Editorials/Opinions Analysis For UPSC 02 January 2023
- Doubling Farmers’ Income: A Noble but Unachievable Goal
- Courts should examine decisions’ economic impact
Doubling Farmers’ Income: A Noble but Unachievable Goal
As we approach the end of 2022, we recall the government’s failed goal of doubling farmers’ income by 2022. Despite this, an expert committee led by Ashok Dalwai recently submitted a 14-volume report on Doubling Farmers’ Income (DFI).
GS Paper -2: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
GS Paper-3: Indian agriculture, related issues and constraints; marketing of agricultural produce and supply chain management.
Despite the government’s push to double farmers’ income, the most recent available data shows that farmers’ income has declined or remained largely stagnant in recent years, according to Analyze. Also, propose measures to increase farmer income. (250 words)
- In a February 2016 farmer rally in Bareilly, Uttar Pradesh, Prime Minister Narendra Modi announced the government’s intention to double farmers’ income by 2022.
- He emphasised that it was not just political rhetoric, but a real project that would be a good initiative to commemorate India’s 75th year of independence.
At a Glance: India’s Agri Sector
- In 1951, India’s agricultural and allied sector contributed approximately 55% of GDP.
- According to the Economic Survey, agriculture and allied sectors will account for approximately 20% of total Gross Value Added (GVA) in 2020-21.
- Agriculture & Allied Activities’ Share of Agriculture GVA
- 60% of crops
- Livestock (27%)
- Forestry and logging: 7%; fishing and aquaculture: 6%
- Agriculture was the only industry to post positive growth of 3.4% in 2020-21. (during COVID lockdown).
- According to the World Bank, the agricultural sector employed approximately 42% of India’s workforce in 2018-19.
- Agriculture employed more than a third of the total workforce in 1951.
- In 2018-19, approximately 16 million Indians are employed in agriculture and allied sectors.
- Agriculture and allied sectors employed more than two-thirds of the unorganised workforce in 1951.
What is the need for farmers’ income to be doubled?
- Agrarian distress
- A large disparity in income between farmers and non-agricultural workers has existed for a long time, and this, combined with a low level of absolute income, has resulted in the emergence of agrarian distress in the country, particularly in the late 1990s.
- In recent years, it has become more severe, affecting nearly half of the country’s population, which is dependent on agriculture for a living.
- Farm income fluctuations
- The low and highly fluctuating farm income is having a negative impact on interest in farming and farm investments.
- It is also forcing an increasing number of cultivators, particularly younger age groups, to abandon farming.
- Poor policy decisions
- Previous agricultural development strategies in India focused primarily on increasing agricultural output and improving food security.
- This has been a contributing factor to farmers’ low income, as evidenced by the prevalence of poverty among farm households.
- Poverty and farmer suicides
- In the late 1990s and early 2000s, the country experienced a sharp increase in the number of farmer suicides due to poverty, natural disasters, and other factors.
- Promotes farmer welfare
- Farmers’ increased income may address agrarian distress and promote farmer welfare.
- As a result, the goal of doubling farmers’ income by 2022-23 is critical to achieving parity between farmers’ and non-agricultural workers’ incomes.
Income statistics for farmers
- Despite the government’s proactive involvement, no standards on farmer income and related issues exist.
- In 2017, a policy paper authored by an NITI Aayog member (agriculture in charge) provided benchmark estimates of farmer incomes as well as details on how to double these.
- The policy paper included estimates of cultivator incomes up to 2015-16, which was used as the base year.
- According to its data, real farm income per cultivator increased by 0.44% per year between 2011-12 and 2015-16, compared to a 7.5% increase between 2004-05 and 2011-12.
- Due to the agrarian crisis, it fell by 0.55% per year between 1999-00 and 2004-05.
- Cultivators’ farm income in 2022
- According to the most recent data, farmer income fell 1.5% per year between 2016-17 and 2020-21, three times faster than it did during the agrarian crisis of 2000-2005.
- Using 2015-16 as the base year, income increased by 0.6% per year between 2015-16 and 2020-21.
- Data for 2021-22 are not yet available, but it is clear that even if farm incomes grow at very high rates, it will take a miracle for them to reach 2016-17 levels.
Estimated farm income from the Dalwai panel
- The Dalwai panel adopted the National Statistical Office’s Situation Assessment Survey (SAS) definition of “farmer” (NSO).
- It used the total income of such households to set the goal of doubling farmers’ incomes.
- This included non-farm income from businesses as well as farmer households’ labour wages.
- Problems with the methodology
- A lack of current data, as the most recent NSO survey of farmers is for 2018-19, and the previous survey was in 2012-13.
- There is no way to estimate farmers’ incomes in 2022 because there have been no surveys since 2018-19 and none are expected in the near future because these are generally decennial.
- Even older data show that farmer households’ crop cultivation income fell 1.5% per year between 2012-13 and 2018-19.
- Data manipulation is possible because farmer income rises by only 0.6% per year when livestock income is factored in.
- When non-farm income is included, it shows a 2.8% annual growth rate based on the non-farm intake of farmer households.
- Differential definitions and criterion if another source of data on agricultural household income is used, such as the rural household survey conducted as part of the NABARD All India Financial Inclusion Survey (NAFIS).
- Furthermore, its definition of agricultural households and income differs from the SAS’s, and it only provides income data for 2015-16.
- However, it discovered that agricultural household income from all sources increased 1.7% per year between 2015-16 and 2018-19, less than half the previous period’s 3.8% growth rate between 2012-13 and 2015-16.
Initiatives by the government to increase farmer income
- Smart Agriculture, which involves the use of drone technologies in agriculture and has the potential to revolutionise Indian agriculture.
- A wide range of agricultural schemes, including crop insurance under the Pradhan Mantri Fasal Bima Yojana (PMFBY), supplementary income support under the PM-KISAN, a new procurement policy under the PM-AASHA in addition to FCI operations, and improved irrigation access under the Pradhan Mantri Krishi Sinchai Yojana (PMKSY), among others.
- Establishment and promotion of 10,000 Farmer Producer Organizations (FPOs), as well as financial assistance under the AtmaNirbhar Package (Agriculture).
- The National Mission for Sustainable Agriculture (NMSA) seeks to develop and implement strategies to make Indian agriculture more resilient to climate change.
- Increase in Minimum Support Prices (MSPs) for all Kharif and Rabi crops, ensuring a profit margin of at least 50% on production costs.
- A variety of schemes and programmes for agri-allied services, such as the Bee-Keeping Mission, the Rashtriya Gokul Mission, the Blue Revolution, the Interest Subvention Scheme, agroforestry, and the restructured bamboo mission, among others.
- Robust farm income estimation is difficult o Due to a lack of data, there is little chance of concrete and robust estimates of farmers’ income in the last 5 years.
- However, based on the available sources, we can infer that farmer incomes have slowed since 2015-16, regardless of the source or method.
- The rural economy requires a reboot.
- Not only farmers’ income, but also rural real wages, have been declining in the last five years; wage workers’ incomes have not increased.
- Three-fourths of rural workers are seeing income declines, which is likely to exacerbate rural stress.
- While this has an impact on lives and livelihoods, given recent spiralling inflation and a demand deficit, it will exacerbate our economy’s crisis.
As a result, prioritising the revival of India’s rural economy is not only desirable, but a necessity for any meaningful plan aimed at an economic revival in the future.
Courts Should Examine Decisions’ Economic Impact
There is a need to establish a mechanism for the judiciary to consider the economic implications of its decisions before making them, particularly for India’s vulnerable.
GS Paper-2: Structure, Organization, and Functioning of the Judiciary
It is necessary to establish a mechanism for the judiciary to consider the economic implications of its decisions before issuing them.” Discuss using appropriate examples. (250 Words)
Need for Holistic Assessment:
- There is a need for a holistic assessment of the impact of different options available to the courts on diverse stakeholders, whether or not they are legally represented, and for making decisions that avoid adverse consequences for those who have no connection with the wrongdoing in question.
- The Constitution empowers courts to take such a broad view, imposing a moral obligation to do so whenever possible.
- There are numerous examples of judicial decisions that have severely impacted thousands of jobs, such as those that have cancelled telecom licences and mining leases in bulk.
- Our constitutional courts have a moral obligation to prevent such consequences.
- A judiciary cannot be prepared for the future if it is unable or unwilling to recognise the economic consequences of its decisions on underrepresented groups. It can no longer ignore the cries of the voiceless.
- Goa Airport Case: o The Prime Minister recently inaugurated Manohar Parrikar International Airport in Mopa, Goa.
- This airport is expected to boost tourism, create significant direct and indirect job opportunities, improve customer comfort, and boost the Goan economy.
- While there has been a perceived need for a new airport in Goa for several years, construction has been patchy.
- The Supreme Court (SC) suspended its environmental clearance, potentially causing immediate job losses of around 1,500 workers and indirectly affecting about 6,900 people through no fault of their own.
- The suspension lasted an entire eight months, contributing to a cost increase of approximately 715 crores.
- Sterlite Copper plant: o Several affected citizens have recently demanded that a Sterlite Copper plant in Thoothukudi, Tamil Nadu, be reopened so that the local economy can recover.
- The Tamil Nadu Pollution Control Board and the state government ordered its permanent closure, which was approved by the Supreme Court and the Madras High Court.
- This closure directly impacted approximately 30,000 jobs in and around the plant, as well as approximately 400 downstream businesses employing approximately 100,000 people.
- The closure severely impacted the livelihoods of thousands of service providers and workers for no fault of their own.
- On the other hand, India went from being a net exporter of copper to a net importer, increasing our trade deficit.
Decisions based on a holistic perspective
- There have been many instances where the courts have been successful in making judgements that strike a fine balance between economy, environment, judicial considerations, and so on, such as in the case where the Supreme Court’s intervention resulted in the adoption of CNG and subsequent economic benefits, and in the case where the Apex Court directed that overhead power transmission lines located in Rajasthan must be laid undetected.
- While the Supreme Court highlighted in the much-publicized Shivashakti Sugars Limited decision in 2017 that courts must avoid a particular outcome that has a potentially adverse effect on employment, the economy, or state revenue, and should consider the economic impact of a decision.
- In early 2022, the Supreme Court directed high courts to be extremely cautious in delaying the completion of projects of national importance.
- The Supreme Court ruled in September that developing countries cannot be told to halt ongoing projects simply because they are likely to exacerbate climate change.
- In November, the Supreme Court denied an urgent hearing on a petition for a ban on stubble burning.
- The court stated that it could not impose such a ban on every farmer in Punjab, Haryana, and Uttar Pradesh.
- Training Judges on Economic Principles: o Training judges on basic economic principles is a good but medium-term solution.
- Expert Committee: o A more immediate and practical strategy could be to institutionalise the mechanism of expert committees, which can guide judges in considering a wide range of perspectives and gathering necessary evidence.
- The Supreme Court has frequently avoided taking up cases that could have serious consequences for the Indian economy due to a lack of institutional mechanisms.
- The court must first construct its decision on a firm legal and constitutional foundation, and then follow it up with an economic rationale that the court may provide as an additional support ground.
- As has been done on several occasions, the courts shall, in most cases, appoint an expert committee to examine and study issues in depth, investigate their enforceability, and then take action.
- Public review: o Because the judiciary is funded by public funds, the public should be able to review the quality of the court’s orders.
- There have been numerous instances where judicial decisions have resulted in avoidable economic harm and a failure to provide proper and complete justice to those affected.
- Before issuing an order, the judiciary should devise an efficient alternative solution or mechanism to assist it in considering the perspectives of various stakeholders.