The Indian economy today needs both low and stable inflation as well as boost to spending, which is best guaranteed by increased farm production and incomes.
Farmers are currently harvesting, if they haven’t already, a bumper rabi crop. The India Meteorological Department has forecast a 100 per cent normal southwest monsoon (subject to a model error of ± 5 per cent), with the possibility of weak La Niña conditions (the opposite of El Niño that is generally not favourable for rainfall in the subcontinent) developing in the second half of the four-month season from June to September. That bodes well for the coming kharif planting season too. Agriculture is important from two standpoints. The first is inflation control, which is predicated on adequate supply of food, feed and fibre. Secondly, farmers and rural labourers have high marginal propensity to consume. The Indian economy today needs both low and stable inflation as well as boost to spending, which is best guaranteed by increased farm production and incomes.
That being so, concerted efforts are required to ensure proper marketing of the rabi wheat, mustard, pulses and other harvested crops. The issuing of coupons or SMSes by governments to farmers for bringing their respective produce to mandis at given dates and times is fine, given the imperative for maintaining social distancing. But it raises the question: Why limit procurement only to mandis? Why not open purchase centres at rice and dal mills or, for that matter, even village schools, panchayat offices, primary cooperative societies, district courts and other unused public places during lockdown? Wheat and chana, after all, only have to be unloaded, cleaned, weighed, filled in gunnies and stocked. There’s no necessity for cold storage or reefer vehicles for subsequent movement to Food Corporation of India’s godowns. If the idea is to procure and pay farmers fast, while preventing overcrowding, the best way is not to stagger, but spread out purchases beyond mandis.
Equally urgent is planning for kharif, where sowing of cotton and paddy nurseries will start from early to mid-May in North-West India. Plantings of these and other crops across the country will take off from June, with the arrival of the monsoon. There is no time to lose with regard to arranging supply of seed, fertiliser and crop protection chemicals. The same farmers who would sell grain in hordes now will very soon queue up for buying inputs for the next crop. The challenge of managing crowds at fertiliser sale points is serious enough in normal times. In the time of novel coronavirus, it would be a herculean endeavour. That extra logistical effort is, however, worth mounting for a sector offering some hope in this most uncertain economic environment. This is also the time to free agricultural markets. Allow the farmer to sell to anyone and anywhere, while simultaneously lifting all restrictions on stocking, domestic movement and export of produce.