IAS (Retd.)

Former Additional Chief Secretary


Notwithstanding the rhetoric of the governments regarding high priority for agriculture and the rural development, in reality the situation is just the reverse from the very inception of governments, whether in the Center or the States. The most influential/ talented MPs are picked up for Finance/HomeorDefence Ministry etc. Portfolios like Agriculture/ Rural Development may be given to left outs. At the end of the day, one may not be able to recall even the name of Agriculture Minister of India or of one’sown State. In the posting of bureaucrats again, the same caste system is visible. With a plethora of national and international issues, the focus,if any, on agriculture and rural development recedes to the background.

During elections, every party makes tall promises and tries to win elections through short term gimmicksbut it is lamentable that even after so many decades, too little has been done too late.

Agriculture revolves between two cycles of drought and bumper crop. Particularly after a bumper crop, when the prices crash, the agony of the farmers is acute. Long term strategy of governments could savesuch a pathetic situation.Agriculture even by the most liberal yardstick, is not a profitable venture. Agriculture cannot sustain 69% rural population of our country. It is just not viable.

The daily milk collection of Amul is 180 lac liters and around 36 lacs farmers are benefited by it. In 2009-10 the daily milk collection was barely 90 lacs liters but in such a short period, the milk collection has recorded a 100% jump. India has become the largest milk producer in the world. Almost 50% of the milk is processed for production of ghee, butter, curd, cheese etc. These processed products have international markets.

Impressed by the Gujarat model, in the recent budget, the Finance Minister, Arun Jaitley has very thoughtfully created a corpus of Rs.8000 crores, with NABARD for setting up of milk processing units. The proposal is to process 500 lac liter milk every day. With the corpus of barely Rs.8000 crores, the farmers are likely to have an additional income of around Rs.50000 crores every year.The return is more than six times, not once but year after year. Such vision is needed for long term strategy in agriculture sector.

Due to lack of proper storage and thrust on food processing, every year almost 18% of the fruits and vegetables perish in India while the processing is only for 2% of fruits and vegetables. Compared to this in milk, the component of processing is 37% and losses are less than 1% (to be precise 0.2%). What a remarkable metamorphosis can take place if the perishable component could be significantly reduced and the processing component could be given an exponential jump. In Brazil, the processing of fruits and vegetables is nearly 70% while in the USA it is around 60%.

A single step which can effectively prevent the recurring crashing of prices due to bumper crops is the construction of large number of cold storage units in private sector. In predominantly agricultural states, let every Tehsil have at least one cold storage.

This would generate lot of employment and boost cement production. Thanks to the dynamicleadership of Piyush Goyal, Minister for Energy and Coal, for the first time, electricity is surplus even during the peak load hours. Hence the cold storage units will get adequate electricity supply.

If the Prime Minister takes up the monitoring of such aprogramme, I am sure in barely one year, we could have thousands of cold storage units in the country. Fast implementation of a large number of schemes is the hallmark of the present government.

Against the above background, the loan waiver schemes would prove suicidal for our economy as well as farmers. In the long run it would harm rather than help the farmers. It will give the wrong message. Even those farmers who have been foolish enough to repay the loans would be encouraged to commit default in repayments. That would be a big blow, particularly to the large number of Cooperative Banks. If loans are not repaid, future loaning by banks would get choked. That would cause greater hardships to the farmers. This is not a onetime solution. This demand would become an annual feature.

If huge amounts are squandered on loan waivers, all developmental activities would come to a grinding halt. The rural areas require better roads, better health and educational facilities. These activities would immensely suffer as a result of loan waivers.

Of course the farmer’s agitation has ushered in “Achhe Din” for the opposition. It is not easy for the opposition to resist the temptation to escalate the agitation. In fact this is a golden opportunity for them but long term national interest should not be sacrificed for such short term gains. In the developed countries, on basic national issues, there is a broad national consensus.

We have debated interlinking of rivers for several decades. A time has come for translating the scheme on the ground. It would lead to a big jump in irrigation facility to the farmers, apart from hydel generation,the employment generation would jump exponentially.

Instead of frittering away our time and energy on violent agitations and non-issues relating to language or food habits or even history, we should all join in the nation building activities. In 1947 we were far ahead of China on a variety of fronts but today we are way behind China in most parameters.  One is reminded of the clarion call of the late President Kennedy when he said “Ask not what the nation can do for you, ask what you can do for the nation”.