Agrarian Crisis and Way Forward

Ramanjaneyulu

@ infosys campus on 21st March, 2013

The evolution of agricultural technology was from labour intensive to capital intensive and should move on to knowledge and thought intensive

Richard Lewontin and Richard Levins in 'Biology under Influence'

Input Intensive Agriculture

• Economic Crisis– Increasing costs of cultivation and decreasing returns– Reducing public support and increasing indebtedness

• Ecological Crisis– is highly LINEAR, whereas traditionally agriculture was highly CYCLICAL.– is based on maximizing the output of a narrow range of species leading to

monoculture of crops and varieties– is based on capital depletion and massive additions of external inputs (e.g. energy,

water, chemicals)– views the farm as a factory with “inputs” (such as pesticides, feed, fertilizer, and

fuel) and “outputs” (grain, cotton, chicken, and so forth)– never cared about the externalities

• Socio-political crisis– Increasing tenancy, land use shift– Increasing farmers suicides, 270,940 in 17 years– Huge migration

02000400060008000

100001200014000160001800020000

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

Farmers suicides in India

No. of suicides

Source: NCRB 1995-2010Total 270,940 in 17 years

State Farmer Suicides Difference (2nd Avg-1st Avg)

1995-2002 2003-2010

Andhra Pradesh 1590 2301 +711

Assam 155 291 +135

MP+Chhattisgarh 2304 2829 +525

Maharashtra 2508 3802 +1294

The table only includes States whose annual averages have risen by over 100 farmer suicides between the two periods. It also treats Madhya Pradesh and Chhattisgarh as one unit for data purposes.Source: NCRB Accidental Deaths & Suicides in India Reports 1995-2010

Smaller holdings

• Between 1960-61 and 2003, the total number of operational holdings increased from 50.77 million to 101.27 million.

• During the same period, the total operated area declined from 133.46 million hectares to 107.65 million hectares.

• Thus average operated area declined from 2.63 hectares to 1.06 hectares.

(NSSO 59th Round, Some Aspects of Operational Land Holdings in India, various issues)

Income and Expenditure of farmersLand holding

Category Total Income (Rs/month)

Expenditure(Rs/month)

Percent of farmers

<0.01 Landless 1380 2297 36 %

0.01-0.4 Sub marginal 1633 2390

0.4-1.0 Marginal 1809 2672 31 %

1.0-2.0 Small 2493 3148 17 %

2.0-4.0 Semi-medium 3589 3685 10 %

4.0-10.0 Medium 5681 4626 6 %

>10.0 Large 9667 6418

Total 2115 2770 All farmers

Source: Report “On Conditions Of Work And Promotion Of Livelihoods In The Unorganised Sector” Arjun Sen Gupta Committee, 2007

Farm Incomes: Continuing problem• Incomes of farmers have stagnated or declined; while living

costs have increased enormously

• Disparity between agricultural incomes and other sectors has widened

• Recent studies also show farm incomes have fallen e.g. From the decade of 1981-82 to the decade of 2001-02.

• Income per ha in Karnataka from Rs.8809 to Rs.5671

• Income per ha in Maharashtra from Rs.4194 to Rs.3047

Where do the farmers go? To other sectors?

Poor employment in other sectors

Poor employment in other sectors

Where are the jobs?• From 2004-05 to 2009-10, only 2 million additional employment was generated but 55 million were added to working

age population!• 25.1 million people lost their self-employment• Increase in the number of casual workers by 21.9 million, while growth in the number of regular workers nearly halved

between 2004-05 and 2009-10, compared with the previous 5 year period.

Sector 2004-05 2009-10 Difference

Agriculture 258.93 243.21 -15.71

Manufacturing 55.77 48.54 -7.23

Services 112.81 112.33 -0.48

Non-Manufacturing (construction)

29.96 56.10 26.14

TOTAL 457.46 460.18 2.72

Sector-wise unemployment (millions)

66th NSSO survey: deep urban-rural divide

• Per capita expenditure of urban India was 88% higher than rural India• Average MPCE in 2009-10 to be Rs. 1054 and Rs. 1984 in rural India and

urban India respectively • Top 10% of India’s rural population having an average MPCE (Rs. 2517)

5.6 times that of the poorest 10% (Rs. 453)• Top 10% of urban population having a 9.8 times higher average MPCE

(Rs. 5863) compared that of the bottom 10% (Rs. 599)• Considering the average rural MPCE value of Rs. 1054 in isolation

would be partially misleading. The rural MPCE median of Rs. 895 (about Rs. 30 per day) implies that half the rural population had MPCE below this level.

• 40% of the rural population had MPCE below Rs. 800 while 60% had MPCE below Rs. 1000

• Compared to the rural median MPCE (Rs. 895), the urban median MPCE level was 1.68 times higher at Rs. 1502 with 30% of the urban population having MPCE above Rs. 2100 and 20% having MPCE above Rs. 2600.

FARM HARVEST PRICES AND MINIMUM SUPPORT PRICES OF PADDY IN APFarm Harvest Price Minimum Support

PriceYEAR Kharif Rabi Average Grade-A Common

1998-99 510.53 426.17 486.35 470 4401999-00 559.42 524.44 538.66 520 4902000-01 507.93 478.58 499.61 540 5102001-02 565.77 529.40 550.16 560 5302002-03 623.29 578.08 609.27 560 5302003-04 569.37 572.27 570.38 560 5302004-05 605.49 604.07 605.02 580 5502005-06 648.21 579.59 616.95 600 5702006-07 670.19 622.22 650.30 610 5802007-08 777.76 767.17 773.66 675 6452008-09 1035.75 892.28 963.56 921 9502009-10 1100.67 955.76 1072.66 1030 10002010-11 880.65 850.76 865.70 1080 10302011-12 1680.00 1220.00 1450 1110 1080

Source: DES, AP Govt

Prices recommended by AP government for 2012-13

Crops Cost of Cultivation

Rs /acre

Rec. Support Price Rs /Quintal

MSP in 2012-13 Rs/Quintal

Paddy (Fine var) 28,784 2,135 1280

Paddy (Common) 27,140 2,102 1250

Groundnut 13,456 5,543 3700Jowar 6,321 1,953 1520Maize 20,890 1,844 1175Redgram 9,819 6,066 3850Blackgram 8,974 5,544 4300Greengram 7,677 5,691 4300Soyabean 13,316 3,086Cotton 25,731 6,359 3300Sugarcane 67,458 312 139.12Ragi 8,994 2,381 1500Sunflower 11,998 5,559 3700Sesame 5,008 6,890 4200

State governments irresponsibleMSPs recommended for 2013-14 (Rs/q)

Crop Announced MSP (Rs/q) 2011-12

Announced MSP (Rs/q) 2012-13

Recommended MSP (Rs/q) 2013-14

Paddy 1110 1280 2811

Blackgram 3300 4300 7295

Soybean 1650 2200 4382

Groundnut 2700 3700 8019

Sunflower 2800 3700 7412

Sesame 3400 4200 7847

Ragi 1050 1500 2925

Maize 980 1175 2100

Jowar 1000 1520 2862

Redgram 3850 7277

Greengram 4300 7287

Government of Andhra Pradesh

Prices to Farmers during 2010-11 and 2011-12

Crop 2010-11 Rs/Quintal 2011-12 Rs/QuintalCotton 6500 3600Turmeric 14000 4000Chillies 12000 5500Redgram 5000 3500Blackgram 5200 3500Bajra 4000 2000Jowar 2500 1800Onion 16000 2500Sweet Orange 75000 60000

Reducing institutional credit• The share of agricultural credit in total bank lending nearly doubled

from around 10% in the mid-1970s to about 18% in the late 1980s. • The share of agricultural credit in total bank lending declined from

the peak of 18% in the late 1980s to about 11% in 2005, the decline has continued since then.

• Rural branches of commercial banks has declined from 51.2% in March 1996 to 45.7% in March 2005.

• Data also shows that the share of agricultural credit cornered by farm sizes of more than 5 acres has increased

• Tenancy is informal and tenant farmers do not get access to credit

(GOI, 2007).

Indirect finance

• Till 1993 only direct finance was considered as part of (18%) priority sector lending

• Indirect finance growing at an astonishing rate of 32.9% compared to 17% of direct finance from 2000 onwards

• Indirect finance definition changed after 1993

• Not adequate• Not accessible-

crops, region, tenant farmers

• Interest subvention who benefits?

• How to increase coverage?

Year Rural + semi-urban branches

Only rural branches

Urban+ metropolitan branches

Only metropolitan branches

All branches

All India

1990 85.1 55.5 14.9 4.0 100.0

1994 83.4 54.6 16.6 5.6 100.0

1995 83.7 52.7 16.3 7.3 100.0

2005 69.3 43.0 30.7 19.0 100.0

2006 62.4 37.1 37.6 23.8 100.0

2008 66.0 38.4 34.0 20.0 100.0

Maharashtra

1990 82.4 59.7 17.6 - 100.0

1994 76.8 52.9 23.2 - 100.0

1995 70.5 46.5 29.5 - 100.0

2005 41.8 26.1 58.2 48.5 100.0

2006 31.6 18.4 68.4 61.3 100.0

2008 42.4 25.7 57.6 48.3 100.0

Share of agriculture credit from different bank branches 1990-2008 (in %)

Source: Government of India, 2009; RBI, 2009.

Irrigation and fertilizer based production

Fertilizer issues• NPK use is 14.78:1.56:1 where as ideally it is 4:2:1• The higher and imbalance use of chemical fertilizers threatened the

soil health• Fertilizer use efficiency less than 50%• Factor productivity of fertilizer coming down• Fertilizer production largely dependent on Petroleum products and

prices fluctuate with them• Phosphotic and Potash reserves coming down

• Nutrient response drastically declinedPeriod Response (kg/kg NPK)

V FYP 15.0Now 6.5

• During 1961-2006 globally 8 fold increase in use of agrochemicals, but increase in grain yield only 1.5 times

(‘000 crore)

2008

2012

Soil Organic matter The soil organic matter has declined from about 1.43 and 1.21 % in

red and black soils in the 1950’s to about 0.80 to 0.86 percent respectively at present.

Soil organic matter performs Hydrological, Biological and Nutrient related functions, which are both interrelated and distinct.

The OM helps tide over dry spells and in reducing runoff. Soil moisture and organic matter is essential even for improving the efficiency of biofertilisers and chemical nutrients.

Pesticides poisoning past, present and future

• Acute poisoning effects• Agriculture workers killed

• Chronic poisoning effects• Children growth effected• Effect on reproductive health

• Pesticides increased costs of cultivations• Rs. 1000 to 15000/acre

• Ecological Disturbances• Beneficials killed, pest shifts• Pest resistances, pest

resurgences • Poisoning of resources

• Soils• Water• Milk• Food (NIN study found18

pesticides found in Vegetables in Hyderabad, 2012)

Loosing Seed Sovereignty

• Increasing dependency on seeds over industry• Increasing costs of seed (>500% in the last 5 yrs)• Vegetable seeds costs upto 70,000/kg• No regulation..seed bill pending from 2004• Increased monoculture-few crops, few varieties and

now few genes

Before Bt Cotton 70% increase

Data for % area under BT for 2010-11 and 2011-12 are estimates and for 2005-06 is interpolated

GM crops and foods• Key issues

• Relevance of GM crops• Biosafety issues• IPRs and Market monopoly• Conflicts of interests and scandals

• Documentary evidences on Violations of regulations in field trials,

• Newer pests and diseases like Bronze wilt, Tobacco Streak Virus, Mealybug

• Studies on Environmental Risk Assessment and Socio Economic Impacts

• Contamination organic cotton and Bt Bikeneri Narma• What does reports say

– Public Consultation during Bt Brinjal Approval– Parliamentary Standing Committee– Technical Expert Committee

• Liability and Redress Mechanism

Life in queues 2011

Life in queues 2012

Water foot print of crops Water foot print (Lit/kg) Blue Green Grey TotalMilled Rice 1062 2967 460 4489Wheat 906 236 414 1556Maize 201 2192 251 2644Millets 62 4290 301 4653Sugarcane 126 91 18 234Sugar 1305 537 122 1964Chickpea 1278 659 346 2283Pigeonpea 140 6059 327 6527Soybean 25 3646 216 3888Mustard 2814 700 865 4379Cotton 2080 8047 1595 11722

Water Foot Prints

Each ha of paddy yields @ 30 bags/acre and 75 kg/bag

5625 kg/ha grain

In terms of rice 70 % milling 3938 kg/ha

Water requirement 2000 mm (2 m) crop water requirement x10000 sq m.

20000 cu m water

Which is equal to 5.078 cu.m/kg rice (5078 litres/kg rice)

Each family consuming monthly 30 kg rice

152340 Litres of water per month per family

This is equivalent to

Each family consumes water directly at around

@ 300 litres/day and for 30 days

9000 litres

Water consumption by way of rice is

16.93 times higher than the water we consume directly

Depleting natural resources• Increasing dark zones due

to groundwater depletion• 30 % of soils are reported

to be saline by the recent study by ministry of environment

Lift Irrigation Schemes in AP

Today 3,000 mega watts power is supplied freely to agriculture for 29 lakh pump sets

• 31 projects under lift irrigation• It needs about 206 million units electricity/day needs

12,682 Megawatt power/annum (currently we use 160.80 million units a day or 10,000 mega watt/yr)

• 47 lakh ha would be brought under irrigation• Seven and half horse power motor will be used for every

10 acres and five lakh such motors have to be installed• Needs 37.5 lakh HP electricity (2775 mega watt)• Major lift irrigation schemes needs 6407 mega watt • Minor lift irrigation schemes needs 500 mega watt• to produce and supply one mega watt power

• Rs. 4 cr to create infrastructure to produce• Rs. 4.5 cr for transmission and distribution

Farmer •Shifting to better and sustainable practices•Getting organised to deal with the markets and policies

Policy Support•Supporting sustainable models•Regulating unsustainable practices•Invest more in agriculture•Income security to farmers

Market Support•Farmers moving up the value chain•Direct marketing•Forward and backward linkages•Better prices

Ecological farming practices

• Holistic understanding of the ecological and biological processes (Gestalt approach)

• Harnessing the synergy of biodiversity, ecological balance, high energy efficiency,

• Need a new science to under stand technologies and not a new technology with old science

Crop productivity vs land productivity

• Productivity is narrowly understood as crop productivity in a monoculture situation, and

• Often compared with western developed countries which have – advantage of long day light, – higher diurnal variation of temperature– monoculture to suit mechanisation due to labor

shortage– limited by only one crop season

• cannot be compared with tropical climate which is rich in diversity and three crop seasons.

What is needed….

• Integrated farming systems integrating livestock, trees etc

• Building soil organic matter• Conserving moisture• Rainwater harvesting• Locally adopted crops and varieties• Contingence planning• Moving away from agro-chemical use

Community Managed Sustainable Agriculture in Andhra Pradesh

Basic Principles Regenerative, ecologically sound practices Organized communities planning,

implementing and managing the program Govt/ngos playing facilitating agency role

2004-05 started with 225 acres in one dist and reached 7 lakh acres in 2007-08 in 18 dist. World Bank says this is a good tool for poverty eradication and now promoted as part of NRLMWith 50 % development expenditure one can double the incomes of the farmers A national program called Mahila Krishi Sashaktikaran Pariyojana (MKSP) is launched based on this experiencce

2009

0.225 25 200 700

1300

2000

2800

35003800

0.1 1580

300600

10001500

20002500

2135 1997

1394 1541 1381

1015

0500

1000150020002500300035004000

Acerage ('000 acres) Farmers ('000) Pesticide use (MT Active Ingradient)

Farmers and area covered under CMSA

States/UTs 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-072007-08 2008-09 2009-10kg/ha 2000-01

kg/ha 2009-10

Punjab 7005 7200 7200 6780 6900 5610 5975 6080 5760 5810 0.98 0.82

Haryana 5025 5020 5012 47330 4520 4560 4600 4390 4288 4070 0.84 0.68Andhra Pradesh 4000 3850 3706 2034 2135 1997 1394 1541 1381 1015 0.34 0.09Tamil Nadu 1668 1576 3346 1434 2466 2211 3940 2048 2317 2335 0.32 0.45

Gujarat 2822 4100 4500 4000 2900 2700 2670 2660 2650 2750 0.30 0.29

Kerala 754 1345 902 326 360 571 545 780 272.69 631 0.31 0.26

Karnataka 2020 2500 2700 1692 2200 1638 1362 1588 1675 1647 0.17 0.14

Orissa 1006 1018 1134 682 692 963 778N/A 1155.75 1588 0.16 0.26

Status of pesticide utilization in different states**

**Source: http://ppqs.gov.in/IpmPesticides.htm MT of active ingredient

Average Reduction in costs and net additional income for different crops

Crops Reduction in cost due to NPM (Rs)

Reduction in costs due to use of organic fertilisers/manures (Rs)

Net additional income (Rs)

Paddy 940 1450 5590

Maize 1319 2357 5676

Cotton 1733 1968 5676

Chillies 1733 1968 7701

Groundnut 1021 3462 10483

Vegetables 1400 390 3790

3rd Party Evaluation of Rashtriya Krishi Vikas Yojana (RKVY) : Community Managed Organic Farming implemented by SERP

Evaluation TeamProf. R. Ratnakar, Director, Dr. M. Surya Mani, Professor, EXTENSION EDUCATION INSTITUTE, (Southern Region), Ministry of Agriculture, Government of India

Who benefits from your purchase• Farmer gets Rs 15 for each kg of rice you

purchase at Rs 35

• Farmer gets Rs 30 for each Kg of Toor Dal you purchase at Rs 80

• In case of other foods the farmer’s share is similar or lesser.

• In processed foods farmers share is less than 10% and the rest goes to the Industry, advertising and sales.

• Your purchases in retail chains go towards energy-hogging facilities like air-conditioned stores, cold storages and transportation all of which have a huge ecological cost.

Sahaja Aharam

Producer Co-op-1Farmer Group B

Consumer Co-op

•Healthy food•Affordable Price•Max share to farmers Organic Store

Mobile Store

Direct to Home

Producer Co-op-2

Other farmers and farmers groups

Farmer Group A

Farmer Group C

Sahaja Aharam Marketing Agency•Capacity building•Institutional building•Value Chain Fund•Brand building•Qualtiy Management•Fair Trade

Market placeDirect to resellers

Whole sale to traders

Bulk buyers

Organic Store

Processing unitsSeed market

Yet to estiblish

Way forward• Moving from high external input agriculture to high internal input agriculture• Information based to knowledge based extension• Reducing the risks with uncertain weather conditions and degraded and

limited natural resources, by adopting agroecologically suitable cropping patterns and production practices

• Diversifying the assets and income sources to sustain the livelihoods by integrating livestock and horticulture into agriculture and promoting on-farm and off-farm employment opportunities,

• Conserving and efficiently use the available natural resources like soil and water, and promote biomass generation,

• Organizing farmers into institutions which can help them to have better planning, greater control over their production, help to access resources and support, improve food security and move up in the value chain,

• Recasting subsidies to support farmers own resources and labor• Building livelihood security systems to withstand the natural disasters like

drought, floods and other climate uncertainties.

My Home Garden

www.csa-india.orgwww.krishi.tvwww.agrariancrisis.inFacebook: ramoo.agripageTwitter: ramanjaneyuluGVEmail: ramoo.csa@gmail.comPhone: 040-27017735, 09000699702