India Rich Agriculture: Poor Farmers

Green revolution strategy developed India’s agriculture sector phenomenally from 1970 to 1990 and made India self sufficient in food grains and other agricultural commodities. The limitation of small size of the farms was made good by a package of inputs and small farmers of India competed well with developed countries. However, since 1990s and during the last five years farmers are facing the problem of decreasing income and many farmers have committed suicide during the last two years. The need has arisen for polity sift from farms i.e. production to farmers i.e. income. There is no concreted thinking on income policy for farmers unlike the developed countries. Te book proposes to present design of income polity for farmers suiting India’s over farms and the farmers is presented to understand the structure of the farm economy and type of farmers for whom the income policy is designed. It also looks into the present income level of the farmers and limitations of the data in this respect. Sheer number of farmers producing different commodities is so large that it is a complicated task to have a homogenous in India’s agriculture to increase farmers’ income is small size of farm. The partnership farming through an incentive mechanism can bring small and large farmers together for commercial management f farms for increasing farmers’ income. N income policy for farmers is designed keeping in view the financial constraints. The policy is a mix of direct and indirect incentives in money terms for increasing income. Such a kit is designed based on the level of agricultural development in different States in India. Any policy to be effectively implemented requires financial resources for a fairly long period of time. India has huge foreign exchange reserves of about $154.1 billion (April, 2006) which have been sterilized for fear of inflation. A case has been made out for use $10-15 billion to implement income policy without crossing safe limit of FE Reserves. The income generation capacity of the farmer commensurate with the efficiency in production is the key to integrated Indian agriculture in world trade in agricultural commodities. Financially weak farmers will hardly be able to face the competition from the developed countries. The strategy to face and welcome the WTO is spelt out in the light of Agreement on Agriculture discussed in Doha, Cancun and Hong Kong round of negotiations. The Government needs to change its policy gear from production economics to income economics.