Indian Agriculture: Emerging Issues and Policy Perspectives

Indian Agriculture: Emerging Issues and Policy Perspectives[1]

Srijit Mishra 

Introduction

The summer of 2014 got drenched with the elections euphoria, but for Indian agriculture all eyes are set on the prospects of a good monsoon. Is there a possibility of an El Nino? Will it lead to a drought like condition and have an adverse impact on agricultural production? How will this impact those dependent on agriculture for their livelihood? What about farmers' suicides? These questions remind us of the larger agrarian crisis and its interrelated dimensions of an agricultural developmental crisis. The former is about declining share of the overall pie towards agricultural sector, poor returns to cultivation, and nutritional deprivation while the latter is about inadequate and inappropriate planning that led to a deceleration in the growth rate of production and productivity, and an increase in risk and vulnerability. This also calls for alternative policy thinking.

Agrarian Crisis

The share of agriculture and allied activities in gross domestic product at constant 1999-2000 prices decreased from 41 per cent in 1972-73 to 14.6 per cent in 2009-10 while during the same period the share of employment in the sector declined from 73.9 per cent to 53.2 per cent. This means that the average returns per worker in agriculture and allied activities as a proportion of average returns per worker in non-agricultural activities has declined from 24.5 per cent in 1972-73 to 15.0 per cent in 2009-10.

There is an increasing marginalisation of holdings as indicated through agricultural census. Between 1970-71 and 2010-11 the distribution of operational holdings indicate that the share of marginal (0-1 hectares, ha) increased from 51 per cent to 67.1 per cent while that of others declined - for small (1-2 ha) from 18.9 per cent to 17.9 per cent, for semi-medium (2-4 ha) from 15 per cent to 10 per cent, for medium (4-10 ha) from 11.2 per cent to 4.2 per cent and for large (10+ ha) from 3.9 per cent to 0.7 per cent.

A situation assessment survey conducted for the agricultural season of 2002-03 indicates that average monthly household income compared to expenditure is lower for small (Rs.1,659 and Rs.2,482), medium (Rs.2,493 and Rs.3,148) and semi-medium (Rs.3,589 and Rs.3,685) holdings while it is higher for medium (Rs.5,681 and Rs.4,626) and larger (Rs.9,667 and Rs.6,418) holdings. What is more, even after increasing the returns by one-third to account for the drought, per capita per day returns to farmer households was less than Rs.8. Assuming a 6 per cent annual average growth rate, which is much on the higher side, the per capita per day returns in 2013-14 would double to Rs.16. This explains the poor returns to cultivation. With nearly half the population being still dependent on agriculture, the non-farm opportunities remain limited.

The 2013 Global Hunger Index puts India at a rank of 63 from among 78 countries, which is lower than some of the Sub-Saharan countries and all the other South Asian countries. The per capita per day availability of foodgrains, as indicated in the State of Indian Agriculture 2012-13, has reduced from 510 grams in 1991 to 463 grams in 2011. This is also reflected in the per capita per day calorie and protein consumption as the national sample survey estimates of 1993-94, 2004-05 and 2009-10 suggest. Such an outcome is also because of a shift in the cereal production and their consumption from millets to rice and wheat. There have been recent initiatives to increase the millets production and their consumption.

The manifestation of the agrarian crisis has been identified with farmers' suicides. However, it is symptomatic and its absence does not necessarily preclude risks. A comparison of suicide mortality rates (SMRs, suicide deaths for 100,000 persons) between farmers and non-farmers suggests that at the all India level the difference in the rates diverged the most in 2004 (18.8 and 13.6) and then there was a secular decline in the gap till 2008 (16.9 and 14.7) to diverge again in 2009, a drought year, and then started converging again from 2010 to 2012. However, a closer look at the six states with relatively higher incidence of farmers' suicides indicate that for the recent three years (2010 to 2012) the rates are diverging in Andhra Pradesh, Maharashtra and Kerala and converging in Chhattisgarh, Karnataka and Madhya Pradesh. The turnaround in Chhattisgarh is because it has stopped reporting farmers' suicides and instead increased reporting of a category called self-employed others. In addition, West Bengal did not report profession-wise suicides data for 2012. Thus, the convergence that one observed at the all India level is more on account of inappropriate and incomplete reporting. In any case, one has to look up other aspects to identify possible changes.

Agricultural Developmental Crisis

Using triennium ending data divided to three sub-periods, 1981-82 to 1993-94, 1993-94 to 2004-05 and 2004-05 to 2010-11, an analysis of growth rates computed through a double-kinked exponential curve suggests that the growth of agriculture and allied activities in the first period (3.3 per cent) was statistically significantly higher when compared with the second period (2.7 per cent) and there has been an increase in the growth rate in the recent period (3.0 per cent). An analysis in terms of value addition points out that the growth rate in the first period was statistically significantly higher than the second period for cereals (3.3 per cent and 1.0 per cent), pulses (1.5 per cent and -0.03 per cent), oilseeds (6.1 per cent and 0.5 per cent), cotton (4.1 per cent and 1.0 per cent), milk (5.0 per cent and 3.7 per cent) and meat (5.1 per cent and 2.9 per cent); the growth in the third period was higher than the second period for all the above except for milk (3.5 per cent) and it was statistically significantly higher for pulses (2.5 per cent), oilseeds (4.8 per cent) and cotton (13.7 per cent).  The trends observed till 2010-11 have continued till 2013-14, but for a setback in 2012-13 because of delayed onset and deficient rainfall.

Conventionally, in monsoon India, the farmer was exposed to either yield or price shocks that were supposed to move in opposite directions counterbalancing each other. Today, the possibility of yield risk increases because of unavailability of power that in turn affects water availability at a crucial time, or because of spurious seeds or due to an increase incidence of pest attack or because of weather changes. Further, because of global integration, price volatility has increased and price shocks could be because of higher subsidies in the United States or the European Union. And, with these changes the two risks do not counterbalance each other and the farmer can also be exposed to both the shocks in the same season.

 

Over the years, the farmer is increasingly relying on the market for inputs. The link between ground realities and publicly funded research and extension is waning and the farmer depends on the input-dealer leading to a supplier-induced-demand. What is more, the private provisioning of inputs without any regulation to address the sale of spurious products or other market irregularities increases farmers' vulnerability. Further, with changes in technology, the farmers' current knowledge become redundant and there is deskilling.

Adequate, affordable and timely availability of credit would be essential for any enterprise, but this has been eluding the Indian farmer. In addition, agricultural credit is about doing the same things again and again and not linked to horizontal or vertical expansions. Thus, any shocks are likely to make debt non-serviceable and this would make the farmer ineligible for subsequent loans from formal sources. This would increase the reliance on informal sources at a greater interest burden.

Input-intensive cultivation practices bring in risks that go beyond weather and market uncertainties. There can be inappropriate fertiliser applications having an adverse impact on soil health resulting in yield fatigue or pesticides having harmful impact on livestock and human health or depletion of groundwater among others. A way out being propagated is an expansion of the same, that is, to bring more areas under the input-intensive approach - the look east policy being touted under a second green revolution or an evergreen revolution. The argument put forward in favour of this or other technology-driven approach is that there is no alternative (TINA).

Alternative Policy Thinking

In practice, multiple alternatives exist (MAE, an acronym that sounds as mother in some vernacular languages and we refer to it as mother earth depicting the multiple alternatives that she provides) that is context-specific. It differs across locations and evolves over time. It questions the one-size fits all approach. Such thinking takes advantage of the variability of the natural resource base and the diversity in the production systems. As each crop has a different life cycle, the diversity spreads out the vulnerability from each episode of unforeseen climatic events. In addition to an integration of different crops, the system is also integrated with livestock production. These could lead to low external input sustainable agriculture (LEISA). The application or propagation of this approach is knowledge centric.

Comparing knowledge-centric MAE to technology-driven TINA, one can state the following.

• MAE is bottom-up where different knowledge providers will not only have to keep the local specifics in mind, but will have to work in tandem with the users. TINA is top-down where the provider of the technological-fix, as a solution to some presumed problem, is considered hierarchically superior to the user of that technology.
• MAE is context-specific, requires an understanding of the system dynamics and evolving of effective structures to manage them. TINA is crop-specific and involves application of inputs/technology to enhance production.
• MAE focuses on the production of a complex system with an important emphasis on risk reduction. TINA focuses on a single crop or livestock with an emphasis on improving productivity.
• MAE understanding of efficiency is from a system perspective. TINA looks into efficiency in the technological and economic sense that is normalised per unit of input.
• MAE involves marginal lands with the crop-livestock system spread over a larger area and in that sense is extensive. TINA is mainly in areas with better soils and with access to water (preferably through irrigation) and input-intensive.
• MAE is about integration of mixed and multiple crops with livestock. TINA is about specialisation that espouses mono-cropping.
• MAE production on private lands is dependent on commons. TINA production is in owner-operated lands.

Despite these differences, MAE like TINA, cannot happen on its own. To promulgate it, one needs the support of appropriate knowledge, resources and adequate leverage with marketing opportunities and information technology. It also requires constant monitoring and evaluation.

One of the recent initiatives in-line with MAE is the interventions in comprehensive pilots through the Revitalizing Rainfed Agriculture Network (RRA-N) comprising of a number of civil society groups spread across the country. The comprehensive pilots are spread across different agro-ecological conditions and focuses on integrating knowledge-centric interventions on water, soil, seed, livestock, fisheries, credit and institutions among others. They also collaborate with the local-level line departments and other government functionaries, as that is very essential to scale-up within the pilot area. The interventions that started in Kharif 2012 have attracted the attention of the Planning Commission, the Department of Science and Technology and the Food and Agriculture Organization. This requires greater research engagement that will delineate the specificities in each comprehensive pilot and identify the similarities across comprehensive pilots to facilitate their application beyond the pilot areas.

To sum up, Indian agriculture has been going through a crisis that is agrarian as also agricultural. A way out of this is to explore context-specific knowledge-centric approaches. This, to borrow a term, has the potential for an inclusive, sustainable and food-secure India.

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[1] This is a slightly edited and hyper-linked version of a write-up that has been published in Yojana, June 2014, pp.58-60 (the PDF version of the issue is available in Google drive). It draws from some of my recent works. They include: Technology, Development, and Farmers' Suicides in India: A Misplaced Debate, Visiting Fellows Seminar, Asia Research Centre, London School of Economics and Political Science, 20 March 2014; Agriculture in India: Performance, Challenges and Opportunities (with S Mahendra Dev and Vijaylaxmi Pandey) in Ashima Goyal edited The Oxford Handbook of the Indian Economy in the 21st Century, Oxford University Press (OUP), New Delhi, 2014;  Rainfed Agriculture: for an inclusive, sustainable and food secure India (with A Ravindra and Ced Hesse), IIED Briefing Paper, April 2013; Persistence of Crisis in Indian Agriculture: Need for Technological and Institutional Alternatives (with D Narasimha Reddy), in Dilip Nachane edited India Development Report 2011, OUP, New Delhi, 2011; and Agrarian Crisis in India (co-edited with D Narasimha Reddy), OUP, New Delhi, 2009 among others.

Some earlier related blogs on this theme are:

India's best dramebaaz

Farmers' suicides and crisis in Indian agriculture

Remarks on rural credit for globalising farmers

Opinions and priorities for agriculture in India

The farmers' strain

India's best dramebaaz

India's Best Dramebaaz is a reality show for 5-12 year old children that is different from many others. Unlike many other shows the children are not stressed and seem to be enjoying while learning and honing not only their acting skills but also lessons in life. The concepts are educating for adults too.

I was tempted to write this after the play depicting farmers predicament (18 May 2013, starts at 18th minute). In the act, Aditya was brilliant and the judges have already conveyed that and I cannot add to it. But, what is even more commendable is the concept and the message that was portrayed that taking ones life is not the solution. A socially relevant issue was handled very sensitively. It also has lessons for reportage.  Kudos to the mentors and the judges.

Of course, the sensitivity with which issues are handled is true of many other acts such as pressure of studies on children, caring for old parents, the environment and many others while opening up our eyes to history, culture and other contemporary issues. I am not elaborating on those. The reason for speaking about a particular theme could also be because of my own related research on Maharashtra or about Agrarian Crisis in India leading to possible solutions in rainfed agriculture among others.

Satyamev Jayate on Toxic Food: Some Concerns

The eighth episode of Satyamev Jayate on toxic food was one where I saw many familiar faces Ramanjanayelu and Kavitha. In the background, one also saw Mr Raidu who has been looking into Community Managed Sustainable Agriculture of Andhra Pradesh. The two organisations selected for receiving funds donated by people are Ramanjanayelu's Centre for Sustainable Agriculture and Umendra Datt's Kheti Virasat Mission. I had met them, a couple of weeks ago at a Bt review meeting (see press note and a write-up along with a comment from the other perspective in Down to Earth). I use this to write a couple of related things.

Both pesticides production and organic exports have good business propositions. Moral and ethical concerns are outside the realm of these decisions. Hence, those into agri-business can enter into both the domains and there is no contradiction in that.

The Non Pesticidal Management (NPM) movement of Andhra Pradesh is to make the cultivation less costly by largely using locally available resources and by following a list of practices without applying pesticides.  This does lead to the product being organic, but we keep the business of labelling it aside so as to keep the farmer away from the associated costs and risks. It also keeps the onus of contamination from groundwater, air or through any other means outside the purview of the farmer. Of course, they are equally important and need to be appropriately dealt with, but it definitely does not call for reprimanding the farmer.

A related point about the success of Andhra Pradesh is the existence of institutions of women through Self-help Groups (SHGs) of women that have been federated to village, mandal and district level community based organisations. These have been indicated in my co-authored paper Persistence of Crisis in Indian Agriculture: Need for Technological and Institutional Alternatives, in Dilip M. Nachane edited India Development Report 2011, Oxford University Press, New Delhi, pp.48-58, see pre print version. This institution building of farmers is relevant because in its absence their bargaining power against large market players become weak - these players could either be the sellers of external inputs or the buyers of the products.

The issue of farmers' suicides came into the discussion. I have written about it elsewhere (see Suicides of Farmers in Maharashtra with links to the report as also the executive summary). One thing which is relevant for the current purpose is that pesticide consumption continues to be the single largest method of committing suicide by farmers. This assumes importance because many pesticides that are banned elsewhere in the world are still available and that there are no regulatory mechanism about control their sale or even their usage. Globally it has been seen that checks and controls on fatal methods of committing self-harm have led to reduction of incidences. However, such controls will not address the Agrarian Crisis in India, but will reduce the loss of lives. 

An aspect related to farmers suicides among cotton farmers is the use of Bt seeds, which have become popular since its legal introduction about a decade ago. Their large scale usage and increment in production is cited as success by some, but in the absence of appropriate counterfactuals nothing much can be said about their yield increases. Today, most of the cotton farmers who commit suicides would have used Bt seeds, and hence, these seeds become an associated risk factor or one can at least state that their usage has not reduced such risks. Based on a study comparing bad or drought years, one can state that in some situations Bt has added to the risk of the farmer (see To Bt or Not to Bt, a co-authored working paper of mine).

In the Bt review meeting, mentioned earlier, one speaker compared the success of Bt with that of mobile phones. The analogy begins with both being new technological developments that were rarely used even a decade ago and today both are very popular. Fair enough!

We would  like to bring in some other dimensions of comparison. Usage of mobile phones, which were quite costly to begin with have become cheaper, even much cheaper than the landline and the (nominal) prices of the latter has not increased while Bt seeds continue to be costlier than the traditional alternative. The reduction in prices in mobiles was because of an introduction of  competition by bringing in many players whereas in Bt seeds the intellectual property right is owned by a single company who charge a royalty for it at a flat rate for each packet of seed and thereby increasing the cost. Mobile phones have facilitated communication and in that process access to knowledge, but use of Bt seeds brought in a new paradigm leading to deskilling of knowledge among farmers. An aspect of commonality, as indicated by concerns raised by some, is the possibility of health risk arising out of the radiation in mobile technology (more so from towers) as also from the toxicity in Bt plants.

Before I forget, those who want to sign the petition to the Union Agriculture Minister on India for Safe Food may sign and send the petition here.

For some of my other related writings see:

The farmers strain

Pesticide usage in India 

Day 28 of farmers marching across India to save agriculture 

Day 35 of farmers march coincides with Obama's visit to India 

Kisan swaraj yatra travels through Eastern India

Kisan swaraj yatra in North India

Options and priorities for agriculture in Indian on the eve of the 12th five year plan

Size-class and returns to cultivation in India

Hunger ethics and the right to food

Daughters are precious: first episode of Satyamev Jayate
Four episodes of Satyamev Jayate

Size-class and returns to cultivation in India

'Size-class and returns to cultivation in India: a cold case reopened' is the title of a recent working paper from IGIDR that Sarthak Gaurav and I have co-authored. This revives the age-old debate on farm size and productivity that started in the early sixties  by Amartya Sen. Some excerpts from the abstract, introduction and conclusions of the working paper are given below. An abstract of its revised version published in Oxford Development Studies is also given below.

Abstract

This paper investigates the relationship between returns to cultivation per hectare and size-class of land cultivated in India, using unit level data from the 59th round National Sample Survey, 2003. The analysis is done separately for ‘kharif’ and ‘rabi’ − for total value of cultivation from all crops at the all India level. The empirical evidence rejects the null hypothesis of no relationship and points to the existence of an inverse association. We argue that the efficiency of the small-holders has to be taken with a pinch of salt because their low absolute returns brings into focus the question of their livelihood sustainability which is further aggravated on account of higher unit costs. Being the first exercise in a series of proposed explorations into disaggregated analyses across states, and for specific crops, it opens up the classic debate on farm size and productivity in the 21st century.

Introduction

In recent years, Indian agriculture has been reeling under a crisis and one of the concomitant outcomes is poor returns to cultivation which has rendered farming as an unsustainable livelihood option – particularly for the marginal and small holders.2 This also raises the long debated question of inverse relationship between size-class and productivity, that is, whether marginal and small farmers are relatively efficient vis-à-vis larger size-class farmers? The current paper explores this aspect of Indian agriculture using unit level data from the Situation Assessment Survey of Farmers, administered in the 59th round of the National Sample Survey (NSS).This survey was conducted during 2003 and collected information for the agricultural year 2002-03.This is the latest (and the largest) nationally representative data set for analyzing the state of farming in India. By conducting the analysis at the unit level, to the best of our knowledge, we provide the first baseline for the 21st century. An attempt has been made to assesses the relationship between size-class and returns to cultivation; and in doing so, it expects to contribute and open-up the long drawn out, and till recently dormant debate.

...

Conclusions

An analysis of size-class and returns to cultivation using nationally representative data from the Situation Assessment Survey of Farmers (SAS) of the 59th Round of the National Sample Survey, for the period 2002-03 opens up the classic debate on the efficiency of the small holder. Our empirical results, computed separately for kharif and rabi, at an aggregate all India level as also for each size-class reject the null of absence of any relationship between size-class and productivity and indicate the existence of an inverse relationship. While the small holder seems efficient the low absolute returns raises questions on livelihood sustainability. This is also important from the perspective of the risk bearing capacity of the small-holders given the fact of their per hectare costs being higher.

To the best of our knowledge, these are the first estimates for the 21st century and at the pan-Indian level; and could be used as a baseline for comparative analyses in the future. Our empirical evidence can be considered as an important contribution to the literature on size-class and productivity relationship. While opening up this cold case we are aware that one needs to go down to further details and control for other factors that may affect returns to cultivation. It would be equally important to analyse the variation across states, social groups as also the crop-specific patterns. We plan to do some of these in a series of future exercises.

In spite of the limitations of our study, it is a first attempt at a fundamental problem in Indian agricultural using a nationally representative sample. Given the relevance of our findings in corroborating the story of a crisis in Indian agriculture on one hand, and with the promise to reopen the classic debate on farm size and productivity on the other, we argue for the need for further inquiries, and if feasible, a future round of the SAS as it is almost a decade since the first (and only) survey.

Those interested in the full paper can click, 'Size-class and returns to cultivation in India: a cold case reopened'.

A revised version of the paper is now available as 'Farm size and returns to cultivation in India: revisiting an old debate' Oxford Development Studies, Published online 21 Nov 2014.

The abstract of the revised version is as follows. This paper revisits the long-debated question of the relationship between farm size and productivity by studying the relationship between area cultivated and net returns to cultivation in India using a nationally representative data-set. The analysis is carried out separately for the two major agricultural seasons, kharif and rabi, and for both the seasons pooled together. Our findings suggest the existence of an inverse relationship, even when we control for a number of household and farm characteristics and even when we treat factors such as household type (occupation), social group (caste), agro-climatic zone (region) and agricultural season as fixed effects. The result is also robust to correction for selection bias. However, the efficiency of the smallholder as a result of this greater productivity has to be treated with some caution as it ignores the low absolute levels of their returns, which raise questions about the sustainability of their livelihoods. This is further aggravated by the fact that they pay relatively higher unit costs and because of their greater dependence on purchased inputs.

Whirlwind Tour of Odisha

A very happy new year to you all. I have just returned from a whirlwind tour of Odisha. The initial purpose was to attend the Indian Economic Association 92nd annual conference held at Bhubaneswar and perhaps combine it with a meeting of friends from School after 25 years. The latter could not materialize. Thus, I combined my visit with some other work and made a whirlwind tour of rural Odisha.

I visited places in Banki (one flood prone village where I had a two-hour discussion with villagers), Nayagarh (two farmer field school groups (FFSGs) - one in their field one in their village, two civil society groups that facilitate formation of FFSGs and Selh-help Groups (SHGs) and additional livelihood activities, and one farm house), and Puri (a cluster of two-three villages in and around Birapurusottampur, which happens to be my native village) and also had discussions with various stakeholders. It will not be appropriate for me to reveal the contents of my discussion now, but it does reiterate the grim agrarian scenario in Orissa. The macro observations indicated earlier in Poverty and Agrarian Distress in Orissa (nay, Odisha) is more or less substantiated by these field visits.

A disturbing picture that one observed during this visits is reportage of farmers' suicides by the media almost every day. I did disucss this with many and the responses were familiar as these are similar to the ones that one came across when I was starting the study on Suicide of Farmers in Maharashtra. People have to get out of the denial mode (that this is just a media hype) and the least that they can do is to stop blaming the farmers for this. The media can have a look at the World Health Organization (WHO) guidelines on suicide reportage. This is a symptom of the larger Agrarian Crisis in India, elaborately discussed in the book edited by D. Narasimha Reddy and me and published by the Oxford University Press. There is need for technological and institutional innovations that reduce costs and improve returns.

Agrarian Crisis In India

D. Narasimha Reddy and Srijit Mishra (eds.) Agrarian Crisis In India, Oxford University Press, New Delhi, 2009, pp.xxix+286, Rs.695, ISBN-13: 978-0-19-569595-3, ISBN-10: 569595-X.


Cover flap:
For more than a decade, Indian Agriculture has been marked by deceleration in growth and distress of farmers. This crisis is structural and institutional in nature, with farmers' suicides symptomatic of dee-seated maladies that have engulfed the agriculture sector. This book brings together for the first time a detailed analysis of this crisis in all its dimensions.

The complexity of the issues is unravelled by addressing both the macro context and the regional-level manifestations of the agrarian crisis. The macro dimensions include detailed analysis of structural, institutional and policy changes; institutional credit; and state of agricultural research. Case studies of five states-Maharashtra, Andhra Pradesh, Karnataka, Kerala, and Punjab, which experienced high and unusual incidence of farmers' suicides and agrarian distress-present the micro-perspectives. These case studies not only bring out the diversity of conditions prevalent in the states, but also highlight the common problem of failure of public support systems in agriculture. The methods used range from models of explanation based on data from national surveys to discussion of state-specific situations seen through farmer household surveys.

Providing a comprehensive picture of the state of Indian agriculture at eh turn of the twenty-first century, this book will be useful to researchers, policy makers, civil society organizations, and students of Indian economy, polity, and society.

Contents:
Foreword by R. Radhakrishna
1.Agriculture in the Reforms Regime by D. Narasimha Reddy and Srijit Mishra, pp.3-43.
2.Capital Formation in Indian Agriculture: National and State Level Analysis by Ramesh Chand, pp.44-60.
3.Agricultural Credit and Indebtedness: Ground Realities and Policy Perspectives by S. L. Shetty, pp.61-86.
4.Managing Vulnerability of Indian Agriculture: Implications for Research and Development by Suresh Pal, pp.87-106.
5.Farmers' Distress in Modernizing Agriculture-The Tragedy of the Upwardly Mobile: An Overview by V. M. Rao, pp.109-125.
6.Agrarian Distress and Farmers' Suicides in Maharashtra by Srijit Mishra, pp.126-163.
7.Farmers' Suicides and Unfolding Agrarian Crisis in Andhra Pradesh by S. Galab, E. Revathi, and P. Prudhvikar Reddy, pp.164-198.
8.Agrarian Transition and Farmers' Distress in Karnataka by R. S. Deshpande, pp.199-229.
9.Distress, Debt, and Suicides among Farmer Households: Findings from Village Studies in Kerala by K. N. Nair and Vineetha Menon, pp.230-260.
10.Agrarian Crisis in Punjab: High Indebtedness, Low Returns, and Farmers' Suicides by Karam Singh, pp.261-284.

Agrarian Crisis and Farmers’ Suicides in India

The larger agrarian crisis has two dimensions. On the one hand, there is a livelihood crisis that threatens the very basis of survival for the vast majority of small and marginal farmers as also for agricultural labourers. On the other hand, there is an agricultural developmental crisis that lies in the neglect of agriculture arising out of poor design of programmes and allocation of resources and having resulted in declining productivity and profitability. This twin dimensions could also be equated with the developmental discourse where the former is about displacement of people and the latter is about displacement of ideology. The outcome is that planning is not people-centric.

In monsoon India, abundance or paucity of water has always been considered as a major source of agricultural uncertainty. Today, this yield risk could also be because of spurious inputs or inappropriate use of technology. Increasing costs, price volatility, non-availability of credit from formal sources and other risks further compound it. Social responsibility of education, healthcare and marriage instead of being normal activities add to the burden. All these would even put the semi-medium farmer under a state of transient poverty.

An extreme response to this distress is the increasing incidence of farmerss suicides. Between 1995 and 2006, more than 190,000 farmers have committed suicides, 83 per cent of these being males. The suicide mortality rate (SMR, suicide death for 100,000 persons) for male farmers increased from 10.5 to 19.5 whereas that of male non-farmers has more or less remained around 13. The major states with SMR for male farmers greater than the all India average of 18 during 2001-06 are Kerala (233), Maharashtra (53), Chattishgarh (47), Karnataka (39), Andhra Pradesh (35), Tamil Nadu (31) and West Bengal (21). It is to be reiterated that suicide is a symptom of the larger crisis, and its absence does not in any way indicate the absence of a crisis.

It is only in Kharif 2008 that one observes a substantial increase in the minimum support prices of the 16 major crops. In fact, the absolute increase would be almost equal to increments in the entire decade. Though welcome, this vindicates the established fact that returns to agriculture had turned out to be abysmally low. Per-capita per day returns to farmer households from cultivation in 2002-03 was eight rupees. Another recent public policy intervention has been the Rs.70,000 crore debt waiver package. This is just a book keeping exercise and at best will reduce the burden from formal sources. Indebtedness, like suicides, is another symptom.

Risk mitigation has to go beyond suicides and debt. What is more important is to spruce up public investments that will increase returns to cultivation. Skill enhancement and linking of opportunities to local resources are required to increase non-farm income. Success of the credit and input markets require effective regulation. There is a case of encouraging technological and financial products that would reduce costs while increasing returns. Institutions that can organize farmers are required.

My earlier blog on a related theme is Indian Agriculture in Doldrums.


Selected Readings:

Bhaduri, Amit (2008), Predatory Growth, Economic and Political Weekly, 43 (16), 10-14.

Government of India (2007), Report of the Expert Group on Agricultural Indebtedness, Chairman: R Radhakrishna.

Mishra, Srijit (2007), Agrarian Scenario in Post-reform India: A Story of Distress, Despair and Death, Orissa Economic Journal, 39, (1 & 2), 53-84. IGIDR Working paper version is WP-2007-001.

Mishra, Srijit (2008) Risks, Farmers’ Suicides and Agrarian Crisis in India: Is There a Way Out? Indian Journal of Agricultural Economics, 63 (1), 38-54. IGIDR Working paper version is WP-2007-014.

Reddy, D. Narasimha and Srijit Mishra (eds.) (2008) Agrarian Crisis in India, Oxford University Press, forthcoming.

This is the abstract of a presentation at a one day international seminar, “Environmental degradation and food crisis – Lessons for India” being organized by Greenpeace India on 24 October 2008 at India International Centre, Lodhi Road, New Delhi, India.