Years of unheeded reports: Why Ashok Gulati didn't join govt's agri panel

Gulati is perfectly correct when he says that several reports already exist on reforming the agriculture sector

Noted economist and former chairman of the Commission for Agriculture Costs and Prices (CACP) Ashok Gulati has reportedly declined to become part of yet another government panel constituted by the NITI Aayog on reforming the country’s agriculture sector by 2020 on the grounds that unless recommendations made by earlier such committees are implemented, another such exercise is useless and futile.

Gulati is not wrong when he says several such reports already exist on reforming the agriculture sector. 

Under the current NDA government, a panel was formed to reform food management when the part came to power in 2014. It suggested lowering of the existing entitlements under the Food Security Act and instead shifting towards a more cash-based system, along with other recommendations.

The suggestions of the panel, which was headed by former food minister Shanta Kumar, were accepted in part, while the government was slow in reacting to the rest of its recommendations.

Thereafter, another high-powered panel was formed under the NITI Aayog on agriculture reforms and marketing. Among other things, it had suggested freeing up land leases, which is also in the works. 

A third panel has been formed to double farmers' income by 2020 and it has submitted four volumes of recommendations so far.

Further, there is the NITI Aayog's three-year action agenda and its recommendations for the agriculture sector.

In a recent piece published by The Indian Express, Gulati and former agriculture secretary Shiraz Hussain said that the recommendations made in the three-year action agenda are nothing new and nothing wrong as most of the other committees also made similar recommendations.

"The action agenda, however, does not prioritise policy actions, nor does it talk about the role of trade policy in agriculture or reforming the massive system of food and fertiliser subsidies," the duo wrote.

They then went on to suggest five actionable points the government should immediately take to make agriculture profitable and push its growth, which has been averaging at less than two per cent in the first three years of the Modi government.

There is no dearth of suggestions to the government. Instead, what is needed is their implementation on the ground.

Under the last UPA government headed by the Congress, the Centre had constituted a Working Group on Consumer Affairs headed by none other than then Chief Minister of Gujarat and present Prime Minister Narendra Modi. The working group was constituted on April 8, 2010, and gave its report in January 2011.

The other members of the panel included the chief ministers of Maharashtra, Andhra Pradesh, and Tamil Nadu.

The report, unlike its predecessors, was called a precise document, which gave specific recommendations in 64 big and small points.

The recommendations included, among other things, reforms of the Agricultural Produce Market Committee (APMC) Act, liberalisation of agri-markets, along with an unbundling of Food Corporation of India (FCI) operations of procurement, storage, and distribution.

It also suggested a ban on futures trading of essential commodities.

The suggested measures also included specific interventions such as the time-bound development of agri-marketing infrastructure, including storage capacities in food deficit regions, cold chains, agro-processing, and increasing competition by promoting retailing by the organised sector and cooperatives.

The report also suggested the setting up of a price stabilisation fund by the Centre to help state governments procure and distribute essential commodities in short supply.

For evolving a single national agriculture market, the report recommended setting up a "ministerial-level coordination mechanism at the national and the regional level for coordinated policy making".

Enlarging the scope of priority sector lending so that agriculture marketing activities were also made eligible was another key recommendation.

To minimise information asymmetry in the agriculture market, the report also called for establishing a mechanism, if necessary by creating a dedicated agency, to collect and widely disseminate information to all stakeholders on production, import, stocks, and overall availability of essential commodities, besides the extensive use of the information.

The panel also recommended that offences under Section 10-A under the Essential Commodities Act should be made non-bailable and that special courts be set up for speedy trial of offences under the legislation.

In addition, the report stipulated that the period of preventive detention under the Prevention of Black-Marketing and Maintenance of Supplies of Essential Commodities Act, 1980, should be increased from six months to one year.

Before the Modi-led working group, a committee of state ministers of agriculture marketing, also constituted by the UPA government, had said that the reluctance of states to rationalise their market fees and prevent farm goods from being exposed to cascading market fees, cess and taxes was the reason for not even one big reform having taken off in the APMC until then.

Among the other provisions of the model APMC Act, the report showed that out of the 35 states and 16 Union territories, 16 had the provision for private market yards but rules and by-laws hadn't been framed by all of them, in the absence of which, the reform became meaningless. 

Before that panel too, many committees, panels, and groups had been constituted, both within the government and outside, to reform and revitalise the agriculture sector.

Unfortunately, many of the recommendations have not seen the light of the day till date. Or else, the share of a sector that employs more than half of the country’s population wouldn't be less than 20 per cent of its GDP.