There is small doubt the Supreme Court (SC) erred in placing the central farm laws in abeyance and in 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 major blow to the government’s capacity to govern. The resignation of BS Mann, one particular of the members of the 4-member panel, even prior to the very first meeting, only reinforces the worry that SC is going to have egg on its face the farmers’ refusal to cease the capital’s gherao even right after SC place the laws in abeyance was the very first indication of the problems SC’s program would run into.
But now that SC has accomplished what it has, it is critical absolutely everyone give it a shot. Sadly, farmers have refused to seem prior to the panel on the grounds that it is packed with supporters of the farm laws. The panelists could effectively be supporters of the farm laws, but not appearing prior to the panel is in all probability a error.
Apart from casting aspersions on the intellectual capacity of the committee, the farmer unions and political parties – like the Congress – that are supporting them do not appreciate that the agriculture specialists will in all probability create a report that is in their favour. While numerous Congress party leaders and spokespersons have argued that India subsidises its farmers quite small compared to the EU or the US – and so can afford to devote a lot more in performing so – FE columnist and Icrier professor Ashok Gulati who is a member of the panel was the very first to argue, numerous decades ago, that India really taxes its farmers by stopping exports or imposing stocking limits on numerous crops the moment their rates rise! This is not to say that Gulati is a supporter of legally guaranteeing MSPs – or of hiking MSPs on wheat and rice by bigger amounts – which is what the farmers and the Congress party want, but his strategy will in all probability support farmers in even the medium-term.
More critical, even though talks involving the Centre and the farmers centred about the repeal of the farm laws – when the Centre had abjectly surrendered on the concern of electrical energy reforms and stubble-burning laws – the panel provides Punjab’s farmers a opportunity to negotiate a significantly more meaningful package for the state.
As the graphic tends to make clear, Punjab has steadily lost its prime position amongst agriculture 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 very same in the next two decades and more than the final 13 years, it has been about half that of the complete nation. There are a lot of factors for this, ranging from more than-use of urea lowering soil productivity to excessive use of water causing salinity, but at the root of it is developing the incorrect crop and lack of diversification.
While Punjab has steadfastly remained focused on developing wheat and rice, the enhance 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 fruits and vegetables (tomato rates barely rose more than the final 3 years but rose by more than 83% in the final two years), but not diversifying its cropping pattern is the most important explanation for the state’s fall from grace.
MSPs of these crops cannot be raised by as well significantly as the centre has spending budget constraints and, if you raise the rates as well significantly – as has occurred in the case of wheat – the ballooning stocks cannot even be exported FCI has 42 million tonnes of further stocks of wheat and rice precisely for the reason that there is not adequate demand at the cost at which they had been purchased.
What the panel can do, if the farmers pick to engage with it, is to come up with a diversification program for Punjab that consists of a generous dose of central funding. Indeed, recognizing there was a issue, the Punjab government below Amarinder Singh set up a Group of Experts headed by former organizing commission deputy chairman Montek Singh Ahluwalia and one particular of the ideas produced by the Group a handful of months ago was to lessen the region below paddy by a third more than the next 6-7 years and to diversify into maize, fruits and vegetables, dairy, and so on as it takes place, working with maize as cattle feed raises milk productivity considerably.
While such a program will involve paying farmers greater MSPs on other crops like maize and possibly even gap payments – till citrus trees get started fruiting if citrus in planted – it can be funded by each the centre and the states. The centre, for instance, would save about Rs 5,600 crore a year from just obtaining much less stocks from Punjab that FCI has to carry one more Rs 13,275 crore is spent by the centre and the state on annual electrical energy and fertilizer subsidies so, as the diversification requires spot, some portion of this will be freed up. And it is not as if the state government is not conscious of this 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, and techniques in which to enhance procurement from eastern UP, Bihar and West Bengal, it is not particular the agitating Punjab farmers will accept it, or even that it will uncover favour with the government. But its ability lies in convincing the Centre that its greatest bet is to get started 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 poor news for the nation but, if handled effectively, there is a possibility we can come out of this by restricting the harm.