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More support prices

Govt's attempt to raise tribal incomes is counterproductive

Business Standard Editorial Comment  |  New Delhi 

The government's decision to provide minimum support prices (MSPs) to 12 main items of minor may have been made with the best of intentions, but it faces near-impossible hurdles when it comes to implementation. The expressed objective is to ensure remunerative prices for minor forest produce, which forms the mainstay of the livelihood of forest-dependent people, largely members of the Scheduled Tribes. But the unstated goals are to drum up a few more votes - and, at the same time, to dent a significant funding source for the Naxalites by eliminating contractors in marketing. Many of the tribal-dominated tracks in the nine states included in the Schedule V of the Constitution, where the scheme will operate, are haunts of left-wing extremism. They are believed to draw an estimated 40 per cent of their financial resources (around Rs 140 crore a year, according to a recent study) from contractors; the rest comes from miners, road contractors and private companies. Many of these states, moreover, are Opposition-ruled and face Assembly polls in the next few months.

The proposal for this scheme, mooted by the affairs ministry and approved by the Cabinet Committee on Economic Affairs in its last meeting, will bring under the MSP mechanism non-timber forest products such as bamboo, tendu leaves, tamarind, mahua seeds, sal seeds and leaves, and karanj seeds. The for these items are to be determined by the Cooperative Marketing Development Federation, the marketing arm of this ministry, while the actual procurement operations have been left to the state-designated agencies, mostly co-operative organisations. The cost of these operations is proposed to be shared by the Centre and states on a 75:25 basis.


However, there are several aspects of this programme that will make its implementation difficult. For one, neither the affairs ministry nor the Cooperative Marketing Development Federation has any expertise in determining reasonable prices for forest produce, given that the cost of production criterion followed for fixing for crops is difficult to apply here. Besides, even for crops whose marketing is far more organised than that for forest produce, the Centre and the states are unable to enforce except for rice and wheat. To make it work, state-nominated agencies will need to establish an elaborate and fairly dense network of procurement centres throughout the sprawling forest belts to buy tiny lots of goods brought out by local residents loaded on their heads. All this is, of course, apart from the hazards that a Naxal presence will imply for procurement personnel. Any failure on the part of the government to meet the raised expectations of Scheduled Tribes after the announcement of high will only exacerbate the prevailing discontent among the tribals. The government would, thus, be well advised to first do the necessary spadework and make effective arrangements to create a deeper market, in order to buy, transport, and pass on to end-users. Any haste on this front, for political or other reasons, will prove counterproductive.

First Published: Tue, August 06 2013. 21:38 IST
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