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Wake-Up Call for Farmers of India, It's No More Gandhi’s Philosophy of Trusteeship
The issue is that the government is eyeing for doubling of farmers’ income and investors are interested in investments in mostly post-harvest activities like processing and market connectivity aka supply-chain
Photo Credit : Shutterstock
‘Wealthy people be the trustees of Trust which may look after the common people’ said the father of the nation, Mahatma Gandhi. There was a time when visionary industrialists like JRD Tata started following this philosophy. Though socialist movements have criticised the same, calling the philosophy to be in favour of landlords. Indian farmers have always been in the core of the philosophy.
But when sounds of discomfort start coming from entrepreneurs and modern-day investors, it is an alarming signal for farmers in India. According to an India brand equity foundation report, which quotes the Department of Industrial Policy and Promotion (DIPP), ‘the Indian agricultural services and agricultural machinery sectors have cumulatively attracted Foreign Direct Investment (FDI) equity inflow of about US$ 2,315.33 million from April 2000 to December 2016’.
How is it the time to be innovative or perish? During national skill foundations summit on climate-smart agriculture in New Delhi on October 12th, there was a serious discussion on the topic, ‘Integrating investment opportunities into the user eco-system’. Various initiatives taken by shell foundation had been showcased on the background of the discussion. Few interesting points came out, as warning signs for policy makers and of course for farmers. Around 60 per cent of investments in agriculture is specially focussed on pre and post-agricultural activities, said Ritu of Ankur Capitals.
Now the issue is that the government is eyeing for doubling of farmers’ income and investors are interested in investments in mostly post-harvest activities like processing and market connectivity aka supply-chain. What will happen to the person who is growing grains on their farms? Possibly he is the same farmer who commits suicide due to various reasons ranging from personal to opting for un-organised country money lenders for farm credits on harsh terms and conditions.
The government initiatives of Investments
As per the report of India brand equity forum, the government has taken various measures (possibly being the sole body to bear responsibility of the last line of farmers)
- Total allocation for rural, agricultural and allied sectors for FY 2017-18 has been increased by 24 per cent year-on-year to Rs 1,87,223 crore (US$ 28.1 billion). A dedicated micro-irrigation fund will be set up by National Bank for Agriculture and Rural Development (NABARD) with a corpus of Rs 5,000 crore (US$ 750 million). The government plans to set up a dairy processing fund of Rs 8,000 crore (US$ 1.2 billion) over three years with an initial corpus of Rs 2,000 crore (US$ 300 million).
- The participation of women in Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has increased to 55 per cent and allocation to the scheme has been increased to a record Rs 48,000 crore (US$ 7.2 billion) for FY2017-18.
- Short-term crop loans up to Rs 300,000 (US$ 4,500) at a subsidised interest rate of seven per cent per annum would be provided to the farmers. An additional incentive of three per cent is provided to farmers for prompt repayment of loans within due date, making an effective interest rate for them at four per cent.
The Warning Sounds
During the session, it was said that ‘Farmers get everything free, be it electricity, fertilizer subsidy or loan-waiver then, why is it difficult to sell anything to them’. The speaker may have forgotten that, had this been freebies to the farmers, lakhs of farmers wouldn’t have paid the price by committing suicide. NABARAD chairman during a conversation with BW Businessworld had agreed that NPA’s in agriculture have lowered. So, is it the big fish the banks do not catch but follow the snail of the pond!
Another speaker, from a firm that is pushing micro-nutrient enabled bio-fertilizer, had said that it is difficult to deal with the government. The government, a body which remains the last ray of hope for a farmer. This had been followed by the urge of new venture capitalists for Indians, to be more innovative, so that VC’s may feel more secure with their investments which is again a chicken and egg issue of the agrarian economy where opportunity by foreign direct investors are identified prior to country investors, as FDI as cumulative had been huge in terms of figures inflow of about US$ 2,315.33 million.