In election year, farmer on centrestage -Harish Damodaran and Parthasarathi Biswas

-The Indian Express

The new year could witness the first national elections being fought on farmers’ issues. And it could test both the ruling BJP pushed to the defensive, particularly in the larger sugar-producing states, and the Congress under pressure to deliver loan waivers

If 2017 saw the beginnings of agrarian unrest in large swathes of the country, 2018 brought it centrestage as the numero uno political issue. And almost everyone’s agreed that in April-May 2019, when the next Lok Sabha elections are due, farmers and rural India would be the key campaign theme.

For farmers, the main concern today is prices for their produce. As the accompanying chart shows, average wholesale rates in mandis during October-November, the peak marketing period time for the post-monsoon kharif season crop, ruled lower than the government’s minimum support prices (MSP) for practically every agri-commodity. The only exceptions were jowar (sorghum) and cotton — in which the major growing states of Maharashtra and Gujarat, respectively, have had droughts — and sesamum, a premium oilseed that rarely trades below MSP.

One indicator of the price pressures being faced by farmers is the official wholesale price index (WPI). The average annual inflation based on it during January-November 2018 over January-November 2017 was minus 0.33% in “food articles” and 1.66% for “non-food” agricultural articles. Coming on top of the previous calendar year’s corresponding rates of 2.22% and minus 0.99%, respectively, it represents a price-flattening, if not deflationary, trend that Indian agriculture has never experienced on this scale before. And hardly any crop has been spared — including even relatively high-value items such as vegetables and milk.

The average WPI for vegetables during January-November 2018 was 6.08% below that for the same period of 2017. In Maharashtra, farmers are now getting just around Rs 20 per litre for cow milk with 3.5% fat and 8.5% solids-not-fat or SNF content. They had taken to the streets in July, following which the BJP-Shiv Sena state government had directed dairies to procure milk at Rs 25 per litre in return for a Rs 5/litre reimbursement, primarily intended as a support for producers. But with the payments not being released on time, the dairies — who estimate the state government’s dues at roughly Rs 100 crore — have reverted to paying farmers Rs 20/litre from this month. This, when the same milk, not too long ago, was fetching Rs 27-29 per litre, even without subsidy.

The road ahead

The above price pressures are unlikely to ease, at least in the run-up to the polls. Among the major crops to be marketed in the coming months are arhar/tur (pigeon-pea), chana (chickpea), potato, onion, rapeseed-mustard, wheat and, of course, sugarcane and milk.

Arhar is planted during kharif (June-July), but its mandi arrivals are only in January-February. Chana, mustard and wheat are rabi (winter-spring) season crops. The first two are harvested and sold mostly in March-April, while it is April-May for wheat. What is significant is that even before their marketing is to start, the ruling prices of arhar in Maharashtra at Rs 4,300-4,400/quintal, mustard in Rajasthan at Rs 3,700-3,800/quintal and chana in Madhya Pradesh at Rs 3,900-4,000/quintal are quoting below their respective MSPs of Rs 5,675, Rs 4,200 and Rs 4,620 per quintal. Guaranteeing MSPs may be easier in wheat and paddy, only because these two fine cereal crops are procured by government agencies.

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(With inputs from Gopal Kateshiya in Rajkot)