Indian farmers hold their government to ransom in static agricultural policy

09-02-2021

Blog from Klaas Johan Osinga, Senior Advisor International Affairs at LTO Netherlands and Agripooler at Agriterra

Last Tuesday (26 January 2021), India celebrated its 62nd birthday, Republic Day. The scenes in New Delhi, however, were far from festive. Thousands of farmers 'marched' to the old town centre, many on noisy motorcycles, some on their tractor or horse. They had balloons and Indian flags with them. And such slogans as 'farmers feed India' and 'hands off our farms'. Elated supporters lined the road. It looked like an Indian wedding.

The farmers, mostly from the Punjab and Haryana had been staying on the outskirts of the city for weeks. A peaceful protest against a serious issue: agricultural reform. Indian farmers have a lot to worry about: extreme weather, uncertain harvests and a weak currency. Many are trapped in poverty. Dependent on government support. The government, in turn, has every reason to pursue an agricultural policy: stable prices are a precondition for electoral success. Scarcity of onions, an essential ingredient in Indian cuisine, can cause governments to collapse.

Narendra Modi's government is seeking to abolish the system of government-regulated markets, where farmers sell their products through wholesale markets at guaranteed minimum prices.

A national law to that effect has come into force. This has angered the farming organisations, who feel their views have not been heard.  There is fear that minimum prices will disappear and that farmers will become dependent on multinationals. Narendra Modi has a huge political problem: over 40% of the population works in agriculture and he seriously underestimated this group. Only one committee has now been set up to find a solution, but the farmers are by no means reassured. Their trust in the government has been damaged.

Painful process

In the sixties, India was famous for its "green revolution": increased productivity transformed India from a food-importing company into a food exporter. The reality now is that agricultural policy is trapped in price support and subsidies for fertilisers and crop protection. This 40% of the population accounts for approximately 16% of the GDP. Many of them should be helped to find work in other sectors. But that is a painful process that will take many years. India is, in fact, trapped in the current agriculture policy. You would need to create millions of jobs to offer small farmers a realistic alternative, then you could adjust the pricing policy. A complicated puzzle, but who can solve it? Mansholt struggled with the same problem as European Commissioner for Agriculture in Brussels in the early seventies.

Agriterra

Co-initiated by the Dutch Agriculture and Horticulture Organisation (LTO), Agriterra was launched in 1998 to prevent such situations. The organisation supports agricultural cooperatives with knowledge and skills to enable them to produce for real markets. This form of cooperation gives farmers a better prospect of a liveable and more stable income, and promote economic development in rural areas. This creates jobs for farmers who are looking for work outside of agriculture. Agriterra also helps organised farmers with lobby training to ensure governments can implement better agricultural policies. The most effective lobbying takes place behind the scenes before proposals become political. Apparently that has not been successful in India, with all that that entails.

Not going home yet

Last Wednesday, the farmer protests quickly turned to chaos. The police closed roads and used tear gas. According to reports, hundreds were injured. One farmer was killed when his tractor overturned. India's Republic Day is usually a day of celebrations. From now on, it will also be remembered for the biggest farmer protests in decades. And the farmers have no intention of going home yet.

Klaas Johan Osinga


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