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LATEST NEWS UPDATES | Paddy Profit Nosedives, Farmers Driven to Brink -Siba Mohanty

Paddy Profit Nosedives, Farmers Driven to Brink -Siba Mohanty

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published Published on Nov 3, 2015   modified Modified on Nov 3, 2015
-The New Indian Express

BHUBANESWAR: In a State where agriculture continues to be the mainstay of livelihood for the majority, the spate of farmer suicides has not really come as a surprise. Or has it?

With agriculture turning into a non-remunerative business and State’s farm sector remaining largely rain-fed, climatic changes have been sounding the warning bells but the Government saw no danger. Its self-assuredness that minimum support price (MSP) only is good enough to take care of the economic well-being of farmers has backfired.

Paddy farming has no more remained economically viable for majority of farmers who are either small or marginal since cost of cultivation has gone up over the last decade but returns have not grown proportionally. With profitability squeezed, most farmers are hard-pressed when the crops are damaged.

According to data available with Commission for Agricultural Costs and Prices (CACP), the average net return of paddy in Odisha stands at Rs 8,177 per hectare (ha) during the period 2010-11 and 2012-13. This calculates to about Rs 3,270 per acre which means against an MSP of Rs 1410 per quintal, the famer makes barely in the range of Rs 3,000-4,000. When the monsoon turns truant or there is an unforeseen event, the profit margin is erased and the farmer is left to fend for himself.

According to information available with Directorate of Economics and Statistics, the operational cost of paddy cultivation has jumped sharply over the years. Margin of profitability, though, has not. In 2004-05, the operational cost of paddy stood at Rs 12,619 per ha. By 2011-12, it had touched Rs 26,417 per ha.

Cost of labour has jumped at least 200 per cent during the period - from Rs 7,093 to Rs 16,594 per ha. Similarly, use of machine labour has risen from Rs 598 to Rs 1,176 per ha.

Since most of the farmers are small or marginal, average of profitability drops significantly because of the size of the holding, use of labour, credit rate and inflation. Although the Government has been raising the MSP, it does not offset the sharp rise in inflation. “A farmer does not just depend on the rice he produces, he has to buy so many other things and their prices have just shot through the roof,” said an agriculture expert.

In absence of adequate institutional credit linkage, the local money-lenders have wreaked havoc. The interest on capital in the last 10 years has also doubled from Rs 1,075 to Rs 2,240 per ha.

Since share-croppers and tenants constitute a large part of the farmers, the spiralling cost of cultivation has affected them the most because they have to shell out rents on land or even lease value.

When Vidarbha and Telangana regions were reeling under agrarian crisis with hundreds of cotton farmers taking to the extreme step, Odisha Government made no attempt to make an assessment of the sector in its backyard. It could have promoted crop-diversification and agro-processing but it chose to look elsewhere. Now it is paying the price.

The New Indian Express, 2 November, 2015, http://www.newindianexpress.com/states/odisha/Paddy-Profit-Nosedives-Farmers-Driven-to-Brink/2015/11/02/article3109523.ece


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