Delhi starts to become dystopian, a few weeks before Diwali, and this continues for around a month after the festival of lights. The conventional explanation for the Delhi smog (in fact, it impacts large parts of North India) is the burning of rice straw by the farmers of Punjab (primarily), Haryana and western Uttar Pradesh.

The farmers use mechanical harvesters in order to cut, thresh and clean rice from paddy. The problem is that these harvesters leave six to eight inch long straws on the field, which cannot be used as animal feed because of the high silica content, which the cattle cannot digest.

Further, the fields need to be prepared for the winter wheat crop in a matter of two to three weeks. There are machines available which can take care of the straws, but machines cost money, whereas, all that is needed to start a fire is a matchstick.

Of course, there is the threat of fines for those who choose to set their fields on fire. But it still makes sense for a farmer to start a fire, even if he gets caught and has to pay a fine, given that machines are expensive. Also, most farmers don’t want to spend money on machines that they are likely to use once or twice a year, yet still require maintenance all through the year.

This is the conventional explanation of why farmers in Punjab, and other states, burn rice straw and how that causes a cloud of smog across large parts of Northern India. But there is a more important question which no one is asking—Why are semi-arid states like Punjab and Haryana growing rice in the first place?

The procurement of rice by the FCI has to move away from Punjab to states like West Bengal and Assam, where it takes less water to grow rice-

In 2016-2017, Punjab was the third largest rice producing state after West Bengal and Uttar Pradesh. Punjab produced 11.03 million tonnes (mt) of rice, or around a tenth of the total production in the country. The Indian government primarily procures rice and wheat directly from the farmers at a minimum support price. This is done through the Food Corporation of India (FCI) and other state procurement agencies. In 2016-2017, a total of 38.1 mt of rice was procured by the government in the central pool. Punjab contributed 27% or 10.29 mt to this pool. Of the total production of 11.03 mt of rice in the state, more than 93% was acquired by the government. This large procurement is a hangover from the days of the Green Revolution, where the government was trying to incentivize farmers of Punjab to grow more foodgrains to make India sufficient on the food front.

Also Read: Economic logic of setting paddy fields on fire

All the rice is being grown in a semi-arid region, which ends up using a lot of water. As an official document on the Price Policy for Kharif Crops points out: “If water consumption is measured in terms of per kg of rice, West Bengal becomes the most efficient state, which consumes 2,169 litres to produce one kg of rice, followed by Assam (2,432 litres) and Karnataka (2,635 litres). The water use is high in Punjab (4,118 litres), Tamil Nadu (4,557 litres) and Uttar Pradesh (4,384 litres)."

Also, free electricity allows Punjab’s farmers to pump all the groundwater they need to produce rice in a semi-arid region. As Jean Drèze writes in his book Sense And Solidarity—Jholawala Economics for Everyone: “Massive resources have been spent on promoting unsustainable farming patterns in Punjab, Haryana, and other privileged areas."

What is the solution to this? First and foremost, free electricity, at least to the medium and large farmers (those who own plots of 4 hectares and above), should be done away with. Of course, given the strong lobby of large farmers in the state, this remains easier said than done.

Secondly, the procurement of rice by the FCI has to move away from Punjab to states like West Bengal and Assam, where it takes less water to grow rice.

Third, the import duty on rice needs to come down. As the official document on kharif crop price policy for the current fiscal points out: “With some intermittent relaxations, import duty on rice remains at 70-80%. Such a high level of import duty on a water guzzling crop like rice may not be desirable and if import duty on rice is rationalized, it may support crop diversification into much needed crops like oilseeds and pulses."

Fourth, the excess procurement of rice in the central pool needs to end. As per stocking norms, as on 1 October, the total amount of rice that needs to be maintained in stock is 10.25 mt. The actual stock is at 18.63 mt. Given that the government is buying more rice than it needs, it encourages the farmers to produce more rice. This needs to stop. Basically, Delhi and Northern India’s smog problem is about the allocation of right resources in the right areas. And given that, it is a political problem more than an economic one.

Vivek Kaul is the author of the Easy Money trilogy.

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