MUMBAI – At least 60 farmers in India have died during protests against new farm laws while braving rain, hail and biting winter cold with many sleeping under tractor-trailers or in tents given to them by sympathizers.
The daughters and wives of many of the 100,000 farmers camped in New Delhi have joined the fight against the new provisions they fear will increase their vulnerability to corporate middlemen, erode agrarian incomes and put the ownership of their land at risk.
Thousands more are being held back from reaching Delhi as they seek to escalate protests by holding tractor rallies in the capital during January 26 Republic Day celebrations. Unions expect farmers from several other states to stage protests in solidarity.
Agriculture is still the main source of livelihood in India, with more than 700 million of its 1.38 billion population surviving on agriculture and related activities. Yet the sector contributes only 16% to gross domestic product (GDP), compared with 43% half a century ago.
That is the root cause of the problem playing out on New Delhi’s farmer-occupied streets. Farmers find it tough to ramp up productivity from small landholdings, with most of their land divided up over generations in inheritance. An estimated 86% of farmers own less than two hectares.
This limits their bargaining power, investments in infrastructure including technology, mechanization, storage, processing, long-distance transportation and other areas that could make farming more viable. Farm mechanization in India is only 40%, compared with 60% in China and 75% in Brazil.
As China, Brazil, Indonesia and Ukraine have moved up the affluence ladder, workers moved from farming to manufacturing and services. In China, the population dependent on agriculture fell from 60% in 1991 to 25% now.
In Brazil, it fell from 19% to 9%, Indonesia 55% to 28% and Ukraine 24% to 14%, according to the International Labor Organization (ILO). The decline in India from 62% to 42% is less striking also because of the rapid increase in population.
The China model
China embarked on an ambitious program to move as many as 250 million rural people over a dozen years from 2013-14. The workers were largely redeployed to industrial and services sectors, a critical reallocation of resources that helped to spark China’s exponential growth.
China’s economy, predicted to overtake the United States in size in less than a decade, has grown from $1.2 trillion in 2000 to $6 trillion in 2010 and $14 trillion in 2019. India now faces the same conundrum China confronted a decade and a half ago.
But as the world’s largest functioning democracy, unlike China, India can’t forcibly move masses of its population from the fields and into urban housing blocks. It is also not well placed for more disruption with the economy likely to contract 7.5% in the year to March 2021.
The economy slowed to 4.1% in the year to March 2020, from 7.6% in the year to March 2016.
To be sure, failure to develop new cities or evolve agrarian hubs into developed rural centers has left little choice for many rural residents but to migrate to cities, often bloating the number of urban poor.
Rural hubs or new towns from strategically located rural clusters could help the under-employed to secure additional income and learn new skills to acquire alternative employment.
India faces the threat of under-employment much graver than unemployment, say economists. Well-intentioned programs by the Narendra Modi government such as “Skill India” could have made a difference, but haven’t taken off because of poor implementation.
India’s success in software, telecoms and other technology-driven, knowledge-based industries has remained the privilege of urban dwellers. So, too, have most of the lucrative jobs in manufacturing, which have bypassed most of the rural and semi-urban populace.
Deep in debt
The absence of quality education and vocational training contributes to the gross under-employment of the land-dependent. Millions of farmers seeking greener pastures at best find semi-skilled jobs like waiters, cabbies or delivery boys in towns like Mumbai, Delhi or Bangalore.
The pandemic lockdown, however, exposed their vulnerability as depleted savings forced millions to walk hundreds of miles back home, ironically increasing pressure on the land.
With 70% of farmers owning land smaller than one hectare, they are easily squeezed during any produce price dip or manipulation by middlemen.
About 40% of their borrowings come from informal sources at high interest rates. Between 1996 and 2016, more than 333,000 farmers have killed themselves because of their inability to repay debts.
That’s why the new contested farm laws make farmers nervous as they bar them from legal recourse in case they feel short-changed, and direct them instead to local officials who are often in the pocket of powerful business interests.
Hundreds of cases of cheating have already cropped up in Madhya Pradesh state under the new law, increasing the farmers’ desperation to have the laws repealed. Broken promises and ill-conceived moves, meanwhile, have broadly reduced the farmers’ trust in the government.
In the run-up to 2014 elections, Modi promised to double farm income in five years. He has now moved that deadline back to 2022 while officials are busy fine-tuning the definition of “doubling.” Economists say growth in farm income in real terms has been almost static since 2014.
Rural expert Yogendra Yadav describes the new laws as the government’s attempt to wriggle out of responsibility for the farm sector and create space for private capital players to purchase and horde farm produce for potential global export plays.
At present, the government fixes a minimum support price (MSP) for 23 crops, though it purchases mainly wheat and rice, a part of which it sells at lower prices to the less affluent. Large quantities often rot in open storage facilities, causing a drain on the exchequer.
Protesting farmers are insisting on a government guarantee that every buyer, including the government and private buyers, make purchases at MSP or more.
The government has rejected the demand. India is also tied down by its World Trade Organization (WTO) commitment to not give MSP subsidies to farmers, which the trade body describes as “trade distorting practices.”
To be sure, Indian farmers will need to keep producing more for the growing consumption of its population as general income levels rise.
India is the world’s second-largest producer of rice, wheat, sugarcane, cotton and groundnut and is the largest producer of milk, pulses and jute, according to the Food and Agriculture Organization (FAO).
With a large non-meat eating population, India produces and consumes a quarter of the global pulses output.