The Hindu : Agriculture in distress

Online edition of India's National Newspaper
Tuesday, Feb 25, 2003

Business

Business

Agriculture in distress

By Prem Shankar Jha

Thirty years ago hardly a day would pass when the newspapers did not report what was happening to the agricultural sector of the economy. A poor monsoon meant starvation deaths in the countryside and a sharp rise in food prices in the urban areas. A good monsoon, on the other hand, would suffuse the entire country in a sense of well-being. As everyone was affected, so agriculture was news. It is a measure of how much the Indian economy has changed that with one of the worst setbacks to agriculture in recent years, the subject hardly figures on the front page of any newspaper today.

Following a disastrous monsoon in which the average precipitation was 17 per cent below normal, the kharif (autumn) harvest of foodgrains fell by a whopping 19.1 per cent. In many other years a decline in the kharif harvest has been made up by a bumper rabi (spring) harvest. But unfortunately this year the rabi harvest will also fall short of what it was last year. Extreme cold at the end of December and in much of January and a lack of moisture in the soil in the drought struck regions of central and western India have restricted the area sown with winter crops. As a result, a preliminary estimate by the Ministry of Agriculture has shown that the rabi harvest is likely to be more than 5 per cent below that of last year. Overall there is likely to be a decline in the output of foodgrains of 13.6 per cent and of cash crops of over 5 per cent this year. This will make 2002-03 the worst crop year in the past decade.

In recent weeks the decline in harvest has attracted a good deal of attention in the media. But this has mostly been for the wrong reasons. There is concern about what this will do to the GDP growth rate. For instance, an estimate by the Central Statistical Organisation recently that the poor harvest would bring down the growth rate from a previously estimated 5.5 per cent to 4.4 per cent attracted a lot of attention. Several follow up reports focused on the fact that a smaller growth of GDP will mean a higher ratio of fiscal deficit to the GDP and therefore an even more rapid worsening of the Government's financial condition than had been expected earlier. Still other reports highlighted the decline in consumer demand for manufactured products that will result from the smaller sales of foodgrains and cash crops by the farmers. This will slow down and may even abort the mild industrial recovery that began in April last year.

All of these concerns relate, however, to the effect that the decline in agriculture will have on the rest of the economy. Not one has dealt with how it will affect the lives of the farmers and agricultural labourers who make up almost two-thirds of the country's population. Yet this, arguably should be the primary concern.

Although the effect of the poor monsoons and decline in harvest have only recently begun to be felt, there are accumulating signs of a rise in rural distress. The prices of coarse grains, which the rural poor mainly eat, have gone up by 16.7 to 22.4 per cent. The prices of potatoes and onions have gone up by more than 12 per cent. These increases are vastly in excess of the rise in the consumer price index for industrial workers of 4.1 per cent. The rise in rural foodgrain prices has pushed large numbers of people, who had stopped buying foodgrains from the government-run ration shops when market prices were low, back to buying their requirements from them. As a result the sale of foodgrains through the public distribution system has risen by almost 50 per cent between April and November 2002 (from 16.7 million tonnes to 24.7 million tonnes).

The most serious impact of a drought however is on the earnings of agricultural labourers, who make up about one-third of the rural population. When a crop is struck by drought and starts to wither farmers have no option but to cut it as soon as possible and sell it as feed for cattle. For agricultural labourers this means not only untimely work at a fraction of the normal wage rate, but also the disappearance of an entire chain of post harvest operations that would give them a daily cash flow for months to come. The bottom thus falls out of their lives. If they cannot find alternative employment soon they begin to starve to death.

The only way to prevent this is to start drought relief public works programmes in the rural areas, where at least one member per family can be employed every day. This gives the poor the purchasing power to take advantage of the government's ration and fair price shops and buy the grain they need. There are some indications that the governments of the drought affected States have geared themselves up well to cope with this challenge. Till the end of November they had distributed 6.1 million tonnes of foodgrains under various welfare programmes, of which half at last had been devoted entirely to drought relief along the above lines.

But if past experience is anything to go by the performance on this score tends to be extremely uneven. While the southern States have maintained efficient public distribution and drought relief mechanisms, states in eastern and central India have allowed them to virtually wither away.

Sustained media attention to the plight of the drought-struck poor would have made a marked difference to the performance of these governments. But that I precisely hat seems to have gone out of Indian journalism today. Thirty six years ago media attention to what came to be called the Bihar Famine largely ensured that it never took place. There is no similar sense of urgency in the media today.

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