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Rising Above Binary Choices In Indian Agriculture
India’s dependence on cities for development has been disproportionately high. 63% of GDP today comes from urban centres while 65 % of the population lives in rural areas.
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The debate in agriculture is fraught with binary choices. The prime time debate of the day, following the reactions to the Farm bill is - Mandis, or Markets? Equally critical questions, with a bearing on long term economic and environmental outcomes include - Should the rural youth persist with agriculture, or migrate? Should food production focus on higher yields, or on better nutritive value? Is it okay to trade off long term ecological sustainability to extract short term gains in productivity? These make for entertaining prime time television debates but in almost every pair of seemingly exclusive options, the answers lie in mitigating the tradeoffs and expanding the total opportunity to achieve sustainable development.
MAKING MARKETS AND GOVERNMENT WORK FOR ALL FARMERS
Over the past several years, experts across the spectrum have advocated de-regulating the agriculture sector and opening up spaces for market-led efficiency and innovation. For such a promising step in what has been touted as the right direction, the reactions from the farmers on the Farm bills have been far from enthusiastic. The confidence in the markets to deliver better outcomes than public procurement systems is low - primarily driven by fear that markets will serve the consumer first, not the producer.
As long as we see farmer income vs. food inflation as opposing forces that need to be balanced, we remain in the state of stalemate, worse conflict. Instead - what if we were to ask the question - What would it take to increase the profitability of the farmer, while holding food inflation constant? What opportunities can we create for the farmer - particularly the youth in farming communities - to expand the livelihood, increase revenue streams and reduce the costs as well as exposure to risks?
In May 2019, NABARD announced an investment of Rs. 700 crore (US$ 100 million) venture capital fund for equity investment in agriculture and rural-focused start-ups, signalling that the time is ripe for agritech innovations that put the farmer, particularly the small farmer at the centre. In recent times, we have seen notable startups like Samunnati, EM3, Agrostar, to name a few - focused on improving farming practices, easy access to working capital, an efficient supply chain, reduction of information symmetry, transport and warehousing infrastructure, etc that have the potential to radically alter the unit economics in farming. And unlike in developed countries where this was achieved through large capital and heavy machinery, India’s leapfrogging opportunity comes at a time where technology can make infrastructure accessible even to a small farmer. There is also a very real opportunity in value chain expansion for a lot of crops such as biomass management for crops like sugarcane and rice. For instance, the estimated annual bioenergy potential from the surplus crop residue biomass is 4.15 EJ, equivalent to 17% of India's total primary energy consumption but very little of this value is realised today.
Innovation to improve farm profitability, if aided by a nurturing policy environment, can result in a win-win for both farm and fork. I am personally excited to see disruptive innovations in this space expand livelihood opportunities for rural youth and increase farmer income at scale.
FOOD AND NUTRITION SECURITY
Beyond the market vs. mandi debate is an equally critical tradeoff between yields and nutrition. Between 1967 and 1979 the push for food security was the dominant feature of our agricultural policy. In the effort to feed a growing population, and becoming a food surplus nation, we inadvertently compromised on unit nutrition in food to the extent that our current sufficiency masks an acute undernourishment statistic. Over the last 50 years, the amounts of protein, calcium, phosphorus, iron, riboflavin and vitamin C in conventionally grown fresh fruits and vegetables have declined significantly. - as revealed in an intensive study of USDA nutrient data by the University of Texas. Similar trends have been established in India, as a consequence of bias for high yielding varieties and depleting soil nutrients. In parallel, this also depleted biodiversity and endangered several highly nutritious indigenous varieties of grain and other food that did not meet the bar for density of yield.
With advances in agricultural life sciences, we have a unique innovation opportunity to restore nutrition in food. Artificial Intelligence is making great strides in low-cost and in-situ measurement of nutrition in food. This has immense potential to incentivise crop and seed selection in favour of high value varieties. Life sciences in agriculture remains an area of underinvestment even as the agtech market grows, but with the right stimulus, we could usher in a new wave of bio-diverse and sustainable options in food production.
INDIA’S CITIES WILL GROW AND HER VILLAGES MUST THRIVE
India’s dependence on cities for development has been disproportionately high. 63% of GDP today comes from urban centres while 65 % of the population lives in rural areas. The labour surplus in rural India and the related poor per capita income has in recent years, triggered one of the largest inland displacements in Indian history. According to a 2017 survey by the UN, by 2030, 40.76% of India’s population was expected to reside in urban areas - an estimate that is up for revision, following the inability of cities to provide for its migrant workers during the pandemic. Notwithstanding, migration is here to stay and our cities must become more equal to enable migration at lower social cost.
While migration will not abate, the more sustainable solution to address the labour surplus is to plan for economic growth and prosperity in rural India. For India’s villages to thrive, youth in the villages need to see opportunity and prospects beyond farming. Infusion of capital, combined with developing agency in communities, particularly women and the youth, will be key to create a strong foundation for positive, long term social and economic outcomes. Opportunities in near-farm industry, energy from farm waste, processing of agri products, structured food storage and transportation, cottage industries etc. are all areas where the synchronized development of human and commercial capital can rebalance rural India’s contribution to the national GDP.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.