A high-powered committee (HPC) of chief ministers for ‘Transformation of Indian Agriculture’ was set up by the prime minister on July 1, 2019. The HPC was set up subsequent to the deliberations of the Governing Council meeting of NITI Aayog and in keeping with the promise of the central government for agriculture reforms, rural development, and water conservation. The objective of the committee is to suggest policy measures, attract investments, and raise growth in food processing. The committee is to find ways for transformation of agriculture and raising farmers’ incomes and suggest modalities for adoption and time-bound implementation of agricultural sector reforms.
The 9-member committee is headed by Devendra Fadnavis, Chief Minister of Maharashtra, who is the convenor; other members are the chief ministers (CMs) of Karnataka, Haryana, Arunachal Pradesh, Gujarat, Uttar Pradesh, Madhya Pradesh, the Minister of Agriculture, Rural Development and Panchayati Raj, and Ramesh Chand of NITI Aayog (member secretary).
The HPC was to submit its report within two months of the date of notification of the committee.
The Terms of Reference
The terms of reference pertained largely to matters related to agri-markets. This includes reforming the Agricultural Produce and Livestock Contract Farming and Services Act, 2018 and the Essential Commodities Act (ECA) as well as suggesting measures to reinvigorate the e-NAM, GRAM, and other relevant centrally sponsored schemes (CSS). The committee was also to look into modalities for adoption and time-bound implementation of agricultural sector reforms, policy measures to raise growth in food processing, boost agricultural export, and attract investments in value chains, logistics, and modern market infrastructure. It invited suggestions on agri-technology upgradation to match global standards and improvement in the access of quality seed, plant propagation material, and farm machinery of agriculturally advanced technology to farmers.
However, transforming agriculture in the medium-to-long run requires fundamental reforms in land institutions as well. This is what was missing in the committee’s terms of reference. For instance, tenancy of farm land is an area of concern. According to NSSO 2012–13, about 10 per cent of the agricultural land is under tenancy, compared to 20 per cent in 1953–54. However, official estimates may hugely under-report actual tenancy, which is actually expected to be around one-third of the agricultural land. Another concern is the declining size of the actual landholding. According to a NABARD survey, the average landholding size of a household is only 1.1 hectare as of 2015–16. Small tracts have less economic viability and affect farmers’ income. So, liberalisation of land lease markets is seen as necessary.
First Meeting
The committee held its first meeting on July 18, 2019, in New Delhi, amid the prevailing farm distress in the country and growing discontent among farmers over shrinking income level.
Suggestions The discussion focused on the immediate need to accelerate the growth of the food processing industry, which is growing at a mere 1 per cent annually, and find ways to encourage the infusion of technology and private investment to modernise agriculture. It stressed on the need to digitise the entire agricultural process: from sowing and marketing to using drones and satellites for crop surveillance. It also called for bringing down the cost of institutional credit available for farming. During the meeting, the CMs took stock of the modalities for adoption and time-bound implementation of the measures by the states/UTs.
It was mentioned that the small traders, farmer-producer organisations, and other institutions that produce crop for which minimum support price is declared by the central government should get an exemption from the ECA. It called for more co-ordination between the ministries of Agriculture and Commerce. The CMs emphasised that apart from reviewing the Essential Commodities Act (ECA), 1995, ways and means need to be found to give better market access to farmers. It suggested to calculate farmers’ incomes on the basis of their profit. It emphasised that farmers using storage facility, which is associated with the market, should be provided with warehouse receipt/credit facility. Establishing local storage facility would provide extra advantages.
Second Meeting
On August 16, 2019, the second meeting for transforming Indian agriculture and raising farmers’ income was held in Mumbai, Maharashtra.
Suggestions The suggestions at the meet were as follows:
Where agricultural pricing is concerned for the benefit of small traders and farmers, the panel decided imposition of the Essential Commodities Act, 1995, only in rare cases, such as scarcity and war, when the commodity price rise by over 50 per cent of market rates.
The panel sought states’ views on whether genetically modified (GM) crops could be used in restricted spaces to boost productivity and export in the agricultural sector. The committee is looking to build a consensus on the use of genetically modified technology for enhancing edible oilseeds.
It discussed the Agricultural Produce Market Committee (APMC) Act 2003, Contract Farming Act, 2018, and unexpected unusual rainfall in south-central India that has led to crop loss. The panel recommended that ‘agricultural and processed food products export development authority’ (APEDA), an autonomous body under the commerce department, should be made the nodal agency for all agri-related export promotions and gathering market intelligence. It emphasised on creating a dynamic system for gathering market intelligence to get the right prices for exports. The committee wanted to reduce dependence on imports of edible oil as well as fuel.
