India and the Agricultural Economy

I was in two minds when I read Ritesh’s blog post about the Indian Economy. I was angry with Ritesh as he seemed to selectively take facts and present it rather than taking it whole. Even if he had searched even a little bit, he would have got much more better material and everybody would have been the gainer.

I have to also admit, I feel very much like a hypocrite as I have never slaved in a farm so my understanding and conclusions are a mix of media and limited interaction with farmers some years ago. There is also lots of local customs and politics that come into the picture and it’s not as straight-forward as Ritesh thinks. What he has failed to share/account for is the far worse bad and stressed debts for the industry so just saying farm loan waivers are bad without sharing any of the context makes it seem much more worse. This is when our Current Chief Economic Adviser states about loan waivers to corporates “You need to be able to forgive those debts because this is how capitalism works. People make mistakes, those have to be forgiven to some extent”

Let me start though with words from a book I read sometime back –

“On —– a peasant uprising erupted in —— . The farmers were angry with high interest rates, high taxes, high inflation and low-government prices for their crops. The system had let them into debt, and debt had meant foreclosure and loss of their fields to the land barons. ”

I intentionally have made a fill in the blanks as both the dates and places was true in India 100 years back and even today, the only difference between the two is the absence of taxes. Many people would think I’m talking about Champaran whose tale while well-known in India is sadly a stub-class article in wikipedia 😦 with quite a few citation needed tags as well 😦 but is also true today as will be seen below.

Interestingly, there is/was a remark by some unknown person who said ‘gora sahab gays, bhura sahab aaya’ meaning the white officer has gone, in his place the brown officer has come. The evidence of this is very much in the Telegraph Act and the story about its usage and its place in Indian politics

Surprisingly, sadly and coincidentally, the quote minus the dates and place didn’t happen in India but also in Cambodia. The above quote has been taken from ‘for the sake of all living things‘ by John M. Del Vecchio. The quote itself appears in the first 10 odd pages (historical summation) of the somewhat 1200 odd pages book. I actually got an old edition which tops out at 900 pages so probably some more updated input/news isn’t available but it still packs a powerful wallop. I want to dedicate a separate blog post for the book itself so will not say more on that book and what it shares.

`Sadly and coincidentally, there were news reports yesterday itself of farmers agitating for better prices just yesterday.

Some of the interesting work if you want to understand the farmer’s indebtedness is to study the ‘Income, Expenditure, Productive Assets and Indebtedness of Agricultural Households in India‘ done by NSSO.

Again, one does not need to read the whole report, there were some of the analysis shared by the Hindu here and here. This was also echoed by Logical Indian

It really boggles the mind to know than an average farming household earns around INR 200 per day. Even if you take a family of four people that comes to INR 50/- per person. Most rural joint families at the very least have 3-4 kids at the very least. Sadly Agricultural incomes do not keep sync even with the inflation index as there is no fair minimum age and wage for the Indian farmer, the concept does not exist for her(im) 😦 . Just me and mum going onto a restaurant and having one dish each easily can run anywhere between INR 200~250 easily . Cooking in the house is the same if you add/input the labor (which is usually not calculated) used to make lunch/dinner.

There was the idea that contract farming might be a solution but even that was corrupted by Multi-national companies such as Pepsi and others that the Government is showing movement to have a “model contracting law” . There are loads of stories on downtoearth magazine which deals with the above and all sorts of issues the farmer faces.

I should talk about Maharashtra and even here there was/has been an irrigation scam with figures given from 35k to 70k crores or 350 to 700 billion INR . The latest finding by the PAC has been shared here.

I will cut the blog post short as I find the whole thing personally very depressing. As far as local customs go this was from one of the farmers interaction some years ago where me and some other friends had gone across a village and came to know that all of them grew the same crop with some minor variances. When asked why is it so, while many said its fate, one of the elderly gentleman shared an experience where a farmer had planted some other thing. The gentleman prospered while the other villagers were suffering from glut of whatever they produced. Knowing he prospered, the other villagers damaged his crops and all sorts of unlucky things started happening for the farmer. In the end he realized his best bet is to follow the ways of the other villagers, at least they would be in peace.

What I have shared isn’t either unique or even unknown, even Toronto Star of Canada reported on the issue some years ago.

At the end of it all, the story is one of no education and limited skill-set and I don’t see it changing any time soon. There are some who are earning big figures, but majority of the farmers will always be in the red