Follow Us:

Farmers & Farming

Corporate farming is the very antithesis of cooperative farming that was being promoted by the Government earlier. Corporate farming, which is not at all labour intensive would prove disastrous for small farmers, landless labourers and tenant farmers.

Devendra Saksena | New Delhi |

With China trying to threaten us, Coronavirus infections peaking and the economy faltering, it may not seem the right time to discuss agriculture but with a number of major policy changes in the offing, we urgently need to have a look at the long-term future of farmers and farming. It has been more than six weeks since the Finance Minister announced a stimulus package of Rs 4.30 lakh crore for farmers, out of which Rs 2.80 lakh crore were in the form of credit and Rs1.50 lakh crore were in the form of Government spending.

From the sketchy details, available in the public domain, one gathers that Rs one lakh crore has been set aside for an Agricultural Infrastructure Fund, Food Micro Enterprises get Rs 10,000 crore, fisheries get Rs 20,000 crore, animal husbandry infrastructure gets Rs15,000 crore, herbal cultivation gets Rs4,000 crore and bee-keeping and vegetable cultivation get Rs 500 crore each. The precise way in which this humongous sum is to be spent has not been spelt out, so far. Sincerely implemented, an investment of this magnitude, in tandem with substantive reforms, can transform Indian agriculture.

However, perennial neglect of the agricultural sector and the tardy implementation record of the Government, across sectors, does not inspire confidence. For example, out of an allocation of Rs 3.34 lakh crore in Budget 2019 for agriculture and allied activities, only Rs 2.35 lakh crore could be spent. Viewed from this perspective, Rs 1 lakh crore appears to be a budget shortfall, being made up in the current package.

The Finance Minister had also promised reforms like exempting agricultural commodities from stock limits under the Essential Commodities Act (ECA), limiting the role of Agricultural Produce Marketing Committees (APMCs), e-trading of agricultural commodities and permitting inter-state movement of farm produce. Pursuant to the FM’s announcement, the Essential Commodities Act has been amended to remove the existing restrictions on stocking food produce. Then, the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020 (FPTC Ordinance) ends the monopoly of the Agricultural Produce Marketing Committees (APMCs) and allows free purchase and sale of agricultural produce.

Another ordinance, the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020 (FAPAFS Ordinance) legalises contract farming. The amendments to the Essential Commodities Act have been well received but the FPTC and FAPAFS ordinances are being opposed tooth and nail by States and farmers’ bodies who apprehend that the FTPC Ordinance would make APMCs defunct, leaving farmers at the mercy of big traders and corporates.

Similarly, it appears that the FAPAFS Ordinance would facilitate the entry of corporates in farming, leading to huge mechanized farms, thereby threatening the livelihood of agricultural labourers and small farmers. Farmers also fear that cash-rich companies may force them to enter into disadvantageous leasing contracts. Additionally, non-BJP States feel that agriculture being in the State List, the Central ordinances have intruded into their legislative domain.

Taken together, the three ordinances would change the agricultural landscape in our country. Productivity per acre of land would go up and we would produce much more than what we are producing today. However, there would be significant downsides. Looking to what is happening in the US, where extremely large farms predominate, one can predict that we would see an increased use of fossil fuels in agriculture because modern farming uses chemical fertilisers, pesticides, farm machinery, food processing and packaging and transportation ~ all derived from petroleum.

It is estimated that while traditional farming produces 2.3 calories of food energy for every calorie of fossil-fuel energy consumed, modern farming needs 10 calories of fossil-fuel energy to produce one calorie of packaged food. According to estimates, 19 per cent of the emission of greenhouse gases in the US is due to farming. Clearly, industrialised farming would entail an environmental cost due to a rise in emission of greenhouse gases. The seasonal spike in pollution, when farmers clear the land after harvesting, may become a permanent feature in Delhi and adjacent areas.

There would also emerge a danger of mono-culture of crops and animals. Monoculture of crops i.e. repeatedly planting the same crop in the same area depletes the nutrients from the earth leaving the soil weak and unable to support healthy growth, forcing farmers to use chemical fertilizers which, in turn, disrupt the natural composition of the soil and contribute further to nutrient depletion. Also, there is a danger of plant diseases wiping out the crop of an entire geographical area.

Waste from farm animals replenishes the soil, but the waste of the same animals reared in a factory environment creates a pollution problem. Diseases spread quickly amongst animals kept close together. Also, monoculture of both kinds wastes a lot of water, which is a scarce resource in our country. Despite these obvious risks, farming conglomerates would rely on monoculture because performing complex rotations of plants and managing pests without petrochemicals is labour intensive and requires traditional skills, different from merely driving a tractor or harvester and spraying chemical insecticides.

The bottomline is that corporate farmers would only be tenants on the land they farm, so they would not worry unduly about the long-term impact of their wasteful farming methods on the soil. To add value to foodstuff, corporates engaged in farming would go in for food processing in a large way, which would be at the expense of public health, because consumption of calorie dense processed food, often leads to heart disease, stroke, diabetes and cancer.

Statistics show that spending on health has gone up from 5 per cent to 16 per cent of the national income in the USA in the last 70 years, the time when the country switched over to industrial farming. Consequently, educated Americans now realise the illeffects of fast food and the value of healthy local organic food. By embracing industrialisation in farming we would move away from regional food economies to a national food economy where an orange grown Maharashtra may be sent to Gurgaon for processing and the processed orange would again be sent to Maharashtra for consumption.

This may sound great in theory but we would have to abandon regional food systems, which are more resilient and cost-effective and provide fresh and nutritious food to consumers in favour of national or even international food systems that provide indifferent food grown in a factory environment. Stating the obvious, corporate farming is the very antithesis of co-operative farming that was being promoted by the Government earlier. Corporate farming, which is not at all labour intensive would prove disastrous for small farmers, landless labourers and tenant farmers.

Since 45 per cent of our population is engaged in farming and most of them fall in the aforementioned categories, corporatisation of agriculture would probably result in a colossal human tragedy. The basic problem of Indian agriculture is of excess production which depresses the price of farm produce. Corporatisation would further increase production but do little to ensure a worthwhile income for farmers. Rather, because of over-production, prices of farm produce would hit rock bottom, bankrupting small farmers.

Some leading corporates have evinced keen interest in the new regime because economies of scale would ensure that they would make a profit from farming but corporatisation would definitely sound the death knell for traditional farming. Probably, the Government can help farmers more by modifying and adopting the European Union’s Common Agricultural Policy (CAP) which supports and stabilises farmers’ income through subsidies.

The other three components of CAP are also worth emulating: the first one focuses on improving the competitiveness of the farm and forestry sector through support for restructuring, development and innovation. The second one is for improvement of the environment and the countryside, to counter climate change. The third priority is of improving the quality of life in rural areas and promoting diversification of economic activity. One can easily think of myriad ways to benefit farmers.

Compulsory composting of city waste would reduce pollution and provide low-cost manure to farmers, replacing costly fertilisers. We can also have schemes to tackle the most common problems faced by farmers like soil erosion, soil depletion and proliferation of parasitical plants like watercress (jal kumbhi) and parthenium hysterophorus (congress grass). To help farmers, we need to think like farmers and not impose some ill-thought out policies on them. As US President Dwight D Eisenhower had said: “Farming looks mighty easy when your plough is a pencil and you’re a thousand miles from the corn field.’’

(The writer is a retired Principal Chief Commissioner of Income-Tax)