funds. Further, if required, the Government will also use additional funds available under the Compensatory Afforestation Fund Management and Planning Authority (CAMPA) for this purpose.

ATAL Bhujal Yojana (ATAL JAL) (2019-Dec) #

• Nodal à Jal Shakti Ministry’s Jal Shakti Ministry.
• Funding: 50:50 by Union and World Bank.
• This scheme is not meant for entire India but only in the selected areas of selected 7 states facing extreme water shortages viz. Gujarat, Haryana, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan and Uttar Pradesh.
• Panchayat led ground water management and behavioral change. Better performing gram panchayats, will be given more funding allocation.
• Villagers formed into ‘Water User Associations’ → try to minimize water wastage, build water assets, IEC etc.
• 2019-25th Dec: Modi formally launched this scheme on the 95th birth anniversary of former prime minister Atal Bihari Vajpayee. Further, Rohtang Tunnel connecting Manali, Himachal Pradesh with Leh, Ladakh and Jammu Kashmir, will now be known as Atal Tunnel

In 2014-15, PM Modi also announced Bharat Ratna for Atal B. Vajpayee, and declared his birthday (25th Dec) to be celebrated as ‘Good Governance Day’.

 

Holistic Water Management Initiatives: Beyond Pradhan Mantri Krishi Sinchai Yojana #

• Nodal à Jal Shakti Ministry.
• Central Sector Schemes = 100% funded by union (In the sense that states are not required to give money) + Additional loans from World Bank.

DRIP (2012)	Dam Rehabilitation and Improvement Program. DHARMA web-portal: to monitor safety of dams in India, minimize loss of life and property damage in case of dam overflow / disaster.
National Hydrology Project (2016)	Objective – Remote Sensing for water resources, flood forecast etc.
NABARD	Budget 2017– NABARD has given funds for Long Term Irrigation Infrastructure (20k cr) and Micro Irrigation (5k cr)

  

Enhancing Water Management: Insights from the Composite Water Management Index and Economic Surveys  #

Suggestions by Economic Surveys on Water (irrigation) # River inter Linking project. Encourage pulses cultivation in the drought prone areas. Canal water usages: cost-based water pricing, stop theft of water. Rainwater harvesting i.e. capture and store rainwater. Watershed management e. building percolation tanks, recharge wells, etc. with community participation. It helps in conservation of rain, surface and groundwater resources. A National level dedicated agency to push above things.

• NITI Aayog’s index
• Guidelines Version 1.0 in 2018, Version 2.0 in 2019.
• NITI divides India in:

1. 1. Non-Himalayan states
   2. North-Eastern and Himalayan states,
   3. Union Territories (UTs).

• NITI ranks them into nine themes and 28 indicators against the base year 2017-18.

Preserving Life, Livelihoods, and Sustainable Development: The Imperative of Water Management in India #

Water is a scarce natural resource. Water is fundamental to life, livelihood, food security and sustainable development. SDG Goal-6 requires India to provide Universal access to safe and affordable drinking water for all. Aforementioned policy / scheme / challenges are significant in this regard / need to be addressed on priority basis. 

Agricultural Development: Balancing Soil Nutrients through Fertilizer Application #

• Manure or Compost is a natural substance from decomposition of organic waste. Whereas, Fertilizer is an artificial chemical prepared in factories to boost nutrients in the soil.

Fertilizers	Notes
Nitrogen (N) Urea	Haber process: natural gas (methane) converted into ammonia (NH3) → further processing to create Urea. Therefore, Urea production requires natural gas imports. The Ministry of Chemicals and Fertilizers gives Indian companies subsidies to manufacture and sell it at cheap price to farmers. Urea subsidy is a Central Sector Scheme = 100% paid by the Union. (i.e. State Government not required to contribute money).
Phosphorous (P)	~80-85% demand is met via import. ISRO using remote Sensing technology to identify the potential mines for rock phosphate.
Potash	100% demand is met via import.

  

Ideal Nitrogen: Phosphorus: Potassium (NPK) ratio in soil: 4:2:1, for India it’s 8:3:1  #

Mitigating Urea Misuse: Government Initiatives to Ensure Sustainable Agricultural Development #

• Soil & groundwater pollution.
• Subsidized urea smuggled to non-agro purposes in chemical industries related to dyeing, inks, coatings, plastics, paints, even synthetic milk.
• Subsidized urea was also smuggled to Bangladesh and Nepal.
• Increased use & smuggling → increased subsidy burden → increased fiscal deficit.

So Govt. initiated one following reforms to control urea Misuse/Overuse/Diversion:

Balancing Agricultural Development: Nutrient-Based Subsidy to Curtail Urea Misuse #

• To prevent misuse of urea
• Central Sector Scheme = 100% Paid by Union (i.e. State Government not required to contribute money).
• The Ministry of Chemicals and Fertilizers gives subsidies to companies based on weight of the different nutrients in the fertilizer. E.g.

Nutrient	N (Nitrogen)	P (Phosphorus)	K (Potash)	S (Sulphur)

• Above subsidy given to companies for producing non-UREA type “customized/mixed” fertilizer according to soil requirement in each region.
• Challenge à Urea not covered in this scheme, Urea subsidy paid separately. Delay in NBS subsidy payments.
• Therefore Fertilizer companies focus more on urea than other fertilizers → Urea overuse continues.

Agricultural Development Enhancement: Empowering Farmers with Soil Health Cards (2015) #

• Nodal à Agro Ministry. Core Scheme – not 100% funded by the Union.
• SHC contains the status of soils with respect to 12 parameters →

Macronutrients	N, P, K
Micro- nutrients	Zn, Fe, Mn, Bo
Secondary- nutrients	S: Sulpher
Physical parameters	Ph, electrical conductivity(EC), organic Carbon (OC)

 

• A farmer’s land is tested & he is given an updated soil card once every 3 years.
• The card also advises on which type of crops, seeds, fertilizer, and irrigation method will be suitable for his farm, according to his soil type.

Agricultural Development Innovation: Neem Coating of Urea for Sustainable Farming (2015) #

• Nodal à Ministry of Chemicals and Fertilizers. From 2015, the Government made it mandatory for fertilizer companies to neem coat the urea before selling it.
• Benefits →

1. Prevents diversion of subsidized urea towards non-agricultural purposes.
2. Neem coating slows down the rate of dissolution of urea in soil→ Improves the plant’s absorption of Nitrogen from the urea → Yield is improved.
3. Reduction in pest and disease attack → Pesticide consumption is also reduced.

Q. Why does the Government of India promote the use of Neem-coated Urea’ in agriculture? (CSE-2016) Release of Neem oil in the soil increases nitrogen fixation by the soil microorganisms. Neem coating slows down the rate of dissolution of urea in the soil. Nitrous oxide, a greenhouse gas, is not at all released into the atmosphere by crop fields. It is a combination of a weedicide and a fertilizer for particular crops.

  

Revolutionizing Agricultural Development: Direct Benefit Transfer of Fertilizer Subsidy (2018) #

• Nodal à Ministry of Chemicals and Fertilizers.
• Direct Benefit Transfer in fertilizer: Fertilizer companies are paid subsidy only after the retailer has sold the fertilizer to farmer through Point of Sale (PoS) devices & noting down his Aadhaar Card/ Kisan Credit Card/Voter Identity Card etc. to verify his identity as farmer.
• Then the Government transfers the subsidy ₹ ₹ directly into the bank account of the respective fertilizer company.
• Benefits – Prevents diversion of subsidized urea towards non-agricultural purposes and towards Bangladesh / Nepal.

Optimizing Agricultural Development: Navigating Pesticides and Weedicides for Sustainable Farming #

• Pesticides and weedicides are chemicals which are used for killing / controlling pests and weeds respectively.
• 25% crop loss on account of pests, weed, diseases but India’s per hectare pesticide consumption is far less than the first world. We should encourage organic pesticides and biocontrol agents.
• We should adopt Integrated Pest Management (IPM) approach i.e. rather than eradicating pest population to 100%, just try to keep crop damage to economically tolerable level. Because even pests are important for biodiversity protection and food chain balance.
• Spread awareness about proper use of chemical pesticides (esp. Endosulfan) so it doesn’t contaminate food / land / water / human bodies excessively.
• 2019: Monsanto & its parent company Bayer fined in the USA for their weedicide / herbicide ‘ Glyphosate’ (brand name ‘Roundup’) which was causing cancer. This weedicide is already banned in Punjab, Kerala and selected states of India (2018).

Optimizing Agricultural Development: Paramparagat Krishi Vikas Yojana (PKVY) for Sustainable Organic Farming (2015) #

• Organic farming is a type of agriculture that avoids the use of synthetic fertilizers, pesticides, and other chemical inputs. It relies on crop rotation, crop residues, manures, biofertilizers, biopesticides etc.
• Nodal à Agro Ministry. Core Scheme = Not 100% paid by Union. (60:40,90:10)
• Mechanism à Form a group of 50 farmers in a cluster to start organic farming. Every beneficiary farmer is given ₹ 20,000 per acre for 3 years for doing organic farming.

Ecological benefits	Less use of chemicals → biodiversity protected, less soil pollution and water pollution. Less air pollution (because farmers will not burn the crop residue).
Economic benefits	Organic products command higher prices among the health conscious buyers from developed countries → more exports → less CAD, more farmer’s income. Less use of chemical fertilizers → governments urea subsidy bill will decline → fiscal deficit can be controlled.

  

• In 2003, recognizing the aforementioned benefits, Sikkim stopped the entry of chemical fertilizers, and its Vidhan-Sabha declared the intention to become a 100% organic state. The goal achieved in 2015.
• 2015: To encourage organic farming in India, Union Govt. launched Paramparagat Krishi Vikas Yojana (PKVY).
• Agro Ministry’s Jaivik Kheti webportal to help organic buyers and sellers connect with each other.
• Agro Ministry’s Participatory Guarantee Scheme (PGS) for certification of organic products. It assures the buyers the given fruit/vegetable/produce has organic origin.

Agricultural Development Revolution: Zero Budget Natural Farming (ZBNF) for Sustainable Agriculture #

• ‘Zero Budget’ means without using any loan, and without spending any money on purchase of inputs (seeds, fertilizers).
• ‘Natural farming’ means farming without chemicals. By using biofertilizers, earthworms, cow dung etc. Associated keywords:

Jeevamrutham:- It is a mixture of fresh cow dung and aged cow urine (both from India’s indigenous cow breed), jaggery, pulse flour, water and soil; to be applied on farmland 

Bijamrita:- It is a concoction of neem leaves & pulp, tobacco and green chilies prepared for insect and pest management, that can be used to treat seeds. 

Acchadana (Mulching):- It protects topsoil during cultivation and does not destroy it by tilling. 

Whapasa:- It is the condition where there are both air molecules and water molecules present in the soil. 

• ZBNF saves farmers from debt-traps; and protects the environment, soil and biodiversity.
• Practice first started in Karnataka by Subhash Palekar. Himachal Pradesh and Andhra Pradesh are also frontrunners.

Budget-2019 promised to expand ZBNF in other parts of India. The government is thinking of launching it as a sub-scheme under Paramparagat Krishi Vikas Yojana.

  

Challenges in Sustainable Agricultural Development: Limitations of Organic Farming and ZBNF #

• Organic farming yield (quantity produced per acre) is lower than conventional chemical-based farming.
• Difficult to produce off-season crops using organic farming. so if the entire India became “100% organic farming” → food shortage → inflation.
• Shelf life, colour and texture of organically grown fruits/vegetables are less attractive than chemically grown hybrid / GM varieties. So, unless ordinary consumers are made aware of their health benefits they may not buy.

Sustainable Agricultural Development: Catalysts for Doubling Farmers’ Income and Achieving SDGs #

• SDG along with New India Vision 2022 requires doubling farmers’ income, while Sustainable Development Goal No. 2 requires nations to adopt agriculture practices that improve land and soil quality & protect the genetic diversity of flora- fauna.
• Given the aforementioned ecological and economic benefits of organic farming /ZBNF, it can help us achieve both the targets.

Optimizing Agricultural Development: Unleashing Efficiency with Farm Mechanization #

• It means the higher usage of combine harvesters, land levelers, cultivators, tractors, reapers, threshers, trolleys and mechanical pickers etc.
• Significance:
  • ↑ productivity of land and labour by increasing work output per unit time.
  • ↑ employment opportunities to rural youth in production, operation, and repair-maintenance of machines.
• Labour augmenting technological progress: Allows each laborer to be more productive e.g. Industrial revolution → James Hargreaves’ Spinning Jenny that allowed each worker to spin eight cotton threads at once (1770).
• Capital augmenting technological progress: Allows capital assets / machinery to be more productive. E.g. wooden plough replaced with steel plough → more sturdy, requires less maintenance & repairs, resistant to water-fungal attacks.
• After MNREGA scheme (wherein villagers are guaranteed 100 days of unskilled manual work), the Punjab-Haryana farmers are facing shortage of farm-laborer in peak season, & forced them to offer higher wages → many of those farmers opting for machinery to reduce labour requirement.

Challenges	The Indian tractor industry is the largest in the world, accounting for one-third of the total global production. Nearly 80,000 tractors are exported every year to African and Asian nations. But within India, the utilization is low. India farm mechanization (40%) < China (60%) < Brazil (75%) < USA (95%).
	Customized machinery required for India’s soil and climatic diversity so R&D, Make in India required.
	Small-marginal farmers lack financial resources to own machines so renting centres should be set up.

• Government Scheme – 2017: Green Revolution – Krishonnati Yojana → Sub-Mission on Agricultural Mechanisation (SMAM): to address above challenges.

Q. The substitution of steel for wooden ploughs in agricultural production is an example of ___________ technological progress. (CSE-2015) Labour-augmenting Capital-augmenting Capital-reducing None of the above.

  

Agricultural Development Empowerment: Facilitating Farming through Finance and Credit #

• Small and marginal farmers produce little marketable surplus, and are often deprived of remunerative prices even during bumper crops, so without borrowing they can never buy inputs for the next cropping cycle.

Economic Survey 2016 found an inverse relation between size of landholding vs. Indebtedness of farmers i.e. small/marginal farmers are more indebted than big farmers.

• ES20: The share of North Eastern States <1% in total agricultural loans.

Budget-2020: Agriculture credit target for the year 2020-21 has been set at ₹15 lakh crore. NABARD will provide a refinance facility for this. If a PM-KISAN beneficiary doesn’t have a Kisan Credit Card, he will be given such a card.

  

Notable steps to enhance credit availability to farmers:
1.	RBI’s PSL norms: 10% to agriculture + 8% to Marginal Farmer (upto 1ht) & Small farmer (>1 upto 2ht).
2.	Nationalisation of banks after Independence. Setting up of differential banks (RRB, LAB, SFB).
3.	Kisan credit card scheme & interest subvention scheme

  

Negotiable Warehouse Receipts (NWR) #

• Nodal à Ministry of Consumer Affairs, Food & Public Distribution → Statutory Body Warehousing Development and Regulatory Authority (WDRA) – law in 2007.
• Farmer deposits his produce into WDRA registered warehouses and gets negotiable warehouse receipt (NWR). He can use it in two ways:
  • Pledge it in the banks to obtain loans for the next cropping cycle. OR
  • Trade it via the commodity exchange markets or electronic National Agriculture Markets (e-NAM).
• Benefit à NWR prevents the distress sale of agricultural produce. Farmer can wait and watch for the prices to improve before selling, while his crop is safely stored in the warehouse.
• 2017: Govt launched Electronic Negotiable Warehouse Receipt (e-NWR) to prevent tampering, frauds & loss of the receipt. Unscrupulous farmers will not be able to sell the same receipt to multiple buyers or get multiple loans from multiple banks.
• Budget-2020: Negotiable Warehousing Receipts (e-NWR) will be integrated with e- NAM portal.

Loan waivers for the farmers #

• Budget 2008: Agricultural Debt Waiver and Debt Relief Scheme (ADWDRS). On their outstanding crop-loans upto 29/Feb/2008→
• Small and marginal farmers given 100% debt waiver;
• Other farmers were given 25% debt relief
• Department of Financial Services → paid the dues to the banks in a phased manner on behalf of farmers → 2009: 15th Lok Sabha Election won by UPA/Congress.
• 2016-18: The state governments of Tamilnadu, Maharashtra, Karnataka, Uttar Pradesh, Jammu Kashmir, Punjab, Chhattisgarh Andhra Pradesh, Telangana et al. also launched similar debt waiver and debt relief.
• 2017: Budget gave 60 days interest waivers to farmers on account of the problems farmers suffered during demonetization in 2016.

Advocating for Agricultural Development Relief: Farm Loan Waivers and Their Rationale #

• 2002 onwards: BT cotton was approved → boost in agriculture production & income.
• 2008: Post-subprime crisis and global financial crisis, the demand for textile declined in the international market → cotton prices fell in India → farmers suffered.
• 2014: drought, 2015: again drought. Agri growth in zero to negative territory.
• 2016-17: Demonetization → cash shortage → price of agricultural commodities fell.
• Thus farmers are suffering for a decade (2008-18), as evident from the violent agrarian agitations in Madhya Pradesh, Uttar Pradesh and Maharashtra in 2017 and 2018. While corporate borrowers are eligible for loan restructuring, farmers are not given such benefits. So farmers should be given a loan waiver.
• “Debt overhang”: a situation where all current income gets used up in repaying the accumulated debt. Farmer feels no motivation to invest in his ‘business’. Debt waiver cleans up his liability. It’ll spare his income /savings for investing in better seeds/fertilizers and machines. (Counter: ES20 found no such evidence.)

Critiquing Agricultural Development Relief: The Pitfalls of Farm Loan Waivers #

• Moral Hazard: Lack of incentive to be “disciplined”, when risky behavior is insured by someone. If the government continues to give loan waivers, farmers will have no discipline to be efficient, cost-savvy and hard working.
• “Loan waivers undermine honest credit culture. NPA problem will get aggravated.”, said RBI Governor Urjit Patel.
• Whenever elections are near, agri-loan defaults are increasing. It hints farmers are strategically defaulting on loans, in anticipation of waiver.
• Consequently, neither agricultural investment nor productivity is increasing.
• Thus, Government Intervention has hurt more than it has helped, says ES20.
• Loan waivers → Higher fiscal deficit → households and business firms will be hurt.
• Total farm loans: ~5 lakh cr (2013). Out of that ~60% by formal lenders (banks, Microfinance etc.) Rest by informal money lenders. So even if loan waivers are announced, all farmers will not benefit from it.
• The Government’s expenditure on healthcare is ~1.2% of GDP. WHO recommends 5%. If all the farm loans are waived it will cost 1.5% of GDP. So, if the government has so much spare money to spend, it’ll be better to spend on public healthcare which will benefit both farming and non-farming families.

Anti-Argument: Loan waiver will not stop farmer suicide Farmer suicide is a result of: #

• Lack of marketable surplus produce because they’ve small landholding, lack of irrigation, high yielding seeds and fertilizers.
• Lack of remunerative prices because of challenges in APMC, MSP and transport-storage infrastructure.
• Lack of financial inclusion and financial planning. Even after a good monsoon and good harvest, they waste money on social events and pilgrimages.
• So, loan waiver is a short-term remedy that can’t prevent farmer suicide until above three issues are addressed.

ES2017: cited similar reasons to prove, Loan waiver will not increase our crop production or GDP growth. 

Navigating Agricultural Development Challenges: Seeking Sustainable Solutions for Farmer Well-being

From the aforementioned analysis, it’s evident that farm debt waiver will have negative macroeconomic consequences for India. Debt waiver is neither feasible nor sustainable solution against agrarian distress, we should work on more efficient and targeted ways to help farmers. 

Agricultural Development: Risk Reduction and Insurance #

• Though the agriculture sector is a minor contributor to India’s GDP, a large proportion of our population depends on agriculture. Agriculture itself depends on monsoon, pests, disease and other vagaries of nature. But insurance penetration & insurance density is low in India.
• 2002: Agriculture Insurance Company of India Ltd. (AIC) was set up.
• The Agro Ministry launched Pradhan Mantri Fasal Bima Yojana (Core scheme) and other crop insurance schemes.
• Challenges à State Governments not paying their share of money in PM Fasal Bima Yojana , private insurance companies rejected / delaying claim settlements.

Agricultural Development: Issue of Burning Crop Residue #

• Every year during Sept-October, farmers of Punjab, Haryana, Uttar Pradesh burn the paddy stubble & residue which are left over from previous cropping season. Burning clears the farm land for sowing wheat for next cropping season.
• Result à Thick smog, air pollution, particulate matter (PM 2.5) in Delhi.
• Open burning of crop residues has ill effects on soil organic carbon and soil fertility

Solutions

In-situ composting Machines like Rotary Slasher, Zero Till Seed Drill, Rotavators, ‘Happy Seeder: They help in wheat sowing without having to get rid of paddy straw on the land. 2015: National Green Tribunal order → Burning crop residue is a crime under Section 188 of the IPC and under the Air and Pollution Control Act of 1981 Budget-2018: Union to give 100% funding to Punjab, Haryana and Delhi to tackle this menace. Further, individual farmers are given subsidies for such machinery purchase. ES20: PM2.5 emission (g/Kg) from burning crops: Sugarcane (12.0) > Maize (11.2) > Cotton (9.8) > Rice (9.3) > wheat (8.5). So, we should promote low lignocellulosic crop residues like rice, wheat, maize etc. Setup biomass depots for storage of baled crop residues. from there: o Thermal power plants to use crop residues with coal. o Biochar briquettes as fuel for local industries, brick kiln and hotel/dhaba

  

Agricultural Development: APMC and Agri-Selling #

• In Post-independent India, despite the abolition of zamindari, the farmers were not ‘liberated’ from exploitation. Because, the goons of local Baniyaa or money lender would forcibly take away the farmers’ harvest without paying sufficient money. So, state governments enacted APMC laws that “first sale of agriculture produce can occur only at the market yards / Mandis of Agricultural Produce Market Committees (APMC).”

Issues with APMC: #

• APMC trustees (office bearers) are politically influential persons. They enjoy a cozy relationship with the licensed commission agents. These agents then form a cartel, manipulate prices and deprive farmers of remunerative prices; they also engage in hoarding & artificial shortage of food supply in the retail market, thereby driving up the food inflation for profiteering.
• APMC trustees lack the managerial skill / vision for vertical integration with food processing industries.
• WhiletheseMandischargemultipleentry,exitandotherfees.Butmoneyissiphoned off → poor infrastructure, lack of cold-storage and transport facilities → substantial waste of fruits & vegetables despite bumper harvests in good monsoon years.

Model APMC Act #

• Since agriculture is a state subject, ultimately state governments have to reform their archaic laws. Union Government already circulated a model APMC Act, 2003
• It allows the private entrepreneurs and cooperatives to set up their parallel markets, & sell directly to consumers
• It allows the corporate companies to engage farmers in ‘contract farming’ and directly purchase the produce from farmgate. Further, Union Government released
• Model Agricultural Produce and Livestock Marketing Act 2017 (APLM) → it has better features than the above model act, covering both Agro commodities as well as livestock, fisheries and poultry.
• Model Contract Farming Act, 2018 → (concurrent list) → aims to protect farmers engaged in contract farming with better features than model APMC act 2003.
• 2016: NITI Aayog launched Agricultural Marketing and Farmer Friendly Reforms Index (AMFFRI) to rank States and UTs. It has a score of 0-100. No state has achieved a 100 score yet.

Q. In India, markets in agricultural products are regulated under the (CSE-2015) Essential Commodities Act, 1955 Agricultural Produce Market Committee Act enacted by States Agricultural Produce (Grading and Marking) Act, 1937 Food Products Order, 1956 and Meat and Food Products Order, 1973

    

Agricultural Development: E-National Agriculture Market (e-NAM) and Online Agri-Selling #

• Nodal à Agro Ministry (2016) → Small Farmers’ Agribusiness Consortium (SFAC)
• Central Sector Scheme = 100% paid by Union.
• e-NAM aims to connect the existing 580+ APMC mandis across India through a web portal, thus enabling interstate and intrastate (within state) trade of agricultural commodities.
• It will also remove the information asymmetry between buyers and sellers, and help in real time price discovery based on actual demand and supply.
• 2019-Nov: FM Nirmala. S says State Governments should dismantle the APMC-mandis & replace them with E-NAM Mandis so farmers can get a better price for their produce.
• Budget-2020: Negotiable Warehousing Receipts (e-NWR) will be integrated with e- NAM. This will help merchants buy e-NWR from the E-NAM portal.

Criticism of e-NAM #

• While the portal was launched for namesake in 2016, but, first inter- state trade started only in 2019.
• Only 16 states have so far connected their mandis with the web portal.
• Many APMC mandis lack quality-check labs for grading of the commodities before online auction- so buyers are hesitant to purchase.
• Delays in the actual delivery.

Other initiatives for Online Agri-Selling #

• Coffee Board (a statutory body under Commerce Ministry) has launched blockchain based coffee e-marketplace.
• e-Rashtriya Kisan Agri Mandi (e-RaKAM) 2017: portal is a joint initiative by state-run- auctioneer Metal Scrap Trade Corporation Limited (MSTC- a Government company under the Steel Ministry) and Central Warehousing Corporation (a statutory corporation under Consumer Affairs Ministry). It helps farmers to sell agricultural produce.

Q. What is/are the advantages/advantages of implementing the ‘National Agriculture Market’ scheme? (CSE-2017) It is a pan-India electronic trading portal for agricultural commodities. It provides the farmers access to nationwide markets, with prices commensurate with the quality of their produce. Both a and b Neither a nor b

  

Gramin Agricultural Markets (GrAMs) #

• Nodal à Agro Ministry (2018) → NABARD fund for Agri-Market Infrastructure Fund (AMIF).
• Gramin Haats are owned by Local Bodies (Panchayats/councils), Agricultural/ Horticultural Departments of State Govts, Cooperatives, APMCs and Private Sector. Total ~22,000 of them. Whereas APMC mandis are barely 580 plus.

Budget-2018: # We will upgrade Gramin haat into GrAMs. We’ll link them with e-NAM. So, farmers can directly sell from nearby Gram Haat, instead of transporting the produce to the APMC Mandis at the district level.

  

Agri Export Policy, 2018 #

• Nodal à Commerce Ministry
• Since the economic reforms began in 1991, India has remained consistently a net exporter of agri-products i.e. we export more than we import, in value terms.
• 2018-19: India’s Largest Agri-export (Value wise): Rice > Oil meals> Sugar > Fresh Vegetables > Cotton > Spices
• Oil meals are leftovers after oil extraction. It’s used as fish food, animal food & fertilizer. E.g. de-oiled soya extract, groundnut oil cake etc.
• Target à To double agricultural exports from present ~US$ 30+ Billion to ~US$ 60+ Billion by 2022 and reach US$ 100 Billion in the next few years thereafter.
• To diversify our export basket e.g. Wild Herbs, Medicinal Plants, Aromatic Oils, Frozen vegetables; Biscuits, Confectionery & Processed Food etc.
• To diversify destinations e.g. Biscuits to Uganda, Nigeria, Kenya. (because Americans are unlikely to be attracted to our Parle-G biscuits.)
• To boost value-added agricultural exports e.g cashew apple jams , flavoured / roasted cashew, etc. instead of exporting raw cashew.
• To help exporters with sanitary and phyto-sanitary (SPS) issues via APEDA, FSSAI and other bodies. So their products are not banned by the US/EU on the allegations of pesticide residue / pathogen / fruit fly contamination.
• To focus on branding, packaging & marketing of Indian ethnic products e.g. canned Indian cuisine like Sarson Da Saag, Makhana from Bihar, Agra petha, Hyderabadi biryani in overseas markets.
• To focus on R&D for gluten free, fibre rich products to cater health conscious consumers overseas.
• Encourage private investments through Ease of doing biz. in export oriented activities: cold storage, packaging, air cargo; Creation of Agri-start-up fund.

Conclusion à Thus, this policy will help integrate Indian agricultural products with the global value chains and help doubling farmers’ income by 2022.

  

INCOME SUPPORT FOR FARMERS 2018: #

• NABARD released the All India Rural Financial Inclusion Survey.
• Total ~21 crore rural households. Out of them ~10 crore engaged in agriculture.
• These agricultural households’ average monthly income is ₹ 8900/-
  • Out of that agriculture cultivation brings barely ₹ 3100.
  • Rest of the income comes from livestock, wage labour, MNREGA etc.
• Thus farming is not a very profitable enterprise in India.

ES2018 noted: Climate change’s negative impact is twice on unirrigated farms than irrigated. With higher temperature and shorter rainfall: income fall will be 15-18% (for irrigated farm), 20-25% (for unirrigated farm).

• Present government has a target of doubling the farmers income (from base year 2015-16) in 2022-23. But for that agricultural sector must grow at 10% annually whereas it’s struggling to grow even at 5%. Therefore, Govt. intervention is necessary in the form of subsidies, procurement, MSP and minimum income support (PM-KISAN at 6k/pa).

MINIMUM SUPPORT PRICES (MSP) #

• Under the State APMC Acts, the first sale of agricultural commodities can occur at Agricultural Produce Market Committee (APMC) Mandis only.
• However, a farmer may not get remunerative prices at the Mandi due to following reasons:

1. 1. Bumper production /supply which brings down the market prices AND / OR
   2. Cartelization / price-fixing by the mandi-merchants.

• So, to protect the farmers, the Government of India announces MSP before each crop sowing season.

MSP covers which crops? #

For 22 crops (MSP) + 1 sugarcane (FRP) = 23 viz. 

14 kharif crops	Kharif: Grown In Summer / Monsoon Season. Paddy, Jowar, Bajra, Maize, Ragi, Arhar, Moong, Urad, Groundnut. In-Shell, Soyabean, Sunflower, Sesamum, Nigerseed And Cotton;
6 rabi crops	Rabi: grown in winter season. Wheat, Barley, Gram, Masur(Lentil), Rapeseed/Mustard And Safflower
3 commercial\cash crops	Jute, Copra and Sugarcane. For Sugarcane, the mechanism is different: It requires the sugar mill companies to pay the minimum Fair and Remunerative Price (FRP) fixed by Govt. (Whereas for other 22, Govt itself procures @MSP)

  

Q. Consider the following: (CSE-2018) Areca nut Barley Coffee Finger millet Groundnut Sesamum Turmeric The Cabinet Committee on Economic Affairs announces MSP for which of the above? 1, 2, 3 and 7 only 2, 4, 5 and 6 only 1, 3, 4, 5 and 6 only 1, 2, 3, 4, 5, 6 and 7

  

MSP computation, Swaminathan Committee? #

• Agro Ministry’s Commission for Agricultural Costs and Prices (CACP) recommends MSP (& FRP for sugar) → Cabinet Committee on Economic Affairs (CCEA) chaired by PM approves & announces MSP.
• CACP’s computation method is →

A2	Actual costs directly incurred by the farmer on seeds, fertilizers, pesticides, hired labour, depreciation on farm buildings & machinery, interest on working capital, diesel/electricity for tractor/ pump sets etc.
FL	Imputed cost of (unpaid) family labour.
(A2+FL) 1.5 times	This will be the official MSP. (from Budget-2018 onwards). So farmers see 50% profit on this cost of production.

•  The National commission on farmers (2006) headed by Scientist MS Swaminathan had suggested 50% profit but using a different ‘C2 formula’, but,
• C2 formula computed lot of costs, including imputed rent on his own land and imputed interest on his own capital etc. (i.e. what if farmer had leased the farmland or gave his savings as loan to someone else, instead of farming by himself, then how much rent / interest would he have earned?)
• If govt. used C2 formula, MSP will become very high due to aforementioned (hypothetical) imputed costs → higher budgetary allocation, fiscal deficit will increase. So, the Govt is using the A2+FL formula only.

Q. The Fair and Remunerative Price (FRP) of sugarcane is approved by the (CSE-2015) Cabinet Committee on Economic Affairs. Commission for Agricultural Costs and Prices. Directorate of Marketing and Inspection, Ministry of Agriculture. Agricultural Produce Marketing Committee.

  

Agricultural Development: MSP and Procurement #

• Central agencies namely, Food Corporation of India (FCI), Cotton Corporation of India (CCI), Jute Corporation of India (JCI), Central Warehousing Corporation (CWC), National Agricultural Cooperative Marketing Federation of India Ltd. (NAFED), National Consumer Cooperative Federation of India Ltd. (NCCF), and Small Farmers Agro Consortium (SFAC) will purchase the entire quantity offered by the farmers at MSP.
• So, it’s also called ‘Open Ended Procurement’ e. whether a farmer brings a specific kilo, Govt agencies will buy it, without any ‘quota’ for every farmer.
• Collectively, this entire mechanism is called Market Intervention Scheme and Price Support Scheme (MIS-PSS).
• Nodal à Agro Ministry. Central Sector Scheme = 100% paid by Union. From Food Corporation of India’s point of view, the economic cost of food grains is:

1. MSP paid to farmers (technically called ‘Pooled cost of grains bought at MSP’)
2. + Bonus paid to farmers (if any. This is usually announced during election season for Vote bank appeasement)
3. Procurement Incidentals: paid to truck drivers, loaders, diesel, cost of operating godowns etc.
4. Cost of Distribution: When delivering grains to States for their Public Distribution System (PDS) shops, National Food Security Act (NFSA), Mid-day-meal schools etc.

Q. The economic cost of food grains to the Food Corporation Of India is Minimum Support Price and bonus (if any) paid to the farmers plus______ (CSE-2019) Transportation cost only Interest cost only Procurement incidentals and distribution costs Procurement incidentals and charges for godowns

  

Benefits of MSP #

• Farmers always have the option to sell produce to the government, if he can’t get remunerative prices from private merchants. It prevents distress-sale of produce at throwaway prices to private merchants.
• Government announces MSP before the sowing season for 23 crops including cereals, pulses, oilseeds & certain cash crops. This advance information helps the farmer to make an informed decision about which crop to sow for maximum economic benefit within the limitations of his farm size, climate and irrigation facilities.
• MSP sends a price-signal to the market that if merchants don’t offer higher than MSP prices the farmer may not sell them his produce. Thus MSP serves as an anchor or benchmark for the agro-commodity market. While MSP doesn’t guarantee that market prices will always be higher than MSP, at least it ensures the market prices will not be drastically lower than MSP.

Limitations of MSP #

• FCI/NAFED procurement is usually confined to big towns and district centres. Farmers in remote & tribal areas unable to bring their produce to the procurement agencies due to high cost of transportation.
• 1997: Government launched Decentralized Procurement (DCP) wherein State Government themselves procure wheat and rice from farmers, & Union will bear the costs. But not much success in increasing the penetration yet.
• Procurement is usually confined to rice and wheat (cereal grains). Not done for pulses, oilseeds and other crops. So, aforementioned benefits of MSP remain ‘only on paper’, they are not implemented in reality.
• MSP is not even announced for vegetables and fruits.

Agricultural Development: PM-AASHA to Fix MSP #

• Pradhan Mantri Annadata Aay Sanrakshan Abhiyan.
• Nodal à Agro Ministry (2018-Sept). Central Sector Scheme = 100% funded by the Union. The scheme has three components:
  • Price Support Scheme (PSS): Central Agencies will henceforth also do physical procurement of pulses, oilseeds and Copra.
  • Price Deficiency Payment Scheme (PDPS): If Farmers sell oilseed crops to private merchants in APMC-mandis who are paying them less than MSP price, then the government will directly transfer the difference money in the farmer’s bank account.
  • Private Procurement Stockist Scheme (PPSS): Private agencies will be hired for procuring the commodities at MSP on behalf of Govt.

FCI BUFFER STOCK PROBLEM #

• 1964-65: Food Corporation of India (FCI, HQ-Delhi), a statutory corporation, setup under Consumer Affairs Ministry
• Procurement of foodgrains from farmers at Minimum Support Prices
• Distribution of foodgrains to consumers through Public Distribution System (PDS)
• Maintenance of buffer stock for food related schemes and to meet emergency situations like unexpected crop failure, natural disasters, festivals, etc.

Agricultural Development: Problems of FCI #

• Due to electoral populism, successive Governments kept increasing MSPs → MSP is no longer ‘minimum support price’ but rather maximum offered prices as rarely any private trader is matching that amount. Consequently, 80-90% of rice and wheat in Punjab- Haryana is procured by FCI only.
• This discourages the private sector to undertake long-term investments in procurement, storage and processing of these commodities.
• 2019: Food Corporation of India’s (FCI) godowns are overflowing with three times the buffer stock requirement. So:
  • Started Open market sale.
  • Exploring to donate it to the poorest nations of the world.
  • FCI was forced to spend a large amount of ₹₹ for acquiring, storing and distributing foodgrains. But the Government is not releasing subsidy / funds to FCI in a timely fashion. FCI is forced to borrow money.
• Thus, Government Intervention has hurt more than it has helped.

Solutions by ES2020
National Food Security Act (NFSA):	It aims to provide rice (₹3/kg), wheat (₹2/kg) and coarse grains (₹1/kg) at heavily subsidized prices to 67% of the Indian population. We should reduce the number of beneficiaries to the bottom-20% poorest Indians. For ‘relatively less poor’ people, the Govt should charge slightly higher prices.
Conditional Cash Transfer Schemes:	Brazil (Bolsa Familia), Mexico (Oportunidades), Philippines (Pantawid Pamilyang Pilipino). Here poor families are given money to buy (non-subsidized) foodgrains from the market. We should explore similar ways of giving cash/food coupons/smart cards to reduce the FCI’s procurement and stock keeping burden.

  

Agricultural Development: Agri-Selling – Storage and Transport Measures  #

Budget-2020 announced: #

Kisan Rail	Indian Railways with refrigerated coaches in trains. This will improve the national cold supply chain for perishables, milk, meat and fish.
Krishi Udaan	The Ministry of Civil Aviation will permit new flights on international and national routes to transport agricultural cargo. This will help farmers of North-East and tribal districts to sell their exotic fruits/flowers at premium prices.

• We’ll encourage the Warehousing Development and Regulatory Authority (WDRA), Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) to build more warehouses. [All these are bodies under Consumer Affairs Ministry]
• We’ll launch a Village (grain) Storage scheme using Self-Help Groups (SHG). (Details yet to be finalized)

Agricultural Development: PM-KISAN Income Support Scheme #

• Pradhan Mantri Kisan Samman Nidhi à Income Support Scheme
• Nodal à Agro Ministry. Central Sector Scheme = 100% paid by Union.
• Beneficiary à Originally, A small / marginal farmer family comprising husband, wife and minor children -who collectively own cultivable land upto 2 hectare as per the land records of the concerned State/UT. (2 hectare = ~5 acres). However, 2019-May: After the General Election, the Modi 2.0 Government will remove the land holding ceilings. Now the scheme is available for all farmers, irrespective of farm size.
• Entitlement à Direct Benefit Transfer (DBT) of ₹ 6000 per year in three equal installments (₹ 2000 x 3) in the beneficiary’s bank account. Thus, eliminating middlemen and corruption.

PM-KISAN Scheme Announcement and Launch Details #

• 1/2/2019: PM-KISAN scheme announced for the first time in interim budget 2019 & allotted annual ₹ 75,000 crores for Financial Year 2019-20.
• 24/2/2019: Modi formally launched from Gorakhpur, UP.
• The benefits are given with retrospective effect from 1/12/2018 (so, addl. ₹ 20k crores are allotted for this previous-instalment in revised estimates of 2018-19).
• Farmers may show Aadhar card, Driving License, Voters’ ID Card, MNREGA Job Card etc. State authorities will cross check it against their land ownership database.
• Aadhar card is kept optional for the 1st and 2nd installment. But, in subsequent installments, Aadhar will be compulsory for farmers for verifying their identity.
• Mobile number is optional but State Govt are encouraged to capture it.
• Compulsory to give Bank account number and its IFSC code (This code is written on bank’s passbook, helps identify the name of the bank and address of the branch.)
• Mechanism → Union ₹ → State govt’s bank account → beneficiary’s account. States send data to http://pmkisan.nic.in portal.
• Complaint à District Level Grievance Redressal Committees.

PM-KISAN: Criticism And Challenges #

• If a farmer’s name is not in the land records of State/UT then he’s not eligible. This excludes:
  • Landless / tenant farmers – who cultivate someone else’s land on contract.
  • Tribal farmers who may not have land ownership documents.
• It excludes farmers with land above 2 ht. But in drought prone / rain-fed areas, even they require income support because their income is low.
• ₹ 6000 rupees per year is too little to cover the cost of seeds, fertilizers, wages of farm labourers. For a 2 ht land, minimum input cost is ~₹ 50k in reality.
• Some state governments are running better schemes on their own e.g. Telangana’s Rythu Bandhu, Odisha’s KALIA scheme etc. Either they give more ₹₹ per farmer and/or even landless farmers given some ₹₹.
• Counter-argument à Union government has launched a scheme within the constraints of fiscal deficit target. The 15th finance commission has provided 41% tax devolution to the states so they may run parallel schemes with their own ₹₹ for the farmers’ welfare. PM- Kisan is a better alternative than one-time loan-waivers.

Pension: PM Kisan Maan Dhan Yojana #

• 2019-August launched on the similar lines as Shram-Yogi Maan Dhan Yojana.
• Voluntary and co-contributory for small / marginal farmers in the 18 to 40 years age group.
• They’ve to contribute ₹ 55-200 (depending on which age they joined). The Agri Ministry will co-contribute money. LIC is the fund manager, and responsible for Pension pay out.
• They get a monthly pension of ₹ 3000/pm on attaining 60 years. Husband dies → wife gets ₹ 1500/pm as ‘family pension’. Wife dies → children get nothing.

Exclusions from PM-KISAN Scheme #

• Small / marginal farmers who joined Pradhan Mantri Shram Yogi Maan Dhan Yojana, NPS, EPFO or any other Government run pension scheme.
• Farmer who owns more than 2 ht cultivable land.
• Any income tax assessee; Any registered as Doctors, Engineers, Lawyers, Chartered Accountants etc; Any Government employee; Any person who is a member in local bodies, State / Union legislature…. Even if they own 2 ht or less farmland, they’ll not be eligible for this scheme.

Conclusion: #

Successive economic surveys have noted that farming is not a profitable enterprise in India. However, an Indian farmer is often at the mercy of the monsoon & the APMC-merchants. PM KISAN income support scheme / PM Kisan Maan-dhan Yojana is a notable initiative to empower him. 

Consumer Food Inflation and Its Connection with Agricultural Development #

• With the green revolution, we became self-reliant in cereal production. But perishable fruits and vegetables have remained our Achilles’ heel. Seasonal spikes in onion, tomatoes & pulses is a recurring nightmare for middle class families of India. The underlying causes as following:

Demand Side:	Growth of middle class & their disposable incomes → increase in demand for fruits/veggies than before.
Supply Side:	Shortage of commodities on account of: Poor monsoon & pests Post-harvest losses due to unavailability of cold-storage & warehousing Hoarding

Consumer Food Price Index (CFPI) by NSO, Base year-2012

Food Inflation due to shortage of Vegetable supply #

• Global Warming: April-May heat waves destroy nascent flowers / buds of vegetable plants.
• Pests & Diseases: Maharashtra and Southern Indian farmers have been growing tomatoes & onions since the last 3 decades. But, overuse of general pesticides → whiteflies, red mites, gram pod borers and other pests have gained immunity. → crop- loss has increased. Farmers had started using Swiss-MNC developed seeds but later they were found to be vulnerable to certain viral diseases.
• UPA-Congress Govt (2004-14) had rapidly hiked MSP for wheat & rice so many farmers shifted from veggies / pulses to cereal production.
• After demonetization (2016), cash -based retail vegetable industry suffered → lower prices to farmers in the last season. So they shifted away from vegetables towards sugarcane, maize, soya etc. cash & cereal crops → veggies production decreases.
• Price wedge = large difference between the wholesale and retail prices. It’s due to high transaction costs, poor marketing infra, huge margins by middleman etc
• Heavy rains, floods and cyclones disrupt the supply chains. Farmer strike in Maharashtra, UP & MP, wherein they destroyed truckloads of tomatoes, milk, potatoes etc. to vent their grievances.
• Shortage of cold storage infrastructure. Big traders utilize them for hoarding onions and potatoes, → less space for other vegetables’ storage even during bumper crops.
• 2019 (Sept-Dec): Onion Shortage caused by:
• Late-arrival of monsoon: sowing period delayed.
• Prolonged rains damaged the standing crop in the Major producers viz. Karnataka, Telangana, Madhya Pradesh and Maharashtra (largest producer: Its Lasalgaon town in Nasik district is India’s largest onion market).
• 2019-Sept-Oct: Heavy rains affected cutting and transportation of the crop.
• So, [Supply < Demand] = Onion prices increased to ₹140/kg in late-2019.

Pulses Shortage and the Cobweb Cycle: Impact on Food Inflation #

• Finest irrigated land used for cereal and cash crops like sugarcane because of better MSP. So pulses’ area under cultivation is declining. The Government should tweak the MSP for pulses cultivation, especially in rain-fed areas because pulses require less water than sugarcane.
• Pulses make the soil nitrogen rich, it encourages weed growth- which harms the pulses yield. Pulses are themselves protein rich, so they’re more susceptible to:
  • Pests attack
  • When stored in open godowns, humid conditions = fungal growth. 25% of the produce is lost by this.
• Solution à New seed varieties required but Indian scientists are always focused on ‘cereals’ rather than ‘pulses’.

Cobweb Cycle #

• If a farmer observes a high price for a specific crop for a year, he would opt to produce more of it the next year.
• But if all farmers think with this mindset → excessive production & supply → prices decreases → then they stop cultivating it in the next cycle → shortage in supply→ price increases.
• Faulty producer expectations → cyclical fluctuation in supply & prices.
• This is called the ‘Cobweb’ Cycle. Term given by economist Nicholas Kaldor (1934)

ES2020 blamed this phenomenon for price fluctuations in pulses.  #

Government Initiatives to Tackle Food Inflation: MEP, Hoarding Regulation, and MIP #

• Minimum Export Price (MEP) It is the price below which commodities cannot be exported from India. During inflation in a particular agricultural commodity, the commerce ministry will raise MEP to discourage its export from India and increase its availability in the local market.
• Limitation à Frequent revisions in MEP creates uncertainty for export-oriented farmers for the next cropping season.
• Hoarding by big traders to create artificial shortage & food inflation. Essential Commodities Act (1955) if the Union finds that a certain commodity is in short supply and its price is spiking (agro, fertilizer, edible oil etc.) then it can notify stock-holding limits for a specified period.
• Limitation à The state govts. have to enforce it. But not done in letter and spirit due to nexus between politicians & big traders who provide them election funding.

Minimum Import Price (MIP): it’s the price below which a commodity can’t be imported. This is usually done for protecting domestic industries against cheap imports. E.g. Government imposed MIP on pepper and arecanut in 2018-19

 

Government Interventions: FCI and Open Market Sale Scheme (OMSS) #

• 1964-65: A statutory corporation Food Corporation of India (FCI) was set up under Ministry of Consumer Affairs, Food and Public Distribution –
• By default, FCI procures cereals/foodgrains at MSP & sells them to poor-families via the Public Distribution System (PDS) outlets.
• However, during food inflation, FCI would also sell the grains in the open market to increase supply and curb price rise. This is called the Open Market Sale Scheme.
• Limitation à While OMSS can help during shortage / inflation of cereal grains (rice, wheat). But, not much use in veggies because they’re out of FCI-MSP ambit.

Price Stabilization Fund (2014) #

• PSF is a Central Sector Scheme = 100% funded by the Union.
• Nodal à Govt gives Interest free loans to FCI, NAFED & other central/state agencies to procure pulses and perishable vegetables from local and foreign farmers and sell it to the common man at reasonable prices.
• 2014: set up in the agriculture ministry but 2016: shifted to the Consumer Affairs Ministry.

Operation Greens for T-O-P (2018) #

• Nodal à Food Processing Ministry → NAFED given ₹ 500 crore.
• NAFED pays money / subsidy to the farmer self -help groups, food processing companies etc. for processing, transportation & cold storage of Tomato, Onion and Potato (TOP), to ensure their round the year availability in the market at a reasonable price.

Onion Inflation (2019-Sept to Dec) #

• Commerce Ministry → DG Foreign Trade → temporarily banned the export of Onions from 2019-Sept. (Although Andhra’s Krishnapuram onions were allowed for exports. They are extremely pungent in taste, liked by Srilankan and ASEAN families. But, Indian families don’t like its taste much.)
• Income Tax officers raided onion traders for verifying stocks and finding tax evasion.
• Commerce Ministry’s MMTC Ltd. company will import onions from Turkey & Egypt using the ₹₹ from Price Stabilisation Fund (It’s a fund under Consumer Affairs Ministry) → These onions will be supplied to State Government’s Food and Civil Supply Departments → sold at reasonable prices.
• Government also directed the States to build buffer stocks, impose stock limits on traders and take action against hoarding.
• Long term solutions à Help the farmers cooperatives to directly sell to customers, strict action on hoarding, develop more cold storage warehouses etc.

ECA Act harms, says ES-2020 #

• Essential Commodities Act 1955 (ECA) aims to control the production, supply and distribution of certain goods considered as essential commodities e.g. foodgrain, pulses, edible oil, sugar, jute, fertilizers & seed, cattle-fodder, medicines, petrol, diesel, kerosene, etc.
• The Ministry of Consumer Affairs itself does not lay out Rules and Regulations but allows the State Govts to issue Control Orders related to dealer licensing, stock limits, restrict movement of goods and compulsory purchases during emergencies.

ES2020 Findings on Government Interventions in Onion Inflation (2019) #

• 76,000+ raids were conducted, yet, less than 3000 traders were penalized. It hints that raids are misused for bribery and harassment.
• Assuming every raid needs a minimum of 5 govt officials, this is a waste of manpower as well.
• Under ECA, State Governments randomly impose stock limits on all wholesalers, distributors, and retailers. But, these raids and stock limits had no impact on decreasing onion inflation (2019) or pulses (2006) or Sugar (2009).
• In fact, ECA discourages traders from investing in warehousing and storage facilities. It discourages entry of large private sector players into agricultural warehousing and marketing.
• The ECA Act does not distinguish between genuine large firms that need to hold large amounts of stock vs a greedy trader hoarding speculative profits.
• ECA Act was passed in 1955 when India was worried about famines, shortages, speculative hoarding and black marketing; it is irrelevant in today’s India and must be discarded.
• Because here, Government Intervention has hurt more than it has helped.

Food Inflation and Its Implications on Nutritional Security and Export Competitiveness #

• Vegetables and pulses are a rich source of vitamins and nutrients. They’re part of large varieties of Indian and international cuisines. Therefore, food Inflation is a matter of concern for:
• Nutritional security in India and
• India’s export competitiveness. Hence aforementioned factors need to be addressed on priority basis.

Q. India has experienced persistent and high food inflation in the recent past. What could be the reasons? (CSE-2011) Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased in the last five years by about 30%. As a consequence of increasing incomes, the consumption patterns of the people have undergone a significant change. The food supply chain has structural constraints. Answer Codes: 1 and 2 only 2 and 3 only 1 and 3 only 1, 2, and 3

  

Agricultural Development and Deflation (2017 Onwards) #

• While agri. Inflation was a recurring nightmare during UPA-Congress raj (2004-14), the Modi-raj has resulted in food-deflation (fall in the prices) for 3 reasons:
• Demonetization, limits on cash transactions and fear of being tracked by IT/GST authorities → Traders are less inclined to hoarding → more supply available at market.
• Protectionism by US/EU & fall of International commodity prices → India’s agro exports are down → More supply available in domestic market.
• Urjit Patel’s hawkish policy helped curbing inflation.

Agricultural Development and Sugar Mills Challenges #

• Bumper production of sugarcane in India and Brazil → fall in global sugar prices but to keep Indian farmers happy Govt did not reduce FRP → Mill-owners’ arrears to farmers (i.e. previous payment not cleared yet.) → Ministry of Consumer Affairs, Food & Public Distribution gave mill-owners soft loans. It also raised the Minimum Selling Price (MSP) of sugar from factory gate to wholesalers from ₹ 29 → ₹ 31/kg.
• The Finance Ministry imposed 100% custom duty on import of sugar & 0% custom duty on export of sugar to help Indian sugar mills.
• 2019-March: Brazil and Australia filed an official complaint in WTO that Indian Govt’s subsidies/soft-loans/tariff to sugar sector led to excess supply & “depressed” global prices so their local industry is hurt.

OTHER SCHEMES  #

Farmer Producer Company (FPC) – Agricultural Development #

• Western economists had predicted that small farms will eventually cease to exist as big farmers will buy their land, but that hasn’t happened in India. So, the Government decided to enable small farmers to set up companies & combine their landholdings.
• 2003: Companies Act, 1956 was amended to allow a new type of company- FPC.
• FPC is a hybrid between a private limited company (=professional management) and a cooperative society (mutual benefits without excessive weightage to who contributed how much land / share capital.)
• FPC can be set up by a minimum of 10 farmers (no upper limit). However, FPC is not allowed to become a Public Ltd. company i.e. they can’t invite the public at large to invest in their shares/bonds.
• Agro ministry gives them up to ₹ 10 lakh equity support, & additional credit guarantee for bank loans.

RKVY & RAFTAAR (2017) – Agricultural Development #

• Nodal à Agro Ministry. Core Scheme = not 100% funded by the Union.
• Rashtriya Krishi Vikas Yojana (RKVY) started during UPA/Congress (2007).
• 2017: Modi renamed and rebranded it to RKVY-RAFTAAR i.e. Remunerative Approaches for Agriculture and Allied sector Rejuvenation.
• It’s a SUNSET scheme – will expire in 3 years (2017-2020).
• It provides funding for Infrastructure creation (warehouse, cold storage, market facility etc.); training & skill development (Mushroom cultivation, beekeeping, aromatic plant cultivation, floriculture) and financial support to farmers to start agri- enterprise after getting the training.

Agro Prod. & Processing – Green Revolution – Krishonnati Yojana – Agricultural Development #

• Boss à Agro Ministry. Core scheme= not 100% paid by Union.
• It’s a SUNSET scheme 2017 to 2020. (Unless renewed and continued further)
• 2017: Modi made this umbrella scheme by combining the previous 11 Schemes viz.
• Mission for Integrated Development of Horticulture (MIDH): Bee keeping is also promoted in it. One of MIDH sub-mission is ‘Coordinated Programme on Horticulture Assessment and Management using ‘geo-informatics’ (Project CHAMAN) to use space technology / remote sensing data to assess the horticulture production & diseases in India. 2018: Phase-II of Chaman launched.
• National Food Security Mission (NFSM) to increase production of rice, wheat, pulses, millets (coarse cereals) and commercial crops & restore soil fertility.
• 2018 was declared as the “National Year of Millets”. Further, UN & FAO accepted India’s proposal to celebrate 2023 as the International Year of Millets. Because millets are tolerant to drought, climate change, photo insensitive; need less water, provide nutritious elements in poor families’ diet. So, the Govt created two sub-missions.
  • NFSM on Makka and Jau.
  • NFSM on Nutri-Cereals – Jowar, Bajra, Ragi and little millets like Kutki, Kodo, Sawa, Kangni and Cheena.
• NFSM has another sub-mission: National Mission on Oilseeds and Oil Palm (NMOOP) to augment the availability of vegetable oils and to reduce the import of edible oils. Associated term: Yellow Revolution.
• National Mission for Sustainable Agriculture (NMSA) to encourage organic manures, bio fertilizers, cropping practices for soil and moisture conservation measures; Rainfed Area Development (RAD) programme.
  • Sub-scheme: National Bamboo Mission (NBM) to augment the income of farmers. Further, Indian Forest Act, 1927 was amended to exclude bamboo from the definition of ‘trees’. This will encourage bamboo grown outside the forest area without interference from the Forest Department.
• Sub-mission on Agriculture Extension (SMAE): farmers training & skill development with more use of electronic / print media, mobile apps and ICT tools, etc.
• National e-Governance Plan on Agriculture (NeGP-A): to enhance reach of extension services- about cropping methods, market prices etc. to the farmers.
• Sub-Mission on Seeds and Planting Material (SMSP): to promote new technologies in seed production, processing, storage, certification and quality etc.
• Sub-Mission on Agricultural Mechanisation (SMAM): To increase the availability of farm machines to small and marginal farmers. e.g. ‘Custom Hiring Centres’ where they can rent the machines without spending money on individual ownership. encourage R&D for small-sized machineries for small landholdings, hill-areas etc.
• Sub Mission on Plant Protection and Plan Quarantine (SMPPQ): To minimize the damage by insect pests, diseases, weeds, rodents, etc. and to shield our agricultural biosecurity from alien species.
• Integrated Scheme on Agriculture Census, Economics and Statistics (ISACES): For data collection which can be used for R&D and policy making.
• Integrated Scheme on Agricultural Cooperation (ISAC): Give financial assistance for farmers’ cooperatives for agricultural marketing, processing, storage etc.
• Integrated Scheme on Agricultural Marketing (ISAM): To develop online and offline agricultural marketing infrastructure.

PM Kisan Sampada Yojana: Boosting Agricultural Development and Infrastructure #

• Boss à Food Processing Ministry. Core Scheme = not 100% funded by the Union.
• Modi’s PMKSY is an umbrella scheme incorporating previous schemes like Mega Food Parks, Integrated Cold Chain, modernization of reefer vans etc. Basically, funding is given to set up food processing infrastructure / parks / collection centres. E.g. Patanjali Food and Herbal Park at Haridwar, Uttarakhand.
• Budget-2018 launched a new sub-scheme under PM Kisan Sampada Yojana called Operation Greens for T-O-P: Tomato, Onion and Potato.

Animal Husbandry and Livestock Census: Strengthening Agricultural Development #

• DPSP-Article 48: requires the State to organise animal husbandry on modern and scientific lines, preserving and improving breeds, and prohibiting the slaughter of cows and other cattle.
• ES2020: India is the largest producer of milk in the world. Per capita availability of milk and eggs has steadily increased in recent years.

Livestock Census # The Department of Animal Husbandry conducts livestock Census every 5 year since 1919-20. The 20th Livestock Census: data collection started in 2018-Oct. Provisional data released in 2019-Oct. India has the world’s largest livestock population

  

Category (Largest to Smallest)	Census 2018-19 (in million)	% growth / fall to previous census 0.8%	Internal Distribution: More imp for StatePCS Exam than IAS exam
Cattle	192.49	0.8%	» WB>UP>MP>BH>MH> Female Pop>Males. » Indigenous Population is more than Crossbred/Exotic Pop. = In-Milk giving population greater than Dry Population
Goat	148.88	10.1%	RJ>WB>UP>BH>MP
Buffalo	109.85	1.1%	UP>RJ>Guj>MP>Bihar
Sheep	74.26	14.1%	Telangana>Andhra>Kar>RJ>TN
Pig	9.06	-12.0%	Assam>JH>Megha>WB>Chhattisgarh
Mithun	0.38	26.7%	It’s a Buffalo like animal found in Northeast Only 4 States: Arunanchal>Naga>Mani>Mizo
Horses & Ponies	0.34	-46.0%	UP>JK>RJ>BH>Guj
Camel	0.25	-37.5%	Only 4 States: RJ>Guj>Haryana>UP
Donkey	0.12	-62.5%	RJ>MH>UP>Guj>BH
Mule	0.08	-60.0%	info not available in Census document
Yak	0.06	-25.0%	Only 5 States: J&K>Arunanchal>Sikkim>H
Total (Mammal) Livestock	535.78	4.6%	Top 5-States: UP>Raj>MP>W.Bengal>Bihar
Poultry	851.81	16.8%	Top 5-States: TN>Andhra>Telengana>WB>MH

  

Agricultural Development Empowering Animal Husbandry through White Revolution #

• White Revolution Scheme Nodal à Department of Animal Husbandry & Dairying.
• Core Scheme = Not 100% Funded by Union.
• India ranks first in milk production, accounting for 20 percent of world production.
• 1970-1996: Operation Flood in 3 phases, to set up dairy farmers’ cooperatives → increase milk production in India.
• Afterwards, milk production in India has been increasing steadily.
• All India per capita availability of milk is 375 grams per day, it varies between 71 grams per day in Assam to 1120 grams per day in Punjab.
• It is an Umbrella scheme covering many schemes like Dairy Entrepreneurship Development, Livestock Census, National Livestock Mission, Schemes for fodder & vaccination etc.

Notable parts of White revolution are:
Pashudhan Sanjivani	Animal Wellness Programme with emergency helpline Farmers given Nakul Swasthya Patra: An Animal Health card with UID identification number of each animal registered in a National Database.
e-Pashudhan Haat portal	Online portal for connecting farmers with breeders of indigenous bovine breeds so they can connect with each other for bulls, artificial insemination etc.
Rashtriya Gokul mission	Indigenous bovine breeds – conserve them & increase their population. E.g. Gir, Sahiwal, Rathi, Deoni, Tharparkar, Red Sindhi. State govts are given money for establishing Gokul Gram breeding & disease treatment centres.
National Kamdhenu breeding centre	For development and conservation of indigenous breeds in a scientific manner.
Rashtriya Kamdhenu Aayog 2019	Int-Budget-2019 setup this executive body in the Department of Animal Husbandry & Dairying. Goals: Genetic up-gradation of cow resources. Enhance cow productivity through research in organic manure, biogas etc; Cow welfare, cow protection laws. Structure: Chairman with tenure of 2 years. Members from govt, research institutions, social workers etc their tenure depends on govt’s discretion. HQ: New Delhi. Minimum 1 meeting every quarter (3-3 months)

 

Budget-2020 We’ll eliminate following disease by 2025: Cattle: Foot and Mouth disease, Brucellosis Sheep and goat: Peste Des Petits Ruminants (PPR) We’ll use MNREGA workers to develop fodder farms.

 

Navigating Challenges in the Dairy Sector: Global Surpluses, Price Crashes, Farmer Distress, and Societal Implications #

• Post-2017: Excess supply of milk in the global market → crash in milk prices. So, Indian private dairy owners also cut down their procurement prices, resulting in dairy farmers’ distress & agitations. So, farmers spilled milk on highways in protest.
• As an animal gets old & stops giving milk → farmers sell it to slaughterhouses to get money to buy new animals. But, this trade is becoming difficult with rising incidents of Cow-vigilantism → even leather-industry also suffering.
• RCEP Angle.

ES2019: Focus on Small Ruminants #

• Sheep and goat are collectively known as small ruminants
• These small ruminants have higher survival rates under drought conditions compared to bovines: Cattle, Buffalo, Mithun and Yak).
• They can even live on shrubs and trees. Their reproduction rates are higher than large ruminants. Farmers/producers can sell them more frequently & no fear of ‘cow- vigilantism’.
• Thus, small ruminants can help improve income of the small-marginal and women farmers.

Agricultural Development: Fostering India’s Blue Revolution for Sustainable Fisheries #

• India is the second largest fish producer in the world. Majority of our production comes from the inland fisheries sector. It provides employment, income, export earning, nutrition and food security to a large population of the country.
• Nodal à Dept of Fisheries. This is also a core scheme.
• Government gives money for modernization of boats, marketing & cold storage infrastructure. National scheme for welfare of fishermen which gives money for construction of houses, tube wells for drinking water etc. Promote Inland fisheries, aquaculture & pisciculture i.e. raising fish in artificial tanks/ ponds.

Budget-2019: Dept of Fisheries to launch Pradhan Mantri Matsya Sampada Yojana (PMMSY) for infrastructure, post-harvest management, quality control etc.

  

Budget-2020: “Sagar mitras”: these extension workers advise fishermen with processing and marketing. Target to raise fishery export to ₹1 lakh crore by 2024-25. We’ll promote growing algae, sea-weed and Cage Culture (growing of fishes in existing water resources in a net cage which allows free flow of water.)

  

“Pink Revolution”	“Pink Revolution” for the meat and poultry industry, under the Ministry of food processing, however not much in Limelight under the Modi-government.
Yellow revolution	Yellow revolution in oilseed also not much limelight.
‘Honey Mission’	‘Honey Mission’ was launched in 2017 by Khadi and Village Industries Commission (KVIC), a statutory body under MSME Ministry. PM Modi termed it ‘Sweet revolution’.

  

Mariculture à Cultivation of marine organisms in their natural environment in sea upto 12 nautical miles from coast. Just like Agriculture, this is also a State-list subject. 2018: Agro Ministry announced Draft National Policy on Mariculture which encourages State Govts to lease the sea area to private entities & even farming of genetically modified species in enclosed / caged marine spaces.

  

Agricultural Development Driving Innovation: Indian Council of Agricultural Research (ICAR) and Last Mile Connectivity #

• Indian Council of Agricultural Research (1929) is the apex body of agricultural research, education and extension under the ministry of agriculture. ICAR operates through 690 + Krishi Vigyan Kendra which provide last Mile connectivity to farmers and help them adopt the latest cropping technologies.

Agricultural Development: Addressing Challenges in Research & Development for Sustainable Farming #

• ICAR scientists’ salary structures and promotion rules are time-bound and seniority based. So highly intelligent scientists opt for private companies / foreign countries.
• Presently agriculture research funding is <1% of GDP. We need to increase it.
• Government scientists mainly focus on improving quantitative yields. If they also focus on aroma, taste, appearance, calorie, nutrient, antioxidants etc. from wealthy health-conscious urban/foreign consumers’ point of view, then premium varieties can be created to help farmers earn more money. Because our goal is doubling farmer income, which doesn’t necessitate doubling production.
• Indian agriculture research has become ‘cereal centric’. We need to focus on pulses, oilseeds, horticulture and animal husbandry as well.
• Even if research doesn’t drastically improve the quantitative yield, but improves the shelf life of onions, potatoes, tomatoes etc. then also food inflation can be controlled by reducing seasonal variation in the supply.

Agricultural Development: Enhancing Quality in Agricultural Education and Research #

• There is a proliferation of self-financed private agri colleges without sufficient faculties, proper labs or infrastructure.
• Instead of creating more institutions, we should focus on the quality of research and infrastructure in existing bodies.
• ICAR should have UGC-like powers to regulate these private agro. Colleges.
• At least two agricultural universities should be given large grants so they can achieve global status.

Agricultural Development: Strengthening Extension Services for Inclusive Rural Development #

• Definition: Extension service is an informal education process to offer advice, information and training, usually meant for farmers, villagers and women to change their outlook towards their agricultural / economic / health problems.
• Challenge à According to the NSSO survey, ~60% of Indian farmers do not get much agricultural technical assistance from government-institutes. So they rely on progressive farmers, media, and private sellers of seeds, fertilizers, and pesticides- who may not give them unbiased advisory because of their own vested commercial interests.

Usually 5 delivery channels for agri-extension services:  #

Channel	Challenges
Individual counselling via personal meeting, toll-free Helpline & Letters	Geographical each, manpower availability. Barely 1 extension worker available per 800-1000 farmers.
Group counselling via seminar, workshop, group discussion, field visit.	Farmers fear loss of workday, lack of motivation to spend time / travel.
Kurukshetra and other govt magazines / periodicals.	Illiteracy and poverty. then we’ve to use audio-visual methods such as….
Mass Media via Kisan TV (2014) and Public Radio broadcast.	Marginal farmers may not have instruments to watch them. Customized / tailor made advisory / information difficult to deliver.
E-Technology via E-Krishi (Webportal); mKisan (SMS/USSD), Kisan Suvidha App etc	Mass reach is possible because more mobiles and jio 4G effect. Tailor-made advisory can be given.

  

Agricultural Development: Krishi Kalyan Abhiyaan (2018) – Empowering Farmers through Education and Assistanc #

• Nodal à Ministry of Agriculture and farmers’ welfare.
• Validity à Phase1: 1st June, 2018 till 15th Aug, 2018. Phase2: 2nd October, 2018 to 25th December, 2018.
• Aim à Aid, assist and advise farmers on how to improve their farming techniques. Training on Beekeeping, Mushroom cultivation and Kitchen garden. Distribution of soil health cards. The Animal Husbandry ministry will also advise on vaccination, Artificial insemination etc.
• Where à Earlier NITI Ayog had identified certain backward districts & labelled them as ‘Aspirational Districts’. Within these ‘Aspirational Districts’ some villages are covered. So, NOT ALL villages across India are covered.

Agricultural Development: Expanding Extension Services for Sustainable Farming and Global Cooperation with FAO #

Agricultural extension plays a key role in boosting agricultural productivity, enhancing food security, improving rural livelihoods and changing farming practices positively. However, hardly 40% of Agricultural Households are getting access to it. So, we need to enhance the access to extension services on war-footing.

Global Cooperation: Food and Agriculture Organisation (FAO) à FAO is a specialized agency of the UN, setup in 1945 with HQ @ Rome, Italy  #

International Years by UN #

2024	Camelids (group of Camel species)
2023	Millets
2022	Artisanal Fisheries and Aquaculture
2020	Plant Health
2019	1. Indigenous Languages; 2. Moderation; 3. Periodic Table of Chemical Elements
2017	Sustainable Tourism for Development
2016	Pulses

 

(table) International Decades by UN #

2018- 2028	International Decade “Water for Sustainable Development”
2019-2028	1) Nelson Mandela Decade of Peace 2) United Nations Decade of Family Farming
2021-2030	United Nations Decade on Ecosystem Restoration
2021-2030	International Decade of Ocean Science for Sustainable Development

  

Global Cooperation: Misc. → SAARC Food Bank (2007) #

• 2007: South Asian Association for Regional Cooperation (SAARC) countries signed the agreement to establish the SAARC Food Bank.
• The Food Bank will help member nations’ people in case of emergencies.
• Each member country is required to contribute either wheat/rice.
• Stock is kept with respective Govt agencies like FCI. So, Bank doesn’t have a HQ as such.

Global Cooperation: Misc. → International Grains Council (London) #

• HQ: London, for cooperation in wheat and coarse grain matters.
• IGC has two types of members – importing and exporting members. India has been included in the category of exporting member since 2003.

Agricultural Development: Shaping a Sustainable Future for Indian Agriculture #

• Agriculture is the largest sector of the Indian economy in terms of the number of people employed. For their income security, as well as entire India’s food & nutritional security, we’ve to focus on improving soil, irrigation, seed, fertilizers, market reforms etc. schemes are important in that regard.
• And / or to double the farmers income, we’ve to focus on horticulture / floriculture / fisheries / animal husbandry / poultry / food processing / extension services and therefore addressing aforementioned challenges is the need of the hour.

PREVIOUS YEARS MAINS QUESTIONS  #

Syllabus Topic: Major crops cropping patterns in various parts of the country, different types of irrigation and Land reforms in India.  #

How far is the Integrated Farming System (IFS) helpful in sustaining agricultural production?	2019
Elaborate on the impact of the National Watershed Project in increasing agricultural production from water-stressed areas	2019
Sikkim is the first ‘Organic State’ in India. What are the ecological and economic benefits of Organic State?	2018
Assess the role of National Horticulture Mission (NHM) in boosting the production, productivity and income of 2018 horticulture farms. How far has it succeeded in increasing the income of farmers?	2018
How has the emphasis on certain crops brought about changes in cropping patterns in the recent past? Elaborate the emphasis on millets production and consumption.	2018
What are the major reasons for declining rice and wheat yield in the cropping system? How crop diversification is helpful to stabilize the yield of the crop in the system?	2017
What is water-use efficiency? Describe the role of micro-irrigation in increasing the water-use efficiency.	2016
What is allelopathy? Discuss its role in major cropping systems of irrigated agriculture.	2016
Given the vulnerability of Indian agriculture to vagaries of nature, discuss the need for crop insurance and bring out the salient features of the Pradhan Mantri Fasal Bima Yojana (PMFBY)	2016
Discuss the role of land reforms in agricultural development. Identify the factors that were responsible for the success of land reforms in India.	2016
Establish the relationship between land reform, agriculture productivity and elimination of poverty in the Indian Economy. Discussion the difficulty in designing and implementation of the agriculture friendly land reforms in India.	2013

Syllabus Topic: e-technology to aid farmers, Technology missions; #

Explain various types of revolutions, took place in Agriculture after Independence in India. How have these revolutions helped in poverty alleviation and food security in India?	2017
How can the ‘Digital India’ programme help farmers to improve farm productivity and income? What steps has the Government taken in this regards?	2015

Syllabus Topic: Food processing and related industries in India (scope & significance, location, upstream-downstream requirements, supply chain management); storage, transport & marketing of agro-produce and related issues & constraints; Economics of animal-rearing.  #

Elaborate on the policy taken by the government of India to meet the challenges of the food processing sector.	2019
Examine the role of supermarkets in supply chain management of fruits, vegetables and food items. How do they eliminate the number of intermediaries?	2018
What are the reasons for poor acceptance of cost effective small processing units? How will the food processing unit be helpful to uplift the socio-economic status of poor farmers?	2017
Livestock rearing has a big potential for providing non-farm employment and income in rural areas. Discuss suggesting suitable measures to promote this sectors in India	2015
In view of the declining average size of land holdings in India which has made agriculture non-viable for a majority of farmers, should contract farming and land leasing be promoted in agriculture? Critically evaluate the pros and cons.	2015
What are the impediments in marketing and supply chain management in industry in India? Can e-commerce help in overcoming these bottlenecks?	2015
There is also a point of view that agriculture produce market committees (APMCs) set up under the state acts have not only impeded the development of agriculture but also have been the cause of food inflation in India. Critically examine.	2014
India needs to strengthen measures to promote the pink revolution in food industry for better nutrition and health. Critically elucidate the statement.	2013

 

Syllabus Topic: Farm subsidies and MSP and issues therein (direct and indirect); PDS (objectives, functioning, limitations, revamping, issues of buffer stocks & food security)  #

What are the reformative steps taken by the government to make the food grain distribution system more effective?	2019
What do you mean by Minimum Support Price (MSP)? How will MSP rescue the farmers from the low income trap?	2018
How do subsidies affect the cropping pattern, crop diversity and economy of farmers? What is the significance of crop insurance, minimum support price and food processing for small and marginal farmers?	2017
“In the villages itself no form of credit organisation will be suitable except the cooperative society.” – All Indian rural credit survey. Discuss this statement in the background of agriculture finance in India. What constraints and challenges do financial institutions supply agricultural finances? How can technology be used to better reach and serve rural clients?	2014
Food security bill is expected to eliminate hunger and malnutrition in India. Critically discuss various apprehensions in its effective implementation along with the concerns it has generated in WTO.	2013
What are the different types of agriculture subsidies given to farmers at the national and state levels? Critically analyze the agriculture subsidy regime with the reference to the distortions created by it.	2013