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Economic survey confirms bad news for agriculture

Economic survey confirms bad news for agriculture
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First Published: Wed, Feb 28 2007. 12 40 AM IST
Updated: Wed, Feb 28 2007. 12 40 AM IST
New Delhi: The Economic Survey 2006-07 confirmed the bad prognosis on long-term agricultural growth, even while it held out the winter rains had boosted the prospects of the rabi wheat crop.
“There has been a sharp increase in the area under wheat with high domestic and international prices providing incentives to farmers,” the Survey said. The upbeat view in the short-term comes in the context of the fact that the government is scrambling to raise upwards of 4 million tonnes of wheat to bolster its stocks, which are currently below the prescribed norms.
In the long term, the Survey has identified low yield per unit area across all crops as a primary problem. For instance, though India accounted for 21.8% of global paddy production in 2004-2005, the estimated yield per hectare was less than that of Korea, Japan and Myanmar, and only about a third of that in Egypt.
N.C. Saxena, member of the United Progressive Alliance government’s National Advisory Council, said: “The trends are alarming, as foodgrain production has remained stagnant. How can we claim to be a superpower when so many people are hungry? Forty six percent of people are malnourished, and the number of agricultural labourer households has risen to 15%.”
The Survey blamed the decline in foodgrain production on monsoon variability and deficient rainfall in 2002, 2004 and 2006, noting that districts with deficient rainfall had risen from 28% in 2005 to 40% in 2006.
“Most of the farmer suicides have occurred in dryland areas, where rainfall is scanty or non-existent, as most crops are totally dependent on rainfall,” said agriculture commissioner N.B. Singh. As proof of the growing infertility of soil which has triggered a decline in productivity, the Survey said the consumption of chemical fertilizers had touched 20.34 million tonnes in 2005-2006, a 10.6% increase from the previous year. Per hectare use was the highest Punjab, Haryana, Andhra Pradesh and Tamil Nadu.
While the finance minister had, in his Budget speech last year, promised a big push to irrigation and credit to farmers, facts speak otherwise. The Survey noted that up to March 2006, state governments were provided a grant for Rs19,437.88 crore to construct 200 major/medium irrigation projects. To date, only 25% of these were completed.
The Survey added that the irrigation component of the governments flagship programme Bharat Nirman, aimed to create an irrigation potential of 10 million hectares between 2006 to 2009 through the completion of these projects. All of them were currently way behind schedule.
Water expert Sudhirendar Sharma said: “Recent surveys have conclusively pointed to inefficiency in agriculture as the root cause of plateauing of output from irrigated areas. A 10% improvement in irrigation efficiency is enough to pull water from existing irrigation schemes to cover the rest of the country.”
Regarding credit, one of the other critical inputs for agriculture, the Survey noted that the government overshot its target of 30% growth in agricultural credit in 2004-2005, touching 44% and a figure of Rs1,25,309 crore in 2004-2005. But as V.S. Vyas, member of the government’s steering committee on agriculture points out, the increase has failed to achieve its objective as “it is still not reaching the small and marginal farmer.”
The National Agricultural Insurance Scheme, launched by the government in 2000 to protect farmers from crop losses turned out to be an abject failure. By 2006, the scheme covered just 858 lakh families. The Survey observed that “there were certain limitations in its implementation.” These related to the area of insurance, calculation of guaranteed income, low indemnity level and long delay in settlement of insurance claims. The government is currently engaged in examining a new draft of the scheme.
In August 2005, Prime Minister Manmohan Singh announced that a National Rainfed Areas Authority would be set up to address the issues of over 60% of farmers who are subject to the vagaries of climate.
It was set up only in November 2006 and its governing board had its first meeting on 12 February this year.
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First Published: Wed, Feb 28 2007. 12 40 AM IST
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