Author name: Mohamed Mafaz P R

To provide relief to the farmers hit by cash crunch, the Indian Government today announced that the farmers were given them an additional two months to repay their crop loans due in November – December period and said that the prompt repayment would be eligible for the 3 per cent interest subsidy. Under the interest subvention scheme, farmers get the short term crop loans upto Rs 3 lakhs for one year at an interest rate of 7 per cent. Following the recent demonetization of specified bank notes, the government said that it is seized of the constraints faced by the farming community in repayment of loan within dues in the prescribed time limit. The government provides crop loans at reasonable interest rate of 7 per cent per annum. This prompt repayment incentive however does not accrue to those farmers who repay after one year of availing such loans.

In India, rice and wheat comprise 70 percent of agricultural produce by area, but less than 25 percent by value. In other words, wheat and rice are low value crops to grow compared to other options. Yet, the land area dedicated to wheat and rice has not seen a significant decrease in the last decade. Government data shows that the consumption of wheat and rice has been declining around 1-2 percent in both urban and rural India, while the demand for fruits and vegetables has been rising by 2-3 percent annually. This again begs the question: Why aren’t farmers shifting to growing more fruits and vegetables? Furthermore, detailed studies across the country have also shown that while farmers just about break ev en (gross return compared to gross costs) on cultivating wheat and rice, growing fruits and vegetables is a profitable undertaking (gross returns are on average double the costs). Besides fruits and vegetables, there are also other crops that generate a higher income than wheat and rice. Having gone through these reports and data, I have been wondering why, despite all this, do farmers choose to grow mostly and rice? In other words, if Indian consumers are demanding more fruits and vegetables, and these crops are more lucrative anyway, why do Indian farmers keep growing more and more wheat and rice?. Are farmers completely unaware of the difference in returns? Or, is it that despite knowing the disadvantages they choose to grow wheat and rice? The first possibility seems rather difficult to believe. While I am sure farmers have not created a detailed profit and loss statement for growing wheat versus okra, it is unlikely that farmers are completely ignorant. They probably do have a rough idea of probable market prices, input costs and likely profits. So what is it about fruit and vegetables that keeps farmers from growing them?. Almost all of the reasons listed above relate to risk – either production risk, logistics risk or market risk. Only two non-risk reasons can be seen in the list besides dignity of transaction: the opportunity cost of choosing crops which require greater care, and use of stored crops as financial assets. In principle, the latter can be addressed with better financial access for small holder farmers. Typical solutions to risk management are insurance products, but typical crop insurance products cover only a limited subset of these risks. And in any case, insurance subscriptions in India have been much lower than hoped for by policy makers and non-profits alike. Out of intellectual as well as professional curiosity, I have being digging deeper into this question, with the help of field visits and people working in the agricultural sector. Here are the results from my own observations and discussions with agri-sector professionals and experts.

Switching to a crop that has not been typically grown in the area brings in additional sets of challenges. First, it goes without saying that the soil and climate have to be conducive to cultivation of the new crop. Second, the farmer has to learn how to grow the new crop (or new variety of the same crop). For example, I visited farmers who were growing baby corn for the first time and had let the cobs grow too much simply because they did not know when to harvest it. While the produce was still usable, a significant portion of its potential value was lost. Third, buyers for the new crop need to either already exist at the local mandi (wholesale market), or brought to the local market, or the produce shipped to wherever the buyers are. In Bihar, I was speaking to farmers who traditionally grow cauliflower. Driving around the area in the cauliflower season, you see miles and miles of cauliflower. I asked a savvy farmer group why they grow the same crop that everyone else does and they replied that since the region is known for cauliflower, it is the cauliflower buyers who come to their local mandi. If they started growing something else, they cannot be confident of finding a buyer. Interventions in crop switching (such as organic farming) work well when a new market-facing intermediary is created to procure the produce directly, or act as a sourcing agent for other buyers.. And lastly, the financial risks of making the transition need to be absorbed or softened. For example, a few organizations working on transitioning farmers to organic farming are experimenting with providing a financial safety net during the first three years of transition and low yields before the produce can be certified as organic. These kinds of arrangements could be considered in this context as well and would help encourage farmers to switch to new kinds of crops.

Eminent agricultural scientist M S Swaminathan says the Indian Council of Agricultural Research (ICAR) and state agricultural universities should coordinate field trials of genetically-modified crops across the country to get over the on-off and go-no-go policy attitude of states to them. Swaminathan says the benefits and risks of GM crops cannot be known without field trials. He wanted the government to create a Biotechnology Regulatory Authority of India (BRAI). A bill was drafted by the previous government and tabled in parliament. It lapsed with the last Lok Sabha. The bill has not be re-introduced. An all India coordinated project, in Swaminathan’s view, would bring uniformity to risk assessments. It will also reassure the public. The ‘sooner this is done, the greater will be the public confidence in the procedures adopted for assessing risks and benefits; said Swaminathan in the backdrop of a complete standstill on the issue of field trials in many states. In a post on the website of his namesake foundation, Swaminathan wrote in June 2015 that Parliament must approve the BRAI bill so India can have an independent regulator which inspires all-round trust. He said his foundation was engaged in the genetic modification of rice for salinity tolerance using genes derived from the medicinal mangrove species Avicennia marina and for drought tolerance with proteins from Prosopis juliflora, a shrub native to Mexico, South America and the Caribbean. Unless field testing was permitted, he said, we cannot assess the benefits and risks in a reliable manner. Hence at least field testing of GMOs should not be prevented. They should be released for cultivation after bio-safety clearances. For this the government must set up an independent regulator without delay. Swaminathan wanted public sector research to be encouraged for inclusiveness in access to technology. There was very good expertise in public sector institutions in the fields of molecular biology and genetic engineering and we should derive the full benefit from them. There was at present no opposition, he said, to medical, industrial and environmental biotechnology as well as the control of technology. Rightly the concerns were around food biotechnology. This is why Parliament’s approval for the BRAI was an urgent need.

Coimbatore: Tamil Nadu Agricultural University and Central Institute for Cotton Research (CICR) entered into agreement for developing indigenous BT Cotton. In order to develop indigenous Bt cotton, TNAU has already developed a potent Bt gene and using this, cotton events resistant to the boll worms were generated, a University release said today. TNAU in collaboration with CICR, Nagpur will further work on the development of indigenous Bt cotton, it said. Boll worm infestation was a serious problem causing enormous yield loss in cotton and farmers were forced to take up frequent insecticidal sprays and conventional breeding to develop boll worm resistant cotton was difficult due to non-availability of resistance source in cultivated cotton. With the advent of recombinant DNA and genetic transformation technology, it was possible to introduce a specific gene from a soil bacterium into cotton plant, which expressed a BT protein and has insecticidal activity against the boll worms, it said. The MoU was signed by Dr C R Anandakumar, Acting vice-chancellor, TNAU and N Gopalakrishnan, Principal scientist, CICR Regional Station, Coimbatore, in the presence Dr. S. Ayyappan, Director General, Indian Council for Agriculture Research, Delhi and Prof K. Ramasamy, Member, State Planning Commission, Tamil Nadu.