Agriculture Distress and Farmers' Unrest in Madhya Pradesh: An Exploratory Study - Project Report - aiggpa
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93
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Project Report
Agriculture Distress and Farmers’ Unrest
in Madhya Pradesh: An Exploratory Study
Dr. Anitha Govindaraj
August 2018
Atal Bihari Vajpayee Institute of Good Governance and Policy Analysis94
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AGRICULTURE
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UNREST
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AN
EXPLORATORY
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iii
Project
Team
Under the Guidance of
Akhilesh Argal, Director, AIGGPA.
Mangesh Tyagi, Principal Advisor, Centre for Governance, AIGGPA
Project Coordinator & Author
Dr. Anitha Govindaraj, Deputy Advisor, Centre for Governance, AIGGPA
Research Associate
Mr. K.S.Sen. Retd. Deputy Collector, GoMP.
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Table of Contents
Executive Summary
...........................................................................................................
ix
1.
Introduction
....................................................................................................................
1
1.1.Objectives of the study
..........................................................................................................
1
1.2 Research Methodology
.........................................................................................................
2
1.3 Organization of the report
...................................................................................................
2
2. Status of Agriculture in Madhya Pradesh
.................................................................
3
2.1. Type and Size of Landholdings in MP
.............................................................................
4
2.2. Cropping pattern of MP
......................................................................................................
4
2.2. Changing Cropping Pattern in MP
..................................................................................
5
3. Status of Agriculture in the Sample districts
............................................................
7
3.1 Socio economic status of farmers in the districts
............................................................
7
3.2 Cropping pattern in the Study Districts
...........................................................................
9
4.
Distress
in
the
Rural
Areas
.....................................................................................
11
4.1. Issues faced by the farmers
..............................................................................................
11
4.2. Crucial reasons for farmers’ distress
.............................................................................
12
4.3 Immediate measures to address the farmers’ distress
.................................................
14
4.3.1.Expectations of the farmers
......................................................................................................
14
4.3.2. Feedback from the Administration & Agriculture department
....................................
15
4.3.3. Feedback from the Mandi officers
........................................................................................
15
4.4. Violent protests and its trigger factors
..........................................................................
16
6.
Distress
in
MP:
An
Analytical
Evidence
..............................................................
17
6.1 Glut in Production and fall in prices
...............................................................................
17
6.2
Mandi Issues
......................................................................................................................
21
6.3 Storage Issues
.......................................................................................................................
22
6.4
Analysis
on
MSP:
................................................................................................................
22
7. Conclusion and Recommendations
..........................................................................
25
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List of Tables
Table 1: Information regarding the sample of the study
..........................................................
2
Table 2: Position of MP in All India Crop Production
............................................................
3
Table 3: Category of farmers in MP
...............................................................................................
4
Table 4: Major crops grown in MP
.................................................................................................
4
Table 5: Trend in Area under Major Crops in MP
....................................................................
6
Table 6: Socio economic profile of District
.................................................................................
7
Table 7: Price volatility of major crops in MP
.........................................................................
21
Table 8: Mandi infrastructure in MP and affected districts
................................................
21
Table 9: Depositor -wise Warehousing position of commodities in MP
........................
22
Table 10: Comparison of MSP and Cost of Production
.......................................................
23
Lists of Graphs
Graph 1: Gross Cropped Area and Irrigated area in MP
.........................................................
3
Graph 2: Cropping Pattern in Madhya Pradesh
..........................................................................
5
Graph 3: Average annual rainfall pattern in sample districts
.................................................
7
Graph 4: Average size of land holdings in sample districts
..................................................
8
Graph 5: Percentage of various types of Holdings
....................................................................
8
Graph 6: Cropping pattern in the Districts
..................................................................................
9
Graph 7: Trend in paddy production, mandi arrivals and prices in MP
..........................
17
Graph 8: Trend in Wheat production, mandi arrivals and prices in MP
.........................
18
Graph 9: Trend in Channa production, mandi arrivals and prices in MP
.......................
19
Graph 10: Trend in Production, Mandi arrivals and prices of Soybean in MP
.............
19
Graph 11:Trend in area, production and productivity of onion in MP
............................
20
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Executive Summary
The violent protests by the farmers in Mandsaur, Neemuch Dewas and Ujjain districts
of MP during first week of June in 2016 resulting in loss of lives and property has
shocked the entire nation. Farmers protests in a state, which is a recipient of Krishi
Karman award for consecutive 4 years presenting the double-digit growth figures has
attracted many critics. Many reasons were quoted for the growing farmers’ unrest in
the nation. Hence this study was taken up to capture the underlying causes and
triggers for the farmers’ unrest in the districts.
The study is primarily based on qualitative information collected through Focus group
discussions (FGDs) and Interviews conducted with 25 farmers and other stakeholders
such as officers of district administration, Deputy director- Agriculture/ Horticulture,
a Mandi Secretary and 4-5 traders each, from the affected districts.
The sample districts, Mandsaur, Neemuch, Dewas and Ujjain, fall within the agro-
climatic zone of Malwa plateau, which receives an average annual rainfall of 800-
1200mm. More than 40 percentage of the GCA is irrigated in the sample districts. All
the 4 districts suffered drought in 2014 while, Neemuch and Mandsaur suffered
consecutive drought in the year 2015 too. Economy of all the four districts is
predominantly agriculture based, with the majority of its population dependent on
agriculture either as cultivator or as agricultural laborer. The average size of land
holdings in Dewas (2.37ha) and Ujjain (2.21ha) are well above the state and the
country’s average. The average size of holdings is 1.64ha in Mandsaur and 1.54 ha in
Neemuch, which is lower than the state average of 1.78ha. Three fourth of the total
holdings in Mandsaur and Neemuch are small and marginal, while 60-64 percent in
Ujjain and Dewas.
Major crops grown during Kharif season in all the sample districts are Soybean (45-
50 % GCA) and during Rabi, Wheat and Gram are the major crops in the region.
Apart from these, Mandsaur and Neemuch are also the leading opium producing
districts in the country. Onion is grown in less than 2 percent of the GCA in the
affected districts.
Farmers in the state suffered consecutive crop failures due to drought during the years
2014 and 2015, which was followed by a bumper harvest for many crops in the year
2016. It was widely stated that the farmers were in distress, as they did not get fair
price for their produce. The statistics showed that the prices of all the major crops
such as Paddy, Wheat, Gram and Soybean have fallen sharply during 2014-15 from
2012-13. Soybean and Onion prices fell steeply in 2016. Soybean productivity has
also declined due to erratic rainfall during 2014 and 2015. Hence farmers across the
state were in distress due to failed crops in 2014-15.
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Trend analysis of wholesale prices and MSP of the major crops showed that for all the
major crops, annual wholesale prices and the wholesale prices during peak harvest
seasons were more than the MSP for almost all the years. An analysis on MSP over
cost of production of crops revealed that under MSP, farmers were able to receive 112
% margin profit over A2 cost + Family labor. The margin was 44 percent for Soybean
and 78 percent for Gram over MSP.
Increased supply of agricultural commodities over supply led to a drop-in price for
crops in the entire state and this was further exacerbated by the unfavorable regulatory
environment in Mandis. Farmers had issues in selling their produce in Mandi due to
confusion among the traders over GST and over crowding in Mandi. Cash crunch due
to demonetization and Non-cash payments have also created restlessness among the
farmers.
Onion price fall cannot be associated with the distress in the affected districts as only
less than 2 percent of the GCA area is under Onion. It cannot be concluded that the
violence in the protests were only due to agricultural distress as these stress factors
were not specific only to the affected districts. The role of several other local factors
unrelated to agriculture cannot be ruled out in triggering the violent protests in the
affected districts.
The following recommendations may be considered to mitigate the agricultural
distress:
1. Farmers need to be insulated against price risk through effective agriculture
price policy, procurement policy and risk mitigation measures such as
insurance schemes.
2. Focus should be given to improve the mandi infrastructure in the state.
Adequate storage infrastructure accessible for farmers need to be created in
the mandi or in the nearby areas and made available at reasonable
prices/arrangement to small and marginal farmers. This would include
measures such as credit linked storage services, which would cater to the
immediate cash requirements of farmers.
3. Introduction of e-NAM in all the mandis would help in increasing
transparency and dissemination of market prices to all stakeholders. Modern
and scientific methods for grading and weighing of commodities will help in
better price discovery for commodities.
4. Banking infrastructure in rural areas needs to be strengthened to handle the
high volume of transactions during peak harvesting seasons.
5. Crop insurance scheme offering cover against price risk will help mitigate the
problem of uneconomical prices for agricultural commodities.
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1.
Introduction
With Indian economy gaining momentum of growth in the secondary and tertiary
sectors, slow pace of growth in the agriculture sector is a serious matter of concern
with about half of our population dependent on farming for their livelihood. Needless
to mention that agrarian crisis is deepening across the country which is evident with
farmers from many states such as Maharashtra, Madhya Pradesh, Rajasthan, Tamil
Nadu, Uttar Pradesh, Andhra Pradesh, Telangana and Karnataka taking onto streets
demanding better prices and loan waivers. Moreover, number of farmers’ suicides is
also increasing alarmingly to an extent of 42 percent in 2015 (NCRB)1. Seven states
of Maharashtra, Telangana, Andhra Pradesh, Madhya Pradesh, Chhattisgarh,
Karnataka and Tamil Nadu accounted for 87.5 percent of the total farmers’ suicides in
the country in 2015. The major reasons stated for the deaths by the study conducted
by Union agriculture Ministry were frequent crop failures, vagaries of the monsoon,
pest and disease attacks, Debts and social causes.
Farming is becoming less profitable and an extremely risk prone enterprise. A farmer
suffers both during crop failures and bumper crops. The agriculture is increasingly
becoming unviable due to the shrinking size of the land holdings with about 86% of
the land holdings less than 2 hectares. Increasing input costs also add to their agony.
It’s a well-known fact that farmers are not protected adequately against the weather
and the price risk.
The violent protests by the farmers in Mandsaur, Neemuch, Dewas and Ujjain
districts of MP during first week of June in 2016 resulting in loss of lives and property
has shooked the entire nation. Farmers protests in a state, which is a recipient of
Krishi Karman award for consecutive 4 years presenting the double-digit growth
figures has attracted many critics. Many reasons were quoted for the growing farmers’
unrest in the nation. The basic reason is that the farmers do not get fair price for their
produce especially, during good harvest. Demonetization is also mentioned as one of
the reasons for the unrest among the farmers. It is important to understand the ground
realities as much as the macro economic indicators for making suitable policy
interventions. Hence an attempt has been made under this study to capture the crucial
factors that led to violent protests by farmers in the state.
1.1.Objectives of the study
§ To study about agricultural status and socio economic condition of the farmers
in Madhya Pradesh and affected districts.
§ To capture underlying causes and triggers for the farmers unrest in the
districts.
§ To suggest the policy level recommendations.
1
NCRB-‐
National
crime
Records
Bureau
1
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1.2 Research Methodology
The study is primarily based on qualitative information collected through Focus group
discussions (FGDs) and Interviews conducted with various stakeholders in the
affected districts of Mandsaur, Neemuch, Ujjain and Dewas. In order to understand
the issues and reasons behind the restlessness among the farmers, FGDs and
Interviews were held with atleast 25 farmers from the problem spots of each district
using structured questionnaires.
To identify the causes for the recent farmers’ protests from the point of view of
district administration and other stakeholders, one additional collector, SDM,
Tehsildar, Deputy director- Agriculture/ Horticulture, a Mandi Secretary and 4-5
traders from each district were also interviewed using predesigned questionnaires.
Table 1: Information regarding the sample of the study
Information Regarding the Sample
S.No Name of Sample Sample Number Details of Official
the Blocks Villages of sample and other
Sample farmers stakeholders
District Interviewed
1 Dewas Bagli Nevri, 29 Collector, SDM,
Arlavda Tehsildar, Patwari,
2 Mandsour Neemuch Kuchudodh, 28 Sarpanch, vice
Nayakeda Sarpanch, Teacher,
3 Neemuch Malhargarh Bhudah, 27 Agricultural officer,
Takravadh Mandi Secretary and
Traders.
4 Ujjain Ujjain Chayan, 26
Pipalia
Ragoh
The farmers from the villages where the violent protests occurred were chosen to
understand the feel at the ground. Information regarding the villages visited is
tabulated above. (Table-1)
1.3 Organization of the report
The information collected from the field visits were summarized and discussed in
chapter 4. Chapters 2 and 3 are targeted to the readers who are not acquainted with the
status of agriculture in MP and the affected districts. In chapter-5, facts and issues that
emerged during the interviews and FGDs about the violent protests are discussed. An
effort is made in chapter-6, to find data based evidences to support the issues that
have risen during the field study. Actionable points are recommended in the chapter-7
in recommendations.
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2. Status of Agriculture in Madhya Pradesh
Agriculture is the mainstay of the state economy providing employment and
livelihood options to about 70 percent of the population. In this decade, Madhya
Pradesh has achieved double-digit growth in agriculture sector since 2010-11
consistently for 5 -6 years with about 14.6 % in 2014-15, while that of entire country
is volatile since 2011 from 8.6% in 2010-11 to -0.2% in 2014-15 and 0.8% in 2015-
16. The state has been receiving Krishi Karman award for consecutive 5 years since
2011-12 for contributing maximum to the food grain production in the country.
Madhya Pradesh is in the list of top 3 producing states in many crops (table-2).
Madhya Pradesh is the leading producer of pulses and oilseeds in India contributing to
about one-fourth of the country’s production. MP is the leading producer of Soybean
contributing to more than 50 percent share in All India production.
Table 2: Position of MP in All India Crop Production
S.No List of crops State % Share in Rank
Production in All India
MT production
1 Wheat 17.9 18.2 2
2 Maize 3.2 12.1 3
3 Chick pea/Gram 3.5 37.0 1
4 Red gram/Tur 1.5 27.0 3
5 Total Pulses 6.3 27.2 1
6 Total Food grains 33.0 12.0 2
7 Rapeseed & Mustard 0.9 11.5 2
8 Soybean 7.2 51.3 1
9 Total Oilseeds 8.7 27.0 1
(Source: Economic Survey, 2017-18)
Graph 1: Gross Cropped Area and Irrigated area in MP
300
50
41
42
42
44
250
39
37
40
34
200
30
150
220
225
231
240
238
237
242
20
100
50
99
101
100
107
10
74
82
90
0
0
2010-‐11
2011-‐12
2012-‐13
2013-‐14
2014-‐15
2015-‐16
2016-‐17
GCA
(lakh
ha)
Irri.area
(
Lakh
ha)
%
irri.
area
(Data Source: landrecords.mp.gov.in )
3
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The net sown area is about 50 percent of the total geographical area in the state. The
area under irrigation has shown 10 percent increase from 34 percent in 2010-11 to 44
percent in 2016-17 and GCA also has shown an increase of 10 percent in last 7 years
(Graph-1). Average rainfall received by the state is about 950mm. With about 56
percent of the gross cropped area under rainfed farming, Madhya Pradesh farmers are
highly prone to natural calamities like drought, hailstones and flood.
2.1. Type and Size of Landholdings in MP
Average size of holdings in the state is 1.78ha, which is far better than that of
country’s average of 1.15ha. Majority of the holdings in the state are marginal
holdings (44 %) with around 23 percent of the holdings having a size of less than 0.5
ha. Nearly, one-third of the holdings in MP fall under the category of marginal and
small holdings (table-3).
Table 3: Category of farmers in MP
Type of farmer Area in Ha % of Total operational holdings
Number of Area
holdings
Marginal < 0.5 22.6 3.5
0.5 to 1 21.2 8.6
Small 1 to 2 27.6 21.9
Semi Medium 2 to 3 12.6 16.8
3 to 4 6.1 11.1
Medium & > 4 ha 9.9 38.1
Large
(Source: Agricultural Census 2010-11)
2.2. Cropping pattern of MP
Major crops grown in the state are listed in the table-4. Paddy, Soybean, Maize,
Jowar, Moong, Urad, Tur and Cotton are the major Kharif crops and Wheat, Gram,
Massor, Peas, Linseed and Mustard are the major Rabi crops.
Table 4: Major crops grown in MP
S.No Category Major crops in MP
1 Food grains Wheat, Jowar, Maize & Paddy
2 Pulses Gram, Masoor and Tur
3 Oilseeds Soybean, Rapeseed &Mustard, Linseed
4 Vegetables Tomato, Potato, Onion, Green peas, Cauliflower &
Bhendi,
5 Fruits Guava, Orange, Banana, Papaya & Mango,
6 Spices & Chillies, Garlic, Coriander, Ginger & Turmeric
Condiments
(Source: Annual report of GoMP, 2017)
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Soybean and Wheat are the major crops occupying about 50 percent of the GCA
followed by Paddy and Gram (8.8%). Maize and Urad is also grown in about 4
percent of GCA (graph-2). Apart from major producers of Foodgrains, Pulses and
oilseeds, MP is also among the leading producers vegetable and fruits in the country.
MP is among the top 5 states in the production of Tomato, Onion and potato with
about 1.6 percent of GCA under vegetables. In 2016-17, only 0.2 percent of cropped
area is under fruits and among the fruits, Citrus, Orange and Banana are the major
crops in MP.
Graph 2: Cropping Pattern in Madhya Pradesh
Rapeseed
&
Mustard,
1.5
Cotton,
Spices
&
1.4
Others,
14.0
Condiments,
1.8
Fruits,
0.2
Wheat,
26.5
Vegetables,
1.6
Paddy,
8.8
Maize,
4.2
Tur,
Gram,
2.0
Urad,
4.3
8.8
Soybean,
24.9
(Data Source: landrecords.mp.gov.in)
2.2. Changing Cropping Pattern in MP
During last 7 years, there are changes in the cropping pattern, as farmers tend to grow
crops, which have minimum price risk and weather risk coefficients. Various studies
also reported that the Minimum support price policy of the Government also
influences the cropping pattern. Earlier, MSP was fixed only for the major food grains
such as paddy and wheat. But, now as policy planners realizing the impact of MSP on
the cropping pattern, have brought pulses such as Arhar, Urad, Moong and Gram also
under the MSP net in order to promote pulse cultivation in the country (CACP, 2017).
In table-5, the trend in area under major crops during last 7 years shows that area
under Urad and Onion has increased significantly to an extent of 84 percent and 105
percent respectively. Area under Gram and Tur (Arhar) has fallen down by 26 percent
in this decade. Urad is a safer option than Tur and Soybean as it is hardy crop and
requires less moisture. The productivity of the Urad is also good in MP (900 ka/ha) as
compared to national average of 680kg/ha in 2016-17.
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Table 5: Trend in Area under Major Crops in MP
Area under Major Crops in Madhya Pradesh ( 000’ hectare)
Year Paddy Wheat Maize Gram Urad Tur Soybean Onion Veg Fruits
2010-11 1574 4633 838 638 560 2882 5538 56 261 48
2011-12 1693 5248 449 532 606 2624 5772 68 292 49
2012-13 1791 5601 855 455 628 2716 6173 73 306 50
2013-14 1882 6123 852 396 581 2774 6543 79 323 50
2014-15 2058 6351 885 375 665 2446 6167 82 332 54
2015-16 1999 6050 899 384 863 2198 6338 111 382 58
2016-17 2136 6410 1006 474 1032 2127 6035 116 398 59
%
change
36 38 20 -26 84 -26 9 105 52 23
in Last
7 years
(Data Source: landrecords.mp.gov.in)
MSP procurement policy and the bonus price fixed by the government also influence
the cropping pattern, as farmers prefer to play safe against high price risk. Madhya
Pradesh government has fixed a high MSP rate of Rs 8/kg ie. 30 percent more than
the MSP fixed by the GOI for onion. Area under fruits and vegetables has also
increased by 52 and 23 percent respectively.
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3. Status of Agriculture in the Sample districts
The sample districts, Mandsaur, Neemuch, Dewas and Ujjain, where the violent
protests occurred in 2017, fall within the agro-climatic zone of Malwa plateau, which
receives an average annual rainfall of 800-1200mm. Malwa region is better
positioned in the state in term of status of agriculture as compared to backward
Bundhelkhand and Baghelkhand regions. More than 40 percentage of the GCA is
irrigated in the sample districts. The rainfall pattern (Graph-3) in the districts shows
that there was drought in all the four districts in 2014 while, Neemuch and Mandsaur
suffered consecutive droughts in the year 2015 too.
Graph 3: Average annual rainfall pattern in sample districts
Rainfall
Pattern
in
mm
1273
1111
1521
1203
1295
1084
874
649
742
1113
1111
1081
831
801
901
1037
1413
802
669
1185
1258
924
683
810
2011
2013
2014
2015
2016
2017
Dewas
Mandsaur
Neemuch
Ujjain
(Source: cmdashboard.mp.gov.in)
3.1 Socio economic status of farmers in the districts
Table 6: Socio economic profile of District
Particulars Dewas Mandsaur Neemuch Ujjain MP
Cultivators 35.0 41.4. 42.0 32.2 31.2
Agrl. labor 41.8 39.2 32.6 33.7 38.6
Literacy rate 69.4 71.8 70 72.3 63.7
SC population 18.7 18.6 13.5 36.4 16.0
ST population 17.4 2.47 8.6 2.5 21.0
(Source: Census 2010-11)
The economic status of the farmers in the districts are fairly stable and good in Dewas
and Ujjain while in Mandsaur and Neemuch, the economic condition of the farmers
was found to be medium as opined by majority of the farmers, officers and mandi
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personale interviewed. Economy of all the four districts is predominantly agriculture
based, with the majority of its population dependent on agriculture either as cultivator
or as agricultural labor (table-6).
The average size of land holdings in Dewas and Ujjain are well above the state and
the country’s average. (Graph-4). The average size of holdings is 1.64ha in Mandsaur
and 1.54 ha in Neemuch, which is lower than the state average of 1.78ha.
Graph 4: Average size of land holdings in sample districts (in Ha)
2.37
2.21
1.64
1.78
1.54
1.15
Dewas
Mandsaur
Neemuch
Ujjain
MP
India
(Data Source: Agricultural census 2010-11)
Graph 5: Percentage of various types of Holdings
48
49
44
38
31
Marginal
28
30
27
28
26
Small
22
20
19
Semi-‐
17
16
Medium
14
14
Medium
8
9
6
Large
2
2
1
1
0
Ujjain
Mandsaur
Neemuch
Dewas
MP
State
(Data Source: Agricultural census 2010-11)
(Note: Marginal; Less than 1ha, Small; 1-2 ha, Semi-medium; 2-4ha,
Medium; 4-10ha, Large > 10ha)
About 75 percent of the farmers in Mandsaur and Neemuch are small and marginal
farmers in which nearly 50 percent of them have marginal holdings with the holding
size less than one hectare or 2.5 acres. In Ujjain, there are 20 percent semi-medium
(2-4ha), 14 percent medium, 26 percent small and 38 percent marginal holdings. In
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Dewas District, small and marginal holdings account for 72 percent of the total
holdings.
3.2 Cropping pattern in the Study Districts
In all the 4 sample districts, soybean is the major crop during the Kharif season (45-
50%) and wheat during Rabi season (15-25%).
Graph 6: Cropping pattern in the Districts (2016-17)
Others
Opium,
Gnut,
1
7%
0.5
Maize
Onion,
1
Total
Wheat
4%
spices
,
Opium
Rapeseed
Wheat,
15
Spices
16%
Urad
2%
&
11
12%
3%
Mustard,
Gram
5
Maize,
6
Orange
Urad,
1
1%
3%
Gram,
2
Soybean
Soybean,
Rapeseed
46%
45
&
Mustard
6%
Mandsaur
Neemuch
Potato
Rapeseed
Others
cotton
1%
Others
&
Onion
Potato
2%
Tur
1%
1%
Onion
4%
Mustard
1%
1%
4%
2%
Maize
2%
Wheat
Gram
29%
15%
Soybean
47%
Soybean
Gram
Wheat
52%
11%
27%
Ujjain
Dewas
(Data source: landrecords.mp.gov.in)
Mandsaur and Neemuch are the leading opium producing districts in the country. It is
a Rabi season crop and is cultivated from October to December. Crops such as Gram,
Maize, Rapeseed & Mustard, Urad and Cotton. Onion and Potato are also grown in
this belt. Garlic and Coriander are the major spices grown in Mandsaur and Neemuch.
Major produce traded in the Mandi are:
§ Dewas: Wheat, Maize, Soybean, Chick pea (Gram), Garlic, Black Gram
(Urad), Raida, Alsi, Fenugreek ( Methi) and Masoor.
§ Ujjain: Soybean, Chick pea (Gram) and Wheat
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§ Mandsaur: Wheat, Chick pea (Gram) and Garlic.
§ Neemuch: Soybean, Wheat, Garlic, Chick pea (Gram), Black Gram (Urad),
Raida, Alsi, Fenugreek ( Methi) and Masoor
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4.
Distress
in
the
Rural
Areas
In this chapter, the major reasons for the distress among the farmers based on the
outcome of the focus group discussions and Interviews conducted in the affected
districts with various stakeholders such as farmers, district administration, Panchayat
secretaries, teachers, mandi officials, Agriculture department officials are discussed.
4.1. Issues faced by the farmers
Farmers, when asked about the issues faced in various aspects such as production,
marketing, storage etc., their responses are discussed below.
A. Production related Issues:
§ The cost of cultivation has increased.
§ Water shortage and Lack of adequate irrigation facilities.
§ Costly seeds and fertilizers and unavailability of quality inputs in time.
§ Labor shortage.
§ Low productivity.
§ Damage due to wild animals and natural calamities
§ Electricity problem.
B. Marketing and Mandi related Issues
In Mandi, Open auction is done for selling the farmers produce and 2 percent is
charged as Mandi fee officially. The quality of the produce is determined through
visual observations and there is no scientific means of grading and hence often
subjected to bias. Price of the produce is fixed based on the quality of the produce and
market rate in Indore Mandi.
Following were issues stated by the farmers regarding marketing and Mandi.
• Drastic fall in prices of the produce.
Prices – Sarpanch, Neemuch
• Farmers are highly dissatisfied with Crops 2014-15 2016-17
Mandi due to overcrowding in Mandi Soybean Rs. 5,000 Rs. 2,800
and hence farmers have to wait in long Mustard Rs. 4,500 Rs. 3,200
queues up to 2km for 3-4 days to sell Kalonji Rs. 26,000 Rs. 8,000
their produce. It is stated that the Alsi Rs. 9,500 Rs. 4,000
farmer from other states such as
Rajasthan sell their produce in Mandsaur mandi especially garlic. Hence the
local farmers have to wait for 3-4 days to sell their produce.
• Weightman (Hammal) in mandi, demand extra charges for weighing to fill his
pocket. At times, he even charges double the actual cost during the peak
season. If the farmer denies to pay, he will be made to wait for 2-3 more days
to weigh his produce.
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• Small and marginal farmers are unable to sell in Mandis as the mandi has the
capacity to weigh only tractors and trolleys and the marginal farmers cannot
afford to hire a trolley/tractor paying Rs. 1500/day and wait for 3-4 days to
sell in Mandi and hence they had to sell to private traders at a price (30%)
lower than the MSP.
• There is unrest among the Farmers due to non-cash payment and delayed
payments through NEFT /cheques and it takes 15 days to 1 month to receive
the payment in their account.
C. Storage Issues
In Mandsour and Neemuch, there is no storage facility available in Mandi and the
receipts are very high. In Ujjain and Dewas, storage facilities are available in Mandi
at free of cost.
§ The storage charges are very high in the private warehouses.
§ Farmers needs free storage infrastructure in the areas near Mandi premises.
§ Even if the produce is stored for 3-4 months and then sold, farmers are not
able to get fair price to cover the storage costs.
D. Crop Insurance
Farmers have lost their confidence in the crop insurance schemes and they say that
they have taken crop insurance, as it is compulsory for loanee farmers. They were
unhappy with crop insurance programmes due following issues.
§ The crop loss assessment is not fair and the amount of compensation is too
low
§ The compensation is also delayed
§ The sum insured is 30-35 percent in cooperative banks while it is 10-12
percent in other banks
4.2. Crucial reasons for farmers’ distress
Majority of the respondents from all the categories stated that farmers were in distress
due to the following prime issues:
§ Farmers were not happy with the government in handling farmer’s
issues and they felt that they were not at all heard.
§ Farmers did not get fair price for their produce. The price received
could not even cover the cost of production.
§ Onion being the bumper crop, prices fell drastically even to the extent
of Rs.1/kg.
§ In Mandi, there were long queues to sell the produce and hence
farmers had to wait for 3-4 days to sell their produce.
§ Moreover, farmers were highly irritated due the non-cash payment in
Mandi. The payment in banks through Cheques /NEFT was delayed to
the extent of 15-30 days.
§ Due to GST, the purchase of produce by the traders has dropped
suddenly.
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§ Farmers were disappointed with the government for lack of initiatives
on ground after making huge promises such as doubling of farmers’
income in 5 years.
Traders
Farmer
already
in
Bumper
clearing
stocks
Debt
due
to
crop
production
in
panic
due
to
failures
in
previous
GST
seasons
Lack
of
Demand
&
Abundant
Traders
stopped
Supply
in
Mandi
purchasing
from
Cash
crunch
farmers
due
to
GST
Sharp
fall
in
prices
not
even
to
cover
cost
of
Farmers
Unable
to
production
sell
the
produce
in
Increase
in
Mandi
Input
prices
due
to
GST
Non-‐cash
&
Delayed
Online
payments
Accumulated
Distress
Farmers
unable
to
buy
inputs
Inadequate
for
the
next
banking
season
crop
infrastructure
in
rural
areas
Figure-‐
1
Reasons
for
the
Distress
among
farmers
Farmers were already in distress due to drought/insufficient rainfall during 2013-2015
and were debt ridden. With good monsoon and bumper production in 2015-17, they
were expecting better returns from agriculture, so that they can cover the previous
years losses. Much to their dismay, prices of Gram, Soybean, and Onion etc. fell to
the bare minimum and farmers could not even cover their cost of production. Glut in
Onion production has led to fall in prices to the extent of 20 Paise /kg in Neemuch
Mandi. As per the estimates of National horticultural research and Development
board, the cost of production of Onion is around Rs.8.27/Kg.
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Demonetization, GST and Digital payments, all in a row, executed at a short span of
time from December 2016, have created restlessness among the farmers. Paucity of
the funds/cash crunch had upset the lives of rural people largely as they do most of
their transactions with cash. Adding to their irony, farmers could not sell their
produce in mandi, as they were no takers for their produce due to the GST.
Forced Digitization has also irked the farmers. Farmers generally sell their harvested
produce and purchase the inputs needed for the next crop using the cash money
received from buyers. Every farmer interacted, insisted strongly that they need their
payment in cash because, it takes minimum 15 days to get their payments through
Cheque/NEFT. Banks in rural areas are also not having adequate infrastructure, funds
and staff to handle the rush during the peak seasons. Farmers have to make atleast 2-3
visits to get their money and it certainly hurts the farmers as its cost their labor and
transport charges. They also need to make a separate visit to market to buy the inputs
for the next crop and other necessities after receiving the money.
4.3 Immediate measures to address the farmers’ distress
The immediate measures that are needed to reduce distress in agriculture as per the
expectations of the farmers and perceptions of the different stakeholders interviewed
are discussed here.
4.3.1.Expectations of the farmers
1. MSP should be announced even before sowing season and the MSP should be
more than the cost of production of the produce.
2. Farmers demand immediate loan waiver.
3. The production of crops should be estimated well ahead and necessary
arrangements /infrastructure created for the procurement of crops under the
MSP.
4. Farmers need a permanent solution/ pricing policy to ensure fair price for their
produce.
5. Marginal and small farmers should be given priority while, procurement under
MSP in Mandi.
6. The fertilizer subsidy should be given in cash before sowing.
7. The cash payment should be done for their produce.
8. Electricity bills should be forgiven.
9. Food processing plants needs to be setup for perishable crops and free storage
facilities in mandi should be provided for farmers.
10. Farmers also expect more subsidies for cold storage units for Potato, which is
currently 35 percent.
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4.3.2. Feedback from the Administration & Agriculture department
1. The crop production should be estimated well ahead of harvesting and
necessary storage and marketing arrangements should be done. The Minimum
support price should be decided well before, based on the cost of cultivation.
2. Immediate cash payment should be made atleast upto Rs. 50,000, as farmers
need cash to buy farm inputs. They usually align their purchase schedule after
selling their produce.
3. Farmers should be made available easy crop loans, term loans and loans for
small-scale industries.
4. Banking Infrastructure in the rural areas should be improved/expanded.
5. Farmers cannot pay in cash and purchase seeds. The earlier seed subsidy
scheme is better than the present scheme of Cash benefit transfer (CBT) now.
Government should reconsider the seed subsidy in CBT.
6. Seed subsidy should be given to the farmers before the sowing season.
7. Farmers should be given subsidy on purchasing farm implements from Agro
and also the rate of implements should be lesser than the market rate, which
currently is higher than the market rate.
8. Farmers are not happy with Cash benefit transfers.
9. The procedures and processes for availing the benefits of various schemes
need to be simplified.
10. There should be a Krishi/ Agri clinic in every Panchayat for dissemination of
information on technical aspects. Currently, one village extension officer has
to cover around 20-35 villages and hence, they are unable to transfer the
technology to all the villages.
11. Adequate storage infrastructure for onion needs to be created. Farmers will be
encouraged to create more storage structures, if the subsidy for storage
structures is increased from 50 percent upto 75 percent.
12. Food processing needs to be promoted especially, for Onion, Tomato and
Potato.
13. Farmers should be encouraged to take up allied businesses such as mushroom
units, bee keeping etc.
14. Need to give more focus on crop insurance and gradually reduce subsidies and
compensations.
15. A separate division for marketing should be created under agriculture
department who can address the marketing issues immediately in the districts.
16. Farmers’ commission should be created at the state level to address their
issues immediately.
17. The recommendations of the Swaminathan committee report need to be
implemented.
18. The pension scheme for farmers should be considered.
4.3.3. Feedback from the Mandi officers
1. Spot cash payment should be done.
2. Necessary arrangements should be made for the procurement at MSP.
Based on the quantum of arrivals in Mandi, the extension of mandi should be
done. Tin shade areas should be expanded.
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3. The weighing capacities need to be increased.
4. Adequate number of staff needed in mandi.
5. Neemuch Mandi known for arrivals of Medicinal crops. There is need for
expansion and modernization of mandi.
6. E-NAM should be implemented as early as possible.
4.4. Violent protests and its trigger factors
Distressed Farmers across Madhya Pradesh had announced Bandh on 5th June, 2016
protesting for fair price for their produce and waiver of their loans. The initial
problem started in Pipalia Mandi between traders and farmers and violence erupted
which had spiraling effect across the neighboring districts too. The social media has
also played a vital role in the spread of violence. It’s also stated that the Opium mafia
also played a huge role in hatching upon the mood of the distressed farmers in
triggering the violence in the region. It was also opined that there were political
motives behind the violence and it’s is to be noted that the affected districts are
dominated by the Patidar community who had actively participated in the farmers
agitation. Majority of the stakeholders interviewed stated that 90 percent of the
persons involved in protests were unemployed youth.
In Dewas and Ujjain, violence was triggered by farmers death due to police firing in
Mandsaur. Announcement of Rs. 1 crore compensation to the families of Mandsaur
firing victims also boosted the confidence of the youth for rioting. It was stated that,
some protesters stood in front of the police and district administration with petrol
bombs shouting “shoot us if you have guts, we will get one crore”.
There is no particular district specific reason for distress and violent protests in the
affected area, because the situation of farmers’ distress is almost the same across the
state. The mood of the mob mattered and triggered the violence.
It was requested by the officers of the district administration that to handle the law
and order situation effectively, the officers should be given special powers to control
violence.
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6.
Distress
in
MP:
An
Analytical
Evidence
The critical reasons that led to widespread distress among farmers as stated by various
stakeholders during the primary survey were glut in production, price volatility and
issues related to mandi, marketing and storage. An attempt is made to analyze these
factors using the statistical facts in this chapter.
6.1 Glut in Production and fall in prices
Successful crop after two successive droughts has been stated as one of the major
reasons for the sharp fall in prices, which in turn has resulted in unrest among the
farmers. For analyzing this cause for the unrest, four major crops of the state ie.
Paddy, Wheat, Gram and Soybean have been chosen for discussion. Through
graphical presentation, the trend in production, procurement, Mandi arrivals,
wholesale prices (yearly & harvest season) and MSP are compared for the major
crops.
Graph 7: Trend in paddy production, mandi arrivals and prices in MP
45.0
42.3
3000
39.1
Production
in
40.0
lakh
tonnes
36.3
35.5
2452
2500
35.0
Mandi
arrivals
2135
30.0
27.8
28.5
2000
1783
Procured
Qnty
25.0
22.3
1591
1500
20.0
Wholesale
price
in
Rs/Qntls
15.0
1000
MSP
10.0
500
5.0
Wholsale
price
0.0
0
in
Harvest
2011
2012
2013
2014
2015
2016
2017
season
(Data source: Indiastat & NAN, GoMP)
In graph-7, trend in paddy production and prices are illustrated. Though Paddy is not a
major crop in the affected districts, it is one of the major crops in the state
contributing to 8.8 percent of the gross cropped area. It is obvious from the graph that,
there is a decline in production and prices in 2015, followed by the increase in
production in 2016 and 2017. It is interesting to note that the though the wholesale
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price of the paddy has increased, the MSP has fallen down from 2014. One of the
reasons for the MSP paddy prices much lesser than the wholesale prices may be the
quality of paddy traded as the scented varieties like Basmati are purchased by the
traders at a good price in Mandi while low quality paddy are procured at MSP. It is to
be noted that less than half of the total production is procured under MSP while,
major portion of the produce is sold in Mandi.
Graph 8: Trend in Wheat production, mandi arrivals and prices in MP
200
2000
177
178
180
171
1800
Production
in
1592
lakh
tons
160
1720
1600
1300
1633
1635
Mandi
140
1513
1400
Arrivals
in
131
Lakh
tons
129
120
1200
1279
Procurement
115
in
Lakh
100
1000
metric
tons
76
80
800
Wholesale
price
in
Rs/
60
600
Qntls
40
400
MSP
20
200
Wholsale
0
0
price
in
Harvest
season
Data source: Indiastat & NAN, GoMP.
In case of wheat (Graph-8), the MSP has declined since 2014-15, while the wholesale
prices have increased and also there is increase in wheat production since 2014-15.
The whole prices of wheat during the harvest season when most of the small and
marginal farmers dispose their produce has fallen below even the MSP in 2014-15.
But the situation has improved in 2015-16 and 2016-17.
It is also interesting to note that in the total sales in mandi and procured quantity of
Paddy and Wheat is more than the total production in the state in 2016, indicating the
possibility of produce from other states being traded in Mandis of MP or clearance of
old stocks in Mandi. Farmers also stated this issue as one of the reasons for
overcrowding in Mandis.
Soybean is the major Kharif crop of the state, grown in about one fourth of the GCA.
The affected districts are the major soybean-growing belt with more than 45 percent
of GCA under this crop. The price and production of soybean (Graph-9) is showing a
declining trend since 2014. The area and productivity of the soybean is also varying
over the years attributing to erratic rainfall pattern in the state. Soybean is very
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sensitive to drought and temperature changes. In the 2016, the wholesale price during
the harvest season has fallen to Rs.2813 from Rs. 3569 in 2015 and has further
dropped in 2017.
Graph 9: Trend in Production, Mandi arrivals and prices of Soybean in MP
90.0
4000
3506
3364
80.0
3402
3329
Production
3500
3137
3569
70.0
3412
2757
3000
2813
3034
2944
2775
Mandi
arrivals
in
60.0
2258
2595
2500
Lakh
tons
2560
2560
2600
50.0
2240
2000
40.0
2012
Wholesale
price
in
Rs/Qntls
1690
66.5
1500
78.0
63.5
30.0
1440
52.4
62.8
49.1
1000
MSP
20.0
66.7
10.0
500
0.0
0
Wholeslae
price
in
2011
2012
2013
2014
2015
2016
2017
harvest
season
(Data source: Indiastat & NAN, GoMP)
Graph 10: Trend in Channa production, mandi arrivals and prices in MP
45.0
7000
6028
Production
40.0
38.1
35.4
6000
33.6
35.0
32.9
33.0
29.6
5414
5000
Mandi
arrivals
in
30.0
26.9
4214
4032
Lakh
tons
4584
25.0
4000
3300
3051
Wholesale
price
in
2843
20.0
3653
Rs/Qntls
3296
3452
3000
3184
15.0
2770
2000
MSP
10.0
1000
5.0
Wholeslae
price
in
harvest
season
0.0
0
2011
2012
2013
2014
2015
2016
2017
Data source: Indiastat & NAN, GoMP.
19
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