Agriculture in India
Recent Media reports have lauded the current Indian Government for increasing the rate of investment in the Agriculture sector and raising rural incomes through NREGA. However the real situation is very different as hundreds and millions remain malnourished and corruption flourished from the top to the bottom. The Government’s Agriculture Policy is held hostage by vested interests which tightly control the distribution and the food supply chain through archaic laws. The permission to export and import food is given in a manner to benefit a few connected companies and the associated minsters/ bureaucrats. The farmers get a pittance of the final price paid by consumers as most of the value is captured by the middlemen and traders.
India’s nodal agency for procuring and distributing food FCI is famous for being one of the most corrupt departments. The inefficiency and pilferage by FCI is legendary but the current Government has not taken a single step to reform it despite being pro poor. Also bad laws like APMC which forces farmers to sell their produce to designated trading centers leads to massive waste and inefficiency. Again there is no movement to reform it. India’s farm exports have grown by an astounding 88% to almost 15 billion dollars despite the fact that most of the country’s citizens are malnourished. Why are exports growing, when there is massive demand for food in the country, that is still not met, is a big question. Most of the exports are vegetables, fruits and meat which again makes no sense for India to export.
Here is an earlier article on why food inflation in India is growing;
India is suffering from a massive increase in Food Prices even as Millions of Tons of Grains are getting eaten by rats and termites. India’s Agriculture which is still heavily controlled by the Government suffers from total mis-governance and endemic corruption. The Food Corporation of India (FCI) which is the Government body in charge of Procurement and Stocking of Food grains is known for being totally corrupt. In collusion with private traders, FCI officials openly sell subsidized rice and wheat at much higher prices. Most of the Below Poverty Line (BPL) families never get the subsides targeting them with the much heralded Food Programs leaking like a sieve. The Supreme Court in India recently reprimanded India’s Agricultural Minister for not distributing rotting food to the starving poor for free. Instead of improving the Distribution Mechanism, India’s PM told the Court not to interfere with the Executive Authority of the Indian Government. The whole supply chain for Agriculture is totally inefficient and fragmented. The entry of Retail MNCs had promised improvement in Agricultural Efficiency but the middlemen scuttled this move. So India’s Poor Consumers face Rising Food Prices even as India’s Farmer continue their suicides due to unremunerative income as middlemen siphon of the profits.
The export of agricultural items monitored by APEDA rose by 88 per cent to about Rs 82,000 crore in the last fiscal, a top official said. India’s agri exports under Agricultural and Processed Food Products Export Development Authority (APEDA) stood at Rs 43,626.88 crore in the 2010-11 financial year. PEDA.
The export earnings from processed food, which includes processed fruits and vegetables, meat and poultry products, etc., rose to Rs 38,950 crore in the 2011—12 fiscal from around Rs 15,816 crore in the year—ago period.
Similarly, earnings from shipment of buffalo meat rose to around Rs 14,000 crore in 2011—12 compared to Rs 8,412.68 crore in 2010—11 fiscal.