Lack of non-agri data hinders computation of farmers' income: Niti member

The lack of data on cultivators and their income from other sources has become a hindrance in determining whether farmers' income has actually doubled or not, Niti Aayog member Ramesh Chand said, pointing out that they are earning more from non-agricultural sources.

The Niti Aayog member further said that prices of agricultural commodities can not be fixed by a law as it has serious implications, which are neither in the interest of the agriculture sector nor individual farmers.

"The government had fixed the goal of doubling farmers' income so that we make more efforts. There is a need for this assessment, where we are in terms of this goal. (But) the required data is not available with us," Chand told PTI in an interview.

In 2016, Prime Minister Narendra Modi-led government set a highly ambitious target of doubling farmers' incomes by 2022.

An inter-ministerial committee on "Doubling of Farmers' Income" was set up in April 2016 to recommend strategies to achieve this goal.

The committee submitted its report in September 2018. After acceptance of the panel's recommendations, the government has set up an 'Empowered Body' to review and monitor the progress.

Elaborating on the issue, Chand said: "We do not have data on a number of cultivators...because when you want to calculate the income of farmers, you need to know the denominator".

The eminent agriculture economist further said that the government does not have data on the income of farmers from non-farm sources after 2018-19.

Stating that in 2018-19, small and marginal farmers were earning more income from non-agriculture sources, he said, "If we have that data, only then it will be clear whether we have achieved this goal (doubling farmers income by 2022) or not".

Replying to a question on the demand of some farmers' groups, mainly from Punjab, for a legal guarantee on minimum support prices (MSP) for various crops, Chand said if prices of agricultural commodities can be fixed legally then so many countries, which are struggling to give farmers remunerative prices, would have simply made it legal.

"Prices can not be fixed legally. It can lead to all sorts of problems...it has very, very serious implications, which are not even in the interest of the agriculture sector or interest of farmers," he asserted.

He further said that if traders are forced to buy wheat or rice at a price which is not supported by demand and supply, then offtake will not happen.

"So, you can not force a trader to pay that price, which traders feel will not bring profit," he opined.

Chand pointed out that when the government buys something (wheat or rice) at a price again which is not supported by demand and supply, it has economic implications.

"Even in the case of MSP of rice and wheat, if you compare what is the economic cost to the government and what is the open market price. You find that in the case of rice if you are paying Rs 2,000 per quintal, you have to incur a loss of Rs 800 just to clear that in the market," he said.

Chand also highlighted that India is now part of the World Trade Organisation agreement on agriculture, and as such, the total support that the country can give to farmers on agricultural produce is capped at 10 per cent.

"We are struggling in the case of rice and wheat, which is our food security issue. So, there are complications. Had legalising price (a legal guarantee for MSP for crops) would have served the purpose, the government would have done it already," he observed.

The US and other countries argue that India's MSP support for wheat and rice exceeds the maximum 10 per cent price support permissible under the WTO agreement. In 2020-21, India reported its price support at about 15 per cent, but the US claims the support was 93.4 per cent.

Asked if farmers will adopt diversification if an assured price is given to them on the other crops, Chand said the experience of states shows that best diversification happens when farmers are not given any assured support price.

"Simply, even MSP will not lead to diversification because many crops do not become profitable. Their profitability is not at par with rice and wheat, even if you start giving MSP on that," he said.

While noting that diversification of crops is an issue which needs to be treated differently, Chand said the biggest reason for farmers sticking to paddy is free electricity provided by some states.

"Please start charging for the electricity that you are supplying. That is the way to approach diversification," he suggested.

Paddy cultivation accounts for over 70 per cent of groundwater withdrawal and over 90 per cent of Punjab's agricultural water comes from tube wells, and the number of active wells has increased exponentially in recent decades.