Wednesday, July 4, 2018

Why farmers cannot sell their produce on their own at reasonable price

I see 3 reasons for it
1. More than 50% farmers are in the clutches of debt. So I doubt if the produce is even theirs to start with.

2. APMC act forces farmer to only sell their products through Mandis established by government. So end users cannot buy their grains directly from farmers. 

The mandis created by GOI are restricting farmers instead of ensuring good prices.

3.  Finally, A good analysis by Rajiv Tyagi of politics on the issue
We are a strange hypocritical nation. No politician can get the farmer a 'good price' for cauliflower or any other vegetable. He cannot play politics with a farm produce that has such a short shelf life.
But come to grain and we now have a farm produce with a rather large shelf life. This is something he can play politics with. So every politician wants to get the farmer a 'good price' for his grain. Every political party will climb over the other's shoulders, promising the farmer higher prices. Every year, a well publicized exercise announces a minimum support price for grain which the Government purports to be interested in buying. The farmer queues up to sell his wheat. He waits... and waits... and waits... but the Government is not yet ready to pick up the wheat. The farmer does not have enough roofage to protect his entire production. Some of it is stored in bags or just freely in the open. He expects the Government to pick up his wheat. It doesn't. And then it rains. And his entire stock of wheat that was in the open, rots after getting wet. In theory he had become a relatively better-off man. In reality he has sunk further.
With sugarcane, the stakes are even higher! Here is a farm produce which has an industrial process connected with it! Oh goodie! So with sugarcane, every politician has the opportunity to extort or partner with the sugar industrialist, create laws that allow the sugar mills to cheat and ignore the farmer and keep fooling the farmer with 'good prices' for his produce. Then, as a smokescreen, the politicians' Governments will issue periodic threats to jail sundry industrialists and control orders on the price of levy sugar!
The farmer, even when he realizes the desperate situation he has been caught in, cannot but acquiesce to the system that has been created for 'his benefit', by the nexus of the politician and the industrialist, because he has to keep his hearth alight. So he has to keep growing sugar cane and keep supplying it to the mills, because thereby he will get a trickle of the payments already owed to him by the mills. In UP, as in every other state, farmers are owed sugar cane payments from two years ago! And nobody cares a damn - least of all the politician who is a beneficiary of the sugar mills' largesse and 'friendship'.
Every State has a milk scheme. Farmers can make good money from selling milk. But no one has thought through the entire cycle. If the farmer buys a buffalo, he has to fork out speed money to get a loan from the milk cooperative. If his buffalo dies through illness, he has to run around to claim his insurance. There too he has to pay heavily in bribes and spend productive days making expensive trips to a nearby city, to pursue the insurer. He cannot pay back his loan from the milk cooperative. The milk cooperative sends him a legal notice for recovery of dues. Where does he go? Right into the arms of the doodhiya - the local milk businessman. The doodhiya provides him with a buffalo the very next day - no questions asked. If that buffalo dies, the doodhiya brings in another one, right away! But all of these 'services' cost and enormous lot, till the farmer is left milking buffaloes and paying all proceeds of the sale of milk to the doodhiya... All because the Government's systems aren't sensitive enough to tackle the real need of the farmer on the ground.
It doesn't need too much intelligence to understand why every politician wants to administer the price of grain and sugar cane to 'benefit' the farmer! And he has been successful in getting tacit support from the farmer because there is nothing else the farmer can do! To make ends meet, the farmer keeps sinking into deeper and deeper debt, with interest rates starting at a usurious 24% and going up to an unsustainable 40-50%! All the while hoping that he will get out of the debt trap once his wheat crop is sold or last year's sugarcane payment is released by the sugar mill. And then his wheat crop fails! The money lender has been at his door almost every week for the last six months. He knows he now cannot pay because his crop has failed... In a fit of depression he takes the easy way out...
Such has been the story of India's farmer.
What is the solution? How can we help him get out of this desperate situation? How can we prevent suicide as the only solution to the marginal Indian farmer's life?
Any suggestions?

Source:
Agricultural produce market committee
More than half of Indian Agricultural households are indebted and 1/4th of the loan is taken from the Money Lender

No comments:

Post a Comment