India needs a comprehensive agricultural

policy
For almost every sector of the economy, governments have laid down clear policies. But for
farming, they never went beyond a draft prepared by the NDA at the turn of the millennium

Express Illustrations by Amit Bandre

Biswajit Dhar
Updated on:
03 Dec 2021, 5:36 am
3 min read

The repealing of the three controversial legislations by the Government of India must be seen
as a victory for the Indian farmers, especially because policymakers were not able to
convince the cultivators that the legislations were enacted to serve their interests. At the same
time, this episode also serves as a reminder to the policymakers that laws and policies must
be enacted after detailed consultations with all stakeholders and after giving due
consideration to the interests of all concerned. In a country that has seen decades of
discussions on the importance of people-centred development, it is time that policymakers
adopt this framework for betterment of citizens.

There is no doubt that the absence of a people-centred development has hurt the agriculture
sector the most. Standing testimony to this fact is that while for almost every sector of the
economy, the governments had laid down clear sectoral policies, starting with the Industrial
Policy in 1948 followed by its detailed version in 1956, agricultural policy never went
beyond a draft that was prepared by the NDA government at the turn of the millennium. It
must be pointed out here that in the US and members of the EU, where the workforce
dependent on agriculture has been fast decreasing over the past few decades and is currently
just 1% and 4% respectively, agricultural policies are regularly enacted. In the US, Farm Acts
are enacted nearly every five years, while the EU members adopt their Common Agricultural
Policy every decade. However, in India, where well over 50% of the workforce is still
directly or indirectly dependent on agriculture, none of the governments at the Centre
initiated a process of enacting farm policies in consultation with the state governments.
The lack of a comprehensive set of policies has seriously affected India’s agriculture in many
different ways, which was extensively documented by this author along with Roshan Kishore
(“Indian agriculture needs a holistic policy framework, not pro-market reforms”). It was
pointed out that agriculture in post-independent India never experienced a high-growth phase
unlike several sectors in the non-agricultural economy. The highest decadal growth for
agriculture has been just 3.5% in the 1980s. This was in sharp contrast to non-agricultural
growth, which consistently increased between the 1980s and the 2000s, before declining in
the previous decade.

In the mid-1960s, Indian agriculture was in deep crisis, which was overcome through the
introduction of the Green Revolution. However, the benefits of new technology in terms of
higher output growth could not be reaped until the 1980s, and this growth could not be
sustained in the following decades. This also clearly shows that economic reforms had
bypassed the farm sector.

Among the contributory factors to the low growth syndrome was inadequate irrigation
facility. By 2015–16, over half of the gross cropped area under principal crops was still
unirrigated. Moreover, of the 29 states and Union territories for which data were available, in
21, the coverage of irrigated area under principal crops was lower than the national average.
The relatively slow spread of irrigation facilities in the country reflects inadequate
infrastructure supporting agriculture, which, in turn, was a result of deficient investment in
this sector. While in the 1950s, agriculture’s share in the total investment in the country was
about a quarter, this figure fell sharply to around 6% in 2018–19.

Inadequate investment coupled with diminishing funding for agricultural research over the
decades meant growing inefficiencies in this sector. This can be seen from the fact that
although India is among the top producers of all major food crops, it is considerably behind
countries having the highest levels of yields, according to data provided by the Food and
Agricultural Organization. For example, India’s rice yield in 2019 was 2.7 tonnes per hectare
as compared to Australia’s 8.8 tonnes per hectare, while India’s wheat yield was 3.5 tonnes
per hectare as against Ireland’s 9.4 tonnes per hectare. When inefficiencies have gripped the
sector, should it be a surprise that agriculture has faced adverse terms of trade vis-a-vis non-
agricultural sectors during the 1980s and for most years since the mid-2000s, and further that
99.43% of farm holdings in India are cultivated by “low income or resource poor farmers”,
according to the information provided by the government to the WTO? Do these facts leave
any scope for contesting the claims of the farmers that agriculture has become a loss-making
occupation?

The farmers may have won a battle against the agriculture laws, but they stand to lose in the
long run if they do not initiate a dialogue with the government for the adoption of a
comprehensive agricultural policy, which can reverse the neglect that they have faced over
the past decades. This would be one major step for improving their lives and livelihoods.

Biswajit Dhar
Professor, Centre for Economic Studies and Planning, School of Social Sciences, JNU
(bisjit@gmail.com)