Need to get the markets right; loan waiver a temporary solution: ICRIER’s Gulati

Despite the festive season the rural distress continues, the monsoon hasn’t been good and the agri-commodity prices are trading below minimum support price (MPS).

Ashok Gulati of ICRIER strongly believes that there is a need for change in our mindset. We need to get the markets right first and let farmer get the best prices either inside or outside the country.

Things like stocking limits, export controls, suspension of Futures all this should abolished and only then the farmer will be brought to a neutral level compared to the consumer, says Gulati in an interview to CNBC-TV18.

Loan waiver is just a temporary solution and not a solution but only a temporary solution like Band-Aid. There is a need to invest in upgrading the markets but for that policies have to be changed.

The whole urban consumer bias in the system in the policy needs to go and farmer needs to be brought at the same level.

Importantly, there is need to invest in market infrastructure because one cannot create an electronic-National Agriculture Market by putting a software – we need to create grading facilities, storing facilities, delivery facilities, dispute settlement mechanism etc and only then only eNAM makes sense, said Gulatni.

There is need to gradually phase out the system of MSPs after getting the markets right, so the farmer gets the best possible price.