There is small doubt the Supreme Court (SC) erred in placing the central farm laws in abeyance and setting up a panel of specialists who had been to hear the agitating Punjab farmers and recommend a way forward. Since the laws had been not unconstitutional, by placing them in abeyance, SC dealt a large blow to the government’s capability to govern. The resignation of BS Mann, one particular of the members of the 4-member panel, even just before the very first meeting, only reinforces the worry that SC is going to have egg on its face the farmers’ refusal to quit the capital’s gherao even immediately after SC place the laws in abeyance was the very first indication of the problems SC’s strategy would run into.
But now that the panel is there, it is in everyone’s interest to give it a shot. Sadly, farmers have refused to seem just before it as they say it is packed with supporters of the farm law. That may possibly effectively be accurate, but not appearing just before the panel is most likely a error.
Apart from casting aspersions on the intellectual honesty of the panel, the farmer unions and political parties that are supporting them do not appreciate that the panel has their ideal interests at heart. While a variety of Congress party leaders have argued that India subsidises its farmers quite small compared to the EU or the US—and so have to raise subsidy levels—FE columnist and Icrier professor Ashok Gulati, who is a member of the panel, was the very first to argue, a number of decades ago, that India really taxes its farmers by stopping exports or imposing stocking limits the moment a variety of crop rates rise! This is not to say that Gulati supports legally guaranteeing MSPs—or substantially hiking wheat and rice MSPs—which is what the farmers and the Congress party want, but his strategy will enable farmers in even the medium-term.
More crucial, although talks among the Centre and the farmers centred about the repeal of the farm laws—once the Centre had abjectly surrendered on the problem of electrical energy reforms and stubble-burning laws—the panel delivers Punjab’s farmers a opportunity to negotiate a substantially more meaningful package for the state.
As the graphic tends to make clear, Punjab has steadily lost its top rated position amongst agricultural states in the nation. While its development was about 2.5 occasions India’s in 1971-72 to 1985-86, it fell to about the similar level in the next two decades and, more than the final 13 years, it has been about half that of the complete nation. There are quite a few motives for this, ranging from more than-use of urea lowering soil productivity to excessive use of water causing salinity, but increasing the incorrect crop and lack of diversification are at the root of it .
While Punjab has remained focused on increasing wheat and rice, the improve in MSP of these crops has been muted, about 21% more than the previous 3 years in the case of paddy and 14% in the case of wheat. Compare this with onions exactly where rates rose by more than 60% and potatoes exactly where rates rose by more than 2.3 occasions. There is a lot more volatility in rates of fruit and vegetables (tomato rates barely rose more than the final 3 years but rose by more than 83% in the final two), but not diversifying its cropping pattern is the key cause for the state’s fall from grace.
MSPs of these crops can not be raised by also substantially as the Centre has spending budget constraints and, if you raise the rates also much—as has currently occurred in the case of wheat—the ballooning stocks can not even be exported FCI has 42 million tonnes of added stocks of wheat and rice precisely mainly because there is not adequate demand, either locally or globally, at the cost at which they had been purchased.
What the panel can do, if the farmers pick out to engage with it, is to come up with a diversification strategy for Punjab that incorporates a generous dose of central funding. Indeed, recognising there was a trouble, the Punjab government beneath Amarinder Singh set up a Group of Experts headed by former preparing commission deputy chairman Montek Singh Ahluwalia, and one particular of the recommendations created by the Group a couple of months ago was to minimize the region beneath paddy by a third more than the next 6-7 years and to diversify into maize, fruits and vegetables, dairy, and so forth as it occurs, utilizing maize as cattle feed raises milk productivity considerably.
While such a strategy will involve paying farmers larger MSPs on other crops like maize, and maybe even gap payments—till citrus trees start off fruiting, assuming that citrus is planted—it can be funded by each the Centre and the states. The Centre’s FCI, for instance, would save about `5,600 crore a year from just acquiring significantly less stocks that it has to carry a different `13,275 crore is spent by the Centre and the state on annual electrical energy and fertiliser subsidies, and so, as the diversification requires location, some element of this will be freed up. Nor is it that the state is not conscious of the require to diversify away from wheat and rice in 2006, it allotted 300 acres to the Bharti Group for corporate farming and Field Fresh, which operates with 200 companion farmers in the state, is the biggest exporter of infant corn from India today then prime minister Manmohan Singh inaugurated the venture.
Even if the SC panel comes up with such suggestions on funding Punjab’s diversification, and also appears at techniques in which to improve procurement from eastern UP, Bihar and West Bengal, it is not particular the agitating Punjab farmers will accept it, or even that it will locate favour with the government. But, the panel’s ability lies in also convincing the Centre that its ideal bet is to start off considering along these lines.
To recapitulate, there can be small doubt that SC wanting to stand in judgment more than a law cleared by the Cabinet and by Parliament is terrible news for the nation but, if handled effectively, there is a possibility we can come out of this by limiting the harm.