Global Economy

The real agri reforms India needs

India’s farmers can produce enough to feed its 1.3 billion people, but millions are still undernourished. The degradation of the country’s soil and natural ecosystems – the bedrock of rural prosperity – is partially to blame, putting the dream of an equitable and nutritionally secure future out of reach. A changing climate has made the challenge starker, as small landholders exhaust the soil by struggling to grow their crops.

We need a more just and equitable food system for India.

To date, India’s investments in agriculture has not led to sustained increase in farmer incomes. To remedy this problem, GoI is committed to developing a strategy to double farmers’ income. These public incentives also need to be better designed to reduce the sector’s impact on climate. In 2016, agriculture represented 14% of the country’s emissions.

The need is to boost long-term prosperity of rural communities. For example, states provide Rs 90,000 crore annually for free electricity for irrigation. That spending has encouraged farmers to pump so much water from deep aquifers that groundwater is rapidly depleting, endangering future yields and incomes.

Decades of inefficient and imbalanced chemical fertiliser use, anchored by about Rs 1.12 lakh crore annual support for nitrogen inputs, have also damaged soil fertility by depriving it of micronutrients, increased carbon emissions and undermined the long-term productivity of farms large and small.

Reforms are needed to shift existing incentives harmful to the environment while providing farmers a social safety net through price guarantee. Reinvesting in a more diverse agriculture can regenerate the earth and set communities up for long-term economic success. A new global analysis highlights that Rs30 lakh crore a year globally could be repurposed for farm restoration.

The opportunity for landscape restoration and forest protection in India is massive, at nearly 140 million hectares. Governments at all levels should support low-carbon and sustainable agricultural practices, like agroforestry and silvopasture (growing trees on farms and grazing land).

A shift from incentivising the monoculture production of grains like wheat and paddy to a larger variety of diverse food crops well-suited to the soil (including pulses and oilseeds) can provide communities with diverse and healthy diets and protect biodiverse ecosystems. This requires ensuring that minimum support price (MSP) is operationalised and available for all 23 crops and minor forest produce across the country, and infrastructure for accessing MSP is developed to provide price assurance for commodities and to incentivise crop diversification.

GoI has started to invest in this vision of ecologically healthy farms and wealthy farmers. In 2014, India became the first country to develop a national agroforestry policy and launched the National Mission on Sustainable Agriculture (NMSA), which aims to make agriculture more productive, remunerative, and climate-resilient. In 2020-21 the 15th Finance Commission rewarded state governments that were protecting and maintaining trees on farms and in forests by transferring an estimated Rs 85,526 crore of funding to each state based on its forest cover.

Another recent reform has been linking the sale of fertilisers to the e-urvarak portal with the purchasers authenticated by their Aadhar number to reduce over-application of fertilisers by farmers. In such policy innovations and reforms, the role of state governments is critical given that agriculture is a state subject and there is scope for further improvement.

Reforming the food system in India is a complex task. The Union and state governments need to reorient its investments and signal to farmers, and to investors that financing low-carbon agriculture makes sense. To do that, it has to design programs or undertake reforms that reward small landholders and tenant farmers (including women farmers) for stewarding the land, storing planet-warming carbon, protecting biodiversity and providing food to the population. Tracking the impact of these public incentives can help policymakers modify them effectively to support as many farmers as possible.

Entrepreneurs who are developing sustainable value-chains that connect farmers working on restored land with markets also need support. Hundreds are already designing innovative solutions that reduce food loss from farm to plate, provide organic fertilisers, and bring high-value native crops to domestic and international markets. New agricultural incentives should take their perspectives and priorities into account.

By investing in ecosystem restoration, we can invest in the future of all farmers. It’s time for the government to redouble its effort toward building a sustainable future for rural communities.

Singh is director, Sustainable Landscapes and Restoration, World Resources Institute India. Kumar is lead, Food and Land Use Coalition (FOLU) India Platform.


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