Agrarian Distress in India apt title of the latest book by agricultural economists BC Barah & Smita Sirohi would not have come out at a more appropriate time when the government is grappling with rising cost of food items which not only cause lots discomfort to consumers but also policy makers and analysts who have failed to anticipate the trend.
The book acknowledges that the macro economic scenario and growth trends show loss of dynamism in the agricultural and allied sector during the past 10 - 1 5 years. Growth of agricultural GDP decelerated from over 3.5% per year during 1981-82 to 1996-97 to only around 2% during 1997-98 to 2004-05. The growth rate of rice production tumbled down from 3.62% in the 1980s to less than one per cent in the first half of the 2000s.
Another crucial indicator of looming agrarian crisis is the steep decline in the growth of total factor productivity (TFP) during 1990s as compared to 1980s indicating decreasing importance of technological contribution to food production.
Alarmingly the book point out that the productivity of paddy has decreased in Punjab and Haryana during the period 1985-2000 and had remained unchanged in Assam, West Bengal, Karnataka and Uttar Pradesh. The only solace is that yield has marginally increased by in Andhra Pradesh, Bihar, Madhya Pradesh, and Tamil Nadu.
"The decadal analysis of the productivity growth of this most important cereal crop has shown that compounded growth rate of paddy yield after peaking during the 1980s decelerated rapidly since the early 1990s, depicting an inverted bowl shaped growth pattern," the book has commented.
On the loan waiver to the tune of more than Rs 60,000 crore to farmers which was announced more than two years back, the authors of the book criticized the government policy by stating that 'loan waiver cannot be expected to automatically enhance farmers' capacity to increase production and incomes.
"The farmers need measure for raising output and good price for production rather than more credit which, in the absence of viable agriculture, push them back into debt trap," both the authors Barah and Joshi scientists with National Centre for Agricultural Economics and Policy Research (NCAP) has commented.
On the urgent institutional reforms, authors have argued that the agricultural sector needs well-functioning markets to drive growth, employment and the economic prosperity in rural areas. 'The plethora of regulations on marketing of agricultural produce has created restrictive and monopolistic marketing structures, resulting in inefficient operation and high degree of marketing costs,'.
Although the new model Agricultural Produce Marketing Committee (development and regulations) has broadened the APMC act, all the states have yet to modify the existing act which aims at developing agricultural market system.
There is need to develop appropriate legal framework for promoting direct marketing and contract farming arrangements as alternate marketing mechanisms for making agricultural sector financially viable.
"Speedy implementation of the market reforms is essential to provide a conducive policy environment for marketing of agricultural produce," noted the authors of the book.
—The book is published by Concept Publishing Company, New Delhi
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