by The Farmer Who Grows Food for 1.4 Billion People Is Still Among the Country’s Poorest Citizens
Bohiney Magazine | The London Prat
India’s Agricultural Paradox: Feeding Billions, Compensating Millions Inadequately
NEW DELHI — India is the world’s largest producer of milk, the second largest producer of rice, wheat, cotton, and sugarcane, and one of the largest producers of vegetables and fruits globally. The Indian farmer who produces this output earns, on average, approximately $2,500 per year, which makes farming one of the lowest-paid skilled occupations in an economy that is growing at 5-6 percent annually and producing a tech sector with median salaries twenty times that figure. The gap between agricultural output value and agricultural income is the central problem of the Indian rural economy and has been the central problem of every government since Nehru’s first five-year plan.
The Minimum Support Price — MSP — system, through which the government guarantees minimum prices for selected crops, has been the primary policy tool for agricultural income support for sixty years. It works imperfectly: MSP benefits accrue primarily to farmers who produce the supported crops in the supported quantities and can access government procurement, which is more likely to be large and medium farmers than the small and marginal farmers who constitute most of the agricultural workforce. The 2020-2021 farm law protests, which brought hundreds of thousands of farmers to Delhi’s outskirts, were settled by the government’s withdrawal of the laws but not by a fundamental resolution of the MSP and procurement issues that motivated the protest.
The Structural Challenge
India’s agricultural economy supports too many people on too little productive land with too much weather dependency. The solution that economics suggests — fewer, larger, more productive farms employing fewer people at higher wages — is politically and socially unachievable at the pace that the economics require. The transition produces urbanization, which produces urban unemployment and housing stress, which the cities cannot fully absorb. Managing structural economic transformation through democratic politics requires either moving faster than the political system supports or slower than the economic situation requires; global leaders discussing economic challenges include India’s representatives navigating this specific tradeoff. The farmers are still poor. The crops are still growing. The gap is still the gap. The next five-year plan is being written.
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