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LATEST NEWS UPDATES | Getting it wrong on India’s level of agricultural support -Sachin Kumar Sharma and Adeet Dobhal

Getting it wrong on India’s level of agricultural support -Sachin Kumar Sharma and Adeet Dobhal

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published Published on Jan 22, 2021   modified Modified on Jan 22, 2021

-The Hindu

The methodology behind the OECD’s numbers, that suggests negative support, has pitfalls and limitations

The ongoing stalemate between the farmers protesting over the recently passed farm laws and the government has sparked an interesting debate regarding the level of agricultural support. Many media reports, based on data by the Organisation for Economic Co-operation and Development (OECD), have ostensibly stated that the support provided to Indian agriculture is extremely low or negative, and, therefore, net taxed. In contrast, the support provided by the Central and State governments through their various federal and sub-federal schemes is well-documented. This divergence merits a close examination for bringing clarity on this issue.

Estimates and elements

The OECD estimates the support to the farmers in terms of producer support estimates (PSE), which mainly comprises the following two elements: market price support and budgetary payments. The OECD has estimated that Indian farmers received negative support to the extent of minus 2.36-lakh crore and minus 1.62-lakh crore in 2010 and 2019, respectively. The support to farmers was consistently negative during 2000-2019, except in 2000. Surprisingly, the negative support of minus 1.62-lakh crore as estimated by the OECD was higher than the total budgetary allocation of the Ministry of Agriculture at 1.09-lakh crore in 2019.

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The Hindu, 22 January, 2021, https://www.thehindu.com/opinion/lead/getting-it-wrong-on-indias-level-of-agricultural-support/article33629376.ece?homepage=true


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