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Recently, there has been active discussion on the strategies addressing farm distress.
There are media reports that the ‘interim Budget’ may focus on the farm sector among other things.
Agrarian distress, in the present context, is mainly in terms of low agricultural prices and, consequently, poor farm incomes.
Low productivity in agriculture and related supply side factors are equally important.
An issue that is connected is the declining average size of farm holdings and the viability of this size for raising farm incomes. Here are possible solutions.
Removing the roots of farmers’ distress Steps like limited procurement, boosting productivity and consolidating land holdings can help reduce agrarian distress

Prices and incomes

Prices play a key role in affecting the incomes of farmers.
Even during the Green Revolution, along with technology and associated packages, price factor was considered important.
In the last two years, inflation in agriculture was much lower than overall inflation.
The implicit price deflator for Gross Value Added (GVA) in agriculture was 1.1% while it was 3.2% for total GVA in 2017-18.
The advance estimates for 2018-19 show that the implicit deflator for GVA in agriculture is 0%, and 4.8% for total GVA.
In fact, agriculture GVA growth was at 3.8% for both nominal prices and constant prices in 2018-19, giving the price deflator of 0%.
The consumer price index (CPI) also shows that the rise in prices for agriculture was much lower than general inflation in recent years.
Market prices for several agricultural commodities have been lower than those of minimum support prices (MSP).
All these trends show that the terms of trade to be moving against agriculture in the last two years.
When output increases well beyond the market demand at a price remunerative to producers, market prices decline.
And in the absence of an effective price support policy, farmers are faced with a loss in income, depending on how much the price decline is.
The ‘farm distress’ in recent years has been partly on account of this situation, as the loss of income is beyond the ability, particularly of small farmers, to absorb. In a strange way, it is the success in increasing production that has resulted in this adverse consequence.
A few schemes have been suggested to address the problem of managing declining output prices when output increases significantly.
The scheme of ‘price deficiency compensation’ is one such mechanism which amounts to paying the difference between market price and the MSP.
At the other extreme is the ‘open procurement system’ that has been in vogue quite effectively in the case of rice and wheat, where procurement is open ended at the MSP.
Is there a middle way that may be effective in some crops?
One of us had suggested the option of limited procurement for price stabilization.
A ‘price deficiency’ scheme may compensate farmers when prices decrease below a certain specified level.
However, market prices may continue to fall as supply exceeds ‘normal demand’. An alternative is the limited procurement scheme. Under this scheme, the government will procure the ‘excess’, leaving the normal production level to clear the market at a remunerative price.
Thus, procurement will continue until the market price rises to touch the MSP. The suggested ‘limited procurement system’ will not work if the MSP is fixed at a level to which the market price will never rise. There are costs involved which will go up as production increases above the average level.
The government can sell the procured grain in later years or use them in welfare programmes.
Some States have introduced farm support schemes, examples being the Rythu Bandhu Scheme (Telangana) and the Krushak Assistance for Livelihood and Income Augmentation (KALIA) scheme (Odisha).
One problem with the Telangana model is that it does not cover tenants, who are the actual cultivators. Basically, these schemes are income support schemes which will be in operation year after year.
Thus, raising the MSP, price deficiency payments or income support schemes can only be a partial solution to the problem of providing remunerative returns to farmers.
A sustainable solution is market reforms to enable better price discovery combined with long-term trade policies favourable to exports.
The creation of a competitive, stable and unified national market is needed for farmers to get better prices.
Agricultural markets have witnessed only limited reforms.
They are characterised by inefficient physical operations, excessive crowding of intermediaries, and fragmented market chains.
Due to this, farmers are deprived of a fair share of the price paid by final consumers. States have also not shown any urgency in reforming agricultural markets. For better price for farmers, agriculture has to go beyond farming and
develop a value chain comprising farming, wholesaling, warehousing, logistics, processing and retailing.

Low Productivity

The next issue is the low productivity of Indian agriculture.
Basics such as seeds, fertilizers, credit, land and water management and technology are important and should not be forgotten.
Similarly, investment in infrastructure and research and development are needed.
Water is the leading input in agriculture. More than 60% of irrigation water is consumed by two crops: rice and sugar cane.
Basically, it is not investment alone but efficiency in water management in both canal and groundwater that is important.
India uses upto three times the water used to produce one tonne of grain in countries such as Brazil, China and the U.S.
This implies that water-use efficiency can be improved significantly with better use of technologies that include drip irrigation.
Yields of several crops are lower in India when compared to several other countries. Technology can help to reduce ‘yield gaps’ and thus improve productivity.
Government policies have been biased towards cereals particularly rice and wheat. There is a need to make a shift from rice and wheat-centric policies to millets, pulses, fruits, vegetables, livestock and fish

LAND SIZE

Another major issue relates to the shrinking size of farms which is also responsible for low incomes and farmers’ distress.
The average size of farm holdings declined from 2.3 hectares in 1970-71 to 1.08 hectares in 2015-16.
The share of small and marginal farmers increased from 70% in 1980-81 to 86% in 2015-16.
The average size of marginal holdings is only 0.38 hectares (less than one acre) in 2015-16.
The monthly income of small and marginal farmers from all sources is only around ₹4,000 and ₹5,000 as compared to ₹41,000 for large farmers. Thus, the viability of marginal and small farmers is a major challenge for Indian agriculture.
Many small farmers cannot leave agriculture because of a lack of opportunities in the non-farm sector. They can get only partial income from the non-farm sector.
In this context, a consolidation of land holdings becomes important to raise farmer incomes. There was a lot of discussion on this topic in the 1960s and 1970s.
In the context of rural poverty, B.S. Minhas had argued even in the 1970s that compulsory consolidation of land holdings alongside land development activities could enhance the incomes/livelihoods of the poor in rural areas.
Unfortunately, there is little discussion now on land fragmentation and consolidation of farm holdings. We need to have policies for land consolidation along with land development activities in order to tackle the challenge of the low average size of holdings.
Farmers can voluntarily come together and pool land to gain the benefits of size. Through consolidation, farmers can reap the economies of scale both in input procurement and output marketing.
To conclude, farmers’ distress is due to low prices and low productivity.
The suggestions we have made, such as

limited procurement,
Measures to improve low productivity, and
Consolidation of land holdings to gain the benefits of size, can help in reducing agrarian distress. 4. We need a long-term policy to tackle the situation.

Model for malaria control

Through its DAMaNinitiative, Odisha has emerged as an inspiration in the global fight against malaria
The World Health Organisation’s World Malaria Report of 2018 turned the spotlight on India’s recent strides against malaria. India is the only country among the 11 highest-burden countries that saw substantial progress in reducing disease burden: it saw a 24% decrease in 2017 compared to 2016.
This shows that India has assumed a leadership role in advancing global efforts to end malaria. The country’s success provides hope to the other highest-burden countries to tackle malaria head-on.
India’s progress in fighting malaria is an outcome of concerted efforts to ensure that its malaria programme is country-owned and country-led, even as it is in alignment with globally accepted strategies.
The turning point in India’s fight against malaria came at the East Asia Summit in 2015, when it pledged to eliminate the disease by 2030. Following this public declaration, India launched the five-year National Strategic Plan for Malaria Elimination.
This marked a shift in focus from malaria “control” to “elimination”. The plan provides a roadmap to achieve the target of ending malaria in 571 districts out of India’s 678 districts by 2022.
The plan requires more than ₹10,000 crore. Adequate investment combined with coordinated action between governments, civil society and philanthropic donors is imperative to achieve this goal. Since health is a State subject, State governments across the country shoulder a special responsibility in tackling the disease.
Among the States, Odisha has emerged as an inspiration in the fight against malaria. In recent years it has dramatically scaled-up efforts to prevent, diagnose and treat malaria through its Durgama Anchalare Malaria Nirakaran (DAMaN) initiative, which has produced impressive results in a short span of time.
In 2017, accredited social health activists (ASHAs) helped distribute approximately 11 million bed nets, which was enough to protect all the residents in areas that were at highest risk. This included residential hostels in schools. As a result of its sustained efforts, Odisha recorded a 80% decline in malaria cases and deaths in 2017.
DAMaN aims to deliver services to the most inaccessible and hardest hit people of the State.
The initiative has in-built innovative strategies to combat asymptomatic malaria.
DAMaN has been accorded priority in the State’s health agenda. There is financial commitment for a five-year period to sustain and build on the impact created by the initiative.

The hard power imperative

India needs to urgently modernise the armed forces
In a new programme called ‘Insect Allies’, launched by the Defence Advanced Research Projects Agency (DARPA), which is responsible for developing military technologies in the U.S., researchers have been asked to evolve insects that introduce genetically modified viruses into crops. This is being done ostensibly to address infections.
One is yet to come across a more ingenious explanation for a lethal weapon system being developed.
Imagine these insects being let loose in fields with their genes deviously modified? Is this agricultural warfare?
The journal, Science, acknowledges that the programme “may be widely perceived as an effort to develop biological agents for hostile purposes”.
The DARPA has denied that this is its intention, but history has proven that noble human intentions have been overpowered by the lure of obtaining a technological advantage to enhance power.

Developing hard power

No country calling itself a power can afford to lag behind its adversaries in the technology innovation cycle.
China realised this early, and its advancements in weapons technology has been impressive. With research and development (R&D) allocation growing from $13.4 billion in 1991 to $377 billion in 2015 (20% of the world’s R&D budget), China moved from an era of reverse engineering to creative adaptations and now to disruptive innovations, as seen in its J-20 stealth fighter and the hypersonic wave rider vehicle programmes.
On mastering the latter, China would be able to strike any target in the world within an hour of the decision being taken. With such technological breakthroughs, and as part of its influence operations, it is no surprise that China is changing rules that govern geopolitical relations. Accordingly, it has moved from Deng Xiaoping’s philosophy — ‘hide your strength and bide your time’ — to Xi Jinping’s propagation of aggressive aggrandisement.
However, the narrative in Delhi is stuck on the mundane issues of thirdand fourth-generation fighter programmes of Tejas and Rafale.
India seems to hope for an environment sans war. Soft power processes such as the Wuhan summit and the waiver for India under CAATSA (Countering America’s Adversaries Through Sanctions Act) are important but they are not substitutes for the hard power necessary to buttress nation-building.
China and the U.S. may be adversaries, but economic reasons will not let their rhetoric and mutual trade wars cross the rubicon. Cold calculations of national interest drive their decision-making, and collateral damage by way of broken promises and overlooked pledges of friendships with less powerful nations, India included, are plausible.
Promises of friendships between unequals do not withstand the lure of economic give and take of the powerful engaged in a geo-economic tussles; it is a truism that while capability takes time to build, intentions can change overnight.
It is time that India stands on its own with its indigenous hard power.
Needed: An adequate budget and time
Hard power grows only if there is an adequate budget, and if time is given for acquiring intellectual property in the military.
According to the World Bank, India’s total investment in R&D has stayed static at 0.63% of the GDP for a 20-year period!
More worrying is that three-fifth of this is in sectors other than defence.
In the same period, China’s R&D investment has gone up from 0.56% to 2.07% of its GDP.
Reports state that the Indian Air Force has delayed payment to HAL and that the Defence Ministry has not paid military contractors.
The scene thus appears grim vis-à-vis monies available for strengthening the war-waging potential of the services. Due to several false starts in arms acquisitions, ‘India fatigue’ pervades the defence manufacturing sector.
The poor participation of major weapon manufacturers with their top-line products at the last two Aero India and DefExpo exhibitions is proof of this.
Military power does not come with purchase of sniper rifles, the emergency acquisition of which caused euphoria in some circles recently.
It is also a given that not one election cycle but decades are needed to build military power, which is the life span of at least three governments. The rise of Japan’s military in the early 19th century, Germany’s military between 1920 and 1940, and China’s military between 1980 and 2005 attest to decades-long commitment of focused political and scientific attention and assured availability of adequate monies.
With the strengthening of China-Pakistan relations, and the modernisation of their militaries, it is vital that India’s 2019-20 Budget (as also the interim vote on account) addresses the need to urgently modernise the armed forces. Developing intellectual property through indigenous R&D is key to this endeavour.
What India’s polity needs is some serious bipartisan introspection and discussion, which will be in national interest.

Photo exhibitions and seminars on birds are the main feature of the two-day National Chilika Bird Festival inaugurated by the State Tourism Minister Ashok Panda on Sunday. Participants are scheduled to visit the Nalbana Bird Sanctuary on Monday.