After assuming power the NDA government under the leadership of Shri Atal Bihari Vajpayee started giving special attention to the agricultural sector -- in tune with the commitment by the BJP to this vital segment of the economy. In the very first budget of the NDA Government outlay on agricultural sector was raised by 45 percent, followed by around 35 percent annual rise in the following two years. Besides, many innovative measures were introduced to promote the agricultural sector, the backbone of Indian economy. Some of the important measures initiated include kisan credit cards, encouragement to set up cold storage facilities, crop insurance, measures to promote food processing industries etc. As a result, the country could witness record foodgains production of over 201 million tonnes in 1998-99 and 204 millions tonnes in 1999-2000. With this, today, food stock position has crossed 50 million tonnes, that is, around 30 million tonnes in excess over the normal storage capacity and what is required for maintaining the public distribution system. Revival of the agricultural sector also led to revival of the rest of economy, specially, the industry which was under the grip of demand recession three years prior to mid-1998 -- due to negligence of the agricultural sector by the earlier governments -- specially in the post-reform period. Besides, the country's first ever Agricultural Policy has been announced by the NDA Government -- targeting an annual average growth rate of four percent in order to make the country self-sufficient within the next ten years.
However, today, the agricultural sector is again under stress not due to negligence but because of surplus production. The country has been caught in various circle mainly due to certain inherent obstacles which deter farmers getting just prices for their products. To name a few of such obstacles: Essential Commodities Act, 1955, which control movement of essential commodities, their stock, price, etc; monopoly of the Food Corporation of India since 1965 in handling food procurement, storage and distribution; control on the wholesale trade in wheat since 1973-74 etc. Therefore reform in the agricultural sector is a must to take care of these inherent problems in the overall interests of farmers and consumers.
Today, the country experiences a paradoxical situation of surplus food stock on the one hand but at the same time millions of people going hungry. There is also paradox of surplus production in certain regions while some other regions are under the grip of drought. But control on free movement of agricultural produces came in the way of equitable distribution. As a result, farmers from both the region suffer. We can not even export at a desirable price level in view of crash of agricultural prices in the world market. In this background, the decision to distribute 25 kgs of foodgrains (wheat at two rupees per kgs and rice at three rupees per kg) for poorest of the poor people under the Antyodaya Anna Yojana -- announced on the Prime Minister's birthday -- is a timely step. It would help ten million poor people. It may be recollected here that the government had already announced Sarvapriya Yojana underwhich 11 essential commodities would be supplied at lower than market prices. Besides foodgrains would be supplied at 50% of the cost for welfare schemes of the states. The National Executive Committee urges the government to persuade the state governments to implement this scheme on priority basis. The Government may also think of involving voluntary organisations and charitable trusts in implementation of the scheme.
Similarly, the National Executive Committee appreciates the Pradanmantri Gram Sadak Yojana with an outlay of Rs. 2,500 crore which is part of Rs. 60,000 crores overall development of Rural Sector. This would help in connecting the rural sector with domestic as well as international markets and in the process, would get better returns for farm products. Besides, it would also inject much needed demand support to construction industries -- apart from accelerating rural job opportunities.
In a few states farmers who fail to repay their debt started committing suicide. It may be recalled here that within a couple of months of assuming power, the NDA government got a circular issued through the RBI to the commercial banks with a clear instruction that no farmer should be arrested and put behind bars for default in repayment of bank loans. Though it contained suicide taking place at that time in states like Andhra Pradesh, Karnataka, Madhya Pradesh and Orissa, it appears that still many farmers are not aware of the measure. Therefore there is an urgent need to widely publicise this step among the farmers. Besides, it is equally important to persuade farmers to move away from private money lenders to commercial banks. In this context, the party cadre could play an effective role by supplementing the government's efforts -- specially, in apprising farmers about the government's measures.
The National Executive Committee is fully concerned with drought situation in certain parts of the country such as Orissa, Chattisgarh, Rajasthan, Gujarat, Madhya, Hariyana and Maharashtra. As a result farmers are compelled to distress sales of their products. The party urges the government to provide relief measures in the drought areas -- such as supply of fodder, drinking water, and other essential items. Similarly, all types of revenue collections should be suspended.
Opposition parties have been trying to misguide farmers that import of agricultural produces resulted in fall in prices of domestic farm produces. It is true that many farm products are open for import as per the commitment made to the WTO -- during the Congress rule and which also got endorsed by the previous UF Government. But the actual import does not support such fear except in the case of soyabean oils -- on which bound import duty agreed by the then Congress Government was exceptionally lower at 45 percent. Otherwise, import of agricultural products as a whole came down from Rs. 12,584.08 crore in 1998-99 to Rs. 11,510.09 crore in 1999-2000. (If one takes into consideration depreciation of rupee against dollar, actual fall would be more). Infact, share of agricultural imports in the total imports came down from 7.05 percent in 1998-99 to 5.63 percent in 1999-2000. Besides, the government has also raised tariff duty on import of foodgrains from 80 percent to 100 percent (which were zero percent in many cases prior to 1998). Infact, fall in prices of agricultural produces is due to lack of free movement and threat of imports.
Keeping in view the current agricultural situation and the long-term interests of farmers as well as consumers, the National Executive Committee suggests the following steps, which the NDA Government may consider.
1. Extend economic reform measures to the agricultural sector -- specially in the direction of removing all controls such as movement of farm produces.
2. Limit the role of FCI to maintain buffer stock. PDS operations could be decentralised. The private sector may be involved in handling procurement storage, distribution etc. This would not only minimize economic cost of PDS for BPL section but also supplement government's efforts in setting up additional storage capacity.
3. Provide additional incentives for setting up of cold storage facilities and also, encourage refrigerated transport system. This would prevent wastage of perishable commodities such as vegetables and fruits -- which is estimated to be around Rs. 30 000 crore annually. This would help farmers in getting just prices and consumers would end up paying much lower than at present.
4. Reduce import duties on essential agricultural inputs such as fertizliers and agricultural machinery -- except under spsecial cases of dumping. At the same time rationalise fertilisers subsidy so that it would benefit only farmers.
5. Speed up completion of the on-going irrigation projects and encourage small irrigation projects.
6. Give further incentives to food processing industries so that demand for agricultural produces would improve with better prices.
7. Initiate measures to ensure supply of quality seeds and other inputs.
8. Raise import duties on farm products to the bound level so as to protect the domestic agricultural goods.
9. Introduce food for work programme on priority basis involving the elected representatives, NGOs, and local panchayats;
10. Encourage upgradation of agricultural technology -- such as bio-technology to enhance farm productivity. Private seed companies involved in development and testing of seeds may be exempted from land ceilings. Special attention may be given towards enhancing production of pulses.
11. In states like Rajasthan water bed started depleting. Hence integrated water management should get top priority.
12. In case of purchase of f arm produces, often farmers don't get timely payment. Attention may be paid to this crucial problem so that farmers get hassle free timely payment.
13. Take immediate steps to implement comprehensive crop insurance scheme -- linked to crop loans. Individual farmers should be delinked from crop losses.