Statsguru: Indian farmer protests mirror similar scenes in France, Germany

Farmer protests in India mirror similar scenes in countries like France and Germany.

While specific issues vary, subsidy changes and income worries have been broad themes across multiple locations. Indian farmers’ increasing assertiveness comes amid similar pressures on income.

Farm incomes have not risen at the same pace as the growth seen in the rest of the Indian economy. The share of agriculture in the national income has steadily declined over the decades, from 61.7 per cent in 1950-51 to 14.8 per cent in 2019-20. The share of employment has decreased more gradually, with agriculture still accounting for 45.6 per cent of total jobs (Chart 1).

Production for cereals as well as pulses has surged in the past 50 years (Charts 2, 3).

Protest demands have included a support price for all farm produce, which experts believe may not be viable. There has been limited growth in the prices at which the government buys crops from farmers for segments that already have a minimum support price. Both rice and wheat have experienced around a 5 per cent annualised growth since 2014-15.

The government may be limited in its capacity to spend more on agriculture. India already spends significantly more as a share of total government expenditure than large economies like France and Germany. It also outspends other emerging market (EM) peers and makes available a greater share of credit (Charts 4, 5).

Farm protests in Europe include opposition to new laws that seek to limit emissions from agriculture. The move would have increased costs for European farmers and was eventually scrapped following protests.

Pressure has been mounting on EMs to cut down agricultural emissions. The government has pushed back without the need for farm protests thus far.

Agriculture accounts for roughly a tenth of Europe’s emissions, more than twice the figure for India (Chart 6).