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LATEST NEWS UPDATES | Decoding the Agony of the Indian Farmer -Nilanjan Banik

Decoding the Agony of the Indian Farmer -Nilanjan Banik

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published Published on Apr 27, 2017   modified Modified on Apr 27, 2017
-TheWire.in

Statistical analysis suggests that farmers in states that have amended the Agricultural Produce Market Committee Act are less likely to commit suicide, but further reforms are needed to reduce the incidence of farmer suicides across the country.

Every summer, it is the same old story: drought and farmers committing suicide in India. Between 2012 and 2015, over 10,000 farmers killed themselves. Farmer suicides are a major cause of political contention, despite the fact that they are not a new occurrence and the factors driving these deaths – crop failures, an inability to get the market price and insurmountable debt – are sometimes beyond the control of policymakers. Nevertheless, when a large number of suicides occurs, it generates heated political debate. The ruling party typically defends its interventions – such as farm loan waiver schemes, higher minimum support price (MSP), fertiliser subsidies and tax free agricultural income – while the opposition parties criticise the government for not doing enough on the ground.

Our research attempts to understand the factors that contribute to farmer suicides, a more detailed analysis of which can be found here. We examined the reasons behind farmers being unaware that market prices for crops had to do with inefficient supply chain management and lack of irrigation facilities in rural areas. Similarly, the fluctuation of agricultural output in India is due to supply-side shocks resulting from inadequate rainfall, rather than demand-side factors resulting from lower per-capita income. Investment in rural infrastructure, such as electrification and building canals, will help to mitigate losses incurred due to crop failures, and thereby reduce the probability of a farmer committing suicide. Additionally, other factors such as the lack of reforms to the Agricultural Produce Market Committee (APMC) Act, low bargaining power resulting from small farm size and a lack of warehousing facilities are also important to consider.

In India, the problem isn’t only that per-capita agricultural income is low, but also that at times it is not possible to sustain this low income. Additionally, agricultural output fluctuates far more than the outputs of the industrial and services sectors. Official output data shows that during the period between 1991-1992 and 2013-2014, the coefficient of variation for agricultural output is 191.34, in comparison to 50.48 for industry and 22.03 for the service sector. This has led to unequal income distribution in India with rural-urban wage gap amounting to 45% in comparison to around 10% for China and Indonesia. Some 850 million people still live in rural India. India has around 260 million people living in poverty and 80% of them live in the countryside. According to the World Bank, India is home to the largest number of poor people in the world.

Lack of irrigation and farmer suicides

World Bank data shows only 35% of India’s agricultural land is irrigated (artificial application of water to land or soil). This means the majority (65%) of farming is rain-dependent, most of which takes place over just a few summer months. As Figure 1 shows, the likelihood of a farmer committing suicide is more during bad-rain years. To create a meaningful comparison, we standardised rainfall and suicide data with respect to mean and variance, to make them unit free (read: standard rainfall and standard suicide).

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TheWire.in, 25 April, 2017, https://thewire.in/127803/decoding-the-agony-of-the-indian-farmer/


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