Mint Explainer: Why farmers continue to protest despite a govt offer

A man walks through tear gas at the site of the protest, as farmers march towards New Delhi to press for better crop prices promised to them in 2021, at Shambhu barrier, a border crossing between Punjab and Haryana on Wednesday. REUTERS/Anushree Fadnavis  (REUTERS)
A man walks through tear gas at the site of the protest, as farmers march towards New Delhi to press for better crop prices promised to them in 2021, at Shambhu barrier, a border crossing between Punjab and Haryana on Wednesday. REUTERS/Anushree Fadnavis (REUTERS)

Summary

Farmers say the contract farming offer proposed by the government does not offer any financial gains for them

Kisan Majdoor Morcha, the coalition of farm unions spearheading the farmers protest, has prepared to resume the Delhi Chalo march on Wednesday. After four rounds of negotiations with the union government failed to yield results, the Shambhu border crossing between Punjab and Haryana looks set for a faceoff between protestors and police forces today morning. The first rounds of tear gas shells were fired by police forces around noon.

The farmer protests come on the backdrop of subdued agricultural production following repeated climate shocks including uneven rainfall last year. Farm incomes were also hit by export curbs announced by the government to tame local consumer prices. For farmers, who were promised that their incomes will be doubled by 2022—as per a government set target—the crisis of profitability has translated into a rallying cry for revamp of the minimum support price (MSP) regime.

During negotiations on the night of 18 February, the government offered an alternative to the farmers’ demand to make support prices a legal right. Farm unions rejected the ‘limited’ offer and began preparations for the Delhi march.

What is on offer and why was it rejected by farmers?

The Centre offered to purchase five crops—three varieties of pulses such as tur, moong and urad, plus maize and cotton—at MSP for the next five years, under a contract farming arrangement. The scheme was offered after farm unions said during talks that guaranteed support prices on crops other than rice and wheat will help them to transition to less water intensive and more soil-friendly crops like pulses. Currently, Punjab is facing a groundwater crisis with water tables depleting fast due to rice cultivation.

Farm unions rejected the offer saying it will only help those who switch from rice to these alternative crops, but not available to farmers who are already growing pulses and cotton. They also reiterated that farmers are not looking for a Punjab-specific scheme, but a legal guarantee for all 23 non-perishable crops for which support prices are announced every year, for the entire country. Moreover, they want a resolution to other demands which include a loan waiver and monthly pensions.

Can alternative crops provide farmers returns comparable to paddy?

An underlying reason why farmers rejected the offer is because paddy yields in Punjab are far higher than what pulses can potentially offer. So, even at support prices, profitability per unit of land is significantly higher for paddy than pulses. Data from the agriculture ministry shows that productivity of urad (black gram) in Punjab is around a tonne per hectare or lower. This compares with rice yields of 4-5 tonnes per hectare.

Data from the Commission for Agricultural Costs and Prices (CACP), which recommends support prices to the government, show that an average paddy grower in Punjab earns over 88,000 per hectare after deducting input costs like seeds, fertilizers, pesticides and hired labour — the highest in India. In comparison, the highest per hectare returns for maize is 61,000 (in Andhra Pradesh). Among pulses, the highest returns are 75,000 per hectare for moong (Punjab) and 53,000 for urad (West Bengal).

This means that farmers in Punjab need a better deal—in the form of either a cash bonus over MSP or input subsidies—to switch from rice to less resource intensive crops. Pulses require less of chemical inputs, but due to lower productivity, farmers prefer to grow cereals in irrigated land. Moreover, pulses are more sensitive to freak weather such as excess rains when compared with paddy.

So, what is likely to happen next?

Agriculture minister Arjun Munda said on Wednesday morning that the government is ready to discuss all issues raised by farmers in the next round of talks. It is likely that union leaders will take up this offer and talks will resume. A larger coalition of farm unions, the Samyukt Kisan Morcha, which spearheaded the year-long protests in Delhi’s borders beginning 2020 is likely to take a call whether to join the protests on ground; a meeting of its members is scheduled on Thursday. In all likelihood, the numbers of protesting farmers are likely to swell if a resolution is not reached soon.

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