Talks with Farmers: Crop Diversification Proposal Explained

Description

Talks with Farmers on Crop Diversification Proposal

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Context

The Centre presented a proposal for crop diversification in Punjab.

Centre's Proposal

During the fourth round of talks with protesting farmers, the Centre presented a proposal for crop diversification in Punjab.
The proposal aimed to address the issue of over-reliance on rice and wheat cultivation in the state.
Government-promoted cooperatives would offer five-year contracts to procure five crops—tur (arhar), urad dal, masur (lentil), maize, and cotton—at minimum support prices (MSP).

Farmers' Response

The farmers, however, rejected the proposal, demanding a legally guaranteed MSP for all crops across the country.
They also reiterated their demand for the determination of crop prices as per the report of the Dr Swaminathan Commission.

Significance of Crop Diversification in Punjab

Current Crop Scenario

More than 80% of Punjab's geographical area is under cultivation, mostly under rice and wheat.
Paddy cultivation, in particular, has led to massive withdrawal of groundwater, threatening desertification.

Past Diversification Efforts

Previous attempts at diversifying cropping patterns have not yielded significant results.
The area under cotton and maize has decreased, while there has been a slight increase in pulses.

Major Producers of Proposed Crops

Pulses

Masur: Major producers include Madhya Pradesh, West Bengal, Bihar, and Jharkhand.
Arhar (Tur): Maharashtra, Karnataka, Uttar Pradesh, Gujarat, and Jharkhand are the main producers.
Urad: Madhya Pradesh, Andhra Pradesh, Uttar Pradesh, Tamil Nadu, and Maharashtra are significant producers.

Cotton

Punjab accounts for a small share of total cotton procurement in the country.
While procurement by the Cotton Corporation of India (CCI) in Punjab has been rising, overall figures remain low.

Government Procurement of Pulses and Cotton

Pulses

The National Agricultural Cooperative Marketing Federation of India Ltd (NAFED) procured 29.64 lakh tonnes of pulses at MSP under the Price Support Scheme (PSS) in 2022-23.
However, there are challenges in the disposal of pulses procured under PSS, leading to losses for NAFED and affecting market prices.

Cotton

Procurement of cotton in Punjab has been increasing, but Punjab's contribution to total procurement remains low.
Punjab accounts for about 5% of the total cotton procurement by CCI in the country.

CROP DIVERSIFICATION: https://www.iasgyan.in/daily-current-affairs/crop-diversification#:~:text=Crop%20diversification%20means%20growing%20more,cropping%20system%20currently%20in%20use.

MSP: https://www.iasgyan.in/daily-current-affairs/minimum-support-price-msp-19

Pros of Guaranteed Minimum Support Price (MSP)

Income Security for Farmers: Guaranteed MSP ensures that farmers receive a minimum price for their crops, providing them with income security.

Price Stability: MSP helps in maintaining price stability in the market by setting a floor price for agricultural commodities.

Agricultural Growth: It encourages farmers to invest in agricultural practices, leading to increased production and agricultural growth.

Social Welfare: Ensures food security for the country by incentivizing farmers to grow essential crops.

Rural Development: MSP contributes to rural development by ensuring a stable income for farmers, which in turn boosts rural economy.

Cons of Guaranteed Minimum Support Price (MSP)

Market Distortion: MSP can lead to market distortion by creating a price barrier that may not reflect the actual demand and supply dynamics.

Budgetary Pressure: Ensuring MSP for all crops puts a strain on the government's budget, especially in years of bumper harvests.

Inefficiency: It can lead to inefficiency in resource allocation as farmers may focus on crops with guaranteed MSP rather than those with higher demand or better market prices.

Procurement and Storage Challenges: MSP often leads to excess production, requiring the government to procure and store the surplus, which can be logistically challenging and costly.

Disparity Among Farmers: MSP benefits are not equally distributed among all farmers, leading to disparities based on crop choices and regional differences.

National Agricultural Cooperative Marketing Federation of India Ltd (NAFED)

The National Agricultural Cooperative Marketing Federation of India Ltd (NAFED) is an apex organization of marketing cooperatives for agricultural produce in India.

Background and Establishment

NAFED was established on the 2nd of October 1958, with the objective of promoting cooperative marketing of agricultural produce to benefit farmers.
It operates under the Ministry of Agriculture and Farmers Welfare, Government of India.

Objectives

Marketing Support: To provide marketing support to agricultural produce, especially to farmers producing fruits and vegetables.
Price Support: To provide price support to farmers for their produce through various schemes.
Market Intervention: To intervene in markets to check fluctuations in prices of agricultural produce.
Export Promotion: To promote the export of agricultural produce.
Input Distribution: To distribute agricultural inputs like seeds, fertilizers, etc., to farmers.

Functions and Activities

Procurement: NAFED procures agricultural produce at Minimum Support Price (MSP) declared by the Government of India. It mainly focuses on pulses and oilseeds.
Marketing: It markets agricultural produce domestically as well as internationally, ensuring fair prices for farmers.
Price Stabilization: NAFED intervenes in markets to stabilize prices of agricultural commodities.
Export Promotion: It promotes the export of agricultural produce by participating in international trade fairs and exhibitions.
Input Distribution: NAFED distributes agricultural inputs like seeds, fertilizers, etc., to farmers through its network of cooperatives.
Insurance: It provides insurance cover to farmers through various schemes.

Initiatives and Achievements

Operation Greens: NAFED is implementing the 'Top to Total' strategy under Operation Greens to promote the processing of tomato, onion, and potato (TOP) crops.
Pulses Procurement: NAFED has been actively involved in procuring pulses at MSP to support farmers and stabilize prices.
Export of Agricultural Produce: NAFED has facilitated the export of various agricultural commodities, including fruits, vegetables, and spices, to different countries.

Challenges

Logistical Challenges: Procurement and distribution of agricultural produce across the country pose logistical challenges.
Price Fluctuations: Ensuring stable prices for farmers in the face of market fluctuations is a continuous challenge.
Market Access: Access to markets, especially for small and marginal farmers, remains a challenge.
Storage and Warehousing: Adequate storage and warehousing facilities for agricultural produce are essential but pose challenges.

Way Forward

Technology Adoption: Adoption of technology for efficient procurement, storage, and distribution of agricultural produce.
Infrastructure Development: Development of infrastructure, including cold storage and warehousing facilities, to support agricultural marketing.
Capacity Building: Continuous capacity building of farmers and cooperatives for better market access and understanding.
Policy Support: Continued policy support from the government to ensure fair prices and market access for farmers.

PRACTICE QUESTION

Q. Discuss the importance of crop diversification in Indian agriculture. Examine the challenges faced in achieving successful crop diversification, with a focus on Punjab. Suggest measures to promote crop diversification and ensure sustainable agricultural practices in the country.