environment and pollution law

Existing environment and pollution law:

1. It mandates "consent to establish"(CTE) certificates from state pollution control boards for setting up of industry, changing output or any technological modification and is valid for a limited time.
2. This is time consuming because of the limited resources of the state boards and the increasing number of industries.
3. It further tangles businesses in bureaucratic red tape, thus hampering the ease of doing business.

Proposed modifications:
1. Do away with certification and implement self certification and self regulation.
2. Random scrutiny, inspections and audits by a third party.
3. Increased penalties for violation of norms.
4. It will bring uniformity to state laws, as some states require certification, and some dont.

Advantages.
1. Avoid the bureaucratic red tape 
2.Better utilization of human resource in state pollution boards.
3. Third party audits may enforce better accountability and reduce sources of corruption.

Opposition from environmentalists:
1. Self certification will increase flouting of norms as inspection after setting up industries may be useless.
2. There is no point of certification when industry has already been setup.

So, even though cutting down on bureaucratic red tape is the need for the hour, transparent third party audits and procedures can minimize the risk of flouting of norms which ensuring faster developmental efforts.

The political roots of black money / Subir Roy

Cashless transactions are one of the very important solutions to tame black money and should be promoted, Prime Minister Narendra Modi has said. There is a problem of emphasis here. It is good for people to use as little cash as possible as non-cash (through book transfers in banks) transactions leave a trail that law enforcers like income taxauthorities or those tracking money laundering find extremely useful. But going off cash does not offer a major solution to the problem of black money.

To understand what works best in fighting black money it is critical to understand what black money is and is not. It is income that is not declared for income tax purposes. This can be simply tax evasion by a businessman or a professional engaged in legitimate activity. It can also be much more serious criminal offences like handling money that fuels trafficking in drugs or humans.

An enormous amount of black money flows in and out of the banking system and still remains black. A government official can take his family out for a lavish meal at a five-star hotel or buy the choicest Scotch whisky from liquor shops with cash taken as bribe. Once these sales enter the books of the hotel chain or the legitimate foreign liquor importer who pay taxes, the black money becomes "white". Then if the hotel chain's or the liquor importer's liaison person pays a bribe to any official functionary (there are ingenious ways of cloaking it as a legitimate cashless transaction), the amount paid, which will not be declared by the official as income to the tax authorities, becomes black money again.

Before going any further let us get a red herring out of the way. During its election campaign the Bharatiya Janata Party (BJP) had promised to bring back black money stashed away by Indians abroad. How this is any more black than black money that stays within the country (there was no similar emphasis on unearthing it) is unclear. It seems there is greater interest in grandstanding on black money than actually doing something serious about it. Had the latter been the case the primary reason why black money thrives would have been addressed.

Black money thrives because it plays a critical role in Indian elections and no political party of any consequence appears interested in putting an end to this. Had it been so the way elections are fought would have changed beyond recognition by now. It is widely believed that it costs at least Rs 5 crore and often much more to contest a parliamentary seat today, whereas the Election Commission-approved ceiling for such expenditure by a candidate is a mere Rs 70 lakh. What is fascinating is that many candidates, going by their declared expenses, do not even spend up to the permitted ceiling!

The Economist, in a report in May last year, picked up a frequently cited quote of Atal Bihari Vajpayee, saying that "every legislator starts his career with the lie of the false election return he files". Closer to today, the late Gopinath Munde, then deputy leader of the BJP in the Lok Sabha, in 2013 publicly admitted that he had spent Rs 8 crore for his 2009 parliamentary election, and then, on being issued a show cause notice by the Election Commission, denied the statement by saying it was "rhetoric". Thus, how much gets spent in fighting elections is hardly a well-kept state secret.

It is easy to see what such electioneering lets loose. A person who has spent Rs 5 crore in getting elected will want to recoup that principal, plus inflation plus a reasonable return to create a corpus with which to fight for his re-election. Thus, in five years he will want to making close to Rs 10 crore in black money or more. If legislators who rule the country face this kind of compulsion to generate black money for their own political future, how can they be expected to put in place a system that will bring an end to the generation of black money?

It is, therefore, unsurprising that there is a big hole in the rules on permissible election expenses. While there is a cap on what a candidate can spend for his election, nothing like that exists for political parties. What is more, donations up to Rs 20,000 are not treated as donations and can be reported without any details. So all that a party needs to do to account for, say, Rs 1 crore, is to claim that it received it in the form of 500 donations of Rs 20,000 each!

Other rules, in this regard, are either of minuscule size and consequence (companies can now officially make political contributions) or routinely flouted (filing returns on expenses within 90 days of an election). There is no attempt to change the rules where they matter. The entire political class, across parties, is complicit in this.

Source: http://www.business-standard.com/article/opinion/subir-roy-the-political-roots-of-black-money-115011301368_1.html

Cash Transfer Scheme / Mihir Shah

Advocates of unconditional cash transfers claim that they can be both emancipatory and transformative. They argue that people are quite capable of making rational decisions. And that this kind of basic income support can improve their lives.

I have no quarrel with the claim that we must trust the poor. Such suspicion is part of an elite mindset, which we must firmly reject. However, what is equally true is Babasaheb Ambedkar’s reminder that we must not romanticise the poor. We need to bear in mind that historically Indian society has had more than its share of prejudice and discrimination, based especially on caste and gender. Robust empirical evidence suggests that access to food, rather than cash, favours children rather than just adults, and girls, not just boys. Income support goes a long way in providing a modicum of security to those left out of the mainstream development process. But the problem with regarding unconditional cash transfers as transformative silver bullets in themselves is that we may leave unattended many fundamental requirements of poverty elimination, without which cash transfers will just not work.

What will cash do without essential capabilities and skills? Development is much more about empowering the poor and creating concomitant conditions that allow them to translate their aspirations into tangible outcomes. A key part of these conditions is possessing requisite capabilities to be relevant in a rapidly evolving economy. Transmitting these skills is a completely different ball game than just transferring cash to the poor.

Providing linkages

What will cash do without forward and backward linkages? Poverty elimination demands sustainable livelihood options and these require not just cash but vital inputs (such as water or raw materials or veterinary services) and a market, where the outputs produced could be sold. It is good to see the National Rural Livelihoods Mission working not only on skills, but also on assuring these forward and backward linkages.

Can cash work for the unorganised poor when faced with exploitative markets? As any student of the poor in India knows, when individual small and marginal farmers enter any market, they face extremely onerous conditions. The nexus of interlocked markets presents grievously unfair terms for them and most of the time they end up making distress sales, getting even deeper into debt. It is for this reason that recent work on farmers’ poverty has focussed so much on building powerful economic institutions of the poor such as Self-Help Group Federations or Farmer Producer Organisations, so that they can compete on better terms in the market. A mere transfer of cash without this major innovation will do the poor little good.

Can cash work for the unorganised poor when faced with unresponsive governments? Another reason why the poor need to be organised is to generate greater accountability of systems of governance that are the weakest in our most deprived regions. When the poor get organised, especially when led by women, we get much higher quality of mid-day meals and primary health centres. Removing poverty without strengthening systems of public health delivery is almost inconceivable in the poorest regions of India. And without strengthening Panchayati Raj Institutions, governance reform and better public service delivery will continue to remain a pipe dream. The 12th Plan Rajiv Gandhi Panchayat Sashaktikaran Abhiyan is a source of much hope in this direction.

What will people do with cash where there are no options? One of the fundamental requirements for cash transfers to succeed is the availability of affordable high quality options for the poor so that they can choose the best service provider. But as the repeated experience of the Rashtriya Swasthya Bima Yojana shows, the poor have hardly any options for proper health care or for any other basic requirements of life. Indeed, the danger, as I have witnessed over the last 25 years first-hand, is that the poor are caught in a terrible web of low quality local, private providers of health and education. Cash transfers without strengthening quality of service provision could end up even making things worse in this respect.

In large parts of rural India, market failure is rampant. Here, a range of public goods and infrastructure need urgent provisioning. The trustworthy beneficiary of our direct cash transfer cannot arrange for this all by herself. No one has ever stopped the private sector from going there but there is no incentive for a profit-seeking capitalist to travel to these impoverished regions of India. What the markets cannot do, what the private sector will not do, the State must.

The Indian challenge

Governments in all developed nations in Europe, the U.S., Canada, Japan, Australia, South Korea, Singapore and many others have provided their citizens social security, education, health care, mass transport etc. Such public investments also generate many positive externalities and spur private investment; they are indeed, a precondition for it. Cash transfers cannot be a substitute for this. The challenge we face in India is of massive government failure in these crucial sectors. We need to extend the process of reform to these key parts of the economy, where the state is in close interface with our most vulnerable regions and people.

The almost irresistible seductiveness to the idea of cash transfers is a reflection of great intellectual, policy and political ennui. Since real change is hard to come by, why not go with a lazy short cut? Just give everyone a dole. Which is what unconditional cash transfers are. In fact, cash transfers are just one element of India’s anti-poverty programmes. They work only when they are accompanied by other enabling changes, each of which addresses key elements of the poverty syndrome in India. We have many such conditional cash transfer schemes, which I strongly support because their success is contingent upon something more than mere cash transfer: such as the creation of durable assets under Mahatma Gandhi National Rural Guarantee Act; incentivising education of girls and disincentivising their early marriage in the Ladli Lakshmi Yojanas of many States; or the Janani Suraksha Yojana that incentivises institutional deliveries. The real challenge is to reform their functioning and improve their quality, learning creatively from best practices set up by many States, so that these programmes can deliver up to their real potential.

(Mihir Shah is an economist who was Member, Planning Commission from 2009 to 2014. He has lived and worked at the grass-roots in tribal central India for the last 25 years.)

http://www.thehindu.com/todays-paper/tp-opinion/cash-transfers-the-lazy-short-cut/article6786550.ece

Only an average 48.1 per cent of Class V children across India can read a Class II-level text

The Annual Status of Education Report (ASER), 2014, says only an average 48.1 per cent of Class V children across India can read a Class II-level text. From your own experience of school days, or from observations you might have made in your surroundings, critically comment on the reasons behind such low levels of learning outcomes in Indian schools.

Both public and private school enrollment has increased sgnificantly around the country but, as the report by ASER points out, learning levels have remanined stubbornly low. Even though children are moving up the grade they fail to master the grade-level conpetencies they are expected to; like the report says - “only an average 48.1 per cent of Class 5 children across India can read a Class 2-level text”.

This could be attributed to a number of factors:

1. Lack of qualified teachers - owing to the political pressure many government schools have regularised the contract teachers who were not qualified otherwise.

2. Size of class - An ideal teaching ration should be 1:30 but in private schools it can go as high as 1:70! hence teachers are unable to pay attention to students indivisually.

3. Poor pedagogy and curriculum which stresses more on rote-learning then conceptual understanding. Teachers are pressurised to cover the syallabus rather than help students learn.

4. India does not follow TaRL (Teaching at the Right Level) system and students are given classes based on their age and not their calibre and learning capabilities.

5. With a removal of board exams till class X and even regular examinations from many schools there is no student evaluation going on. Hence students do not learn and still end up moving to higher grades.

What needs to be done:

1. Setting up of quality teachers training insitution all over India for capacity building of staff. Proposed Madan mohan malviya teachers training insititute is a good step in this direction.

2. Government should be ready to invest more in education sector to build infrastructre and hire more qualified teachers tpobring down the teacher-pupil ratio of a 1:30.

3. Curriculum should be updated and stress of TaRL should be given.

4. Continuous and Comprehensive evaluation (CCE) which restructures testing practices is a good move in the direction to ensure a systematic evaluation. Teachers should be given freedom to refine and customise this based on curriculum. Whatever method of evaluation is used, a rigrous evaluation of it is needed to ensure that it is working.

5. More community participation is required - like IIT students who go to nearby villages to teach science and maths and to keep a check on teacher's attendance and other infrastructural issues.

6. an equally important expect is that teaching should be promoted as a good career option so that talent should be attracted in this field.

India- Indonesia Relations / Shyam Saran

Prime Minister Narendra Modi and President Joko Widodo(better known as "Jokowi") of Indonesia are often compared to each other. Both achieved high office despite their humble origins. Both have raised surging expectations, of being harbingers of transformational change, in their respective countries but confront similar challenges - of complex democratic polities, entrenched bureaucracies and a legacy of corruption.

It is not clear whether these commonalities engendered any special empathy between the two leaders when they met briefly on the sidelines of the East Asia Summit in Naypyidaw, Myanmar, on November 12 last year. Neither announced any initiative to impart new energy and direction to a relationship that has consistently fallen short of its evident potential. After their meeting, Mr Widodo said the discussions had covered coal and defence industries - and added somewhat oddly that "we had no exclusive cooperation in the maritime field". Odd, because the maritime field is precisely where we do have some modest cooperation.

As pointed out by an Indonesian analyst, India-Indonesia relations "remain mired in neglect". If this persists, then both countries would have missed an opportunity to work together to shape the emerging security landscape in Asia.

In my column entitled "Rising Indonesia" (May 19, 2010,Business Standard), I had spelt out the reasons why Indonesia qualified as a critical strategic partner for India. It is a close neighbour, separated by only 80 kilometres of ocean space. Together our two countries serve as sentinels of the ocean bridge connecting the Indian and Pacific Oceans, and dominate the dense sea lines of communication running across them. They are Asia's two largest and vibrant secular democracies and share a strong cultural affinity. Just as they have an instinctive preference for a multi-polar world, so do they wish to ensure a multi-polar Asia, or what Indonesians describe as a "dynamic equilibrium".

Since India and Indonesia established a Strategic Partnership in 2005, there has been progress in enhancing maritime cooperation through coordinated ship patrols and joint exercises. The Indonesian navy participates in the Indian Ocean Symposium and the Milan joint-naval exercises hosted by the Indian navy. India has offered to share its capabilities in maritime domain awareness. The Indonesian army has benefited from training at the Counter Insurgency and Jungle Warfare School in Mizoram. Training on Sukhois is part of cooperation between the air forces.

However, security cooperation remains thin and the overall relationship in terms of political, economic, trade and people-to-people exchanges is well below expectations. Till date, there are no direct flights between the two countries, despite 150,000 Indians travelling to Indonesia each year. Trade is modest at around $20 billion and Indian investment in Indonesia is mostly flat.

As would be apparent, maritime cooperation between the two countries, even though modest, is the centrepiece of their bilateral relations. Recent developments in Indonesia's maritime strategy pose a challenge. President Jokowi has declared that Indonesia must become a "maritime fulcrum" and a "power between the two oceans". As a maritime country, he adds, "Indonesia should assert itself as the World Maritime Axis". It is the first time that an Indonesian leader has enunciated a maritime doctrine with such clarity, and this is to be welcomed.

At the East Asia Summit, President Jokowi further declared his intention to develop maritime infrastructure and connectivity by "constructing sea highways along the shores of Java, establishing deep-sea ports and logistical networks as well as developing shipping industry and marine tourism". In all, 24 deep-sea and other ports are to be built in the next five years.

In theory, this should create expanded opportunities for India to promote maritime cooperation with Indonesia and offer to play a part in helping build the latter's maritime capabilities. However, it is China that has emerged as the likely partner, subsuming Indonesian ambitions into its Maritime Silk Road (MSR) project. Another attraction for Indonesia is the likely availability of funds from the newly established and Chinese-sponsored Asian Infrastructure Investment Bank, of which Indonesia is a founder member - and has been pitching for the bank to be sited in Indonesia. When the Chinese foreign minister visited Jakarta in October 2014, he supported President Jokowi's ambitious plans: "China is willing to actively participate in Indonesia's process of building a maritime power and take Indonesia as the most important partner in building the Maritime Silk Road of the 21st century."

It is learnt that China has agreed to finance the building of several of the ports identified by Indonesia.

It should be noted that for China, Indonesia is slated to play a key role in the MSR initiative. A Chinese scholar has described the MSR route in a recent article: "The MSR will extend southwards from China's ports through the South China Sea, the Straits of Malacca, Lombok and Sunda, and along the north Indian Ocean to the Persian Gulf, Red Sea and Gulf of Aden. In other words, the Road will extend from Asia to the Middle East, East Africa and Europe and it will mainly rely onASEAN [Association of Southeast Asian Nations] countries."

India has been ambivalent about participating in the MSR project. Some analysts see it as a benignly dressed-up version of the String of Pearls strategy to encircle India. Others believe that we ought to participate and help shape its contours. Whatever our perceptions, it is necessary to examine the implications of Indonesia being co-opted into China's maritime strategy and becoming a platform for an extensive Chinese maritime presence in our sensitive ocean space. We may need to engage Indonesia in a frank dialogue about our concerns and also consult our other partners in the region, including the United States, Japan and Australia, and other Asean countries. Perhaps this coalition could offer an alternative source for assisting Indonesia's maritime project.

There is one inescapable conclusion though. India needs to speedily ramp up its all-round maritime capabilities in terms of modern ports, efficient port-handling facilities and ship-building. Above all, its naval forces must enjoy enhanced priority in resource allocation for defence.

---

The writer, a former foreign secretary, is currently chairman of the National Security Advisory Board and RIS, as well as a senior fellow at the Centre for Policy Research in New Delhi

Source: http://www.business-standard.com/article/opinion/shyam-saran-distant-neighbours-115011301370_1.html

Cow Minister!

नस्लभेद बहुत है यहां
गोरी गायों के मंत्री बन गए
काली भैंसे किसी ने न पूछी!

मैं न कहता था,
अप्रैज़ल तुम्हें ही मिलेगा जानेमन
दूध मेरा कोई कितना भी दुहे!

शाम

छत से दिखता है सूरज

साइकल पे एक बूढ़ा

सड़क पे झड़े पत्ते

मोटे इवनिंग वॉकर्स

और बादलों में तुम्हारा चेहरा.

Hail the invisible hand of the state / Ajit Balakrishnan

The current debate in India about how to trigger a quantum jump in industrial manufacturing activity and, thus, create large-scale employment is largely centred on ways to reduce the role of the state - in allotting land, in environmental clearances, in firing workers and so on. Yet the case studies of two industries that came from origins even smaller than where manufacturing is today and have become international success stories - the Indian pharma industry and the Indian information technology (IT) services industry - proves the opposite point. Neither would have come to their current stellar role in the Indian economy without the active but largely invisible hand of the Indian state.

The Indian pharma industry has grown from minuscule revenues in the late 1960s to a world player with an annual revenue of $40 billion (of which $15 billion is in exports) and an activity base of 20,000 plus manufacturing units employing over 29 million people. The case of the software services industry is even more striking; it employed just 8,500 people in 1990 and had a revenue of a mere $165 million (tiny Ireland had a $185-million software industry at that time). Today, its size is $118 billion, with $100 billion as exports. The people directly employed in the industry is reported as exceeding two million, with another seven million employed indirectly. Both these industries have also created multiplier effects in sectors such as housing construction, transport services and household goods, as young chemists and programmers set up homes, and bought cars and home appliances.

What was the magic? Unfortunately, finding the key to these success stories is like that old tale of the blind men of "Hindoostan", who, when asked to describe an elephant, said that it was like a wall, snake, spear, tree, fan or rope, depending upon which part of the elephant each touched.

Proponents of the "market economy" will say that the success of these two industries is an example of what energetic Indian entrepreneurs can achieve when the government of India steps aside. Reinforcing this view is India's business press, which frequently features stories about software and pharma industry millionaires. Proponents of "globalisation", such as New York Times columnist Thomas Friedman, in his book The World Is Flat, credit globalisation: increased world trade that spreads prosperity around the world. Proponents of "privatisation" say that decades of public sector efforts in these industries (Electronics Corporation of India in the case of IT and Hindustan Antibiotics are often quoted as examples) came to nothing until the private sector was "allowed" to participate. To them, this is proof that the government needs to privatise many other industries as well. And, of course, there are those that say that the state's only role should be to provide zero income tax on export incomes, government-sponsored software parks and export zones.

But actual case studies of these two industries tell another story. The rise of the Indian software services industry can be traced back to two mega projects sponsored by the Union government: the computerisation of public sector banks and Indian Railways. These two projects, apart from providing an impetus to the start-up and growth of hundreds of software development companies, also had another dimension. Far-sighted government policymakers like N Seshagiri of what was then called the department of electronics, the forerunner to the current ministry of IT, insisted that these applications be built using such technologies as the Unix operating system and relational database systems; the world was then getting ready for a paradigm change that would unleash an insatiable wave of demand for computer programmers well versed in these specific technologies as the world shifted from mainframe computers to client server computers. Thanks to the banking and the railway projects, Indian companies had a ready stock of thousands of software programmers well versed in these new technologies, who could be immediately deployed on assignments abroad.

The rise of India's pharmaceutical industry is based on similar visionary moves by the Indian state. In 1970, the government introduced a new patents Act reforming the 1911 one, which excluded pharmaceuticals and agrochemical products from eligibility for patents. Patents on molecules, which are products of chemical reactions or on mere admixtures and the like, were made non-patentable in India. Only the method of making the product was patentable. This resulted in the Indian pharmaceutical industry developing considerable expertise in reverse engineering of drugs that are patentable as products throughout the industrialised world but not in India.

You need to peer really hard to detect this kind of invisible hand of the state. Mariana Mazzucato, professor of science and technology at the University of Sussex and the author of The Entrepreneurial State - Debunking Public vs. Private Sector Myths, did just that and uncovered the role of the American state behind what is generally seen as the ultimate artifact of entrepreneurial vision, the Apple iPhone. "What actually makes the iPhone a smartphone, instead of a stupid phone?" she asks in a recent TED talk. And answers that it is the internet; the Global Positioning System (GPS), which detects your geographic location; the touchscreen display that makes it also a really easy-to-use phone. She points out that "the very smart, revolutionary bits about the iPhone, are … all government-funded … the Internet was funded by the Defense Advanced Research Projects Agency (DARPA) of the United States. The GPS was funded by the [United States] military's Navstar program … the touchscreen display was funded by two public grants by the CIA [Central Intelligence Agency] and the US National Science Foundation", and in the American pharmaceutical industry, "a full 75 percent of the new molecular entities with priority rating are actually funded in boring, Kafkian [United States government] public sector labs".

---

Source: http://www.business-standard.com/article/opinion/ajit-balakrishnan-hail-the-invisible-hand-of-the-state-115011201338_1.html

Ajit Balakrishnan, founder and chairman of Rediff.com, is the author of The Wave Rider, A Chronicle of the Information Age
ajitb@rediffmail.com

( A very interesting but debatable post! )

Farmers Issues

Indian farmers especially small and marginal are under great stress. It is being revealed from from NSSO 70th round findings ,which estimated more than 50% of farm households in debts,farm holdings of 90% shrinking to less than 2 hectares.most worringly most findings have deteriorated even from previous ms swaminathan report on national commission on farmers.
major problems associated with vulnerability of marginal farmers include-
1)flawed aspects of green revolution-
(a)regional disparity- targeted assistance to only selective regions nw india,coastal andhra etc
(b)social disparity- institutional help for credit,bore well etc was availed by rich farmers only.
(c) agricultural disparity- overemphasis on only selected crops ruined traditional crops such as millet. 
2)failure of land reforms- petty politics and loopholes in land ceiling act never allowed proper land reforms except kerala.
3)very low penetration of institutional financial credit in rural areas, in fact priority sector lending has neither benefited farmers nor banks,higher chunk being appropriated by rich farmers,besides heavy corruption keeps needy at bay. 
4)market reform failure- role of middlemen not decreasing even after adoption of model APMC act making farmers much vulnerable.
5)not proper diversification of agriculture-though adoption of rainbow revolution did envisioned overall development but in absence of market exposure,food processing infrastructure they have not impacted small farmers on large scale.
6)vagaries of monsoon- over 60% of indian agriculture dependent on monsoon.
Govt has attempted several approaches specially targeting marginal farmers such as
1)financial schems- (a)criteria of priority sector lending by banks(b)subsidies on diesel,kerosene,drip irrigation,farm machinery etc
2)employment generation - such as IRDP, SGSY,MNREGA act etc
3)institutional structure for agriculture development
(a)Funding for research via ICAR, state agriculture university.
(b)national plans such as -droght prone area development programme,rashtriya krishi vikas yojna,national mission on sustainable agriculture etc
(c)personalized help- soil testing, phone based technical guidance etc.
The dismal state of farmers depicts failure of schemes, major overhaul is agriculture sector is need of hour, governments approach towards establishing a grand alliance between farmers,market and credit institutions is must not only for farmers but also food security and robust economy of country.

An uncertain Hobbesian life / Feroze Varun Gandhi

Of India’s 121 million agricultural holdings, 99 million are with small and marginal farmers, with a land share of just 44 per cent and a farmer population share of 87 per cent. With multiple cropping prevalent, such farmers account for 70 per cent of all vegetables and 52 per cent of cereal output. According to National Sample Survey Office data, 33 per cent of all farm households have less than 0.4 hectares of land. About 50 per cent of agricultural households are indebted. In Sultanpur district, Uttar Pradesh, cultivation cost per hectare for wheat has increased by 33 per cent in five years. Such farmers face an uncertain Hobbesian life: poor, brutish and short.

Rain-fed agriculture has been practised since antiquity in India, with Indus Valley farmers growing peas, sesame and dates. Greek historian Herodotus had noted in The Histories : “India has many vast plains of great fertility. Since there is a double rainfall, the inhabitants of India almost always gather in two harvests annually.” With the British era came the zamindars, the ryots and penury. As Tirthankar Roy notes in The Economic History of India , 1857-1947 , “from 1891 to 1946, diminishing returns coupled with growing land-shortage and yield deceleration led to an acute crisis, particularly in Bengal.” India’s marginal farmers have been worse off for centuries.

Alleviating marginal farming

Our policymakers recognised this dependence on rain and formulated policies focussed on supporting canal-fed crops and improving agricultural productivity. This they coupled with incentive structures, pricing regimes and input subsidies. A bewildering array of schemes was launched — Small Farmers Development Agency (1971), Integrated Rural Development Programme (1980), Swarnjayanti Gram Swarozgar Yojana (SGSY, 1999) and the Mahatma Gandhi National Rural Employment Guarantee Act. Skewed by a bureaucratic approach, these schemes focussed on creating yearly jobs and roads, while resisting decentralisation and localised decision-making. Individual symptoms were mitigated, while long-term food security and ecological sustainability were ignored.

The Drought Prone Area Programme (1974) was “concerned with drought proofing rather than livelihoods and growth-focussed development.” The National Policy on Farmers (2007) focussed on improving farmer income through better risk management and an improved price policy. Implementation, sadly, was lacking, with less than 30 per cent of small and marginal farmers borrowing from institutional credit systems.

The Rashtriya Krishi Vikas Yojana (2011) allocated Rs.10 lakh to each district to prepare and implement the Comprehensive District Agriculture Plan with the participation of local panchayats. The discussions were mostly chaired by the local minister or district collector, with little reflection on farmers’ needs. Best practices were mostly ignored.

Farmers in arid regions were encouraged to plant high-yielding wheat instead of Malwi Ghehu, a local wheat variety, while relying on declining groundwater. Sixty one per cent of irrigation is now from groundwater, with the proportion of districts with semi-critical and overexploited groundwater rising to 33 per cent. The proportion of districts in the critical, semi-critical and over-exploited category rose from 5 per cent in 1995 to 33 per cent in 2004, according to statistics available from the Central Ground Water Board.

Punjab is well past unsustainability, with 110 blocks out of 137 falling under the “over-exploited” category. The Punjab State Farmers Commission (2013) recommended a substantial crop diversification to cotton, pulses and vegetables, decreasing area under paddy cultivation by 40 per cent over five years. Of the Rs.5,300 crore suggested for diversification to dryland crops, the Centre allocated only Rs.500 crore.

A shift back to dryland agriculture, particularly in western India, is much needed. Rajasthan, despite low rainfall, is buffering by integrated farming — having subsidiary farm enterprises such as dairy, poultry, sericulture and goats. States with little rainfall such as Haryana can be encouraged to shift back to oilseeds and coarse cereals. Rice cultivation could be increased in rainfed Odisha and Assam, while incentives to promote wheat and rice are realigned.

With conventional irrigation mostly tapped, drip irrigation is an obvious solution. By accommodating irregular field sizes and unlevelled topography, water application efficiency (greater than 70 per cent) can be kept high, lessening soil erosion. Yield can be increased up to 230 per cent, while fertilizer efficiency rises up to 30 per cent. However, the high initial cost has been a significant barrier. With individual loan sizes too small for transaction costs, banks have been reluctant to provide loans. Bundling farming households through subsidy schemes like SGSY can help structure such transactions. Tamil Nadu offers a 100 per cent subsidy for small and marginal farmers for taking up micro irrigation up to a maximum of 60,000 acres. With high monetary ceilings in irrigation projects, drip irrigation can be mostly funded through a revolving subsidy fund, which is based around local self-help groups.

Even with existing subsidies, sanction delays can cause installation delays, with suppliers reluctant unless the full cost is paid. Banks could be encouraged to advance full loans to government-authorised self-help groups, without insisting on sanction and release of subsidy. Subsidy adjustment can occur later, while repayment periods are kept between 10-15 years.

Funding for research

The Indian Council for Agricultural Research (ICAR) has been primarily focussed on breeding higher yielding varieties for rice and wheat, while mostly ignoring coarse cereals. Funding for research for ICAR and State Agricultural Universities (SAUs) has been dismal. Most SAUs are in overdraft, with little accreditation and a growing dependence on ICAR.

A restructured funding scheme, with a focus on Research and Development in 10-12 crops in dryland agriculture can be encouraged. The Kelkar Committee in Maharashtra had suggested that funding to SAUs could be increased by at least Rs.100 crore, to upgrade research facilities and set up agriculture labour training schools. Mechanisation needs to be encouraged as well.

Even the National Mission for Sustainable Agriculture has been hit by a funds crunch. This mission would have focussed on mitigating risks associated with climate change and ensuring food security, with a focus on organic farming and System of Rice Intensification propagation. Such initiatives need to be encouraged.

The Working Group on Marginal Farmers (2013) recommended that marginal cultivators could be encouraged to join Farmer Producer Organisations (FPOs). Such organisations can be provided interest subvention on loans for a five year period and exempted from the agricultural produce market committee cess. Procurement from small and marginal farmers should be prioritised particularly through regulation for multi-brand retail. Enhancing their investment credit and matching their working capital requirements should be a priority. FPOs could be extended collateral free loans of up to Rs.25 lakh, along with creating a Credit Guarantee Fund for financial institutions to lend to such institutions.

To foster these shifts, comprehensive ground-up regulatory and social action is essential. A shift to drip irrigation can be instituted by mandating it for all sugarcane plantations and fruit orchards. Combining this with micro-irrigation and horticulture incentives might create demand on-ground. Agriculture can be further customised through soil test labs at the ground level that provide advice to farmers on a personalised basis, while promoting greater water efficiency. Taxes on agricultural machinery should be removed and agro-based industries fostered, with commodity parks created at the district level. Such social and governmental action can help the marginal farmer peer beyond penury.

(Feroze Varun Gandhi is a Member of Parliament, representing the Sultanpur constituency for the BJP.)

Source: http://www.thehindu.com/todays-paper/tp-opinion/an-uncertain-hobbesian-life/article6782402.ece