The challenge of making farming profitable

SOMETIMES, silence speaks louder than words. A heart-wrenching video clip of a vegetable vendor breaking down at the Azadpur mandi in New Delhi has gone viral. When asked whether he would go back with an empty cart if he couldn’t afford to buy tomatoes at the inflated price, the vendor is lost for words and unable to control his tears — his silence gives a powerful reply.

The short video clip hit the sensibilities of a nation that otherwise remains engrossed in new car models hitting the market and the latest electronic gadgets flooding the superstores. With regular TV shows about the latest in automobiles as well as what’s new in electronic gadgets, and with reports every now and then of a fast-growing economy, it is only once in a while that a video clip shakes the middle class out of its stupor, bringing it face to face with harsh realities.

The clip of Rameshwar, the vendor from New Delhi, was one such instance. His economic distress was clearly evident from the tears he found difficult to hold back. When asked as to how much he earned, he said it was not more than Rs 100-200 per day. His reply also laid bare India’s poverty levels and the explosive rise in inequality.

Not many would, however, know of a 45-year-old sugarcane farmer and labourer from Thikpurli in Maharashtra. The farmer, Bharati Patil, told a research platform: “Over the last five years, our wages have remained largely unchanged. Before demonetisation, they were Rs 100 per day and now, if we work till 5 pm, we get

Rs 150 a day.” In other words, going by what the marginal sugarcane farmer claims, daily wages in Maharashtra’s sugar belt have increased by a paltry Rs 50 in five years. With the prices of all necessities having gone up, it is difficult to comprehend how the marginal farmers and farm labourers survive with the same low wages year after year.

The increase in real wages, when adjusted for inflation, therefore, must be close to zero, and not looking up in any meaningful way. In fact, some studies have pointed to the real wages either falling or remaining stagnant between 2013 and 2017. The Centre for Monitoring Indian Economy (CMIE) had, in April 2022, said that the majority of the country’s 900 million workers were so disillusioned with the available employment opportunities that they had stopped looking for jobs.

It is primarily for this reason that the farm sector’s share in the country’s employment, which stood at 45.5 per cent in 2021-22 as per the Periodic Labour Force Survey, did not drop to the pre-pandemic levels, when the share of the farming population was relatively lower at 42.5 per cent of the workforce.

Following the outbreak of the Covid pandemic, a sizeable proportion of an estimated 100 million workers who had trudged back to their villages after the lockdown was imposed did not return to the cities.

Similarly, in Bangladesh, employment in agriculture has shown an increase this year. As per the Bangladesh Bureau of Statistics, most of the job generation in the April to June 2023 quarter and seen on a year-to-year basis has been in agriculture. Some economists think it is not a good sign as it indicates the lack of formal employment opportunities in the cities.

Let’s first see how depressing inequality is turning out to be. At the global level, the World Inequality Report has tracked the worsening inequality, with the latest report saying that the richest 10 per cent of the global population own 76 per cent of all the wealth whereas the bottom half of the people own hardly 3 per cent of the wealth. In India, Oxfam International tells us that the top 1 per cent own 40.5 per cent of the country’s wealth.

The economic design is so woven that the rich continue to amass wealth, whereas the poor are driven up the wall. The capitalist system is so well entrenched that despite the big talk of ending inequality, the top 500 super-rich globally added $852 billion to their wealth in the first six months of 2023.

Using the World Bank matrix of assessing the proportion of the population of the BRICS countries living on an income of less than $4 a day, India tops the chart. With 91 per cent of the population below that benchmark — far ahead of South Africa, which is a distant second with 50.3 per cent of its people living on less than $4 a day — the aspiration for a decent living would be much higher among the people who are left behind.

Considering that agriculture is the largest employer, the best way to reduce the gnawing inequality is to put the resources where the actual need is. Instead of continuing with the failed trickle-down economics, the task should be to shift the focus to lift the bottom and middle levels.

Since the majority of the livelihoods in India and Bangladesh are dependent on agriculture, mainline economists should accept the challenge of making farming profitable by incentivising rural entrepreneurship. Instead of sucking wealth from the bottom, provide more income in the hands of farmers even if it means defying the dominant economic framework. A vibrant agriculture is the crying need of the times. There is no other way to wipe the tears of every farmer and wage-earner.

My suggestion would be to devote the next five years to rebuilding agriculture. Provide as many resources, incentives and economic stimuli to agriculture as we have given to the industry ever since the reforms were unleashed. Reconstruct small-scale farming and ecologically sustainable agriculture to usher in the next stage of reforms that are healthy, wealthy and regenerative. Just five years — that’s all I am asking for.