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Dear Readers,

Bharatwasis are saddened by the demise of a great, beloved son of Bharat Mata. Former Prime Minister Atal Bihari Vajpayee was a brave, popular and wise statesman. He was also a poet, a humanist and a socio-economic reformer.

Former Prime Minister Lal Bahadur Shastri had raised the slogan- “Jai Jawan, Jai Kisan”. He had placed importance on farmers and the armed forces of India. Atalji carried forward this sentiment. He delicensed dairy production and took significant steps to improve the income of the farming sector. He was planning to connect all rivers and named Bharat Mala. He delicensed sugar industry to protect the farmers by increasing sugar production. He also allowed production of BT cotton (India’s only GM crop so far, in 2002). As a result, India became the largest producer of cotton and the second largest exporter of cotton globally. He also tried to transform the public distribution system (PDS). He set up the farmers’ commission. 

The White Revolution has made Bharat the largest milk producer in the world. It appears that Bharat is regaining its past glory of being known as a country where milk is flowing. Lord Krishna, an incarnation of Vishnu, the Supreme God of Hindus, was a shepherd, rearing cattle. He was fond of butter and milk. His clan was engaged in rearing cattle. They were quite happy and affluent. India’s milk production was 163.7 million tonne in 2016-17. India’s USD 120 billion dairy market, of which the organized sector accounts for USD 70 billion, is bigger than that of the European Union and the US. However, per capita availability of milk stood at 351 gm in 2016-17. It is not sufficient. Children are suffering from malnutrition. Government has to focus on supplying milk and milk products to schools. Tonnes of milk powder (estimated 200 million tonne) are being wasted. Government can supply milk under its nutrition programmes. Cattle rearing can be a large cottage industry. It can lead to inclusive and sustainable growth. It can also reduce inequality. Price of milk has not been remunerative. Farmers have thrown surplus milk on the streets.

There’s a need to give cattle to farmers so that they might have substitute income. Allow non-milking cattles, male calves access to forest land. Alternatively, create pasture land in the rural areas, preferably in drought-prone and dried areas. The Government of Rajasthan has done this. 70% of milk production is adulterated or diluted. Pure milk cannot be sold below Rs. 50-60 to cover the cost. But milk is selling at Rs. 36-40. So, adulteration and dilution are resorted to deal with the cost and greed. There are injections, which increase milk yield. It is very dangerous for cattle and the milk thus produced can be harmful for human beings. Rs. 80-100 is usually the cost of premium milk. The government should not import milk powder. It should allow export of milk powder.

Agriculture is the primary source of livelihood for about 58% of India’s population. Gross value added by agriculture, forestry and fishing was estimated at Rs. 17.67 trillion in 2017-18. During 2017-18, food grains production was estimated at 285 million tonne at all-time high. Production of rice and wheat was 112.91 million tonne and 99.70 million tonne, respectively. India is the second largest fruit producer in the world. Production of horticulture crops was estimated at a record 307.16 million tonne in 2017-18.

India is the largest producer, consumer and exporter of spices and spice products. It is also the largest producer of tea. Tea production is estimated at about 1325 million kg. Total agricultural exports from India grew at a CAGR of 16.45% over FY 10-18 to reach USD 38.21 trillion in FY 2018.

However, Bharat’s farmers are very poor. They are unable to afford two square meals per day for themselves and their families. They are victims of flood and drought. We have entered 72nd year of independence. Even after so long, the fate of farmers hasn’t improved nor is food provided to them. Their miseries continue. They are unable to repay loans when hit by drought or flood. Loan waiver becomes a matter of political controversies. There’s a need to restructure loans with interest rate of 8% for long-term. Measures should be taken to combat floods and droughts. Fund on subsidies should be diverted to this cause.

Pisciculture, bee rearing (apiculture) and other allied industries need to be promoted. Allow export of agriculture products. Remove all hurdles. Keep limited restrictions on very few items for food security. Let the export market develop so that there's a steady source of income for farmers. Let them reap the benefits. Why for the consumers’ sake restrict export of onions and other products? Let the farmers have benefit, who are poor. In rainy season, the prices will go up. Remember export market can only be developed if there is constant supply. The country cannot find buyers overseas as and when it wants to sell. Farmers will grow more, if they are ensured of regular market and steady prices. When a host of restrictions are imposed on export, domestic prices fall sharply, causing great loss to farmers and accumulation of stocks with the government, which rot or get “eaten by rats”. This leads to heavy loss to exchequer. At times, Government dumps its ballooning stocks in the market.

Prime Minister Narendra Modi has called for transforming the sector and doubling the income of farmers by the next six to seven years. The government has raised the Minimum Support Price (MSP) of crops by 1.5 times of cost. Time will show whether the benefits have percolated to the farmers. It might lead to corruption at various levels. MSP alone cannot lift the farm sector. Food subsidies will cause more burden. Big farmers will be benefited more. About 86% of total land holdings belong to the small and marginal farmers. Model contract farming will help to fetch better yield and prices. National agricultural market, adequate infrastructure, processing industries, value chains, storage space, silos and education are needed to save the national wealth from being wasted. Market fees should also be abolished. Government godowns are overflowing stock of wheat, rice and pulses. Buffer stock requirement for wheat and rice is 31.9 million tonne. It should unload some stocks to open market through e-auctions. This will curb inflation, as claimed by the RBI. India wastes Rs. 440 billion worth of vegetables and fruits. Investment in agriculture should be tax free to an extent. Crop insurance policy is needed. Government should fund it for small and marginal farmers. Government should not put on hold field trials of 15 genetically modified crops. Venture funds have started providing funds to start-ups. About Rs. 2 billion have been given to five start-ups in 2018.

BT cotton is a successful story. It was allowed by former Prime Minister Vajpayee. There has been significant rise in the yield and net income of farmers who have adopted BT cotton. Instead of holding field trials, the government should have a proper regulatory system, which ensures public health and farmers’ interests. USA has 45% share in global GM cropping area while India has only 6%. Its farmers are poor and committing suicide out of hunger, debt, etc.

Organic farming is picking up. It gives better income to farmers. Even educated persons are entering into this field. India ranks tenth in land under organic farming.

With low sugar prices, mills are unable to pay the support price to farmers. Globally, sugar prices are low. Export is affected. Industry has large production and stock. Toor (arhar) production is rising. There should be a curb on the import of Toor and to save dwindling forex reserves. There is ample stock of pulses.

Stock market: Rupee may slide further if it crosses 71. Foreign investors may be decisive in investment in stocks, as their assets will be in depreciating currency. They may start encashing the profit. However, despite its sharp fall vis-à-vis USD, Rupee is holding steady against most other currencies.

Economy: Despite the government’s focus on the manufac-turing sector, its contribution to GDP remained in the range of 16% in recent years. Government’s ambition is to raise this share to 25%. Due to many constraints and restraints, investment is low. To build the confidence, promoters should be allowed to bid in the proceedings of the IBC, where they are not willful defaulters at least to have better price. The gross NPAs of India’s public and private banks were Rs. 10.03 trillion in June, 2018. State-owned banks’ losses are at Rs. 1.7 trillion so far. Assets may be stressed due to external factors. The public sector banks are losing market share to private banks.

China has increased tariffs on import of farm products from USA while reducing tariffs on farm products from India and other countries. India will gain on this score. India will not lose on account of tariff imposed by USA on steel products as the export is only 2%. India needs to export farm products on a regular basis to maintain supply to the global market by fixing a certain quantity for export ignoring local inflation and shortages. To earn forex exchange, India must learn to suffer.

Trade deficit is widening. Imports are more than exports. It could widen to as much as 2.7% of GDP. The country must impose high tariffs on imports like steel, etc. and remove all restrictions on exports. Higher current account deficit may cause inflation, outflow of capital and rupee depreciation.

Kerala’s flood disaster is pathetic. Government should take measures to prevent such disasters. Fund must be invested on this score instead of pomp and show, even by Government and political parties for organising massive public meetings. Let all work for helping the people who are affected by flood.