Rural India must reject continuing doles of subsidies and support prices
Daya Sagar Sharma
May 09, 2009
Inspite of support prices and subsidies the average net income of the Indian farming family has not grown. The service class ( government ) fraternity has made itself quite secure through regular wage revisions. The wage revisions have gone to the benefit of the judiciary, legislators and the bureaucrats quite liberally compared to the net income of an average Indian farming family, the agricultural labour and those working in private sector ( particularly unorganized sector). In a democracy like India all costs to STATE are directly or indirectly borne by the common man in the shape of taxes / duties / national wealth to pay the establishment cost for the government employees / legislators/ judiciary as well as the welfare programmes.
Chowdary Charan Singh Jee ( the then Chief Minister ( 1969/70) Uttar Pradesh ) while speaking in a function at Uttar Pradesh Agricultural University Pant Nagar ( now Pant University of Agri & Technology.) had said," I am son of a farmer but still personally I am not in favour of Indian government offering support prices for agricultural produce to farmers on a regular basis." Chowdary jee had opined that in America around 20% population is engaged in Agriculture and so 80% non agriculturalist can support the Agriculturalists. But in India more than 70% of the population is of agriculturists so it is not fair and logical to ask the just 30% population to support the large chunk of 70% population. But Charan Singh expressed helplessness in this regards since in India majority of the politicians believed in offering support prices to farmers. At that time I had not taken Chowdary's words that seriously . But now after 40 years I do remember the depth his opinion had. Surely a learned economist was then speaking through that " son of a farmer ". But it is so sorry that no learned economist or agri scientist in India could sense the seriousness that lied in the opinion expressed by Chowdary Charan Singh. Surely Chowdary was honest to the core when he made that statement setting aside all political gimmicks. He differed with Nehru as regards the concept of socialism.
A peon in government service has been secured for Rs12000 to 15000 per month wages (i.e. around Rs.500 to Rs.600 per working day wage ) through the 6tht pay revisions where as still a daily labour is paid less than Rs.100 per day. Where as the Congress manifesto for elections to 15th Lok Sabha on the other hand reflects that the common Indian is still worth getting attracted with promises like minimum wage of Rs.100 per day and employment guarantee for only 100 days in year. This speaks all about the development at ground level in India.
All subsidies that are extended to the farmers on seeds, interest, pesticides, fertilizers, exemptions from direct taxes and the like are made good out of the State Exchequer and the state exchequer is raised through the taxes as imposed like sales tax, excise duty, custom duty, income tax , service tax. Even a match stick is taxed. All these add to the cost of the items meant for the use of the Agricultural population as well as the agricultural labour. So a farmer has to pay back the subsidies and supporting costs through the taxes levied by the Government medicines, shoes, clothes, utensils, bricks, transport, increased fares, etc. Costs of all inputs to farmer do rise.
And more so the efficiency with which the tax revenue collected by the State is made use of is what that really matters to the economy. The efficiency for the use of State money has been very very low all these years. The poor efficiency is made good by additional taxes and loans ( including from foreign countries / banks / public) raised by the government . The net worth of the sales received by farmers hence reduces instead of increasing through support price increase.
Majority of the rural India and working classes depend on Government institutions for education and health services. But since the performance of the government schools and hospitals is very dismal the rural India and the labour class too has to buy these services on cost. This lowers the net income of the farmers as well as reduce their working efficiency. Reduced income ( net ) stops their progress and they are not able to add innovative ways and means to increase their income. Hence they continue to remain dependent on government aid and social support of their local leaders. Their family health suffers and also they remain under the pressure of rich and powerful of the village, and hence do not even cast their Vote to their independent choice.
No doubt the net income of the farmer is not rising. But India needs is such programmes that would generate more independent income and not dependence on money doles for rural India. Money doles would get consumed and can not generate.
A south India based regional party has talked of offering Rs.10 per kg as support price for the potatoes to farmers during the campaign for 2009 Lok Sabha polls. From where will the Party pay the extra cost and at what price then the potato will be sold to a common man ? Think over.
The support prices for the food grains too do not directly benefit the farmers. The support prices for wheat and paddy were Rs.630 and 550 per quintal in 2003/04 and in the years 2008/09 the prices are Rs.1080 per quintal for wheat and Rs.900 per quintal for paddy. There has been 71 % increase in wheat prices. Therefore when the support price for wheat is Rs.1080 per quintal , the wheat in private would not be available to traders for less than Rs.1100 per quintal and hence the wheat floor will be available to the working class / labour for not less than Rs.13 to Rs. 14 per kg. The labour would demand higher wages for working in the factories as well as on the farms. So cost to farmer for all material inputs and services needed too has been rising heavily all these years. Hence support prices have not done any good and can not so simply do much good to farmers, rather have damaged the farmers. Even the advantage of support prices too does not that much benefit the farmers .About 60% of the Indian farmers do not have sufficient surplus farm produce that could be sold in market or to government on support prices.
The rural India and the farming community should on their own refuse to accept doles from the politicians like Congress saying in its manifesto 2009 ( released on 24 March 09 by Sonia Jee and Man Mohan Singh Jee ) that it would give 20 kg rice or wheat per month @ Rs.3 per kg to those below poverty line. This would mean about min Rs.11 per Kg subsidy on wheat grain on account of procurement and distribution costs. This would mean Rs.220 per month subsidy on only grains per beneficiary and for 30 Crore population it would be Rs.6600 crore per month / Rs. 69200 crore year. BJP has moved a step forward by offering 35 kg wheat/ rice @ Rs.2 per kg to those below poverty line .And if we go by BJP manifesto then the annual cost burden would be around Rs.1,51,200 crore Who will pay for this subsidy ? Will Congress pay from the bank accounts of its leaders , will BJP pay this cost from their party funds , will the leaders pay from personal treasures? No surely not. The same poor FARMER of India will pay the cost
In 2004 five years back minimum 100 days a year employment was promised for the "hungry stomach" voter citizen. Again in 2009 minimum 100 days a year employment guarantee is being promised as an incentive to voter citizen. Such promises still appear selling. It clearly shows that though the city roads are crowded with automobiles , in India there are many not getting two square meals for 200 days a year.
As soon as the elections to Parliament or Legislative Assemblies approach , those eyeing the power seat start announcing schemes extending / promising financial support to farmers. Political leaders as well as the Kisaan leaders shed crocodile tears on the plight of the rural India.
On the eve of elections to 15 th Lok Sabha some have gone to the extend of even suggesting that minimum monthly income of a farmer should be ensured by the Government. It is just like extending regular cash allowance. Such leaders fail to tell that from which exchequer can the free doles be extended. I was surprised to see that an Electronic News Channel had invited an "expert" who even opined that mechanisation, improved seeds and fertilizers have done no good to Indian farmers and increasing production is not in the interest of farmers since it would help only those who want to sell their machinery, fertilizers, pesticides, seeds and medicines. As per some statistics average income of an Indian farmer family is just around Rs. 2200 per month. No doubt Green and White revolutions have not sufficiently benefitted the farmer , but surely many have been benefitted.
Times demand that the common man need be told about all this so that he is not exploited during elections by the corrupt political order. Those who have started out rightly rejecting the commodity exchanges, free marketing , retail food marketing chains and like involving the farmers at village level do need to re work on their conclusions. May be the fault lies some where else. The economists, the planners, the bureaucrats and the political leadership of India need to re work the theories and practices concerning the farmers and rural India.
( Daya Sagar is social activist and leading scribe on Kashmir affairs dayasagr@yahoo.co.uk www.alookthroughthemist.blogspot.com)
Chowdary Charan Singh Jee ( the then Chief Minister ( 1969/70) Uttar Pradesh ) while speaking in a function at Uttar Pradesh Agricultural University Pant Nagar ( now Pant University of Agri & Technology.) had said," I am son of a farmer but still personally I am not in favour of Indian government offering support prices for agricultural produce to farmers on a regular basis." Chowdary jee had opined that in America around 20% population is engaged in Agriculture and so 80% non agriculturalist can support the Agriculturalists. But in India more than 70% of the population is of agriculturists so it is not fair and logical to ask the just 30% population to support the large chunk of 70% population. But Charan Singh expressed helplessness in this regards since in India majority of the politicians believed in offering support prices to farmers. At that time I had not taken Chowdary's words that seriously . But now after 40 years I do remember the depth his opinion had. Surely a learned economist was then speaking through that " son of a farmer ". But it is so sorry that no learned economist or agri scientist in India could sense the seriousness that lied in the opinion expressed by Chowdary Charan Singh. Surely Chowdary was honest to the core when he made that statement setting aside all political gimmicks. He differed with Nehru as regards the concept of socialism.
A peon in government service has been secured for Rs12000 to 15000 per month wages (i.e. around Rs.500 to Rs.600 per working day wage ) through the 6tht pay revisions where as still a daily labour is paid less than Rs.100 per day. Where as the Congress manifesto for elections to 15th Lok Sabha on the other hand reflects that the common Indian is still worth getting attracted with promises like minimum wage of Rs.100 per day and employment guarantee for only 100 days in year. This speaks all about the development at ground level in India.
All subsidies that are extended to the farmers on seeds, interest, pesticides, fertilizers, exemptions from direct taxes and the like are made good out of the State Exchequer and the state exchequer is raised through the taxes as imposed like sales tax, excise duty, custom duty, income tax , service tax. Even a match stick is taxed. All these add to the cost of the items meant for the use of the Agricultural population as well as the agricultural labour. So a farmer has to pay back the subsidies and supporting costs through the taxes levied by the Government medicines, shoes, clothes, utensils, bricks, transport, increased fares, etc. Costs of all inputs to farmer do rise.
And more so the efficiency with which the tax revenue collected by the State is made use of is what that really matters to the economy. The efficiency for the use of State money has been very very low all these years. The poor efficiency is made good by additional taxes and loans ( including from foreign countries / banks / public) raised by the government . The net worth of the sales received by farmers hence reduces instead of increasing through support price increase.
Majority of the rural India and working classes depend on Government institutions for education and health services. But since the performance of the government schools and hospitals is very dismal the rural India and the labour class too has to buy these services on cost. This lowers the net income of the farmers as well as reduce their working efficiency. Reduced income ( net ) stops their progress and they are not able to add innovative ways and means to increase their income. Hence they continue to remain dependent on government aid and social support of their local leaders. Their family health suffers and also they remain under the pressure of rich and powerful of the village, and hence do not even cast their Vote to their independent choice.
No doubt the net income of the farmer is not rising. But India needs is such programmes that would generate more independent income and not dependence on money doles for rural India. Money doles would get consumed and can not generate.
A south India based regional party has talked of offering Rs.10 per kg as support price for the potatoes to farmers during the campaign for 2009 Lok Sabha polls. From where will the Party pay the extra cost and at what price then the potato will be sold to a common man ? Think over.
The support prices for the food grains too do not directly benefit the farmers. The support prices for wheat and paddy were Rs.630 and 550 per quintal in 2003/04 and in the years 2008/09 the prices are Rs.1080 per quintal for wheat and Rs.900 per quintal for paddy. There has been 71 % increase in wheat prices. Therefore when the support price for wheat is Rs.1080 per quintal , the wheat in private would not be available to traders for less than Rs.1100 per quintal and hence the wheat floor will be available to the working class / labour for not less than Rs.13 to Rs. 14 per kg. The labour would demand higher wages for working in the factories as well as on the farms. So cost to farmer for all material inputs and services needed too has been rising heavily all these years. Hence support prices have not done any good and can not so simply do much good to farmers, rather have damaged the farmers. Even the advantage of support prices too does not that much benefit the farmers .About 60% of the Indian farmers do not have sufficient surplus farm produce that could be sold in market or to government on support prices.
The rural India and the farming community should on their own refuse to accept doles from the politicians like Congress saying in its manifesto 2009 ( released on 24 March 09 by Sonia Jee and Man Mohan Singh Jee ) that it would give 20 kg rice or wheat per month @ Rs.3 per kg to those below poverty line. This would mean about min Rs.11 per Kg subsidy on wheat grain on account of procurement and distribution costs. This would mean Rs.220 per month subsidy on only grains per beneficiary and for 30 Crore population it would be Rs.6600 crore per month / Rs. 69200 crore year. BJP has moved a step forward by offering 35 kg wheat/ rice @ Rs.2 per kg to those below poverty line .And if we go by BJP manifesto then the annual cost burden would be around Rs.1,51,200 crore Who will pay for this subsidy ? Will Congress pay from the bank accounts of its leaders , will BJP pay this cost from their party funds , will the leaders pay from personal treasures? No surely not. The same poor FARMER of India will pay the cost
In 2004 five years back minimum 100 days a year employment was promised for the "hungry stomach" voter citizen. Again in 2009 minimum 100 days a year employment guarantee is being promised as an incentive to voter citizen. Such promises still appear selling. It clearly shows that though the city roads are crowded with automobiles , in India there are many not getting two square meals for 200 days a year.
As soon as the elections to Parliament or Legislative Assemblies approach , those eyeing the power seat start announcing schemes extending / promising financial support to farmers. Political leaders as well as the Kisaan leaders shed crocodile tears on the plight of the rural India.
On the eve of elections to 15 th Lok Sabha some have gone to the extend of even suggesting that minimum monthly income of a farmer should be ensured by the Government. It is just like extending regular cash allowance. Such leaders fail to tell that from which exchequer can the free doles be extended. I was surprised to see that an Electronic News Channel had invited an "expert" who even opined that mechanisation, improved seeds and fertilizers have done no good to Indian farmers and increasing production is not in the interest of farmers since it would help only those who want to sell their machinery, fertilizers, pesticides, seeds and medicines. As per some statistics average income of an Indian farmer family is just around Rs. 2200 per month. No doubt Green and White revolutions have not sufficiently benefitted the farmer , but surely many have been benefitted.
Times demand that the common man need be told about all this so that he is not exploited during elections by the corrupt political order. Those who have started out rightly rejecting the commodity exchanges, free marketing , retail food marketing chains and like involving the farmers at village level do need to re work on their conclusions. May be the fault lies some where else. The economists, the planners, the bureaucrats and the political leadership of India need to re work the theories and practices concerning the farmers and rural India.
( Daya Sagar is social activist and leading scribe on Kashmir affairs dayasagr@yahoo.co.uk www.alookthroughthemist.blogspot.com)
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