Making agriculture viable in India

While reading this synopsis of the talk by Dr. B.D. Sharma on NgoPost, I came across an interesting point (which of course is the viewpoint of the OP of the post)

His romanticism with the agrarian economy and a hope that India would return to times when agriculture dominated the economy is something which is completely misplaced.

Before I write about my thoughts on the above, let us look at the key point of the post – the viability of agriculture in India. The two key points which work against agriculture are

  1. Under-valuation of labour prices at two levels. This, as we are very well aware of is rampant. I agree that policy makers need to not look at farming as an unskilled profession, thereby reducing the minimum wages being paid to the farmer. Given our reliance on the monsoon and proper irrigation facilities, the farmer is faced with more decision making than, let’s say a software developer working with or without a spec, whatever the degree of separation from what is required (I have been a software developer for a while,  so I think I can speak with some degree of confidence).
  2. Compound interests for agricultural loans. This is, in my view a bigger problem than (1). If the farmer who has only few months for farming his crop is lent at interests compounded, one bad monsoon would leave him and his family reeling. It is surprising that the banks and the rural institutions are not willing to consider better terms for lending to the farmers. My thoughts on this:
    1. A run-of-the-mill credit rating mechanism will not work in this case. A credit rating which considers atleast the following can help control the rate of interest
      1. economic condition
      2. family size
      3. amount of land owned vs. amount of land on which (s)he is tilling
      4. geographical region (an area like Punjab with rich soil can’t have the same index as a region like South TamilNadu)
    2. Microfinance might not be the best fit for lending funds to farmers. The increased rates of interest that farmer pays, make this option not very attractive. Though, if the MFI is willing to lend under a simple interest, for long term loans the farmer might be willing to borrow from the lender.

Given the above, I think there is a definite need for revisiting the perception of the populace and the policy makers about agriculture. Given the continuous influx of unskilled workers as day wage earners to cities, this not only creates economic pressures but also social pressures. Sadly, both the policy makers and the government seem to be ignoring this aspect. The government’s knee-jerk reactions won’t help the agriculture sector in the long term. And food security is something that can’t be taken lightly. As Earl Butz commented in the King Corn documentary, the surplus food that America has, is it’s best kept secret. And it is true too. The lesser one spends on food as a percentage of the total earnings, the more that one has to invest in other things. Of course, Earl Butz’s comment was in favour of industrialized farming, which is not the best of the option for India, as is corporate farming.

This brings us back to the  question of – should agriculture be treated like an industry to determine the wages?

Now, back to the point I raised at the beginning of this post. Is it romanticism to believe that the Indian economy can’t be an agrarian one? One shouldn’t equate an agrarian economy to a non-industrialized or non-service (if there were words like that) economies. India’s industrialization, post-independence has been rather limited. We still, I think, have a long way to go with respect to industrialization. And our so called service economy is concentrated in very small pockets of the nation (Bangalore, irrespective of the interest it generates from the media abroad is not a representative sample of the shining India). So, given the big-picture impact of agriculture, I think, there should be more investments in agriculture in the years to come. Come to think of it, if the government were to create institutions like the IITs for agriculture, even taking into consideration the brain-drain that’ll happen, there will be a percentage of the bright minds in the country staying back and creating a positive influence on the sector. I think energies are being spent trying to fight for statehood (sic.) rather than exercising jurisprudence in allocating the monies that states already have.

India after Gandhi – the lesser known story

India’s story if told, either by Indians or otherwise generally falls in two categories – either exalt the rich cultural diversity, great empires that ruled i.e. the India that was, or the India that was epitomized by Gandhi – the non-violent, non-cooperating, peaceful freedom seekers. It is not that there is a problem with either of the portrayals. Neither is wrong and both need the due consideration that history can give them. After all, they are indeed vignettes that can’t always be viewed with a historian’s perspective (especially if you happen to be Indian).

But, there is the story of another India. The India post-independence. August 15th 1947, the British decided to leave India (never mind that Lord Mountbatten chose this day to coincide with the Japan v-day). It was not that the life of the man on the street suddenly shifted from one of indentured servitude to one of unfathomable freedom. It was not that independence declared by the British meant, that India became a prosperous nation suddenly.

For the last 63 years of being independent, India as a nation worked towards changing its image from a country of snake charmers and half-naked people to be reckoned as a world force. And it is this journey that doesn’t get too much attention. My guess as to why – because nation building  possibly doesn’t have the pizzazz of, say, winning freedom or victory in wars. To attempt an analogy (may be a little corny!), may be getting India to where it is now is like a marriage while getting its freedom is like a wedding.

And it is this humdrum, mundane, diplomatic relations, economic progress and bilateral talks (yes, most of you are yawning already) that Ramachandra Guha documents (may be documents is possibly not the best word to describe it) in the book – India after Gandhi.

If I were to attempt to write about the contents and each chapter, this blog post will grow very large. Mr.Guha tries to cover every important aspect of the business of nation building; trying to name as many civil servants that he can. And that, I think is in a way tribute to the men and women of the IAS/IFS and the various government services who toil in the background doing the hard work, while the politicians dictate policy (nope, no references to Sir Humphrey Appleby here 😉 ). But this book is not about the civil services. It is about India, its rulers, its riches, its people, the struggles, the riots, the elections, the differences, the wars and more importantly, the opinion that Indians had (and continue to have) of their country. This book might not be a thumping statement of patriotism, but this is a quiet reminder of the journey so far.

As the author very interestingly points in one of the final chapters –

Sixty years after independence, India remains a democracy. But the events of the last two decades call for a new qualifying adjective. India is no longer a constitutional democracy  but a populist one

And that is also one of the central themes of India post-independence. The leaders at the helm of affairs. Some of them are well known, like Nehru, Indira Gandhi, A.B.Vajpayee; but there are a lot more who are known in their little spheres of influence. For example, Potti Sreeramulu – the man who gave up his life to allow for the reorganisation of states on linguistic basis; V.K.Krishna Menon – the defence minister when India went to war with China; J.B.Kriplani – one of the active dissidents of the Indian government and countless others, who don’t popup in immediate  memory when Indian politics is discussed; but each of whom have left an impact like no other.

This book is a historical. For me, this book is like viewing India the way my dad does. An India where abject poverty was a way of life, bureaucracy hassles were something you assumed to be omnipresent, riots were something you were scared of but had to deal with, elections were for some part (in the middle class) dealt with a whiff of cynicism. A life of quiet sleepy times, where growth was completely state controlled. From an India like that, to a vibrant India where things surprisingly are still pretty much the same (or sometimes worse); where politics is still considered the last refuge of the scoundrel and where the middle class’ voter turnout might not (I don’t have the numbers for this) be as high as it should be. But still, India moves on. One should not assume that the indifference to things is what survives this nation. Nothing could be further from the truth. But somehow, and that somehow is a mystery to everyone in the world, this nation of 1.2 billion people of various cultures, languages, religions, states are striving to stay united as one country.

And this book brings about the appreciation of the monumental effort required. A must-have for anyone who is interested in the India that it is now; and how it reached where it has. In defense of the author – the 800 pages of the book is not possible to document 63 (or 60 when the book was published) years of the country’s growth. For the fact that such a book was attempted, I must thank the author.