19 October 2020: The Indian Express Editorial Analysis
1) Tinkering at the margins-
GS 2- Important aspects of governance, transparency and accountability
It’s over a decade since a so-called nutrient-based subsidy (NBS) regime for fertilisers was instituted.
- By linking subsidy to nutrient composition rather than products per se, NBS was expected to wean(move) away farmers from applying too much urea containing only nitrogen.
- But the actual results prove otherwise. Between 2009-10 and 2019-20, urea consumption rose from 26.7 million tonnes (mt) to 33.7 mt.
- While overall fertiliser consumption increased from 53.4 mt to 61.7 mt, urea’s share went up from below half to 54.6 per cent during this period.
- The reason for the worsening fertiliser imbalance is simple: Since April 2010, the maximum retail price (MRP) of urea has been raised by hardly 11 per cent, from Rs 4,830 to Rs 5,360 per tonne.
- The MRPs of other fertilisers — which were decontrolled, with the government only giving a per-tonne subsidy based on their nutrient content — have gone up from 2.5 to four times during these 10 years.
- Since NBS has been implemented only in other fertilisers, even as urea remains under price control, farmers are using more, not less, of the latter.
- The Narendra Modi government must shoulder much of the blame for this agronomic and environmental disaster.
- The basic MRP of urea hasn’t been revised at all in its nearly six-and-a-half years.
- Bringing urea under NBS would push up its MRP closer to Rs 10,000/tonne at the current per-kg subsidy for nitrogen present in other fertilisers.
- Instead of bringing urea under NBS, the Modi government has resorted to tinkering(changing) at the margins.
- That includes compulsory neem-coating of all urea (from December 2015) and making fertiliser subsidy payment to companies conditional upon actual sales to farmers being registered on point-of-sale machines with retailers after biometric authentication (from March 2018).
- There’s a plan next, as reported by this newspaper, to cap the total number of subsidised fertiliser bags that any person can purchase during an entire cropping season.
- But these measures merely address the issue of subsidised fertilisers, especially urea, getting diverted to bulk buyers/traders or even non-agricultural users such as plywood and animal feed makers.
- They don’t fix the real problem — of overuse by farmers themselves. If urea is heavily under-priced, they will apply three bags when two or less would suffice.
- Urea has to come under NBS.
- A politically feasible way to do it is by hiking its MRP to Rs 10,000 — maybe over two years — and simultaneously reducing the NBS rates of phosphorus, potash and sulphur to make other fertilisers cheaper by Rs 1,500-2,000 per tonne.
- In the long run, NBS itself should be replaced by a flat per-acre cash subsidy that could be used to purchase any fertiliser.
- That includes value-added and customised products containing not just other nutrients, but delivering even nitrogen more efficiently than urea.
- Cap on subsidised fertiliser merely addresses issue of its diversion, doesn’t fix real problem — overuse by farmers.
2) A beginning-
GS 2- Important aspects of governance, transparency and accountability
- The amendments to the J&K Panchayati Raj Act to facilitate direct elections to the second tier of local government, the district development council, are evidently intended to kickstart the political process in the Union Territory.
- It will also infuse(add) some guided political energy into the post-August 5, 2019 environment, especially in the Valley, and pave the way for all those desirous of finding a political foothold in “naya” Kashmir.
- Holding of Assembly elections is tied to the contentious delimitation exercise.
- Participation is uncertain with regional political parties firm on the demand for a return to statehood and special status.
- Election to the DDCs will be a first test of how deep the waters really run.
- The Centre may calculate that getting enough people to contest the DDC elections would help weaken the Gupkar narrative.
- The recently created Apni Party, hacked out from the PDP, has been itching for a role.
DISTRICT DEVELOPMENT COUNCIL:
- Individuals in the mainstream regional parties, especially those overlooked for nominations in previous Assembly elections, may also see the DDCs as a career opportunity.
- The BJP is waiting in the wings, too. Earlier, the DDC was filled through nominations.
- The rationale behind holding direct elections to 14 DDC constituencies in each district is that being chosen through a democratic exercise might give candidates and the DDCs a measure of credibility.
- The initial responses of the NC and PDP have predictably not been favourable.
- PDP leader Naeem Akhtar, for instance, has said the move is aimed at depoliticisation by cutting up the UT into “district assemblies”, and to reduce Kashmiri political aspiration to the solving of district level water-electricity-road problems.
- For the DDC elections to achieve the Centre’s many objectives, the entire exercise will need to be substantially different from how the 2018 panchayat elections went down.
- In that election, candidates were too ashamed to admit they were contesting, and could not appear in public because they feared for their lives.
- Those who won, some of them because they were the only contestants in their halqas, did not surface for months afterwards.
- In many panchayat halqas there were no candidates and the elections could not be held.
- In the DDC elections, the NC and PDP will need to consider the opportunity costs of a boycott even as they weigh it against the price of participation.
- They do not have an easy choice, but they would do better to engage with the political process, even as they oppose, argue and debate.
- The Centre, too, should be aware of the limitations of a bonsai democracy in J&K.
- Sri Lanka is a cautionary example of how an elected body with no powers except to lay roads and repair the drains is not an answer to the political aspirations that lie behind the demand for greater autonomy.
- The restoration of statehood to J&K has to be prioritised, and Assembly elections.
Elected district development councils must be a first step in kickstarting political process in J&K — not a substitute for it.
3) Fruit of Reform-
GS 3- Major crops cropping patterns in various parts of the country, different types of irrigation and irrigation systems storage, transport and marketing of agricultural produce and issues and related constraints
- Santosh Ganar owns two acres of land in Raigadh in coastal Maharashtra — home of the Alphonso mango. Yet he chooses to plant cheap rice rather than lucrative mangoes.
- When I asked him why he replied that he would love to plant mangoes.
- Rice gives him just Rs 30,000 per acre while mangoes would earn 10 times as much.
- But he could not afford the initial investment of an “elevated bund” for the mangoes, nor survive the five-year waiting period for the trees to yield fruit.
- He also added that his friends who have orchards complain of wasting almost half their mangoes since they are not able to reach the markets on time.
- This COVID-filled year was the worst, as most mangoes remained unsold.
- Ganar told me how he saw pot-bellied monkeys, surrounded by half-eaten mangoes, snoring in his friend’s orchard. His friend didn’t find it necessary to shoo them away with catapults.
- The biggest problem the poor in India face is risk mitigation(reduction). Since they do not have savings, they are reluctant to undertake even the minimally risky business that you or I would.
- As a consequence, they remain stuck in a poverty trap, growing cheap rice instead of valuable mangoes.
- Policymakers the world over have come up with a variety of capital investment and risk mitigation instruments — such as micro-credit loans — for the poor to make money while protecting them against risk.
- The tragedy of the Indian farmer — who constitute 40% of the country and an even higher percentage of its poor — is that India’s farm laws have prevented these risk-mitigation instruments from reaching them.
- Under the laws that governed India until the third week of September, farmers could only sell to the local mandi or agricultural market.
- The risk-mitigation methods that “contract farming” provide were illegal.
- The old laws — enacted to protect farmers like Ganar — ensure that they never make enough money to leave poverty.
- Ganar’s sorrow is also the sorrow of the consumer since the old laws did not result in fruit being available at a low price for consumers. Quite the opposite.
- Fruits are not just expensive compared to other carbohydrates in India — A 100 Kcal of energy from fruits costs five times that from rice — but they are also 20 per cent more expensive than even the western world.
- As a result, Indians eat fewer fruits than most others. Based on a NIN-ICMR report of 2019, I estimate that Indians eat only 32 grams of fruit a day versus the recommended amount of 100 grams.
- And this acute deficiency in fruits is much more pronounced among the poor.
- This is a particular tragedy because fruits provide the most benefit of all food classes — they give protection and immunity through vitamins and micronutrients.
- Indians are deficient in Vitamin A, zinc, Vitamin C and iron.
- The last two make anaemia the number one public health challenge that India faces.
- We have a situation where horticulture is saddled with unviability for the farmer and unaffordability for the consumer.
- I asked Ganar, that if someone offered to invest in a mango orchard in his land, pay him what he loses in not planting rice till the mango trees gave fruit and agreed to buy all the mangoes that grew on his tree five years later, how much discount would he give his benefactor?
- Without batting an eyelid Ganar said that he’d happily give a 40 per cent discount and still earn Rs 3 lakh. He would still make 10 times more than he makes today.
- But his investor, an expert in mango cultivation with better access to markets (and doubtless better methods to shoo away monkeys) would make the full potential of the acre — Rs five lakh.
- After paying Ganar and accounting for a return on investment the investor would still be left with a surplus. In a competitive market, the consumer would get cheaper mangoes.
- This is an example of “contract-farming” — one that would benefit the farmer, the investor, and the consumer.
- An acre of land yielding Rs 30,000 starts yielding Rs 5 lakh. But for all these years why would either Ganar or the investor have agreed to a “contract” that was not legally binding?
- Ganar could cheat the investor and decide to sell the mangoes at full price five years later.
- The investor could cheat Ganar and not buy the mangoes he finally produces.
- And in a year of mango glut, when forced to buy all of Ganar’s mangoes, how could the investor have stored it for the next year, if mangoes were suddenly listed under the Essential Commodities Act (ECA).
- The three agriculture bills change all this by providing the legal framework for contract-farming.
- This is the essence of the reform, not the circumventing of mandis or the ECA. And it will benefit everyone — farmers, industry and consumers.