The entangled economics and politics of India’s farm agitation4 min read 18 Mar 2021, 10:36 PM IST
The government should reduce price distortions while farmers must organize themselves to gain collective bargaining power
Our skewed policy of providing support prices chiefly for two crops has led to the oversupply of these, even as our subsidy-cum-procurement regime turned farmers dependent on it.
The roots of the continuing farmers’ agitation go back over 50 years to the origins of the Green Revolution. Following the disastrous droughts of 1965-66 and 1966-67, the government adopted a new policy for food grain production, distribution and pricing to achieve food self-sufficiency. Foodgrain farmers were provided high-yielding variety (HYV) seeds, and subsidized water, power and fertilizers, while assuring them of remunerative prices. This also entailed a hefty food subsidy, since the Minimum Support Price (MSP) at which Food Corporation of India (FCI) procures rice and wheat (plus cost of storage, etc.) is much higher than the price at which foodgrains are provided through the Public Distribution System (PDS).
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