To: February 18, 2016
Shri Arun Jaitley,
Union Finance Minister,
Government of India.
Sub: Our demands for Agriculture and Farmers’ Welfare/Empowerment in the upcoming Budget
Namaste! This is about the need to enhance and incorporate appropriate outlays for Agriculture and Farmers’ Welfare/Empowerment in the upcoming Budget 2016-17, without which, not only will the Agriculture Sector not be able to deliver on growth expectations and thereby impact the rest of the economy also, but will also mean serious distress and increased numbers of farm suicides in India. As a pan-Indian Alliance representing organisations and individuals from 23 states of India, the following are our demands from the upcoming budget and we hope these will be ensured and incorporated.
1. The first and most important thing that we ask for are increased outlays for agriculture, for all departments – these outlays should certainly be higher than 2014-15 and it is not enough that they are higher than 2015-16. India Budget 2015-16 was a serious disappointment in that it actually cut down budget allocations for Ministry of Agriculture to levels less than 2011-12, i.e., five years earlier! A quick look at the following table illustrates this. It is clear that “Farmers’ Welfare” added to the Ministry’s mandate cannot be fulfilled unless adequate public investments are made in the sector.
|Ministry of Agriculture (Plan & Non Plan)||24176.72||27931.59||29772.83||31062.64||24909.78|
|Dept of Agriculture & Cooperation (DAC)||17522.87||20530.22||21933.50||22652.25||17004.35|
|Dept of Agricultural Research & Education (DARE)||4957.87||5392.00||5729.17||6144.39||6320.00|
|Dept of Animal Husbandry, Dairying & Fisheries||1696.25||2009.37||2110.16||2266.30||1585.43|
2. Given that legalising land lease through mechanisms like the Licensed Cultivators’ Act in AP and Telangana is receiving serious attention from the government now (with NITI Aayog studying the subject and likely to come up with its Expert Group recommendations in a month’s time), and given that Bhoomiheen Kisan Credit scheme has taken off very well from reports available, we propose that a Guarantee Fund be set up to increase the bankers’ confidence in lending to non-land owning “licensed” cultivators, both as individual farmers and in Joint Liability Groups. Such a Fund needs to be established and can have around 5000 crore rupees set aside for the purpose in 2016-17.
3. Natural Disasters that affect farming will not be one-off occasional incidents any more in this age of Climate Change. A serious overhaul of the Disaster Relief system as much as it affects agriculture is urgently needed, including the institutional machinery between Finance, Home and Agriculture Ministry streamlined and overhauled. Meanwhile, outlays have to increase to at least 25000 crore rupees, going by the drought experienced this year in various states (this is based on requests from states after their assessment of loss) for SDRF/NDRF to respond promptly to extreme weather events even as crop insurance system has to be improved drastically. This year for instance, the allocation was only Rs. 8679 crore rupees while the approved assistance was around Rs. 13549 crores which itself is much less than what is needed!
4. Investments on Farmer Producer Organisations (FPOs) have to increase manifold, whatever channel is used for the same (NABARD, SFAC etc.). Many analysts have shown that a communitarian approach to farming in the form of FPOs have increased profitability of smallholders and other farmers. This investment is meant for decentralized storage infrastructure, processing and value addition facilities for farmer collectives, for more direct and branded marketing by producer collectives etc. This could be taken up to 1500 crore rupees (from around 800 crores in 2015-16).
5. Scaling up investments on risk-reducing ecological agriculture: The Paramparagat Krishi Vikas Yojana (PKVY) is the first national level scheme of its kind which seeks to promote organic farming and thereby, resilient farming to reduce riskiness in agriculture (whether of risk related to complete crop loss that afflicts monocropped, intensive agriculture systems, by introducing biodiverse cropping systems based approach, or by way of reducing out of pocket investments and thereby indebtedness of farmers). Such is the demand for agro-ecological approaches to be scaled up and mainstreamed that PKVY targets have been exceeded in the first year of implementation. This investment is also to be seen as both a mitigation as well as adaptation effort in the context of climate change, given that this approach reduces GHG emissions, as well as captures more carbon in the soil. From 300 crores in 2015-16, the outlays may be increased to at least 1000 crore rupees. Within this, a specific component of reviving traditional crop diversity in all farms of India may be introduced, to complement the efforts of revival of traditional cattle breed and agro-ecological farming.
6. Rainfed agriculture needs watershed management investments continuously; it is to be noted that in many ways, this is the only significant investment that has gone into rainfed areas of the country over the decades, and it has also had its positive impact in rainwater harvesting, checking of water and soil run-off and groundwater recharge. Watershed investments cannot be scaled down in any way and need full attention, though subsumed right now under Pradhan Mantri Krishi Sichai Yojana. The watershed component (IWMP) of PMKSY got 1500 crore rupees in 2015-16. This may be enhanced to Rs. 3000 crores at least, which should also be seen as a drought proofing effort in the context of climate change and India’s predominantly rainfed agriculture, and given dedicated support.
7. For existing as well as new price support and marketing schemes, including Price Deficiency Payments (new proposal to make MSP effective and meaningful beyond procurement by government of a few commodities in some locations), Market Intervention Scheme (for perishables and those products not covered under price support schemes) or Price Stabilisation Fund (for plantation crops), we seek enhanced outlays. This is one of the most crucial aspects to farm profitability. In fact, by utilizing the concept of “Flexible Procurement Price” as has been pioneered by Karnataka Government in the recent past, the Public Distribution System should be used to procure pulses and millets too, to increase the food basket for poor consumers and to encourage farmers to diversify through assured markets. Right now, a scheme like Price Stabilisation Fund has only 436 crore rupees infused under the scheme. The recommendations of Ramesh Chand Committee report on MSP-fixing formulae should also be accepted and implemented. This aspect of Indian agriculture needs serious attention, and at least 5000 crore rupees have to be set aside for this.
8. Finally and very importantly, we would like a Farm Income Commission to be set up to make all interventions accountable towards delivering minimum living incomes to farm households. To begin with, this budget can have 10 crore rupees allotted for this, for the contours of the Commission’s work to be worked out with such an outlay, with increased and adequate outlays in subsequent years. To move ahead with the Pay Commission recommendations without addressing inter-sectoral parity issues would also pave way for a highly unequal society in India.