\n| Gram, Pigeon pea, Onion, Peas and Mango<\/td>\n | Less than 50%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n Thus, the most important problem faced by farmers because of lockdown was loss of markets, the disruption in supply chains, closure of mandis and a fall in consumer food demand<\/b><\/strong>. There were major losses in the milk, meat and poultry sectors; industry associations estimate the total loss for the poultry industry at \u20b925,000 crore.<\/p>\n\n- <\/b>Inflation and prices:<\/b><\/u><\/strong><\/li>\n<\/ol>\n
Inflation was largely due to disruptions in supply chains and rise in trader margins and not accurately representative of prices for farmers<\/b><\/strong>. The examination of the wholesale market prices for 15 agricultural commodities between March 15 and June 30, 2020 led to a conclusion that prices of most crops declined. For example,<\/p>\n\n\n\nCrop<\/b><\/strong><\/td>\nAverage Prices on March 23, 2020<\/b><\/strong><\/td>\nAverage Prices on June 30, 2020<\/b><\/strong><\/td>\n<\/tr>\n\n| Paddy<\/td>\n | \u00a0Rs. 1730<\/td>\n | Rs. 1691<\/td>\n<\/tr>\n | \n| Wheat<\/td>\n | Rs. 2045<\/td>\n | Rs. 1865<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n A moderate uptick in prices was visible in a few vegetables, but not before June 2020.<\/p>\n Small and marginal farmers who are net buyers of food had to face the brunt of higher food prices<\/b><\/strong>. There is also strong evidence from small sample surveys that rural households reduced food purchases during the lockdown. Thus, the claims that higher rural inflation benefited farmers, and that it was due to higher food demand, are misplaced.<\/p>\n\n- <\/b>Higher kharif sowing:<\/b><\/u><\/strong><\/li>\n<\/ol>\n
SInce the rabi incomes fell during the lockdown, many rural households may have returned to farming or intensified farming for food- and income-security<\/b><\/strong>. Lakhs of migrant workers returned to their villages from urban areas. They may have taken up agriculture in previously fallow or uncultivated lands. Data on monthly employment released by the Centre for Monitoring Indian Economy (CMIE)<\/b><\/strong>\u00a0show that the number of persons employed as \u201cfarmers\u201d in June and July 2019 were 11.2 crore and 11.4 crore, respectively. But in June and July 2020, these numbers rose to 13 crore and 12.6 crore, respectively.<\/b><\/strong><\/p>\n\n- <\/b>The package:<\/b><\/u><\/strong><\/li>\n<\/ol>\n
Agriculture contributes only about 15% to India\u2019s Gross Value Added (GVA). Thus, even if agriculture grows by 4%, it is likely to contribute only 0.6 percentage points to GVA growth<\/b><\/strong>. To contribute a full one percentage point to GVA growth, agriculture will have to grow by 6%<\/b><\/strong>, which is unlikely in 2020-21. This is not to deny a potential rise in demand from higher rabi procurement, higher kharif sowing and flow of cheap credit, which together appear to have resulted in higher purchase of tractors and fertilizers. But the counteracting tendencies in rural areas \u2014 i.e., lower crop prices, lower market arrivals and higher unemployment \u2014 would overwhelm these \u201cgreen shoots<\/b><\/strong>\u201d.<\/p>\n | | | | |