(Note: This is a continuation of our budget analysis of Union Budget 2023–24. The previous six articles have been published in earlier issues of Janata.)
The budget for agriculture is simply devastating for farmers — it is as if the Modi Government is taking revenge on farmers for their historic movement that forced the roll-back of the three farm laws. It has reduced the budget for every important sector related to agriculture — from Ministry of Agriculture, to Ministry of Rural Development, to farm produce procurement and fertiliser subsidy.
Whatever Happened to Doubling of Farmers’ Income?
It was in February 2016 at farmers’ rally in Bareilly (UP) that PM Modi first promised that his government would ensure doubling of farmers’ income by 2022. Soon after, Finance Minister Arun Jaitley repeated the same promise in his budget speech. In April 2016, the government set up a committee, the Dalwai Committee, for recommending strategy for doubling farmers’ income by 2022. For the next 5 years, doubling of farmers’ income remained a staple item in all budget speeches and the speeches of ruling party leaders including the Prime Minister. But in 2022, neither the PM, nor the FM, made any mention about it. Instead, the FM announced a new goal post for 25 years hence, accompanied by a host of new promises for this ‘Amrit Kaal’.
The reason why the government has stopped talking of farmers’ income, and instead conjured up a new ‘jumla’, becomes obvious from the little data available on how much farmers’ income has increased during the Modi years.
The Dalwai Committee report estimated the benchmark farming household income in 2015–16 to be Rs 8,059 per month and this was promised to be doubled in real terms by 2022. Taking inflation into account, this means farmers’ monthly income should have reached Rs 21,146 by 2022. Three years later, in 2018–19, the monthly income of farm households was estimated to be Rs 10,218 per month in nominal terms, as per NSSO 77th Round data released in 2021. Since then, the government has not released any more data. A projection for the next three years (adjusting for the annual agricultural growth rates) gives an estimated farmers’ monthly income of Rs 12,445 per month in 2022. The target of Rs 21,146 remains a mirage (see Chart 5).[1]
Chart 5: Actual and Projected Agricultural Income Growth (Rs / month)
The income of farmers given above includes income from both farming and wages, from animal husbandry as well as non-farm business. In 2012–13 (as per NSSO 70th Round data), the average monthly income of agricultural households was Rs 6,426, of which Rs 2,071 came from wages while Rs 3,081 came from crop production and cultivation (48%). But in 2018–19 (as per the NSSO 77th Round data), the average monthly income had gone up by 59% to Rs 10,218; the income from crop cultivation and production was Rs 3,798 (37% of total income), while the income from wages was Rs 4,063.[2] This means (See Chart 6):
- While the average monthly income had gone up by 59% over the period 2013–19, the income from cultivation had gone up by only 23%.
- The income of farmers from cultivation is less than 50% of their total income from all sources, and had actually declined to less than the income from wages!
Chart 6: Break-up of Average Monthly Income of Farmers, 2013 and 2019
Before the 2019 Lok Sabha elections, the Modi Government repeatedly manipulated the GDP growth rates to make it appear that the economy was doing better during the Modi years as compared to the previous UPA years.[3] But despite all its endeavours, the latest GDP series for the UPA years (2005–06 to 2013–14; it does not give growth rate for 2004–05) and the Modi years (2014–15 to 2022–23) show that:
- average agricultural growth during the UPA years was 3.82% (Table 21);
- average agricultural growth during the Modi years is 3.67% (Table 22).[4]
Table 21: Agricultural Growth Rate During UPA Years, 2005–06 to 2013–14
(at constant 2011–12 prices)
| 2005–06 | 2006–07 | 2007–08 | 2008–09 | 2009–10 | 2010–11 | 2011–12 | 2012–13 | 2013–14 | |
| Agriculture growth rate | 4.8 | 2.9 | 5.5 | –0.2 | –0.9 | 8.8 | 6.4 | 1.5 | 5.6 |
Table 22: Agricultural Growth Rate During Modi Years, 2014–15 to 2022–23
(at constant 2011–12 prices)
| 2014–15 | 2015–16 | 2016–17 | 2017–18 | 2018–19 | 2019–20 | 2020–21 | 2021–22 | 2022–23 | |
| Agriculture growth rate | –0.2 | 0.6 | 6.8 | 6.6 | 2.1 | 6.2 | 4.1 | 3.5 | 3.3 |
The Deepening Agricultural Crisis
The farm crisis is far more severe than that suggested by the above figures of slowing agricultural growth rate.
According to the All India Debt & Investment Survey conducted by the National Statistical Office in 2019 and released on 10 September 2021, more than half of India’s agricultural households (50.2%) were in debt, with an average outstanding debt of Rs 74,121. The average debt had gone up considerably since the previous survey in 2013 — by a huge 58%. The average annual income of agricultural households was Rs 1.23 lakh. This means that the average debt was 60% of the average income.[5] Since these are average figures, this obviously means that a very large number of farmers must be facing a serious debt crisis.
The Modi Government’s anti-farmer policies have pushed the hardy Indian peasants into such despair that they are taking their lives in record numbers. During the first seven years of Modi rule (from 2014 to 2021), 89,200 farmers and agricultural labourers committed suicide (48,500 farmers; 40,700 agricultural labourers).[6]
The result of this worsening agrarian crisis is that employment generation in agriculture has suffered an absolute collapse – the first time it has happened since independence. Total agricultural employment in 2011–12 was 23.19 crore; it fell to 20.53 crore in 2017–18 (see Table 23).[7]
Table 23: Total Agricultural Employment, 1983 to 2017 (in crore)
| 2011–12 | 2017–18 | |
| Total Agricultural Employment | 23.19 | 20.53 |
Let us now examine the budgetary outlays related to the agricultural sector, to see if the FM has announced some concrete measures to provide relief to India’s farming community from this unprecedented agricultural crisis.
Ministry of Agriculture and Farmers Welfare
Unfortunately, the Modi Government is a ‘jumla’ government. Every year, it comes up with a new jumla for agriculture. Thus, in the 2016 budget speech, the FM focussed on improving irrigation facilities and strengthening the ‘Pradhan Mantri Krishi Sinchai Yojana’ — but a closer look at the budget documents revealed that the FM had actually reduced the financial allocation for this scheme as compared to the previous year. In the 2018 budget speech, the announcement that made the biggest splash in the media was the FM’s promise that the government will fix Minimum Support Prices (MSP) for crops at 50% over production costs. An analysis of the budget papers revealed that FM Arun Jaitley had ‘achieved’ this by a sleight of hand: he had lowered the production cost by changing the formula for calculating it![8] In the post-election July 2019 budget speech, the FM announced that the government was going to focus on ‘zero budget farming’, but the budget papers show that she had reduced the allocation for the most important scheme meant to promote organic farming, the Paramparagat Krishi Vikas Yojana, while the budget allocation for National Project on Organic Farming was near zero! During the Covid lockdown in 2020, the government announced multiple relief packages for agriculture as a part of the ‘Atmanirbhar’ economic revival package — but a deeper scrutiny of the budget financial statement revealed that most of the relief packages were mere repackaging of schemes already announced in the 2020 budget and previous budgets. Consequently, the 2021 budget documents showed that total spending on agriculture (Ministry of Agriculture + Ministry of Fisheries, Animal Husbandry and Dairying) had actually fallen (2020–21 RE as compared to the BE); and the 2022 budget papers showed that actual spending was even less than the RE — implying that the relief package for agriculture was not even zero, but negative![9] Last year, in her 2022 budget speech, FM Nirmala Sitharaman returned to the theme of promoting chemical-free natural farming throughout the country. But the budget documents reveal that the allocation for the various schemes meant to promote this were so tiny that the FM has now merged them together with several other schemes into one single scheme called Rashtriya Krishi Vikas Yojana (RKVY) — and the allocation for ‘Krishi Vikas’ (RKVY) has been cut by 30% as compared to last year’s budget estimate. Worse: we will henceforth have no idea of how much the government is prioritising natural farming, as there will be no separate allocation for natural farming related schemes.
This year, the FM announced that the government was going to make India a global hub for millets. It is yet another jumla. There is no mention of any scheme for this in the budget’s financial papers.
In this year’s expenditure budget of the Ministry of Agriculture, all the central schemes for agricultural development have been subsumed under two broad umbrella schemes: one is RKVY, that we have mentioned above; the other has been given the name ‘Krishionnati Yojana’. This latter scheme clubs together all schemes aimed at strengthening infrastructure of production and marketing of agriculture produce. Last year, the allocation for Krishionnati Yojana was Rs 7,183 crore; the revised estimates for 2022–23 (in this year’s budget papers) show a considerably reduced expenditure of Rs 5,000 crore. This year’s budget allocation for this scheme is Rs 7,066 crore, a significant reduction from last year’s budget estimate taking inflation into consideration.
Like last year, this year too the FM is silent on the two most important demands of farmers: i) that the government implement the recommendation of the Swaminathan Commission that farmers be given MSP for their produce which is 50% over the C2 cost of production (which is the comprehensive cost of production); ii) that the government evolve a mechanism to ensure that farmers actually get MSP for their crops. While repealing the three farm laws in December 2021 after a year long agitation by the farmers, the government had promised that it would set up a committee for these demands. Eighteen months have passed since then, but the government has not initiated any action on this.
Instead, the Modi Government is now seeking to make another push to implement the farm laws, this time gradually. The budget papers reveal that the government is winding down all procurement schemes aimed at ensuring that farmers get remunerative prices for their produce.
The most important scheme that guarantees farmers a decent price for their produce is government procurement for implementing the National Food Security Act (NFSA). The allocation for this scheme has consistently fallen since 2021–22. As compared to 2021–22 (Actuals), the allocation for the NFSA in this year’s BE has fallen by more than 30%, and as a percentage of budget outlay has fallen by more than 40% (we discuss this in greater detail in a subsequent article on nutrition schemes).
Two other schemes also meant to assure remunerative prices to farmers for their produce — the Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-AASHA) and the Price Support Scheme–Market Intervention Scheme (PSS–MIS) — have been whittled down to such an extent that they now remain only on paper. PM-AASHA was announced in September 2018 as a scheme for ensuring that farmers get MSP for pulses, oilseeds and copra. It was initially allocated Rs 1,400 crore. However, by 2020–21, the allocation for this scheme had fallen to near zero, and has remained so ever since. PSS and MIS have both been in existence for several years, and are schemes for stabilising prices of specific agricultural commodities. The allocation for PSS–MIS had been significantly scaled up by the government in its 2021 budget, probably in response to the farmers’ agitation. But this year, even this scheme has been abandoned, with allocation for it almost nil (Table 24).
Table 24: Allocations for PM-AASHA and PSS–MIS (Rs crore)
| Year | PM-AASHA | PSS–MIS |
| 2020–21 A | 0 | 1,358 |
| 2021–22 A | 0 | 2,288 |
| 2022–23 RE | 0 | 1,500 |
| 2023–24 BE | 0.01 | 0.01 |
Nearly 50% of the budget for Ministry of Agriculture is spent on just one scheme — the Pradhan Mantri Kisan Samman. It is a relief package meant to provide an allowance to farmers suffering from the agricultural crisis, it is not a plan for alleviating the crisis. The allocation for this too has declined — from Rs 66,825 crore in 2021–22 (Actuals) and Rs 68,000 crore in 2022–23 BE to Rs 60,000 crore this year. To resolve the farm crisis, the government needs to take steps to make farming profitable, which will need measures like providing farmers increased input support (such as increased subsidies for fertilisers and seeds) and output support (such as guaranteeing them remunerative prices for their produce), and also waiving farm loans to free farmers from the debt crisis. However, the Modi Government is refusing to increase the budget allocation for any of these policies.
Even the relief being provided to the farmers is meagre — it translates into a mere Rs 500 per month. It has not been increased by a single paisa since it was first announced in the 2019 budget. This amount is much less than the income support to farmers being given in West Bengal and Odisha (which give farmers Rs 10,000 per year) and Telengana (which gives farmers Rs 10,000 per acre per year).
While it is necessary to provide income support to farmers, ultimately, in the long term, what matters is total public investment in agriculture (apart from the income support scheme). That is the single most important statistic to judge how serious the government is regarding alleviating the farming crisis. The shocking fact is: the allocation for the income support scheme is greater than the remaining allocation for the Department of Agriculture and Farmers’ Welfare (Table 25)!
An important sector that can help provide some relief from the agrarian crisis is the livestock sub-sector (includes sectors like dairy, poultry and meat) and fisheries sub-sector. The livestock sector provides crucial additional income to a large section of small and marginal farmers — according to NSSO data, it provides 16% of the total income of agricultural households today (see Chart 6). While it is estimated that fishing, aquaculture and allied activities provide livelihood to more than 1.4 crore people. But budget allocation for this Ministry is miniscule—barely 0.1% of the total budget outlay.
For a country like India, where the overwhelming majority of farmers are small and marginal farmers, who simply cannot invest in areas necessary to make farming profitable (like agricultural infrastructure and research for improving quality of seeds and soil fertility), for agricultural development and making farming profitable, what matters is total budget outlay for agriculture and the related ministry of dairy farming and fisheries. As Table 25 shows, the total allocation for the Ministry of Agriculture and Farmers’ Welfare and the newly created Ministry of Animal Husbandry, Dairying and Fisheries (which was earlier a Department in the Ministry of Agriculture) is a mere 2.9% of the budget outlay — for a sector on which more than half the population depends for its livelihoods. This allocation is lower than last year’s budgeted allocation of 3.91% (which itself was quite low); taking inflation into account, this would mean a reduction of around 11%, a significant cut.
Table 25: Modi Government Allocation for Agriculture, 2021 to 2023 (Rs crore)
| 2019–20A | 2021–22 A | 2022–23 BE (4) | 2022–23 RE | 2023–24 BE (5) | Increase, 5 over 4, % | |
| Department of Agriculture and Farmer’s Welfare (a) | 94,252 | 1,14,468 | 1,24,000 | 1,10,255 | 1,15,532 | – 6.8% |
| of which: PM Kisan Samman | 48,714 | 66,825 | 68,000 | 60,000 | 60,000 | |
| Dept of Agricultural Research and Education (b) | 7,523 | 8,368 | 8,514 | 8,659 | 9,504 | 11.6% |
| Ministry of Agriculture and Farmer’s Welfare (a+b = 1) | 1,01,775 | 1,22,836 | 1,32,514 | 1,18,914 | 1,25,036 | – 5.6% |
| Ministry of Fisheries, Animal Husbandry and Dairying (2) | 3,363 | 3,943 | 6,037 | 4,729 | 6,577 | 8.9% |
| Total Agriculture Related Ministries (1+2 = 3) | 1,05,138 | 1,26,779 | 1,38,551 | 1,23,643 | 1,31,613 | – 5.0% |
| (3) as % of Budget Outlay | 3.91 | 3.34 | 3.51 | 2.95 | 2.92 | |
| (3) as % of GDP | 0.52 | 0.54 | 0.51 | 0.45 | 0.44 |
As a percentage of GDP, this allocation is a miniscule 0.44% — again lower than last year’s 0.51%.
Despite the worsening farm crisis, the total budgetary allocation of the Modi Government for agriculture and allied sectors has been consistently falling since 2019–20, when it was 3.91% of the total budget outlay (Table 25).
- Ministry of Rural Development
Another important budget allocation that intimately affects agriculture is public spending on rural development.
- Table 26: Budget Allocations for Ministry of Rural Development (Rs crore)
| 2019–20 A | 2020–21 A | 2021–22 A | 2022–23 RE | 2023–24 BE | |
| Ministry of Rural Development (1) | 1,23,622 | 1,97,593 | 1,61,643 | 1,82,382 | 1,59,964 |
| (1) as % of Budget Outlay | 4.60 | 5.63 | 4.26 | 4.36 | 3.55 |
Several important schemes for rural development come under this Ministry, such as Pradhan Mantri Avas Yojana, Pradhan Mantri Gram Sadak Yojana, and National Rural Livelihood Mission. It also includes the scheme for rural employment, MGNREGA, and the National Social Assistance Programme that provides pensions and other social assistance to the poor.
Despite being such an important ministry that oversees so many important programmes, the budget outlay for this ministry this year is lower than the revised estimates of last year by 12% — which means a reduction by around 18% in real terms (Table 26)!
Within this ministry, the only head whose budget has seen a significant hike is the Pradhan Mantri Awas Yojna – Rural (PMAY-G). Its allocation has more than doubled, from Rs 20,000 crore in last year’s budget estimate (and Rs 40,000 crore in RE) to Rs 55,000 crore this year. With this increase (together with an allocation of Rs 25,000 crore for urban housing, which comes under the Ministry of Housing and Urban Affairs), the FM claims that the government hopes to provide ‘housing for all’ by 2024. This scheme appears to be an even bigger scam than the Swachh Bharat Mission (SBM). Under this Mission, the government claims to have spent thousands of crores of rupees and built more than 11 crore toilets; on 2 October 2019, PM Modi announced that the country had become Open Defecation Free. However, an extensive survey done in 2021 on the outcomes of the SBM found that more than 45% of India’s population still defecates in the open. The reason: lakhs of toilets had been constructed only on paper, and a very large number of toilets that had been built were not being used because of non-maintenance of built toilets together with usage of substandard materials for construction. [10] Similarly, the PMAY-G too appears to be more of a paper scheme. While the PMAY-G dashboard claims that more than 2 crore houses have been built under this scheme, the subsidy being provided for building these houses is so tiny that most of these houses are going to be only in government files. Indeed, that is what several newsreports published on the internet reveal. [11]
If we leave out the enhanced allocation for the pandemic year 2020–21, when the government was forced to hike its allocation for MoRD because of a huge spike in rural distress because of which it was forced to increase its allocation for MGNREGA, the budget allocation for this ministry has consistently fallen over past few years — it was 4.9% of the budget outlay in 2018–19 A, 4.6% in 2019–20 A, 4.4% in last year’s RE, to just 3.6% in this year’s BE (Table 26).
Let us now take a look at the most important scheme under this ministry, the MGNREGA.
MGNREGA
The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA) is one of the most important social sector expenditures of the Central Government. It is a demand based scheme that guarantees a minimum of 100 days of employment in a year to every willing household. Significantly, it guarantees time bound employment, within 15 days of making such a requisition, failing which it promises an unemployment allowance.
Despite its many limitations such as the provision of providing employment for only 100 days a year and wages below the minimum wages in several states, its benefits far outweigh its limitations. In a situation when unemployment and poverty have reached their worst levels in several decades, this scheme has been a lifeline for the rural poor. It has the potential to lessen the crisis gripping the rural areas and improve food security. Numerous studies have shown that NREGA has had several positive effects, including increasing rural wages, enabling better access to food and thereby reducing hunger, and reducing distress migration from rural areas.[12] On top of it, MGNREGA also leads to the creation of tangible public assets like roads, canals, and public wells, among others, which too benefit the countryside.
Despite these numerous benefits, the Modi Government has been seeking to undermine this scheme ever since it came to power. Despite the economic slowdown in 2020–21, the Modi government actually cut the budget allocation for this scheme as compared to the previous year. But then the pandemic struck, unemployment skyrocketed, people migrated back to the villages in crores. The Modi Government was forced to nearly double the budget allocation from a budgeted Rs 61,500 crore to Rs 1,11,170 crore in 2020–21 (Actuals). The number of people who took work under this scheme shot up to a record 11.2 crore.
Since then, because of the continuing economic and agricultural crisis, the number of people who have worked under this scheme has continued to remain high — 10.6 crore in 2021–22, and 8.76 crore in 2022–23. The total number of people who worked under this scheme in 2022–23 is nearly 90 lakh more than the figure for FY 2019–20 (7.88 crore) (see Table 27).
Table 27: Employment Provided Under MGNREGA, 2014 to 2023
| 2014–15 | 2015–16 | 2016–17 | 2017–18 | 2018–19 | 2019–20 | 2020–21 | 2021–22 | 2022–23 | |
| Total households worked (in cr) | 4.14 | 4.81 | 5.12 | 5.12 | 5.27 | 5.48 | 7.55 | 7.26 | 6.18 |
| Total Individuals Worked (in cr) | 6.22 | 7.23 | 7.67 | 7.59 | 7.77 | 7.88 | 11.19 | 10.61 | 8.76 |
| Average days of employment provided per household | 40.17 | 48.85 | 46 | 45.69 | 50.88 | 48.4 | 51.52 | 50.07 | 47.83 |
Despite the continuing crisis and high work demand under this scheme, a callous Modi Government has reduced its budget allocation for this scheme every year since 2020–21 (Table 28).
Table 28: Budget Allocation for MGNREGA, 2019 to 2023 (Rs crore)
| 2019–20 A | 2020–21 BE | 2020–21 A | 2021–22 A | 2022–23 RE (1) | 2023–24 BE (2) | Decrease, 2 over 1, % | |
| MGNREGA (1) | 71,687 | 61,500 | 1,11,170 | 98,468 | 89,400 | 60,000 | 33% |
| (1) as % of Budget Outlay | 2.67 | 2.02 | 3.17 | 2.60 | 2.14 | 1.33 |
The inadequacy of the budgetary allocations is obvious from the following facts:
- Despite it being a demand-based act, which says that government must provide the necessary funds to provide work to all households seeking work, even the official website shows that every year more than a crore of people seeking work under this scheme are denied work, obviously due to paucity of funds.[13]
- Even for those provided employment, the scheme has not been able to provide even 50 days of work to each household (see Table 27) — when the MGNREGS Act guarantees 100 days of work to each willing household.
- The scheme saw its highest ever allocation in 2020–21. That year too, the scheme provided only 51.5 days of work to each household!
- All those denied work, or not given 100 days of work, are not being given any unemployment allowance, which is a guarantee under the scheme.
- Given the severity of the crisis, many states and even the Parliamentary Standing Committee examining the MGNREGA have requested the Centre to increase financial allocation for this scheme. The Parliamentary panel has in fact asked the government to extend the employment guarantee provided under the scheme to 150 days.[14]
Table 29: MGNREGA: Number of People Denied Work, 2019 to 2023 (Rs crore)
| 2018–19 | 2019–20 | 2020–21 | 2021–22 | 2022–23 (till Oct 2022) | |
| Total Number of People Denied Work (in crore) | 1.3 | 1.4 | 2.1 | 1.8 | 1.5 |
Instead, government has further reduced its allocation for MGNREGA in this year’s budget by a huge 33%. The actual budget allocation is even less, as the dues pending at the end of fiscal 2022–23 are expected to be around Rs 25,800 crore. That means the actual budget allocation for 2023–24 is only Rs 34,200 crore.
This is despite that fact that due to the continuing economic crisis, the job demand should be as high in 2023–24 as last year. The latest figures from the MGNREGA dashboard bear this out. For the first four months of the financial year 2023–24, that is, April to July 2023, 9.84 crore households worked in the scheme, up by almost 10% over the same period last year, and close to 9.97 crore in 2021.[15]
The Modi Government has now come up with a fiendish solution to justify the reduction in budget allocation for MGNREGA. It is seeking to discourage people from applying for MGNREGA work. From February 1 this year, it has made wage payments to all those seeking work under MGNREGA conditional on timely uploading of workers’ photographs twice a day, using the National Mobile Monitoring System app. This is going to cause havoc, as large parts of rural India have poor connectivity. On any day, if the worksite supervisor is not able to timely upload the photograph of the workers, they will be denied wages for that day. The budget cut and the National Mobile Monitoring System App are thus made for each other.[16]
What should be the budgetary allocation for MGNREGA, to provide 100 days of work to all desirous households? The Peoples’ Action for Employment Guarantee (PAEG), a research and advocacy group, estimates that including the pending dues of Rs 25,800 crore, and the material and administrative costs, the budgetary allocation for MGNREGA of at least Rs 2.72 lakh crore is required in order to provide 100 days of work for each household expected to seek work under this scheme in the year 2023–24.[17] The government has provided less than one-fourth of this amount.
Fertiliser Subsidy
Union Budget 2023 has also announced a huge cut in fertiliser subsidy: urea subsidy has been cut by 15%, and nutrient-based subsidy by a whopping 38%. The overall cut in fertiliser subsidy is 22% (Table 30).
Table 30: Fertiliser Subsidy in Modi Budgets, 2021-22 to 2023-24 (Rs crore)
| 2021–22 A | 2022–23 RE (1) | 2023–24 BE (2) | Decrease, 2 over 1, % | |
| Fertiliser Subsidy (1) | 1,53,758 | 2,25,220 | 1,75,100 | 22% |
| (1) as % of Budget Outlay | 4.05% | 5.38% | 3.89% |
The fertiliser prices in the country are high because of mindless running down and privatisation of the public sector fertiliser industry by the Modi Government, in order to promote the private sector fertiliser industry. But the private sector has been more interested in earning high profits from fertiliser shortages rather than increasing production capacity. This has made India one of world’s largest importers of fertilisers and fertiliser materials; and the prices of these have zoomed due to the Ukraine war.[18]
There is a very cost-effective and environment-friendly way in which can indeed reduce its fertiliser subsidy: by pushing farmers to shift from chemical intensive farming to farming practices that minimise the use of toxic inputs, by using on-farm renewable resources and privileging natural solutions to manage pests and disease. This is known as agroecological agriculture, or more simply, sustainable agriculture.[19] Lakhs of farmers have taken to natural or sustainable farming in Andhra Pradesh and Karnataka, with exciting results.[20] But as we have seen above, the Central government has in fact virtually abandoned efforts to push farmers towards agroecological farming practices. As it is, the budgetary allocation for schemes meant to promote organic and sustainable farming was very low. Now, in this budget, it has subsumed all these schemes under the Rashtriya Krishi Vikas Yojana, and cut the budget for this scheme too.
Without promoting agroecological farming, such a sharp reduction in fertiliser subsidies is going to further reduce the farmers’ meagre earnings and further worsen the crisis gripping Indian agriculture.
- Why is the Modi Government Strangulating Agriculture?
The real intent behind the Modi Government’s agricultural policies is revealed in a recent document of the NITI Aayog. It says:
“With the corporate sector keen on investing in agribusiness to harness the emerging opportunities in domestic and global markets, time is opportune for reforms that would provide healthy business environment for this sector. Small scale has been a major constraint on the growth of this industry.”[21]
This report of the government’s think tank clearly elucidates the ruling regime’s agenda for agriculture — it is seeking to replace small scale farming by corporate agriculture. This can only be done if small farming is pushed into severe crisis and agriculture becomes so unprofitable that small farmers are forced to sell out their lands and move to urban slums in cities, or become labourers on corporate farms.
This was the real intention behind the three farm laws. We have explained in detail, in two articles published some time ago in Janata Weekly, that the farm laws had been enacted by the Modi Government under pressure from the World Bank and the giant agribusiness corporations of the West, as these foreign corporations want to enter and seize control of Indian agriculture. [22] India’s big corporate houses too are seeking to enter the agriculture sector in a big way. Previously unpublished documents accessed by a group of investigative journalists, The Reporters’ Collective, reveal that the Adani Group had lobbied with the Niti Aayog in 2018 for repealing the Essential Commodities Act that limits companies from hoarding agricultural produce, claiming that it was proving to be a deterrent for industries/entrepreneurs — this was one of the farm laws enacted by the Modi Government two years later.[23] The Modi Government has also initiated measures to facilitate the takeover of agricultural lands by corporate houses — this is the real purpose behind the SVAMITVA project (Survey of Villages and Mapping with Improvised Technology in Village Areas) launched by PM Modi in April 2020 (at the height of the Covid lockdown!) and the model Land Titling Act released by the NITI Aayog in November 2020, which it is pressing state governments to adopt.[24]
The Modi Government is undoubtedly the most anti-farmer government to have come to power at the Centre since independence.
Notes
1. Kirankumar Vissa, “A Grim Future: What Happened to the Promise of Doubling Farmers’ Income by 2022?” 5 Feb 2022, https://thewire.in.
2. “Why Doubling Farmers’ Income Is Still a Dream”, 15 May 2022, https://www.thehindubusinessline.com.
3. See for instance our article: Neeraj Jain, “Modinomics = Falsonomics: Part I”, 31 March 2019, https://janataweekly.org.
4. Our calculation. Data for agricultural gdp growth during UPA years taken from: Press Note on National Accounts Statistics Back-Series (2004–05 to 2011–12), 28 November 2018, http://www.mospi.gov.in; data for agricultural GDP growth during Modi years taken from: Press Note on Second Advance Estimates of National Income 2022–23, … and First Revised Estimates of National Income … for 2021–22, 28 February 2023, https://www.mospi.gov.in; for 2022–23, figure taken from: Contribution of Agricultural Sector in GDP, PIB Delhi, 21 March 2023, https://www.pib.gov.in.
5. “Income and Debt Account of India’s Farmers – Explained”, 20 November 2021, https://www.indiatoday.in.
6. Calculated by us from: “Accidental Deaths and Suicides in India”, NCRB, annual reports from 2015 to 2022, https://ncrb.gov.in.
7. Santosh Mehrotra, Jajati K. Parida, “India’s Employment Crisis: Rising Education Levels and Falling Non-agricultural Job Growth”, October 2019, CSE Working Paper, https://cse.azimpremjiuniversity.edu.in.
8. Tushar Dhara, “Budget 2018: By Hiking Minimum Support Price, Modi Govt Makes Good 2014 Promise, But All Is Not as it Seems”, 2 February 2018, https://www.firstpost.com.
9. Neeraj Jain, “Budget 2021–22: What Is in it for the People? – Part 2”, 7 March 2021, https://janataweekly.org.
10. Meetu Jain, “How Do PM Modi’s Big Ticket Announcements From the Red Fort Square Up?”, 15 August 2023, https://thewire.in.
11. See for instance: “Express Investigation – Part 1: PM Awaas is for rural poor but in West Bengal, owners of houses like these are on the list”, 24 January 2023, https://indianexpress.com; “Six Years On and Despite the Praise, the PM Awas Yojana Is Still Riddled With Faults”, 10 August 2022, https://thewire.in; “Pradhan Mantri Awas Yojana: Allegations of Corruption, Discrimination, Political Bickering Mar the Scheme”, 14 February 2023, https://theprobe.in; “CAG Pulls Up Govt Over Graft in Implementation of PMAY”, 21 September 2022, https://www.hindustantimes.com (this report is for PMAY-Urban, but it is indicative of the extent of data fudging taking place under this scheme).
12. See for instance: Sudha Narayanan, “The Continuing Relevance of MGNREGA”, 17 March 2020, https://www.theindiaforum.in.; Stefan Klonner and Christian Oldiges, “The Welfare Effects of India’s Rural Employment Guarantee”, Oxford Poverty & Human Development Initiative, University of Oxford, UK, October 2019, https://www.ophi.org.uk.
13. Subodh Varma, “MGNREGA: Nearly 1.5 crore Job Seekers Refused Work Till Now”, 23 October 2022, https://www.newsclick.in. See also: Sindhu Bhattacharya, “No Unemployment Allowance, Delayed Payments, Paucity of Work: Parliamentary Panel Decries State of MGNREGS”, 11 February 2022, https://www.moneycontrol.com.
14. “MGNREGA Budget Slashed to Rs 73,000 cr; Pending Liabilities of Rs 18,350 cr; Programme Can Provide Only 16 Days Work, Say Activists”, 2 February 2022, https://en.gaonconnection.com;
Alinda Merrie Jan“Is MGNREGA the Rotten Apple, Or Does Govt Want it to be?”, 12 January 2023, https://www.newsclick.in; Sindhu Bhattacharya, “No Unemployment Allowance, Delayed Payments, Paucity of Work: Parliamentary Panel Decries State of MGNREGS”, 11 February 2022, https://www.moneycontrol.com.
15. Subodh Varma, “MGNREGS: Rising Demand Shows Jobs & Earnings Crisis”, 5 August 2023, https://www.newsclick.in.
16. Shreehari Paliath, “No Point in India Growing So Fast If Wages Stagnate and Social Spending Is Slashed”, 8 February 2023, https://www.indiaspend.com; Chakradhar Buddha and Laavanya Tamang, “The Advent of ‘App-Solute’ Chaos in NREGA”, 25 June 2022, https://www.thehindu.com.
17. Gaurav Vivek Bhatnagar, “‘Bloodbath’: Activist Nikhil Dey on Budget Cuts to MGNREGA”, 1 February 2023, https://thewire.in.
18. See: “People’s Commission Calls for National Fertiliser Policy to Reduce Imports, Strengthen CPSEs”, Newsclick Report, 21 December 2022, https://www.newsclick.in.
19. We have published several articles on the advantages of agroecology in Janata Weekly. See for instance: Colin Todhunter, “Lessons in Freedom: Agroecology, Localization and Food Sovereignty”, 9 July 2023; Shreehari Paliath, “‘When I Share A Seed, It Reinstates A Dying Culture’”, 6 November 2022; and many other articles, all available at https://janataweekly.org.
20. Kundan Pandey, “Community-Based Natural Farming Outshines Other Farming Practices in Andhra Pradesh”, 3 September 2023, https://janataweekly.org.
21. “Raising Agricultural Productivity and Making Farming Remunerative for Farmers”, NITI Aayog, 16 December 2015, http://niti.gov.in.
22. Neeraj Jain, “The Three Agriculture Related Bills: Handing Over Control of Agriculture to Foreign Corporations”, 20 September 2020, https://janataweekly.org; “The Kisans are Right. Their Land Is at Stake – Part 2”, RUPE, 14 February 2021, https://janataweekly.org.
23. Shreegireesh Jalihal, “The NRI and Corporate Houses Behind the Farm Laws”, 20 August 2023, https://janataweekly.org.
24. “The Kisans are Right. Their Land Is at Stake – Part 1”, RUPE, 7 February 2021, https://janataweekly.org.
(Neeraj Jain is an engineer. He is the founder of the activist group Lokayat based in Pune, and associate editor of Janata Weekly. He is the author of several books and booklets, all available on Lokayat website.)
