Doubling Income of Small Scale Farmers by 2024

December 14, 2020

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The condition of farmers overs the years has not been very rosy. India faced a severe food shortage in the mid-1960s and lessons from this crisis have been a guiding light for the agricultural policies in the subsequent years. The Green Revolution was successfully adopted with an objective of making India self-reliant for grains production. The Green Revolution was a hit, without an iota of doubt, multiplying food production by 3.7 times while population multiplied by 2.55 times (Source: NITI Ayog Report) i.e. 45% increase in per capita food production. This made us not only self-sufficient but also a proud net exporter.

Ground reality of farmer’s income

The ground realities were not as rosy. The farmers’ income did not grow in proportion with the increased output. The policies so far had not put the farmer’s welfare in the centre. There were no direct measures to promote farmer’s income. The NSSO data for consumption expenditure Survey for the year 2011-12 revealed a staggering fact. More than one fifth of the rural population with agriculture as the primary source of income was below the poverty line. This was certainly not the kind of net food exporter we envisaged India to be!

There were many downsides to this situation. One of the major one being bulk migration of farm labourers to urban areas or other non-agricultural sectors for employment. Realising the plight of farmers, the Ministry of Agriculture was renamed to the Ministry of Agriculture and Farmers Welfare in 2015 and due attention was paid to the financial well-being of farmers. Policies were put in place to reduce the agrarian distress and bridge the gap between the incomes of farmers and non-agricultural professions. Year 2022 was chosen to be the target for doubling farmers’ income to mark the platinum jubilee of Independence. However, experts opined this target to be overoptimistic and eventually the target was revised to 2024.

Talking about numbers, doubling farmer’s income by 2024 over the base year 2015-16 requires an annual growth of 10.41%. Major areas to implement the growth strategies identified broadly are as follows:

Improvement in productivity
Saving cost of production by optimal resource utilisation
Increase in cropping intensity
Diversification towards high value crops

Sources of farmer’s income beyond traditional agricultural practices

Shifting to non-farming occupations like horticulture, poultry, pisciculture etc.
Improvement in the trade of agricultural produce and better prices for the product

The concerned ministry is confident about the new targets now. Government’s price support scheme coupled with Post-production reforms (aimed at incentivising farmers to produce higher profits by getting better profitable prices and together adopting new technology and management practices for larger productivity), is believed to do the magic.

A large number of private players have joined hands to deliver the target at both pre and post production stages. While FMCGs like Pepsico, ITC are enabling farmers to follow the best practices and paying optimal prices for the desired quality of produce. Post production support has been rendered by the entry of e-commerce giants like Big Basket, Grofers and NinjaKart which ensures the best price for the product.

FocusAgritech’s Outlook: With the rising technological interventions in agriculture, doubling farmers’ income by 2024 is not a far fetched dream. Some positive measures like revision of MSP in the Union Budget 2020, PM-KISAN, e-NAM, Direct Benefit Transfer, setting up of Agri-Infra fund of 1 Lakh crore, to name a few, will smoothen out the road to reach the target. Recent amendment to the Essential Commodities Act to deregulate food items including cereals, pulses, onions etc. is expected to help the cause along with ‘The Farming Produce Trade and Commerce Ordinance 2020’ which is aimed at barrier free inter and intra state trading of farm produce.