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Indian Economy

Doubling Farmers’ Income: A Promise to be Fulfilled by 2022

  • 24 Dec 2018
  • 9 min read

Why in News?

  • Union Cabinet recently approved the country’s first Agriculture Export Policy with an aim to double farmers income.
  • The Government has set a target of doubling of farmers’ income by the year 2022.

Need to Double Farmers Income?

  • Past strategy for development of the agriculture sector in India has focused primarily on raising agricultural output and improving food security.
  • The strategy did not explicitly recognise the need to raise farmers' income resulting in low income of farmers.
  • Farmers' income also remained low in relation to income of those working in the non­ farm sector.
  • India also witnessed a sharp increase in the number of farmers suicides due to losses from farming, shocks in farm income and low farm income.
  • The low farm income is forcing more and more cultivators, particularly younger age group, to leave farming.
  • This can have a an adverse effect on the future of agriculture in the country, leading to food insecurity.
  • Therefore, there is need to double farmers income to promote farmers' welfare, reduce agrarian distress and bring parity between income of farmers and those working in non-agricultural professions.
Enhancing Farmers' Income
Enhance Gross Income Reduce Costs Stabilise Income
Production Growth Higher Prices Diversify-Farm/Non-farm Reduce purchased Inputs Exploit Complementarities Coping Mechanisms

Broad Strategy for Improving Farmers Income

  • Improvement in agricultural output viz:
    • Productivity - Area- agricultural output has to be increased through access to irrigation and technological advancement.
  • Resource use efficiency or saving in cost of production;
  • Increase in cropping intensity, i.e. the ratio of Net Area Sown to the Total Cropped Area - By raising short duration crops after the main kharif and after the main rabi season so that agricultural land does not remain unused for half of the productive period.
  • Diversification:
    • Towards high value crops like fruits, vegetables, fiber, condiments & spices and sugarcane.
    • Towards other allied enterprises like forestry, dairing rather than depending primarily on crop cultivation.
  • Shifting cultivators from farm to non-farm occupations - Non-farm sectors provide 2.76 times more productive employment than agriculture sector in rural areas
  • Improvement in terms of trade for farmers or real prices received by farmers- Use of CPIAL (Consumer price index for agricultural labour) as a deflator to change nominal farm income to real farm income.

Measures Taken by Indian Government

Institutional Reforms

  • Pradhan Mantri Krishi Sinchai Yojana, Soil health card, and Prampragat Krishi Vikas Yojana- Aiming to raise output and reduce cost.
  • Pradhan Mantri Fasal Bima Yojana- To provide insurance against crop and income loss and to encourage investment in farming.
  • Interlinking of rivers - To raise output and farm incomes.
  • ‘Operation Greens’ to address price volatility of perishable commodities like Tomato, Onion and Potato (TOP).
  • PM Kisan Sampada Yojana to promote food processing in a holistic manner.

Technological Reforms

  • Initiating E-NAM: The National Agriculture Market (eNAM) is a pan-India electronic trading portal which networks the existing APMC mandis to create a unified national market for agricultural commodities.
  • Technology mission on cotton which aims to increase the income of the cotton growers by reducing the cost of cultivation as well as by increasing the yield per hectare through proper transfer of technology to the growers.
  • Technology Mission on Oilseeds, Pulses and Maize (TMOPM)
    • The schemes implemented under TMOP are:
      • Oilseeds Production Programme (OPP)
      • National Pulses Development Project (NPDP)
      • Accelerated Maize Development Programme (AMDP)
      • Post Harvest Technology (PHT)
      • Oil Palm Development Programme (OPDP)
      • National Oilseeds and Vegetable Oils Development Board (NOVOD)
  • Mission for Integrated Development of Horticulture (MIDH) a scheme for the holistic growth of the horticulture sector covering fruits, vegetables, root & tuber crops, mushrooms, spices, flowers, aromatic plants, coconut, cashew, cocoa and bamboo.
  • Sugar Technology Mission – aimed at reducing the cost of production of sugar and improving sugar quality through steps for improvements in productivity, energy conservation and improvements in capital output ratio.
  • National Mission on Sustainable Agriculture – aim at promoting sustainable agriculture through a series of adaptation measures focusing on ten key dimensions encompassing Indian agriculture namely; ‘Improved crop seeds, livestock and fish cultures’, ‘Water Use Efficiency’, ‘Pest Management’, ‘Improved Farm Practices’, ‘Nutrient Management’, ‘Agricultural insurance’, ‘Credit support’, ‘Markets’, ‘Access to Information’ and ‘Livelihood diversification’.
  • In addition, schemes relating to tree plantation (Har Medh Par Ped), Bee Keeping, Dairy and Fisheries are also implemented.

Suggestions

  • The country need to increase use of quality seed, fertiliser and power supply to agriculture.
  • Area under irrigation has to be expanded by 1.78 million hectare and area under double cropping should be increased by 1.85 million hectare every year.
  • Besides, area under fruits and vegetables is required to increase by 5 per cent each year.
  • In the case of livestock, improvement in herd quality, better feed, increase in artificial insemination, reduction in calving interval and lowering age at first calving are the potential sources of growth.
  • Adoption of agronomic practices like precision farming to raise production and income of farmers substantially.
  • About one third of the increase in farmers' income is easily attainable through better price realization, efficient post-harvest management, competitive value chains and adoption of allied activities. This requires comprehensive reforms in market, land lease and raising of trees on private land.
  • Most of the development initiatives and policies for agriculture are implemented by the States. Therefore, it is essential to mobilise States and UTs to own and achieve the goal of doubling farmers' income.
  • There is a need to liberalise agriculture to attract responsible private investments in production and market. Similarly, FPO (Farmers producer organization)/FPC (Farmers producer company) can play big role in promoting small farm business.

Way Forward

  • The low level of farmers' income and year to year fluctuations in it are a major source of agrarian distress.
  • To secure future of agriculture and to improve livelihood of half of India's population, adequate attention needs to be given to improve the welfare of farmers and raise agricultural income.
  • It is essential to mobilize States and UTs to own and achieve the goal of doubling farmers' income with active focus on capacity building (technology adoption and awareness) of farmers that will be the catalyst to boost farmers income.
  • Since India is a diverse country where majority of agriculture is monsoon dependent therefore interventions are needed which includes research, technology promotion, extension, post harvest management, processing and marketing, in consonance with comparative advantage of each State/region and its diverse agro-climatic features; and then the Country can indeed achieve the goal of doubling farmers' income by the year 2022.
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