Selling crop at the government procurement mandis at officially mandated rates can best be described as a hurdle race for farmers.
I was thinking of PM Narendra Modi’s recent speeches as I watched a disturbing video that recently went viral on social media. In a fit of rage, a farmer identified as Prem Singh Lakhiram Chavan from Jalna district in Maharashtra destroys the cabbage crop standing in his field.
Apparently, having lost his cotton crop and incurring heavy debt, Prem Singh had planted tomatoes and cabbage this season. He realised Rs 442 on the sale of 4 quintals of tomatoes, which didn’t even cover his transportation cost of Rs 600, much less the production cost of Rs 25,000. Rather than undergo a similar experience with cabbages — its price had also crashed — he destroyed his crop.
The video encapsulates the double jeopardy of nature and market faced by the Indian farmers. They routinely suffer when natural disasters like drought, hail and pest attacks damage crops. They suffer even when they escape nature’s wrath and have a good crop because of crash in prices. The crisis that the Indian farmer faces today is an overlap of economic, ecological and existential crises.
Of late, the government has been forced to face this harsh reality of agrarian crisis. A spate of farmers’ agitations through the country, the results of the Gujarat election, and, recently, the ‘long march’ to Mumbai have foregrounded the farmers’ issue.
The PM does not miss an opportunity to rattle off what his government has done for the farmers: soil health card, neem-coated urea, more-crop-per-drop, Pradhan Mantri Fasal Bima Yojna (PMFBY). The trouble is that, in the last three years of my intensive travel across villages, I have never come across a farmer talking about any of the PM’s pet schemes, except for the PMFBY, which all of them curse. The harder the PM tries, the less convincing he sounds. Farmers don’t want to hear about these fancy schemes; they want to hear something positive about their income, about the prices of their crops. Perhaps that is why the government has turned, rather late in the day, to address the issue of MSP (minimum support price), an assured price for 24 crops announced by the central government every year. The PM claims that his government has made a ‘historic’ announcement to increase the MSP, and assures us that the administration will make sure that every farmer can benefit from this.
Over the last 10 days, I have been involved in trying to check this claim. Swaraj Abhiyan’s Jai Kisan Andolan, along with a host of other farmer organisations, launched an ‘MSP satyagraha’ across agriculture produce mandis across the country. The aim was to find out the prevailing rate for the crops in that market; talk to the different stakeholders, i.e. farmers, Agriculture Produce Marketing Committee (APMC) officials, and traders; and observe how government procurement happens, or doesn’t happen. We started on 14 March at the APMC market yard in Yadgir, Karnataka, and travelled to Andhra Pradesh (Adoni, one of the biggest cotton trading centres in India) and Telangana (Suryapet). After this, the yatra travelled to Shri Ganganagar in Rajasthan, and Rewari and Nuh in Haryana.
Our finding: farmers cannot sell even a single crop at a single mandi for the government-mandated MSP. When we visited the southern mandis, they were still trading some kharif (summer) crops like tur dal, groundnuts and cotton. The MSP for tur dal is Rs 5,450 per quintal, enhanced to Rs 6,000 by the Karnataka government. Less than half the farmers could get this price from the government; the rest had to go for an open-market sale for under Rs 4,000 per quintal. Similarly, groundnut farmers in the three southern states said government procurement was carried on for only a short while. The farmers had to sell their crop at a rate between Rs 3,600-3,700 against an MSP of Rs 4,450. Fair-quality cotton fetched good price, but unseasonal rains and an attack by bollworm pests had rendered most of the crop unfit for this price.
The winter (rabi) crop is now arriving in the markets. Among these are Bengal gram (chana), mustard and barley. Wheat and masur will arrive shortly. A bumper harvest of chana, coupled with imports, have depressed its price. Against a declared MSP of Rs 4,400 per quintal, open-market prices are nearly Rs 1,000 lower. In Rajasthan, barley is ripe and, even before sale, the prices are at least Rs 200 below the MSP of Rs 1,410. In Rajasthan, home to more than half of the country’s barley production, the government has refused to purchase the crop at MSP rate. An expected rise in mustard prices is yet to materialise and private traders are offering farmers Rs 300-500 less than the official rate of Rs 4,000. Our analysis of market prices thus far shows that Indian farmers stand to lose as much as Rs 14,474 crore this season alone by selling their winter crops (except wheat and winter paddy) below the official MSP. This is not just a loss, it is loot.
Through these visits, we also got to check for ourselves the state of government ‘procurement’. It’s best described as a hurdle race, with the government putting every possible obstacle to prevent the farmer from selling the crop at the officially mandated rate. In some cases, as for barley, the government simply refuses to purchase. When it does purchase, the operations begin much after most farmers have resorted to distress sales at a much lower price. Farmers told us that the traders purchased their crops below the MSP and sold it to the government at the statutory rate, profiting from the arbitrage. Moreover, states have imposed quantitative restrictions on the amount they purchase from each farmer. While the government pats its back for bumper harvests, it refuses to purchase their entire crop when prices crash.
Next, farmers are made to produce a variety of documents, including their Aadhaar card, bank passbook, a letter from a government agriculture official, land registration papers etc. The paperwork is bewildering and designed to exclude small and tenant farmers. If someone manages to cross all these hurdles and sell his produce to the government agency, the payment is not remitted to farmers for two to three months. And when the money arrives in the account, the banks adjust it against any outstanding loan, defying banking norms. No wonder, most farmers find it expedient to sell at a lower price to private traders.
My thoughts go back to Prem Singh Chavan as I hear about the PM’s ‘Mann Ki Baat’ on farmers. I feel like challenging the PM: Pick any one mandi of your choice in the country, choose any current rabi crop that you like, and show me that all the farmers who came there could sell their entire crop for at least the minimum price assured by your government. If you do, I will salute you and say that the farmers should vote you back to power. If you don’t take up this challenge, is it time for you to listen to the farmers’ mann ki baat?
Yogendra Yadav is national president of Swaraj India.