CII flays interest waiver for Vidarbha farmers

Criticising the government's recent initiative to waive off Rs 712 crore as overdue interest to farmers in six districts of the drought-hit Vidarbha, which has seen over 500 farmer suicides in the past year, Confederation of Indian Industry president R Seshasayee said that debt relief was only a temporary solution to a long standing issue.

"The message from the prime minister also demonstrates that there is a big need to find the root cause and solution to problems in the farm sector. Writing off debt is palliative and giving debt relief is not the solution to this issue. The solution is to make the farm sector stand on its own merit and compete in the market by using technology," Seshasayee said.

He said a solution to a lot of issues plaguing the agriculture sector lay in the legislation, like the Agricultural Produce Marketing Committee Act (APMC) Act.

"The APMC Act offers a solution in terms of creating a market so that farm produce can access the market without going through the mediator in the form of 'mandis'. The Centre has passed this legislation but the states have not implemented it properly," he said.

The government has framed a model APMC Act, which provides a framework for direct sourcing from farmers, contract farming and private yards outside of mandis. So far, 16 states have confirmed that they would implement the model.

Another example quoted by the CII president was the Unified Food Law, which has been drafted by the government.

"Processed food presently forms an extremely low percentage in the food bills of the average Indian. Value addition will not happen unless it is a larger part of our food spend. For this, we need a policy on organised retail in food," he said.

"We need to look at the issue of brand building in food retail and the policy should include brand creation and making a unified law to ensure health safeguards and security. The Unified Food Law has to be enacted and implemented with a regulator in place so that there is no distortion of market forces and farmers get a fair price," he said, adding that there was a need to redraft the law to enable innovation and move it away from being recipe based.

Speaking about the recent WTO talks in Geneva, Seshasayee said that while India was rightfully taking up a defensive position for its farmers, soon it would be time to take up a more offensive stance.

"Since we are looking at farm as a domestic industry, it is right to take up a defensive stance. What we need is a roadmap to unshackle government intervention and regulation to move towards an offensive position in the WTO," he said.