BOOSTING AGRICULTURAL PRODUCTIVITY

TEAM MEMBERS : Bhaskar Dey Utsav KapoorShivani Singh Varsha MallickDivya Dewan

The state of agriculture in India is in an appalling condition. It is manifested by the data that a mere 0.01% of the GDP is being invested in a sector which provides employment to nearly 70% of the population. The problems can be essentially divided into two categories :

Yield and Productivity

When it comes to breaking the yield barrier, our country has been far from it. The average annual growth in crop yields has fallen from 3.5% in 1970 to a meagre 1.2% in recent times. This can be attributed to the lack of proper farming technology and awareness, poor irrigation facilities and the lack of available funds to the farmer.

Post Harvest Management

Another major cause for concern is the inadequate resources available for post harvest management. Nearly 50% of the produce is destroyed in storage and transportation. Researchers have suggested that this wasted produce is capable of taking care of the hunger problems in the country.

As is evident agricultural productivity in India faces tremendous challenges such as lack of funds, inadequacy of technology and irrigation facilities, outdated techniques of production as well as post harvest management among many others. Our model seeks to introduce public private partnerships in the Indian agricultural sector.

India today has become the hub of several renowned conglomerates which have their branches spread across various nations in the world. These companies have access to a large amount of capital, the latest technology as well as up to date techniques to achieve higher productivity and meet performance targets.

Therefore this model aims to integrate the colossal amount of resources , intellectual property and initiative of private companies with the labour of the farmers to result in the increased agricultural productivity in India.

Involves carryingout extensive research about the amount of land available for agricultural usage and their owners. It also involves assembling details of the land i.e. size, soil type,fertility,etc. as classifying the same into different grades(like Grade A ,Grade B )

Involvespreparing a detailed proposal to be presented to the land owners and the private companies.Various laws, acts and policies regarding agriculture and land acquisitionhave to be considered here. Advice will be taken from professionals and experts.

Involvesreaching out to the central and state government so as to garner support for the initiative. This is to convince the government to offer incentives (like tax holidays,rebates,subsidies,relaxation of laws,etc.)to private companies to encourage them to participate in this initiative.

Involvespresentation of the predetermined proposal to the land owners. The proposal along with incentives agreed by the government will be presented to the private companies. This phase is very crucial as it aims at convincing both the parties agree to be a part of the initiative.

Involves the setting up and arrangement of the auction process. This auction symbolizes the interaction between the landowners and the private companies. The details of the land as garnered in phase 1 will be displayed and finally companies will bid for the land of their choice.

TEAM A

AGRICULTURAL

RESEARCHERS

SOCIAL SCIENTISTSPHASE 1 of our proposed solution involves forming a team as manifested in the figure. The main purpose of this team is to re-identify all the land available for agriculture of both commercial and non-commercial crops. This will also categorising each piece of land on basis on crops produced and the type of soil. For example, a piece of land near a river producing a high demand crop such as wheat will be rated as Grade A, and so on. Additionally, they will list the name of the owners of the land, which will be needed in the subsequent phases

MAKING DIRECTORY

A proposal to be presented to each land owner will be prepared after careful analysis of the various stakeholders involves as well as the laws prevalent today. The proposal will contain the following salient features:-

1.The land available for agricultural usage as identified in phase 1 will be auctioned in the presence of the owners and private companies. These companies will be informed about this auction and will therefore bid for the land of their choice.

2.The entire sale proceeds of the land will go to the land owners and after the completion of this process the title of ownership of the land will be transferred to the private company.

3.After this ,the private companies will choose 3 crops (including 2 commercial and 1 non-commercial) which they would like to produce on the land purchased.(examples of commercial crops are maize, wheat,rice,sugarcane,oil seeds)

4.The farmers will then start the process of production of the specified crops after gathering the required resources (like fertilizers, pesticides, new technologies for enhanced productivity, funds for better irrigation facilities, training provided to them for introduction of better techniques of production) from the private company. This entire process will be carried out under the direct supervision of the company.

5.The private company will oversee the above process so as to ensure high productivity is achieved, all predetermined targets of production are met on time and proper post harvest management is carried out after the crops have grown.

6.After the harvest is done or production is complete, the private company will be allowed to use 30% of the crop produced as they like (i.e. as raw material for finished goods or an ancillary good).

7. It is compulsory for the private company to sell the other 70% in the domestic market (a part of this 70% can also be exported. This right is exercisable at the company’s discretion)

8. Lastly, a certain percentage of the profits as agreed upon (through proper discussion and dialogue) between the farmers and the company will be distributed among the farmers employed. They will therefore be treated more as partners than labourers and will have a say in matters directly affecting them.

This phase aims at garnering the support of the central and state government so as to convince the government to provide incentives to the private companies to participate in the initiative. This process involves filing various petitions with the government and following the scalar chain as prescribed by law. These incentives includes:-

1. Provide a monthly amount of Rs.5000 as relief to the private company for training of farmers provided the company employs a minimum of 80% agricultural workers from that particular area.

2. Subsidise the power and electricity utilized by the private company under this initiative up to 15%.This rate varies with change in the consumption of power(measured in kilowatt per hour)

3. Subsidise the water supply as utilized by the private company provided it is under this initiative.

4. Provision of tax holidays on the income earned from sale of the produce in the domestic market (this includes processes which make the product fit for the market)

THE FARMERS THE PRIVATE COMPANIES

A certain percentage of the profits will be distributed among the farmers employed hence solving the ongoing farmer suicide problem to a great extent.

The farmers will get access to new technology for production for which they will be trained by the company so as to get accustomed to new and updated techniques of production.

Farmers will get access to adequate irrigational facilities hence improving the crop yield.

Lastly, this model will insure a fixed money income to the farmers.

Private company will get to choose the crop it wants to produce and use a part of the produce as raw material for its core business and earn profits from sale of the other part.

The use of new technology and production on the larger scale will minimize the cost of production.

The company will own the land after the auction, therefore the cost of the land i.e. rent will be imputed

TEAM B REGIONAL

REPRESENTATIVES

INDUSTRY LEADERS

INCENTIVES FOR FARMERS AND THE PRIVATE SECTOR

THE AUCTION PROCESS:

Each zone has been categorized into certain types depending on the land usage, soil type, crop pattern ,fertility levels and nature of the market , as mentioned in Phase 1.. The land available in each area will be auctioned in the presence of the land owners , private companies will therefore bid for the land of their choice.

The entire sale proceeds of the land will go to the owners. The land would be divided in 4 categories depending upon its fertility levels say Type A-D. A single private company can bid up to 20% of the best Grade land available. Moreover, that company will have to buy same portion of the lower grade land in that area. This is done to prevent monopoly like situation and help increase productivity of lower grade land.

POST AUCTION:

The farmers will then start the process of production of the specified crops after gathering the required resources (like fertilizers, pesticides, new technologies for enhanced productivity, funds for better irrigation facilities) from the private company which now own the land.

The private company will supervise all processes –check productivity levels as well as proper post harvest management.Eventually , after the

harvest is done or production is complete, the private company will be allowed to use 30% of the crop produced as they like (i.e. as raw material for finished goods or an ancillary good).

It is compulsory for the private company to sell the other 70% in the domestic market or even export some portion of it.

STEP 1

• BIDDINGSTEP 2

• PRESENTATION OF DETAILS

STEP 3• TRANSFER OF OWNERSHIP

If the phases are brought about in satisfactory fashion, then there is no doubt about a phenomenal

impact. Through the public-private partnership, all the challenges faced by agriculture in the economy today be more or less solved.

PROBLEMS WITH PRODUCTION

The auction process will ensure that the agricultural land will be efficiently distributed . Since the companies will be entitled to a limited area of land, they will try to maximize the productivity to generate maximum revenue. For example, a new genetically modified crop produced in America will be instantaneously implemented by the said company in their region. Other factors such as the technology available, irrigation , fertilizers etc will be used efficiently to maximize production.

POST HARVEST AND MARKET ACCESSIBILTY OF PRODUCE

Increasing productivity is only one part of the entire equation. Privatisation will ensure that none of the produce is destroyed during post harvest processes.

Moreover the problems caused by middlemen are also eliminated. Middlemen are reported to exploit the farmers to sell their produce at shockingly low prices. Many a time, they also create artificial scarcity through hoarding which causes a steep rise in prices everywhere. Here, the proposal ensures that the farmers do not get exploited and the produce is sold in the markets at competitive prices.

EQUIPPING FARMERS WITH TECHNOLOGY:Critics may argue that since majority of the farmers , especially from the low economic regions are not skilled/equipped to deal with upgraded advancements in technology(which is needed for higher yield),this will result in a low participation rate from the farmer's side,posin5g a threat to the model . However , we propose to solve this issue by organizing proper training workshops for both skilled and unskilled farmers where the farmers will be taught the very basics of using the new technology. These workshops will be accompanied by telephonic discussions and interviews with some of the best scientists and researchers from all over the world thus bridging the gap between the farmers and agricultural experts.

EXPLOITATION OF FARMERS:

The last and the most important challenge is the fact that the very concept of 'Privatisation' is based solely on profit making implying need for better and higher yield which can be met only by brining in new machines and equipments. There's no denying the fact that a situation may arise where private companies might want to try and replace the farmers(manual labour) with advanced machinery hence laving farmers jobless. Hence , issues like these will be taken up in the joint follow-up committee set up by the government which will make sure that no such violations of contracts happen between the farmers and private companies and both the parties maintain their end of the bargain.

FARMER EXPLOITATION

LACK OF SKILLS

CHALLENGES

REFERENCES :

www.icar.com

www.en.wikipedia.org

www.oecd.org/eco/growth/46866991.pdf‎

National Bank for Agricultural and Rural Development Publications

Food and Agricultural Organisation of the United Nations