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BHARATIYA JANATA PARTY
National Council Meeting
Vijay Sankalp Parisar (Ramlila Maidan)
New Delhi – January 28-29, 2008

Resolution on Crisis in Agriculture Sector

The BJP is of the firm belief that the country’s economic development can succeed only if agriculture is made vibrant, if the purchasing power of the farmer and the agriculture workers is substantially augmented, if more employment opportunities are created in rural India and by improving the overall living conditions of entire rural India. The NDA government, through numerous initiatives, tireless worked to improve the condition of the agricultural sector as well as rural India. Under the Congress led UPA government, many of these initiatives have unfortunately either been kept in cold storage or are being implemented at an extremely slow pace.

The fundamental cause of the deterioration of the rural economy is because of the poor performance of the agriculture sector. The low growth in agriculture per capita income and increasing disparity between the per capita farm and non farm incomes has been caused by the slow growth of agricultural and rural output as compared to other sectors of the economy. The disparity would further worsen unless there is a major shift in our policies and the farmer is brought to the centre stage of all our planning exercises.

Plight of the Farmers

On account of the wrong policies of successive Congress governments over the past five decades and particularly during the tenure of the present UPA government, the agriculture sector today has been engulfed by an unprecedented crisis. Thousands of farmers are regularly committing suicide or are being forced to resort to taking this ultimate step. These suicides, by the farmers across various parts of the country, clearly reflect the abysmal apathy of the central government towards addressing all core and burning issues related to agriculture.

Even the Union Agriculture Minister has said that there is a serious threat to the food security of the country. The country’s Finance Minister has also admitted that there is stagnation in the growth of main crops, particularly food grains and cereals.

The Congress led UPA, which made farmers a major election issue in 2004 has miserably failed to address all the challenges confronting the agricultural sector. Some of the glaring examples that highlight the central government’s apathy include failure to implement farm income insurance scheme, expansion of rural godown and cold storage chain, decline in the number of farmers getting agriculture credit through banks, failure in providing electricity to the farmers, tardy implementation of crop insurance, kisan credit card scheme and PMGSY and not announcing a realistic Minimum Support Price (MSP). Today the prices of virtually every agriculture input has risen substantially where as the prices of most of the agriculture produces have remained either stagnant or even depressed in real terms on account of rising inflation.

The careless attitude of the Government in not procuring enough food grains in the domestic market and thereafter importing wheat at double the price has further worsened the situation. Paying Rs.800 to the Indian farmer and Rs.1600 to the American and Australian farmers can be considered as the hallmark of the Congress led UPA government’s attitude towards the domestic farmer and agricultural sector.

The so-called Rs. 25000 crore farm sector programme for increasing production and productivity has not taken off. The Prime Minister’s declaration of doubling the food grain production from 200 million tonnes to 420 million tonnes within ten years i.e. by 2015, is also a non starter. Same is the case with regard to the national goal to raise the production of vegetables and fruits to over 300 million tonnes by the year 2015. As the total available land is shrinking, the only path for achieving the goal of higher productivity has to be on the basis of per unit arable land and irrigation water. No steps have been taken in that direction.

The World Development Report clearly says that to reduce poverty and hunger, the growth of the agricultural sector is the only solution. Higher costs of production without a corresponding increase in prices, is seriously impacting the overall viability of undertaking farming. This also explains why the per capita production of food grain is going down. As a result of these factors, agriculture scientists are saying that it is high time that we urgently start taking corrective steps on a war footing otherwise the agricultural sector will totally collapse and the country’s food security will be jeopardized.

Mismatch Between the Market Price and MSP:


In the recent years, one finds a complete mismatch between the actual cost of production and the MSP declared by the government and also between the MSP and the prevailing market prices. Some of the disturbing trends inflicting the agrarian scene in India include declining capital formation, reduction in public investment as well as share of agriculture in the total GDP, the adverse terms of trade, and falling return to cost ratios. In addition to this, the rising trend of inflation which is being witnessed in our country coupled with a lower growth rate in agriculture juxtaposed with the higher market prices that we pay for agricultural produce are also important factors that are contributing towards further exacerbating the dismal condition of the agricultural sector. These factors create a sense of alienation among the farmers and rural poor that they are being excluded from the benefits of development. The forceful acquisition of fertile and irrigated land for SEZs further aggravates this problem and sense of dismay.

Despite the situation calling for urgent correctives to be taken, one does not find evidence of any timely and adequate steps being taken. The Government of India seems to be unconcerned and unmoved and it is adopting a piecemeal approach rather than addressing the issue in a comprehensive manner. Relief measures and packages that have been announced on many occasions have unfortunately remained confined only to papers. Mere words without matching deeds will neither improve agricultural growth nor solve the severe problems afflicting the sector and Indian farmer.

Loan Remission and Agri Risk Fund


The BJP feels it is high time for serious introspection and for initiating urgent correctives on a war footing. The BJP demands that the government should immediately declare a detailed policy of ‘Loan Remission’ for all farmers including the distressed in view of the all pervasive and unprecedented agrarian crisis which has only been further accentuated on account of the wrong policies of the present UPA government. The BJP also demands that loans upto Rs.50,000, including both the principle and interest, should be written off. The party feels that this measure is possible in view of the substantial rise in the government revenues and being sensitive to the need of providing relief to the largest segment of our population, the farmer, who has tirelessly toiled to literally provide food for the entire nation.

Migration of Private Loans:


The BJP also suggests that the Government should come out with a scheme allowing the farmer to migrate his loans from private financial agencies to public finance institutions including banks so as to relieve them of the heavy interest burden. This is even more important in view of the fact that various studies reveal that public institutions are catering to the credit needs of only 30% farmers, even though the government is making tall claims that institutional credit has doubled during its tenure. However, studies reveal that the number of farmers being provided with credit by the banking sector has actually gone down. This suggestion is in the backdrop of the universal opinion that one of the main reasons for suicides by farmers is increasing debt burden because of higher interest rates.

The recent study states that in Maharashtra, over 55% of the state’s farm households are in debt. Farmers suicides are not only persisting but also tending to increase and spread over a wider area. The Government of India should create an Agri Risk Fund to provide relief to the farmer in case of droughts, floods, failure of crops and heavy pest damage etc. It should also cover the other farming population who depend on animal husbandry, dairy, poultry, fishing, horticulture, agro forestry and agro processing. Crop income insurance should be made farmer friendly and mandatory to all the states.

Imports - Detrimental in the Long Run

The Union Agriculture Minister has warned of a crisis in the agriculture sector since food and farm sector productivity has not increased. He has also admitted that wheat imported from Hungary, Ukraine and other European countries comprises red colored grain, a category not liked in India. He has further stated that if we need to import rice, it is available only in Vietnam and Thailand and has said that the production in these countries is also decreasing.

All these facts clearly indicate towards the need to immediately increase the production of rice. However, despite the similarity in production and higher input costs, the government is still unwilling to fulfill the legitimate demand of the farmers to raise the MSP of paddy to Rs.1000 per quintal at par with wheat.

Moreover, there are serious charges that the wheat being imported is of substandard quality and the state after the state across the country are refusing to use these stocks under the PDS. It is truly shameful that we are also importing pulses from Myanmar, Turkey and Tanzania. Duty free imports are no solution. If the problems affecting the domestic agricultural sector are not immediately remedied, such short term initiatives will prove to be disastrous for the entire farming community all over the country.

Land Use & Acquisition: Outdated Act, Amendments Needed

Land has always been a very important resource for the people of India. Land has provided the basic means of survival for the rural mass. As the basis of all economic activity, land can either serve as an essential asset for a country to achieve economic growth and social equity, or it can be used as a tool in the hands of a few to hijack a country’s economic independence.

Over the past few years, fertile agricultural land has become more a matter of housing, investment, and infrastructure building and land as a basis of livelihood—for subsistence, survival, social justice, and human dignity—has largely been lost. This can also be related to some evident signs of aggression and depression being witnessed amongst the rural masses and also with the decline in food production.

The BJP is of the view that the Land Acquisition Act 1894, which is being misused by governments, has become a nightmare for the farmers in view of the mindless acquisitions of agricultural and fertile land in the name of public purpose. This Act is out dated and needs to be amended. Forcible acquisition of fertile land by the government is leading to anarchic situations in various parts of the country and causing widespread discontent among the concerned farmers. Nandigram is the latest and most glaring incident of this process.

Land is a performing asset. Therefore, agricultural and fertile land acquired by the government, even for public purpose, must also be followed up by a proper rehabilitation policy that works on the principle of creating a sort of permanent asset in place of another permanent asset. This can be achieved by ensuring some participation of the land owner in the equity of the new asset as a share holder.

The BJP feels that the Act should be amended to ensure that the government does not acquire fertile irrigated land arbitrarily for private companies and it should serve the public purpose and opines there is every need to define as to what constitutes the ‘public purpose’ under which the government is authorized to acquire the agricultural land from the farmers. The government should acquire land for private companies only in exceptional circumstances and in such cases also the farmer should be given the prevailing market price and it should be an obligation of the company to make him share holder in the development process.

The BJP urges the central government to immediately wake from its deep slumber and take urgent corrective steps on six important issues concerning the agricultural sector in general and farmers in particular:

1. Increase the quantum of public investment in agriculture and mandate banks to earmark 30% of their total loans for credit to the agriculture sector. The central government should take immediate steps to see that the farmers be given loans at not more than 4% interest for agriculture and allied activities. Allow the farmer to migrate his private loans to the banks.

2. The centre should immediately announce loan remission policy and write off loans upto Rs.50,000 as one time measure. Create an Agri Risk Fund.

3. Amend the present Land Acquisition Act in consultation with all the states. As a general rule, the government should not acquire fertile, irrigated agriculture land for private sector and even for public sector without exhausting the option to acquire non agriculture land.

4. Implement the recommendations of the National Commission on Farmers and assure the farmer of actual cost of production plus 50% over and above this cost as the MSP for his produce. The MSP for paddy should also be raised to Rs.1000 per quintal.

5. Make crop income insurance farmer friendly and mandatory for all the States.

6. The Adivasis (Scheduled Tribes) should be given forest land pattas, instead of giving them Adhikari Patra, to enable them to have ownership right and avail credit from banks and other financial institutions.

The BJP warns that if timely steps are not taken, agriculture in India will be doomed and the Congress led UPA government will be solely responsible for ruining the country’s agriculture economy which could also lead to serious long term social unrest.

The party will be coming out with a detailed document on its approach to agriculture and land use policy.

Bird Flu Menace: Inaction in containing it


The government seems not to have learnt any lessons over the incidence of Bird Flu. The West Bengal government needs to be castigated for the callous manner in which it has acted in detecting and containing bird flu, which has already caused heavy damage to the poultry farmers in the state. Even as the disease spread from across the border, and it was reported on 4th January, the government literally slept on the issue until 11th January.

As a fear psychosis about the disease prevails across the country, the government needs to take urgent steps to contain the disease from spreading to other parts. It also needs to caution people about not getting carried away by rumours, restore confidence in poultry product consumers and enable the poultry sector to recover from the present crisis.