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Synopsis: Adjusted for land holding, the Punjab farmer is doing poorly, and the culprit is paddy. By shifting from rice to maize and diversifying to fruits and vegetables, farmers in Punjab and Haryana can earn more, while practicing sustainable farming.
What are key findings of the latest Situation Assessment Survey (SAS) of agri households?
As per the findings of SAS survey conducted by NSO,
– An average Indian farmer earned Rs 10,218 per month in 2018-19 (July-June).
– Across states, the highest income was received by a farming household in Meghalaya (Rs 29,348) followed by Punjab (Rs 26,701), Haryana (Rs 22,841), Arunachal Pradesh (19,225) and Jammu and Kashmir (Rs 18,918)
– The lowest income levels were in West Bengal (Rs 6,762), Odisha (Rs 5,112) and Jharkhand (Rs 4,895).
Why farmers in Punjab and Haryana need to diversify their crops?
On normalising the incomes of agri-households by their holding sizes as per SAS survey, Punjab’s ranking on per hectare income falls from 2nd to 11th and Haryana goes down from 3rd to 15th.
– This simply means that per hectare income of the farmers in Punjab and Haryana are lower. And the farmers in Punjab and Haryana are earning higher incomes primarily because the size of their landholding is greater compared to their counterparts from other states.
Whereas, farmers belonging to states such as Jammu and Kashmir, Kerala, Meghalaya and Arunachal Pradesh earn better income from cultivating fruits and vegetables, spices, and livestock. These are high value in nature, not linked to MSPs, and market and demand-driven.
How can farmers in Punjab and Haryana augment their incomes with more sustainable agriculture?
Punjab’s former Chief Minister Amarinder Singh had recently approached the Centre with an idea to create a fund of around Rs 25,000 crore to help farmers switch from paddy to maize. Centre should give this idea a serious thought with the following modifications.
One, the fund should be under a five-year plan to shift at least a million hectares of paddy area (out of a total of 3.1 million hectares of paddy area in Punjab) to maize.
Two, the corpus should have equal contributions from the Centre and state.
Three, since Punjab wants that farmers be given MSP for maize, an agency, the Maize Corporation of Punjab (MCP), should be created to buy maize from farmers at MSP. This agency should enter into contracts with ethanol companies. Much of this maize can be used to produce ethanol as the poultry and starch industries will not be able to absorb this surplus in maize once a million hectares of paddy area shifts to maize.
Fourth, maize productivity must be as competitive as that of paddy in Punjab and the best seeds should be used for that purpose. This is to ensure that ethanol from maize is produced in a globally competitive manner. The GoI’s policy for 20 per cent blending of ethanol in petrol should come in handy for this purpose.
What would be the consequential benefits?
Sustainable water source: Punjab will arrest its depleting water table as maize needs less than one-fifth the water that paddy does for irrigation.
Savings in Power subsidy: Punjab will save much on the power subsidy to agriculture, which was budgeted at Rs 8,275 crore in the FY2020-21 budget, as paddy irrigation consumes much of the power subsidy.
Climate mitigation: this could result in a win-win situation for all (farmers, the Government of Punjab and the country) as there will be lesser methane emissions and less stubble burning. Moreover, ethanol will also reduce GHG emissions in vehicular pollution.
Nutritional security: Will help Punjab to produce more nutritious food and raise on the nutritional security front with sustainable and climate-resilient agriculture.
Doubling farmers income: Punjab farmer’s income on a per hectare basis will increase more sustainably.
What more needs to be done?
Other parts of the diversification strategy should include,
- Increasing the area under fruits and vegetables
- More focused policy to build efficient value chains in not just fruits and vegetables but also livestock and fisheries.
- Agri-sector needs to be backed by proper processing, grading and packaging infrastructure to tap its full potential.
Source: This post is based on the article “How Punjab can shine again with nutritional security and climate-friendly agriculture” published in the Indian Express on 25th October 2021.
