| Agricultural policy in India: need for a fresh look (1992) |
There is a need for accelerated development of dry land agriculture which accounts for about 70% of the total cultivated area of the country, and contributes about 43% of the total foodgrains production and 75% of the total production of oilseeds, pulses, and coarse grains in the country. The per capita public investment in the dry land areas of the country is very low as compared to that in the irrigated areas. This is both anti-production and anti-equity, given the high untapped crop yield potential and concentration of the country’s rural poor population in those areas. There is therefore a need for substantially increasing public investment in watershed-based agricultural development of these areas and for long-term bank loans for watershed development.
It is also necessary for the success of the watershed approach that local farmers are fully involved in formulating, implemen-ting, and monitoring watershed development projects and that they are motivated to contribute in the form of labour to meet part of the cost of the project. This can best happen only if the farmers are organised formally or informally as has been done in many places in Maharashtra and Karnataka. Once organised, the farmers could evolve and enforce mutually acceptable rules and regula-tions for the repair and maintenance of various soil and water conservation structures on both private and community lands in the watershed and for equitable distribution of benefits from the community or common property resources restored under the project.
If the watershed approach is followed, a lot of biomass can be produced which can then support many processing industries and can be used for generating bio-energy as has been done in Andaman where biomass, mainly fuelwood, has been used for producing biogas which, in turn, has been used for generating electric power. The biomass-based processing industries could also generate enough employment opportunities for the rural poor in the country. However, there will be a need for imparting the necessary education and skills to the local people so that they could take up the new activities and benefit from them. This could be done under the scheme of ‘Training of Rural Youth for Self Employment (TRYSEM)’ and other ongoing programmes of agricultural and rural development.
Given the highly risky nature of agriculture in the dry land areas of the country, it is suggested that a portfolio of new technologies be developed so that the risks involved in its adoption are minimised. In this context, the need for a cyclical credit policy of the type recently adopted in Karnataka and for crop insurance in dry land areas could be highlighted. According to the present credit policy adopted by commercial banks and co-operative societies in the country, the farmer-borrower becomes a defaulter if he does not repay his crop loan within a period of one year, and he cannot get a fresh loan till he continues to be a defaulter. For dry land areas where the incidence of crop failure due to droughts is very high, and hence the chances of default are also high, this credit policy is not appropriate. It has been observed that dry land agriculture is profitable over a period of 3 to 5 years even though in any one year it may be a losing concern. In view of this, a new (cyclical) credit policy is required so as to meet the full credit requirements of the dry land farmer over the period of 3 to 5 years even when he becomes a defaulter in one or more than one year. Such a policy has been tried in Karnataka and there is no reason why it should not be adopted in other dry land areas of the country.