Reforming agriculture

Farming needs to be made profitable

The proposal to link the allocation of Central funds to farm sector reforms in states, discussed at the first meeting of the chief ministers’ committee on transforming agriculture, has many sides and needs careful examination before the final call is taken. While it is true that several well-judged farm sector reforms initiated by the Centre have failed to make much headway because of states’ apathy, the denial of funding on this count may prove counterproductive, besides undermining the spirit of federalism. If the states’ disinterest in Centre-sponsored reforms and other initiatives is owing to their own better plans to achieve the same objective, squeezing funds would be unfair. But if it is attributable to administrative lethargy and inefficiency or, worse, politically motivated one-upmanship, as is sometimes the case, harsher fiscal steps may not be unjustified. 

Indeed, the idea of leveraging Central finances for nudging states to hasten reforms is not new. Even the National Institution for Transforming India (NITI) Aayog had advised the agriculture ministry in 2017 to tie up a part of the grant under the umbrella farm development scheme Rashtriya Krishi Vikas Yojana with the implementation of farm sector reforms. However, the proposition was not pursued due to the fear of backlash from state governments. But if some chief ministers are themselves veering round to this view, it may be worthwhile to try it out, even if on a selective basic. A beginning can be made to push reforms in fields such as agricultural marketing, land leasing, contract farming, crop insurance, and agricultural credit. 

Another possible, albeit hard to execute, way to circumvent the states’ indifference towards the Centre’s farmer-oriented agenda could be to shift agriculture from the State list to the Concurrent List of the Constitution’s Seventh Schedule. This would empower the Union government to play a greater and more decisive role in the development of agriculture without significantly diluting the powers of the state governments. Such a statutory translocation of agriculture was suggested by the M S Swaminathan-headed National Commission on Farmers in its fifth and final report in 2006. Of late, the Dalwai committee’s report on the issues related to doubling farmers’ income by 2022, presented to the government in September 2018, also favoured putting agricultural marketing on the Concurrent List.

However, the amendment to the Constitution for this purpose would require the support of two-third members of both houses of Parliament and an endorsement by a requisite number of state legislatures. It might be a tall order, but it would certainly not be unprecedented as such statutory amendments have been carried out in the past as well. Subjects like education, forests, and wildlife protection were moved from the State List to the Concurrent List through the 42nd amendment of the Constitution way back in 1976.

The substantive issue, really, is to carry forward some vital and, more importantly, need-based reforms in agriculture to restore profitability and mitigate farmers’ lingering financial woes. Exit avenues also need to be created to let farmers quit farming if they intend to do so to improve their livelihood prospects. The chief ministers’ panel can legitimately be expe­c­t­ed to come out with practically feasible plans to rejuvenate the country’s farm sector.