Reviving agriculture and economy with farm export policies

ECONOMY/AGRICULTURE

Topic: General Studies 3:

• Government policies and interventions for development in various sectors and issues arising out of their design and implementation 
• Indian economy and mobilization of resources; Agriculture Sector  
• Growth and Development

Reviving agriculture and economy with farm export policies

Context:

One of the long term and complex challenge that the country will face would be to get back its economy back on the rails.

Eminent thinkers and experts have suggested for gradual opening up of all agri-produce to exports, so that the country can set an inspiring and exciting new horizon for itself.

Agriculture sector during lockdown

• Despite severe disruptions in long-distance road transport and shortage of labour, the agri supply chains still kept running, while the industrial and service sectors largely ground to a halt and are now struggling to restart. 
• However, the closure of local mandi across the majority of states impacted many farmers as it choked off the only real marketing platform available to them.

• Yet, all major cities across the country continued to receive supplies of fresh vegetables, fruits, and milk throughout the lockdown. Farmers as a community have kept the agri-engine running. 
• All this has been achieved against a backdrop of institutional credit virtually drying up and informal credit rates shooting up very high.
• Government procurement is progressing satisfactorily and also beginning to function normally.

Concerns:

• Agri sector had witnessed sub-4% growth for several years.
• Prices for most crops are stagnant or falling.
• No technology breakthrough has been delivered in over a decade.
• Institutional credit drying up and informal credit rates rising up.
• Markets remain restricted by APMC-led monopolies.
• Failure of e-NAM in its promise to deliver an alternate channel to farmers to tap a wider, pan-India market. 
• States are yet to liberalise direct sourcing of farm produce.
• There is now an unprecedented reverse migration of lakhs of migrant labourers and this burden have to be shouldered by agriculture for the next couple of years.
• Country might face downward pressure on demand for basic agri-products in the domestic market, arising from the closure of lakhs of eateries, restaurants, hotels and catering establishments, factory canteens, hostels, etc.
• Layoffs and pay cuts, and restrictions on the functioning of industrial units as well as construction, transport, etc, will force millions of households to curb consumption and rein in expenditure on food.

Need of the hour:

• Demand should be restored to pre-Covid levels.
• Export-led agricultural strategy can offer an inclusive pathway towards growth, income, employment and rural poverty reduction.
• India is already a major exporter of items like frozen buffalo meat, marine products like shrimp, and basmati rice, besides a varied basket of goods ranging from grapes to spices.
• We need a proactive agriculture export strategy, covering every category of agri-produce available in India: field crops, horticulture, dairy, livestock, poultry, and fisheries.

Conclusion:

India can address both the needs of food security and become reliable suppliers in the international market. 

For which it first needs to align its cropping systems with globally accepted production, storage, packaging, transportation, and handling norms. Its farmers and supply chains will need to reorganise and reorient themselves to address a global market and its attendant challenges.

No other sector offers such an inclusive and pan-India potential for reviving growth, employment, and incomes in the next 18-24 months.

Connecting the dots:

• By setting a goal to gradually open up all agri-produce to exports, the country can set an inspiring and exciting new horizon for itself. Do you agree? Elucidate.
• Do you think the health crisis around Corona would offer opportunities to correct the health of Indian agriculture? Elucidate.