The root of the matter

This may be largely true. For, on a subject like this, which has been analysed threadbare umpteen times, you cannot really expect something that has not been said before.

Still, Debroy's analysis has managed to put the issue in perspective, lending it some new dimensions that merits policy planners' attention. In fact, the same is true for the rest of the book as well.

Indian agriculture, though a totally private enterprise, has been subjected to far too many restrictions on the plea of protecting it from exploiters.

But all this has actually led to greater exploitation of the farmers, especially the small ones who constitute the overwhelming majority. And this exploitation is all-pervasive "" from the input purchasing stage to the final marketing of the produce.

The book has managed to capture the true state of the Indian agriculture and the causes for it.

It has also floated several useful suggestions not only for reforming agricultural marketing but the farm sector as a whole, though the title of the book suggests that it concentrates chiefly on marketing reforms.

Of course, the issue of marketing reforms has been the common refrain in all the five chapters of the book.

Debroy has pin-pointed six reasons why the agriculture sector reforms are stuck. The most telling among these is the mindset of the think tank, including the Planning Commission, who believe that the poor and backward Indian farmer does not know what is good for him. Someone else needs to take decisions on his behalf. This approach has, indeed, done a good deal of disservice to the farmer.

This chapter also seeks to provide reasons for the slowdown in agricultural growth in the 1990s, a decade that saw the advent of the economic reforms process.

It attributes it partly to the diminishing returns due to agriculture in the growth-driving states like Punjab and Haryana having become over-capitalised. Besides, compared to the 1980s, regional growth in the 1990s had also been less diversified.

While in the 1980s, the availability of power, irrigation and infrastructure facilitated the spread of the green revolution even to the erstwhile backward eastern region, the paucity of most of these things retarded growth in the subsequent decade.

The other reasons included high input costs and decline in public investment in this sector, especially investment in research and development. The increase in private investment could not fully offset the shortfall.

It also refers to the multiplicity of authorities and laws concerning the food and agriculture sector and pleads for their rationalisation and harmonisation as a prerequisite for wooing investment in post-harvest handling of agro-products, including agro-processing.

Nine different ministries are concerned with food processing and there are 22 related Acts and Orders governing it.

The book builds a strong case for reforming agricultural marketing, opening it up to the private sector by repealing the retrograde agricultural produce marketing Acts of the states.

It pleads for direct linkage between the producer and the end-user of the farm produce, be it trader, exporter or processors.

Only such a scenario will enable the corporate sector to effectively enter the field of agriculture, bringing benefits of competitive marketing to the small farmers.

Gokul Patnaik, a leading exponent of higher exports of value-added products from India, makes a case for scrapping the Essential Commodities Act, 1955.

This will help remove the hurdles in making the entire country a single integrated market for agricultural produce.

This will also encourage investment, both domestic and foreign, in storage and bulk handling infrastructure.

He also suggests rationalisation or abolition of multi-stage levies and taxes. If need be, a value added tax (VAT) of no more than 4 per cent may be introduced, he maintains.

Debashis Chakraborty of the Rajiv Gandhi Institute of Contemporary Studies, in his article, raises queries over the common notion of inverse relationship between farm size and productivity.

He points out that over the years, the number of small and marginal holdings has increased, but the overall productivity levels have tended to decline.

Has the unabated fragmentation of holdings led to operational holdings becoming uneconomical, he wonders.

The impact of the agreement on agriculture of the World Trade Organisation (WTO) on the Indian farmers has been dissected by Amir Ullah Khan, currently a fellow at the Indian Development Foundation.

Though he has refrained from attempting to quantify it, and perhaps rightly so, he has managed to deliver the message that unless the efficiency of farm output improves, it may be difficult for the farmers to gain much from liberalised global trade.

He suggests enhancement of yield per drop of water through modern techniques of drip irrigation and precision farming.

ENABLING AGRICULTURAL MARKETS FOR THE SMALL INDIAN FARMER

Editors Bibek Debroy and Amir Ullah Khan

Bookwell

Pages: 285/ Price: Rs 595