Prime Minister Narendra Modi has promised to double the income of farmers, as it stood in 2015-16, by the financial year 2022-23. As the Lok Sabha elections are round the corner, the Union government is looking all around, to make that tall promise a reality.
According to sources in the government, the MSP which was increased in the case of some commodities in some states, may be applied to some more crops, if not all food crops across the country. The budget 2019-20 may see this happen.
The budget may also talk about amendment of the state laws with respect to Agricultural Produce Market Committees (APMC), under which farmers now receive only a small part of what the consumers eventually pay. This, however, will not result in the elimination of the middle man, but only narrow down the gap between the farmer's income and the consumer's expenditure on food crops. Said a source in Niti Aayog, “Under the APMC Acts, farmers sell to people in local mandis where intermediaries dictate the price. The state governments will have to genuinely reform their APMC Acts. Several steps are required for this.”
The budget may give the farmers big incentives to move towards value addition, either singly or through small groups of farmers, and simultaneously, restructure the Essential Commodities Act to provide exemptions to exporters, food processors, multiple outlet retailers, etc from stock limits.
Incentives to go into contract and group farming could also be part of the deal. “These processes will not make a huge dent into the government's resources. We are working on broad policy measures, and we are trying to implement everything in a timely manner. We are also in constant touch with the state governments on this,” says Union Agriculture Minister Radha Mohan Singh.
The Ministry of Food Processing Industries will also come into play. “Everything we are doing here is to address the issue of farmers' distress and double their income”, says Harsimrat Kaur Badal, Union minister for Food Processing, adding that they will ensure the farmers move up the value chain. The budget is likely to roll out some schemes under which farmers will be incentivised to turn small time agri entrepreneurs, using their own land and employing local people, with the budget providing funds for transfering technology to them.
