The leaked results of a consumer expenditure survey by the National Statistical Office (NSO) are the latest in the series of worsening economic indicators. Painting a truly dismal picture, the survey shows that average spending per consumer declined by 3.7 per cent, from Rs.1,501 to Rs.1,446 between 2011-12 and 2017-18. Villages fared even worse with consumer spending declining by 8.8 per cent; more significantly the average monthly spending on food in rural areas declined by 10 per cent, from Rs.643 to Rs.580. According to the Global Hunger Index 2019, poor rural households spend more than 60 per cent of their incomes on food but still cannot afford nutritious foods like pulses, vegetables, milk and fruit because of their low spending capacity.
One may well ask as to what nutritious foods could be had in Rs.580 per month? Stating the obvious, food is available in plenty, but poverty limits access to food for a large chunk of our population. In some states, such as Assam, Bihar, Chhattisgarh, Madhya Pradesh, Odisha, Jharkhand and Uttar Pradesh, more than 30 per cent of the population lives below the caloriebased poverty line. People living in the countryside have little income-earning capacity. Agriculture employs 45 per cent of our workforce but accounts for only 15 per cent of our GDP. Most farmers are desperately poor because 67 per cent of farm holdings are less than 1 hectare and nearly 60 per cent of India’s total cultivated area is rainfed.
The average farm size which was 2.28 hectares in 1971 is now only 1.15 hectares. Per capita farming incomes have been falling steadily vis-a-vis other kinds of income and the gap between farming income and income from other activities has widened noticeably over the years. Since Vedic times and up to the coming of the British, agriculture was our prime occupation. Vedic hymns describe ploughing, fallowing, irrigation, fruit and vegetable cultivation. Till the Middle Ages farming was the most respected profession. Uttam kheti, madhyam ban, nipat chakri… . goes an old Hindi saying, which means that farming is the best profession followed by trade and the worst is being a servant of someone.
With the introduction of Zamindari and Western laws by the British, agriculture became a marginal profession, which is the situation even today; even after the abolition of Zamindari, and the Green and White Revolutions. One of the goals of the freedom struggle was to better the lot of farmers. Yet, seventy years Independence, the lot of the small farmer is a sorry one. Farmers throughout the country are a demoralised lot, highly indebted, prone to suicide and struggling to get their voices heard. On the other hand, public servants are making merry ~ most going from one scam to the other. Tradesmen continue to occupy the middle space; doing well and flourishing when the time is right.
The Global Hunger Index reports a high prevalence of undernutrition, with 38.4 per cent of children below 5 years being stunted and 21 per cent wasted i.e. at “very high” and “emergency” levels, by WHO standards. To state the obvious, the cognitive capabilities of most such children would be below par. Thus, we have a situation where poverty is likely to be perpetuated across generations. A great effort at the national level is required to come out of the vicious cycle of poverty. It does not help that our society has extreme inequality. Thomas Piketty and Lucas Chancel in their aptly titled study, Indian Income Inequality 1922- 2014: From British Raj to Billionaire Raj, have pointed out that currently the richest 1 per cent Indians earn 22 per cent of our total income; up from to 6 per cent in the early 1980s and somewhat higher than their 21 per cent share in the 1930s.
Mukesh Ambani, the richest Indian, earned Rs.300 crore per day. Significantly, the poorest 50 per cent of our countrymen own only 4.1 per cent of the nation’s wealth. Highlighting the inequality in our society, in nutritional terms almost a fifth of our population suffers from obesity. Two years ago, our Prime Minister promised to double the income of farmers by 2022. To this end, Minimum Support Price (MSP) of a number of agricultural commodities has been increased ~ in some cases by more than 50 per cent. Yet the Government is able to purchase only a part of the agricultural output; most of which goes waste in the absence of proper storage facilities.
A proper export and food management policy would prevent wastage and help farmers realise a proper price for their produce. Rather than fixing a high MSP, helping farmers in marketing, choosing the correct crops to grow and improving village connectivity would work wonders. Incentives for pooling of land, creating awareness about improved agricultural practices, integration of farmers into markets, better access to credit and agricultural inputs, rural roads, better marketing and storage facilities are some of the measures that have to be taken urgently. Some policy changes are also required. The Government, which protects domestic industry against cheap imports, itself imports agricultural commodities, if prices increase.
On the other hand, in a good year, farmers have to sell their output at rock bottom prices. Thus, farmers are penalised for producing more. Agricultural distress can be addressed only by implementing a well thought out comprehensive strategy like the Swaminathan Report on Agriculture of 2006 or to put in place a policy like the Common Agricultural Policy of the European Union. The current budget prescribes Zero Budget Natural Farming (ZBNF), a method of chemical-free agriculture, to reduce the cost to farmers. Paradoxically, the Finance Minister did not allocate any funds to ZBNF.
Rather, states have been ‘allowed’ to use funds allocated them under Rashtriya Krishi Vikas Yojana-Remunerative Approaches for Agriculture and Allied sector Rejuvenation (RKVYRAFTAAR), and the Paramparagat Krishi Vikas Yojana, to promote ZBNF, Vedic farming, natural farming, cow farming and a host of other traditional methods. The success of an important scheme without allotting sufficient dedicated funds can well be imagined. For immediate succour, the National Food Security Act has to be implemented in a way that the most vulnerable people are able to meet their minimum food and nutrition needs throughout the year and people at high risk of malnutrition, especially women, children and adolescent girls, have access to improved nutrition.
This could only happen if a proper audit of Government expenditure is done; every year more than two-thirds of the Union Budget (Rs.12 lakh crore in the current year) is spent on social security and hunger alleviation schemes but without any satisfactory outcome. Mahatma Gandhi visualised “village republics” which would be self-governing and self-sufficient in all respects. At our stage of development, it may not be possible to turn the clock back but we have to ensure that villages and villagers also get their fair share in our growth story. As a first step, proper infrastructure has to be created in rural areas which alone can create jobs in villages.
Village schools have to be improved; rural youth can be weaned away from agriculture only if they can compete in the job market. Agriculture based industries like food processing have to be encouraged. Complementary activities like dairying have to be promoted. We have to strive to achieve the ideal situation envisioned by President Herbert Hoover: “There is no employing class, no working class, no farming class. You may pigeonhole a man or woman as a farmer or a worker or a professional man or an employer or even a banker. But the son of the farmer will be a doctor or a worker or even a banker, and his daughter a teacher. The son of a worker will be an employer ~ or maybe President.”
(The writer is a retired Principal Chief Commissioner of Income-Tax)