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It seems that that there is a complete breakdown of trust between the Union government and farmers. The multiple rounds of negotiations, offer to negotiate clause by clause of the farms’ bills fail to convince the farmers. As a result, there is no sign that the sit-in by the farmers around Delhi’s border would go up in the near future. It appears to have tuned into a question of ego on both sides.
In this background, the Union budget is to be presented. Understandably, the government will make every effort to pacify the farmers in the upcoming budget, notwithstanding the fact that her fiscal space is limited due to Covid impact.
From the farmers’ perspective, the general view is that the farm bills will hurt all spectrum of farmers. However, a view often said is that this agitation is led by the medium and large farmers and small/marginal farmers are not active in this agitation and they look forward to the implementation for farm bills.
However, there is flaw in this argument. Is crop agriculture the sole source of livelihood of small/marginal farmers? The answer is negative. As Report of the Committee on Doubling Farmers’ Income Volume II indicates, at the lower end of the spectrum of land size, which constitute the small/marginal farmers, wages and salaries constitute the principal source of income. It may be noted that the shares of income from livestock decline as land sizes increase, and vice versa.
In general, livestock is an important source of income for small/marginal farmers which contributes to about 15 percent income of small/marginal farmer at the all-India level, though it is as high as 30 percent in some states (eg. Jharkhand, Gujarat). On the other hand, the share of income from cultivation (crop agriculture) comes to about 36 percent at all-India level. Other components of farmers’ income are wages and salaries and non-farm income, which do not generally figures in the agri-budget.
Since livestock is an important source of income for small/marginal farmers -- about little less than 50 percent of income from crop agriculture -- agriculture in the budget needs to be more centric towards livestock. However, livestock rarely find mention in the budget. A glance at any past agriculture budget indicates that there are surfeit of schemes for crop agriculture. But one come across only a few scheme for livestock. Most of the fund is allocated for crop agriculture.
The Union government has introduced an ambitious scheme of crop insurance in case of crop failure due to drought or other factors. Why not introduce a similar scheme for livestock sectors when there is a muss culling of poultry stock due to a disease like bird flu? Surely this would compensate marginal/small farmers for loss due to this type of disease.
By and large, agricultural extension services are geared towards crop agriculture. There is need to have similar service for livestock sector.
The biggest challenge that the livestock sector is facing now is recent government's policies for the protection of cattle and restrictions on its trade combined with vigilantism by self-appointed cow protection groups. While the ban on cow slaughter was prevalent in many of the northern states, trade was allowed. As a result, an elaborate well-developed informal supply chain existed which facilitated movement of unproductive cows from the northern states to Bangladesh.
Since livestock is an important source of income for small/marginal farmers -- about little less than 50 percent of income from crop agriculture -- agriculture in the budget needs to be more centric towards livestock. However, livestock rarely find mention in the budget. A glance at any past agriculture budget indicates that there are surfeit of schemes for crop agriculture. But one come across only a few scheme for livestock. Most of the fund is allocated for crop agriculture.
The Union government has introduced an ambitious scheme of crop insurance in case of crop failure due to drought or other factors. Why not introduce a similar scheme for livestock sectors when there is a muss culling of poultry stock due to a disease like bird flu? Surely this would compensate marginal/small farmers for loss due to this type of disease.
By and large, agricultural extension services are geared towards crop agriculture. There is need to have similar service for livestock sector.
The biggest challenge that the livestock sector is facing now is recent government's policies for the protection of cattle and restrictions on its trade combined with vigilantism by self-appointed cow protection groups. While the ban on cow slaughter was prevalent in many of the northern states, trade was allowed. As a result, an elaborate well-developed informal supply chain existed which facilitated movement of unproductive cows from the northern states to Bangladesh.
Biggest challenges livestock sector faces is recent government policy for protecting cattle, restrictions on its trade and vigilantism by self-appointed cow protection groups
However, this informal supply chain is now in tatters which has long-term ramifications. According to 2019 Livestock Census data, the cow population in Madhya Pradesh, Uttar Pradesh and Maharashtra declined six per cent between 2012 and 2019 with farmers preferring to keep buffaloes. The population of buffaloes rose over 10 per cent in these three states during this period, with Madhya Pradesh reporting as much as a 26 per cent increase.
The cow owners have now little choice. Either they need to maintain such animals or find ways to surreptitiously get rid of them by abandoning them in forests or pushing them into city roads under the cover of darkness. Both of these options imply that the small and marginal farmers are worse off as they would not be able to earn from selling off their old cattle to invest in new, productive stock. This problem is also faced by the dairies who need to be provided a solution to dispose of cattle that have reached the end of their productive life.
While the state/Union government is keen to have this policy, why do not they have a policy to buy back unproductive stock from livestock owners? This is not really an absurd suggestion. In 2019, the government came out with a policy which offers tax incentives for discarding polluted vehicles. Though the policy is still not implemented, it is not yet completely ruled out. So, let there be a policy to buy back unproductive stocks from owners by state/union government.
There is a view in some circle that by-products (gobar, cow-urine) from unproductive stocks have economic value to take care of the wellbeing of same. However, this is possible only in an organised centre but not in isolation by farmers at their households. For this reason, it is more important to have a buyback policy to benefit the small/marginal farmers.
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*Professor at National Council of Applied Economic Research (NCAER), New Delhi. Views are personal
While the state/Union government is keen to have this policy, why do not they have a policy to buy back unproductive stock from livestock owners? This is not really an absurd suggestion. In 2019, the government came out with a policy which offers tax incentives for discarding polluted vehicles. Though the policy is still not implemented, it is not yet completely ruled out. So, let there be a policy to buy back unproductive stocks from owners by state/union government.
There is a view in some circle that by-products (gobar, cow-urine) from unproductive stocks have economic value to take care of the wellbeing of same. However, this is possible only in an organised centre but not in isolation by farmers at their households. For this reason, it is more important to have a buyback policy to benefit the small/marginal farmers.
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*Professor at National Council of Applied Economic Research (NCAER), New Delhi. Views are personal
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