What made agriculture risky and farmersvulnerable in India? Amar KJR Nayak The overall risk of undertaking agriculture has increased manifold and the smallholder farmers are highly vulnerable today. Increasing cost of cultivation with little increase in farm gate prices of agricultural produce, agriculture for most farmers across the country is no longer remunerative. Modern industrial method of agriculture has not improved the situation of small farmers. High value crop cultivation and mono cropping practiceshave only added more woes to small farmers than solace. Farmer suicides are more common among farmers adopting these industrial agricultural practices. Farmer families therefore have been out migrating from agriculture to other non-agricultural activities or have been migrating to urban and industrial clusters to find labor employment. The governments have been adopting different methods to resolve these growing crises by way of making larger provision for agricultural credit, providing different types of agricultural subsidies, investing in agricultural extension services, investing in crop specific research for greater productivity, and even announcing debt waivers to farmers from time to time. The minimum support prices on different crops offered by the governments end up as the maximum price obtained by farmers. Net incomes from individual crops have been dwindling for most and negative for significant number of farmers. Ironically the efforts of the government have had no long term impact in reducing the vulnerabilities of farmers. Food prices have only spiraled and there is no respite to food bill of the common man. What underlies this growing risk to farmers, agriculture as a whole, safety and affordability of nutritious food for the families in general? The old maxim of ‘Monsoon’ and ‘Market’ viewed as independent monsters of agriculture do not seem to fully explain this dynamics. Productivity in agriculture is highly interconnected and interdependent processes. Nutritional value and price of food is directly proportional to food miles that is the distance agricultural produce travels from farm to plate. Net income to small farmers is not merely a function of productivity per acre today but more complex; dependent on collective risk at different stages of the agricultural value chain. Agricultural value chain starts with agricultural inputs like seeds, manure, labor, credit, water, and wealth of natural resources. This is followed by watch and ward activity of the farm as the crop grows to flower and fruit. With crop harvest, follows value addition and marketing activities. In this value chain, recent risk estimates show that risk in credit, labor and value addition seem to emerge as the new monsters of agriculture and small farmers in addition to monsoon and market. Farmers in rainfed and tribal farmers seem to face more risk from credit availability and value addition that the farmers in irrigated areas. While the governments have

been taking steps to deal with the issues of the new monsters; would this lead to dealing with the core issue in the vicious nature of the present crisis in agriculture? The problem seems to be much deeper and stickier than ever before. With the introduction of Green Revolution, agriculture has gradually become more external input driven. Agricultural inputs of seeds, manure, credit and natural pest management have been externalized. Farmer today needs to buy seeds, fertilizers, capital, pesticides as well as labor from the external market. The externalization of internal capabilities has considerably weakened the farmer and is making him more vulnerable by every passing season. Further, externalization of internal capabilities of farmer probablyhas led to greater external capital dependency, making credit one of the new monsters ofsmall farmer. The externalization phenomenon in agriculture seems to have exposed farmer communities with low government institutional reach especially tribal farmersto greater risk. In the above lock-in effect of small farmers to externalities; how could a farmer free himself today from walking into the death valley of input intensive commercial agriculture? Farmers need to strengthen their internal capabilities in terms of preserving own seeds, use biomass and cattle dung as manure, rely on family labor, and protect natural wealth of their ecosystem. In other words, adoption of diverse, agro ecological practices can significantly reduce the cost and hence reduce external capital requirement. Diversity in agricultural farms can also reduce problems of plant pestsas per recent scientific studies. In order to reduce burden on state exchequer and improve institutional reach of the government to small farmers, governmentsneed to invest in optimal Farmer Producer Organizations as community enterprise system at Gram Panchayat level. This can serve as single window institution for the small farmers at the grass root level and effectively coordinate with the externalities on both pre harvest inputs and post-harvest activities of value addition and marketing. For more information and understanding on the processesto make farmers and agriculture sustainable, see http://centre.lbsnaa.gov.in/ncscs/publication.php

The author is a Professor of Strategy & NABARD Chair Professor at XIMB, Xavier University Bhubaneswar.