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Why doubling farmers’ incomes is still a dream

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Although the government has not provided any specific data on the doubling of farmers ’incomes, available data on various schemes for farmers give some insight into their current state.

The latest estimate of agricultural household income is based on a survey of the situation in farms conducted by the National Spatial Survey (NSSO) during the 77th round (January-December 2019).

According to the survey, the average monthly income for an agricultural household from all sources was estimated at 10,218 rupees compared to 6,426 rupees in 2012-13. In other words, by 2019 the farm’s profit has grown by 59 percent.

But during this period, their income was more wages than from crop production in 2018-19. Although SMEs have increased and the center spends on farm mechanization, insurance, etc., lack of awareness is an obstacle to the schemes reaching farmers.

What are the salaries of farmers?

In 2012-2013 (during the 70th round of the NSS), the average monthly income of agricultural households was 6,426 rupees, of which 2,071 rupees were for wages, 3,081 rupees from crop production and cultivation, 763 rupees from livestock and 5 rupees from non-agricultural businesses.

Data from the 77th round of the NSS for 2018-2019 showed that the average monthly income rose to 10,218 rupees, of which the highest income was accounted for by wages (4,063 rupees), followed by income from growing and producing crops (3,798 won). ). Revenues from livestock increased significantly (1582 won from 763 rupees).

Farmers also receive relatively more income from non-agricultural businesses and rent out land. However, farmers say that the cost of cultivation has almost doubled, and their profits are not commensurate with rising inflation. Wage income in 2012-13 was 32 percent. 40 percent was recorded in 2018-19. This means that farmers are turning into daily wage workers.

Does production growth lead to revenue growth?

The Ministry of Agriculture informed Lok Sabhu in April this year that in 2013-14 the budget allocations of the Department of Agriculture amounted to 21,933.50 crore rupees. This increased more than 5.5 times to 1,231,017.57 crore rupees in 2021-22.

Food grain production increased to its highest level in history from 265.05 million tons in 2013-14 to 305.43 million tons in 2020-21 (third preliminary estimate). Horticultural production increased from 280.99 million tons in 2014-2015 to 320.48 million tons in 2020-21 (second preliminary estimate), which was the highest figure for the horticultural sector.

However, the NITI Ayog report on doubling farmers ’incomes by Ramesh Chand (2017) states that in some cases production growth brings an increase in farmers’ incomes, but in many cases farmers ’incomes did not increase significantly with increasing production.

Do farmers benefit from schemes?

The government has increased MSP for all designated Kharif, Rabi and other commercial crops with a profit of at least 50 per cent of the total weighted average cost of production in India in 2018-19. The interest rate per quintal was increased to 1940 rupees per quintal in 2021-22 from 1310 rupees per quintal in 2013-14, an increase of 48 per cent. The PSA for wheat was increased from 1,400 rupees per quintal in 2013-14 to 2015 rupees per quintal in 2021-22.

Farmers who opposed farm reform laws and protested on Delhi’s borders demanded a Guaranteed Minimum Price Support (MSP) law. The 77th round of the NSS shows that the percentage of products sold by households under the SME ranges from 0 to 24.7 percent (excluding sugar cane).

Households growing rice and wheat dominate awareness charts about SMEs and products sold under it. Due to the fact that more than 14 percent of farmers with 14.6 crore (2015-2016) benefit from SMEs, most farmers have left the SME network and continue to sell their products below SMEs.

The government launched PM-KISAN in 2019 to allocate Rs 6,000 per year in three equal installments. A total of 1.8 million crore rupees was issued to more than 11.7 million farmer families. This benefit does not necessarily apply to capital expenditures in agriculture, as small and marginal farmers are struggling to meet their basic needs, such as education and children’s health expenditures.

Insurance, credit and infrastructure

About 29.29 crore applicants-farmers enrolled themselves under the Pradhan Mantri Fasal Bima Yojana (PMFBY) program launched in 2016. More than 8.99 crore (temporary) applicant farmers received claims amounting to more than 1 03 903 crore rupees. During this period, farmers paid almost 21,448 crore rupees as a premium, against which claims in excess of 1,03,903 crore were paid (preliminary).

For every 100 rupees of premium paid by farmers, they received 484 rupees as claims. However, many states, such as Maharashtra, are now abandoning the scheme, saying farmers are unhappy with the claims settlement. Institutional credit for the agricultural sector increased from Rs 7.3 crore in 2013-14 to reach Rs 16.5 crore in 2021-22.

On mechanization of agriculture from 2014-15 to 2021-22 (as of December 31, 2021). 5,130.61 crore rupees were allocated. About 13.78 thousand machines and equipment were provided to them for subsidies. About 16,007 customs hiring centers, 378 high-tech hubs and 16,064 banks of agricultural machinery have been set up. But the greatest threat to agricultural workers is mechanization of the economy.

Under the Agricultural Infrastructure Fund, the government has mobilized 7,700 crore rupees for more than 7,300 projects. But experts insist on greater investment in infrastructure by the government and the private sector.

A comprehensive policy is needed

Farmers say government schemes will not help them double their incomes if government agricultural policies are not integrated, do not give freedom to technology and the market, and do not inject more money into infrastructure development.

Apex farmers ’organizations such as Shetkari Sanghatana in Maharashtra say special policies and schemes will not help farmers until the government intervenes in the market to control prices so that consumers are satisfied at the expense of farmers.

Posted on

May 07, 2022

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