Resource centre on India's rural distress

Perils of over-promising -Ashok Gulati

-The Indian Express

For all their talk on farm distress, on agriculture, BJP, Congress show they have not learnt from past failures.

We often feel proud of our democratic system. But it also has a shortcoming, which has been magnified in the current election season. The conversation today is not about what the BJP/NDA promised in its manifesto of 2014, and how far they have been able to deliver on their promises. Accusations and counter-accusations are being hurled on who was/is more corrupt — of course, without much proof. The gloves are off and the battle for power is bayonet to bayonet. Our political system seems to have reached a new low given that political parties petitioned the Supreme Court against the Election Commission. They requested the Court to ask the EC to act against violations of the Model Code of Conduct. I hope things will return to normal after the elections are over. The real issues will haunt the government that assumes office after the elections.

In this article, we focus on the key issues that confront the food and agri-sector, including those pertaining to farmers’ incomes.

In 2014, the BJP manifesto promised to implement the Swaminathan Committee report, especially its recommendation on minimum support prices (MSPs) being 50 per cent above the costs incurred by farmers. For four years after assuming office, the party never talked about this promise. In the fifth year, the government raised MSPs to 50 per cent above costs, but the reference cost was lowered from comprehensive cost (C2) — implied in the Swaminathan formula — to Cost A2+FL (paid out costs plus family labour). Cost A2+FL is about 38 per cent lower than Cost C2. Farmers saw through the trick and felt cheated. And when market prices remained 10 to 30 per cent lower than the announced MSPs for most crops, farmers lost any hope of getting remunerative prices for their produce.

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