DOUBLING THE FARMER'S INCOME BY 2022 – CURRENT SCENARIO, ISSUES & CHALLENGES AND WAY FORWARD

For Many Years, Indian Farmer has been at the Mercy of Monsoon, being exploited by Middlemen & Money lenders and being used as a Vote bank by Politicians! Farmers Committing Suicides due to indebtedness and Crop Failures has become a regular feature! Various Governments have made promises to improve the quality of Farmer’s Life without working on core issues like Policy Changes, Infrastructure Development and Ease of Doing Agriculture! Will this change any time soon? Modi Government’s vision for New India involves “Sabka Saath Sabka Vikas”. Transformation of agriculture sector is crucial in that respect as nearly half of the workforce in the country is employed in agriculture.In 2015-16, Prime Minister, expressed his near-Term Target of Doubling Farmer’s Income by 2022-23. Is it practically possible or is it like one of the Populist Statement? Let’s try to understand.

- CMA Ranjan Gunjal

I. Current Scenario

As a country, India is ranked 5th in terms of GDP behind US, China, Japan and Germany.However, if we dig into the details, India’s Per Capita GDP in 2019 is @ US$ 2,100 as compared to US$ 65,000 of United Sates and US$ 10,300 of China for the same Period. In Per Capita GDP, India is ranked 139thwhich is even below Countries like Nigeria and Ghana. In Short, we are a Poor Country!

If we dig further into Sector wise GDP, Agriculture Sector contributes around 16% to GDP with nearly half of the Population dependent on Agriculture. Considering these Numbers, India’s Per Capita Agriculture GDP is @ US$ 700 (1/3rd of Overall Per Capita GDP). At Current Conversion of Rs. 73 / US$, Per Capita Agriculture GDP works out to be Rs. 51,000 Per Annum or Rs. 4,300 Per Month, making the Indian Farmer far poorer than Non Agri Worker in India! Till Date, Government of India’s initiatives were focused on Food Security & increasing the Agri Output. Now, the focus has changed on increasing the Farmer’s Income.

II. Issues & Challenges

India’s rapid Economic Development started post liberation of Industry in 1991. Agriculture was left behind at that time (in terms of carrying out Reforms) , which resulted into Sectoral Imbalances as growth rate as seen in Manufacturing and Service Sector was not visible in Agriculture as the Sector Growth was lower at 3-4% p.a. Major Issues which has adversely impacted growth of Agriculture and Farmer’s income are as follows:

Lower Productivity

India’s Farm Yield is 30-50% lower than that of Developed Nations. Table below compares Yield Per Kg for Cereals (Wheat, Rice, Maize etc.). Reasons for such low Productivity are: