IAS (Admin.) Mains GS Paper 3 (Science-Tech, Economy, Environment, & Disaster Management): Questions 1 of 223


Describe in Detail


Discuss various strategies to adress in the view of farmers


Agrarian distress

Some of the components of agricultural distress can be low agricultural prices, low productivity in agriculture, supply side constraints and declining average size of land holdings.

based on these constraints possible solutions for agricultural distress

  • Price and income
    • Price plays a key role in affecting farmers income. In the last 2 years inflation in agriculture has been much lower as compared to overall inflation. implicit price deflator is a measure of inflation it shows to what extent and increasing Gross Value Added (GVA) in an economy has taken place. Focus on account of higher prices rather than on increased output.
    • The implicit price deflator for GVA for the period of 2017 - 18 for total is where as for agriculture is only.
    • so this shows that in the last 2 years inflation in agriculture has been much lower as compared to overall inflation. advance estimates for 2018 - 19 for implicit deflator for GVA for agriculture is whereas for total is . This effectively has resulted in less form income further market prices for several agricultural commodity have been much lower than minimum support price (MSP) .
    • MSP is the price at which the government purchases crops from the farmers.
    • MSP is basically a form of market intervention by the government to ensure formers to against any fall in prices further an increase in production of crops has also resulted in crashing of prices of agricultural commodities as production increases beyond market demand.
    • This also impacts the farmers in absence of any price support policy by the government in such extreme situations there is need for Limited procurement Scheme.
    • This scheme stabilize the price and this can be done when the Government will procure the excess production. Procurement will continue by the government till the market price increase to touch MSP.
    • The main idea is to Remove excessive production from market so that the price level will control or comes back to the original price.
    • There is need to find the balance between MSP, limited procurement, and price stabilization. limited procurement scheme will not work if MSP is fixed at level to which the market price will never rise so there needs to be a balance between market price as well as minimum support price there is need to be a balance between minimum support price, limited procurement and price stabilization in the market.
    • Sustainable solution is Market reform to enable better price Discovery combined with long term policies favourable for exporters. To achieve these there is a need for creating of a competitive, stable and unified national market for formers to get better prices for their farm products. Agricultural markets have witnessed limited reforms They are characterised by Inefficient physical operations, Excessive crowding of intermediaries in the farm market, Fragmented market chain. All these deprives farmers of there share of price. And there is no urgency by states to reform agriculture markets.
    • For farmers to attain better prices agriculture has to go beyond farming and there is a need to develop a value chain comprising farming, wholesaling , warehousing, logistics processing as well as retailing.
  • Low productivity in Indian agriculture:
    • Basic inputs in agriculture are seeds, fertilizers, land and water management as well as use of technology. Investment in research and development is also extremely necessary water management and efficiency is also necessary in both canal and groundwater management and this is because some crops needs more water than other crops , as more than of irrigation water is consumed by rice as well as sugar cane.
    • Lack of water management in India as it uses of two three times the water used to produce 1 ton of grain as compared to countries such as Brazil, China and US. There is a need to use technology for proper water management and its efficient use.
    • Several crops have low yield and technology can help in increasing the yield of crops and this will also help in improving productivity of crops.
    • The Government policies biased towards increasing the productivity of rice and wheat, Government should shift it՚s focus towards Millets, pulses, fruits, vegitables and fish
  • Land size :
    • Shrinking of farm size leading to low income of farmers it leading to farmers distress Average landholdings 1979 - 71 is hectares and in 2015 - 2016 it is hectares. Share of small and marginal farmers in 1980 - 81 is and in 2015 - 16 is . This data shows land fragmentation in the country. Most of the farmers can not leave agriculture and move to non farming sector there is a partial income from farm sector.
    • Consolidation of landholdings become important to rise farmer income. We need to have a proper Government policy on land consolidation along with land developmental activities to tackle the land fragmentation.
    • The Main reason for Farmers Distress is mainly due to low prices and low income productivity. For thatGovernment must focus on limited procurement, boosting productivity and consolidation of land holdings and Government must come up with long term sustainable policies to reduce agrarian distress in the Indian economy.

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