The agricultural sector of the country went through several ups and downs under the second term of Prime Minister Narendra Modi’s government. While India’s food production saw a rise, with India’s agriculture exports hitting a historic high of $50 billion in FY22, the introduction of three contentious farm laws that had to be withdrawn after thousands of farmers came on the streets to protest against them dented the government’s image.
The Modi government’s biggest promise of doubling farmers’ incomes, however, remains unfulfilled despite introducing direct cash transfers to farmers.
The big promise
In the last four years, doubling of farmers’ income has been the main theme for the sector, since Modi announced it in 2017 during his Independence Day speech. It was reiterated again in the Bharatiya Janata Party’s term 2.0 manifesto. The party promised rising farm sectoral incomes and prosperity for the sector.
The story so far
The farm sector during Modi’s second term witnessed an annual growth rate of 4.6 per cent over the last six years, the Economic Survey for 2023 said. The agricultural annual budget has increased fivefold to Rs 1.25 lakh crore in 2023, from Rs 30,223.88 crore in 2013-14.
Institutional credit for the agricultural sector rose from Rs 7.3 lakh crore in 2013-14 to Rs 18.5 lakh crore in 2022-23, as per a statement issued by the agriculture ministry on March 21 this year.
The 2019 launch of the Pradhan Mantri Kisan Samman Nidhi, an income support scheme intended for farmers with small landholdings that provides Rs 6,000 per year in three equal instalments, has been the success story for the second term of the Modi government. More than Rs. 2.24 lakh crore has been released so far to more than 11 crore farmers as of now. The government claims that digital transfers have meant that the money reaches the end user.
Moreover, concessional institutional credit through the Kisan Credit Card (KCC) scheme is being extended at 4 percent interest per annum for all those who repay loans within one year. This is a measure to allow farmers to rid themselves of indebtedness to informal sources of credit, and a special drive was initiated in February 2020 to enrol more members. As per the latest data made available by agriculture ministry, over 387.87 lakh new KCC applications had been sanctioned as on December 23, 2022, with a sanctioned credit limit of Rs. 4,49,443 crore as part of the drive.
The government has also taken steps to promote organic farming and micro irrigation including creation of a Micro Irrigation Fund with an initial corpus of Rs 5,000 crore with NABARD, along with the introduction of latest technology such as drones for farm use. During the period from 2014-15 to March 2022, Rs 5,490.82 crore was allocated for agricultural mechanisation, the ministry of agriculture said in a March 21, 2023, statement. As many as 13,88,314 machines have been provided to farmers on subsidy basis, it said.
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The government is also working on creating a startup ecosystem in agriculture and allied sectors by giving various grants. As per a February statement by the agriculture ministry, between FY20 and FY22, 1,102 startups were selected by different knowledge partners and agribusiness incubators. A total of Rs 66.83 crore grants-in-aid was released for funding these startups.
The unfinished business
A parliamentary panel on agriculture in a report tabled in Parliament on March 23 this year noted that the government is far from its 2022 goal of doubling the income of farmers.
The panel said that the monthly agricultural household income rose from Rs 8,059 in 2015-16 to Rs 10,218 in 2018-19, while flagging that incomes in states such as Jharkhand, Madhya Pradesh, Nagaland, and Odisha, declined instead of rising.
While PM KISAN over the past three year has provided assistance worth more than Rs 2 lakh crore to needy farmers, giving them Rs 6,000 each year in three equal instalments, as per data made available by the agriculture ministry in a statement, the amount is too little to make any noticeable difference in farmers’ incomes as it amounts to only Rs 500 a month.
Another challenge is issues of climate change that are directly affecting foodgrain production. This will remain among the biggest challenges for years ahead.
The effects of the country’s green revolution that helped it make great strides in domestic food production and transformed India from a food-deficit nation to a food-surplus, export-oriented country are now waning. As the country faces second-generation problems of sustainability and nutrition, and the adoption of new agricultural technologies, a dialogue needs to be initiated to find suitable solutions for the future and make farmers adopt the means to it.
Narendra Singh Tomar, Minister of Agriculture in Parliament on February 7 said responding to a question on measures taken to double farmer incomes:
“The government has adopted and implemented several policies, reforms, developmental programmes and schemes for achieving higher income for farmers directly or indirectly. Results are looking very positive.”
Devinder Sharma, agriculture expert:
“PM KISAN scheme looks like a mega scheme but is only Rs 500 in the pockets of farmers. This is, however, a tectonic shift to move from price policy to income policy. The income support must rise as we move ahead.”
Indra Shekhar Singh, independent agri-policy analyst, former director, policy and outreach, National Seed Association of India:
“Doubling farmers’ income programme was the biggest promise of the Modi government but it has failed miserably. Pressure on the farm sector has gone up with over 80 crore people to be fed under the public distribution system.”