If rural distress means the government has to provide than the minimum 100 days of work as provided for under the law, it should, former agriculture secretary T Nanda Kumar said in an exclusive interaction with Moneycontrol.
The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) guarantees a minimum of 100 days of work during a financial year.
It is feared that an erratic monsoon which has recorded an overall deficit of 5.6 percent will cause a fall in rural agricultural production with the last sowing numbers indicating negligible increase in acreage along with damage to crops in several areas due to excess rainfall. This has further led to a rise in demand for jobs under MGNREGA scheme which in turn faced a cash crunch just six months into the financial year 2023-24, after the allocated budget of Rs 60,000 crore fell short with the rural development ministry seeking additional funds of about Rs 25,000 crore.
Identifying the current situation as rural distress, Kumar says the best way to tackle it is to push up MGNREGA works. "It is mostly the small or marginal farmers who have been affected. If the government has to go beyond 100 days to alleviate distress, it should do it," he said.
He underlined that it is not as it has not happened before, "We did that in the drought of 2009, so there is precedent. And it doesn’t have to be done across the country. You do it in districts that have reported distress where the number of employment days on agricultural land has come down or prices have risen or people are not buying enough foodgrains. I think that's the way to do it," he said.
Another option the government has, as per Kumar, is to increase disbursal under the public distribution system (PDS). "Raise eligibility in pockets where the need is felt and spending on basic necessities is down," he added.
Kumar was agriculture secretary between 2008 and 2010 when the country’s food production dipped due to weather anomalies and the country imposed export bans on both wheat and rice.
Caution need on foodgrain production
While the India Meteorological Department has termed the monsoon normal, with a deficit of 5.6 percent of the LPA or long period average, a closer look suggests that the rainfall distribution has been skewed by large margins. Out of 717 districts, 221 had reported deficient to large deficient rainfall by the end of the monsoon on September 30.
"This is has led to stress in agriculture but one could see a lower production in some commodities, not all. It depends on which commodity grows where and how much is irrigated," said Kumar.
However, he urged caution in terms of an internal assessment as it will be those numbers that would decide future policies. "The government would need to be cautious of the foodgrain production, take steps accordingly," he said.
Move towards a market-driven economy
Commenting on the government's export bans, Kumar said that the country has to eventually move towards a market-driven economy if the farm sector does not want such restrictions. "The farmer cannot have it both ways, wanting to export when the prices are high and expecting the government to buy when the prices are low. That won't work in a market economy," he pointed out.
It is here that the government balances out the game, he said. "If you want a full free market, then you take the lowest and the highest together. It'll take a little time for farmers to adjust to that volatility, but we have to move there," Kumar added.
Rabi sowing to not get affected
Water levels in India’s 150 key reservoirs have fallen sharply to 21 percent below last year’s level and 9 percent below the last 10-year average. However, lower water level will have only a marginal impact on the rabi crop sowing, as per Kumar.
"In my view, rabi showing should not get affected too much, because there'll be some moisture as late rains have happened, which should contribute to extra moisture required for sowing," he said.
As per the central water commission, 133 of the 150 water reservoirs are below their peak storage capacities, and at least 20 are down by 40 percent of their total storage capacities as on November 2.
Agricultural states including Andhra Pradesh, Karnataka, Tamil Nadu and Uttar Pradesh have the biggest deficiencies, ranging between 30-50 percent.
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