“The soul of India lives in its villages,” declared the Father of the Nation in the last century. Even today, more than 60 per cent of Indians live in villages. The significance of rural development in the over-all national development cannot be over-emphasized. The soul of rural India is in agriculture. It generates 17 to 18 per cent of our GDP. Agriculture is the source of livelihood for more than 50 per cent of our total work force. It supplies food to the nation and basic raw materials to agro-based industries. It earns valuable foreign exchange from agricultural exports. Farm income generates demand for industrial goods and contributes to domestic capital formation through savings out of farm income.
Agriculture plays a critical role in the environmental and ecological sustainability of the country. The Economic Survey, 2018 of the Government of India observed that with growing rural to urban migration by men, there is ‘feminisation of agriculture sector’, with increasing number of women in multiple roles as cultivators, entrepreneurs, and labourers.
Globally, there is empirical evidence that women have a decisive role in ensuring food security and preserving local agro-biodiversity. Professional development economists have repeatedly campaigned for ‘women’s empowerment’ as a strong driving force in the socio-economic and political development of a nation. The Prime Minister promised farmers a good price for their harvest and low input costs as his government’s initiatives to double their incomes by 2022.
The Central government claims to have been helping the nation’s food producers at every stage from sowing to selling. “The entire credit for nation’s food security should go to the farmers,” commented the PM.
In July 2018, the Chief Minister of West Bengal claimed, after a high-level meeting at the state secretariat, Nabanna, Kolkata, that, ‘The state has already trebled farmers’ income.’ Does this mean West Bengal has out-performed the rest of India in such a big way that what the nation targets to achieve by 2022, West Bengal has already over-achieved it in 2018? A dispassionate discourse is evidently called for.
A farm household earns its incomes from cultivation, from live-stock, from wages and salaries and from non-farm business. If we analyse incomes of farm households in India using data from the 70th. round of National Sample Survey (NSS) conducted during January to December 2013, we reach the following inescapable conclusions: The growth rates of real income of farm household across different states indicate that Haryana (8.3 per cent), Rajasthan (8.1 per cent) and Odisha (7.6 per cent) showed high growth rates during the period from 2002-03 to 2012-13. The growth in Haryana was driven by growth in cultivation incomes, while growth in Rajasthan as well as in Odisha was largely due to growth in livestock incomes.
Assam (-0.3%), Bihar (- 0.8%) and West Bengal (-1.3%) showed the lowest growth rates in income during this period. Assam showed a deceleration in non-farm business incomes, Bihar showed deceleration in all sectors except wage incomes and West Bengal saw a deceleration in crop cultivation income and non-farm business income. Across different states, J&K, Chhattisgarh and Assam registered high profitability while Tamil Nadu, West Bengal and Andhra Pradesh showed low profitability.
If we look at the state-wise data on total annual farm incomes, we find that farm households in Chandigarh, Delhi and Punjab recorded the highest total incomes (Rs. 260,046, Rs. 232,739 and Rs. 217,450 respectively), while farm households in Bihar, West Bengal and Uttarakhand recorded the lowest total incomes (Rs. 44,172, Rs. 48,195 and Rs. 56,666 respectively).
The conclusions of the NSS findings are fair and clear. Income from cultivation in West Bengal went down and, consequently, the growth rate in farm income turned out to be negative. What is important is that the farm sector in West Bengal consistently showed low profitability. West Bengal also recorded the second lowest total farm income in India (with Bihar taking the last rank).
Do these findings get reciprocated by the data on farm households below the poverty line? The NSS data give us the following supporting proof of West Bengal being a relatively poor performing state: The all-India proportion of the farm households earning below poverty line is 53.37 per cent.
Some states and union territories have a relatively low proportion of farm households earning below poverty line. Around 12 states and UTs have less than 40 per cent households earning below poverty line. These states and union territories are Telangana, Sikkim, Gujarat, Lakshadweep, J&K, Haryana, D&N Haveli, Meghalaya, Punjab, Kerala, Chandigarh and Delhi.
A very high proportion of farm households in Bihar (71.9 per cent), Uttarakhand (66.9 per cent), Uttar Pradesh (66.8 per cent), Puducherry (65.7 per cent) and Jharkhand (62.12 per cent) earn less than the poverty line.
All other states have between 40 and 60 per cent of farm households earning below poverty line, the figure for West Bengal being 56.94 per cent, which is more than 3.5 percentage points above the national average.
One might be tempted to argue that the present Government of West Bengal came to power only in 2011 and that the claim of the Chief Minister announced in July 2018 must not be judged by the findings of the 70th round of the NSS. It is, therefore, reasonable to go beyond December 2013.
Let us look into the ‘State Statistical Hand Book, 2015’ of the Bureau of Applied Economics & Statistics, Government of West Bengal. On Page 200 we find Table 22.1 that gives us ‘Estimates of Net State Domestic Product of West Bengal by Industry of Origin at Current Prices’ along with Table 21.2 (Page 180) and Table 21.2a (Page 184) of the aforesaid document to get a feel of the rate of inflation during the period in West Bengal. Combining the information, we see that the CPI increased by 34.09 per cent (approx) over the period 2011-15, while agricultural income increased by 59.29 per cent at current prices over the same period (roughly), implying thereby a modest increase of 25.20 per cent in the real income of farmers over the said period. The average annual growth rate turns out to be 6.3 per cent only. It is not at all clear what dramatic changes took place during 2016 and 2017 in the agricultural sector of West Bengal that led the Hon’ble Chief Minister to claim a 2.6-times increase in income per farmer (and not per farming household) in the state in her letter to the Prime Minister of India, dated 26 March 2018. One gets all the more surprised because West Bengal experienced floods in 2015 and again in 2017.
The Chief Minister declared 12 districts in West Bengal as flood-hit with heavy rain hitting the state in July and early August 2015. Total area under cultivation damaged by the flood was put at 2 lakh hectares and over 80 per cent of the damaged farm land was under kharif rice (aus and aman) production. The State Government demanded Centre’s assistance for the flood-affected districts. In 2017 the chief minister put the flood damages in the state at Rs 30,000 crore and demanded Centre’s assistance for the flood-affected districts.
Let us look at the performance of the state’s agricultural sector in the last three years. We use the data provided by the Economic Review, Government of West Bengal, 2018-19. At 2011-12 prices, agricultural output increased by 0.3 per cent in 2015-16, by 3.6 per cent in 2016-17 (Provisional estimate) and by 2.3 per cent in 2017-18 (Advance estimate). It is, by now, evident, why the July 2018 claim of the Chief Minister of West Bengal is amazing.
To conclude, we venture to look into the Economic Review of the Government of West Bengal, 2015-16 (Table No.2.1 on Page 17). Going by the statistics of the State Government, the growth rate of individual farmer’s household income increased from 18.4 per cent in 2012-13 to 20.3 per cent in 2013-14 and then declined to 13.2 per cent in 2014-15. If we now add to it the floods of 2015 and 2017, trebling of farmer’s income over 2011-18 seems unlikely.
(The writer is Associate Professor, Department of Economics, St. Xavier’s College, Kolkata)