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What explains the Maharashtra farmers’ strike in a bumper crop year?

LiveMint logoLiveMint 06-06-2017 Sayantan Bera

New Delhi: The fifth day of the strike by protesting farmers in Maharashtra on Monday witnessed unprecedented visuals of milk tankers being ferried to state capital Mumbai under heavy police cover. Not long ago, before the monsoons arrived last year, rail wagons transporting water to severely drought-hit districts in the state were an arresting visual. Between then and now, there was a normal monsoon (in 2016) followed by a bumper harvest. But this seems to have changed little for farmers in the state.

Beginning 1 June, farmers from at least seven districts in Maharashtra took to the streets, shut down wholesale markets and vandalised trucks carrying vegetables. They spilt gallons of milk on the road, and sent vegetable prices soaring in major cities. Why are they protesting in a year when the state witnessed a record food harvest, and agriculture growth for the entire country shot up to a five-year high of 4.9%?

A look at the farmers’ demands is indicative of the problems they are facing, despite having harvested a record crop. Waiving off all farm loans, minimum support prices at 50% over costs of production, a pension scheme for farmers aged 60 years and above, interest free credit, higher prices for milk and fully-subsidized micro-irrigation equipment are among their major demands.

The trigger for the protests was the Rs36,359 crore farm loan waiver announced early April by the newly elected Bharatiya Janata Party (BJP) government in Uttar Pradesh, prompting farmers in Maharashtra to ask for a similar waiver, since it is also a BJP ruled state. The other immediate concern was nose-diving crop prices.

While demonetisation of high-value currency in November 2016 led to the collapse of wholesale vegetable prices due to a severe cash crunch—forcing many to dump their onion and tomato harvests—farmers were also forced to sell their bumper arhar (pigeon pea) crop at wholesale rates substantially lower than government-announced minimum support prices (MSP)—about Rs4,000 per quintal or lower, compared to an MSP of Rs5,050 per quintal.

Preceding these events, farmers suffered consecutive droughts in 2014 and 2015 when vast swathes of pulses, soybean and cotton crops yielded next to nothing. This took a toll on their ability to repay loans and led to a spate of suicides.

Data from the Nation Crime Records Bureau (NCRB) shows that Maharashtra accounted for over a third (4,291) of the total suicides by farmers and agricultural labourers in India (12,602) in 2015, the highest among all Indian states. A staggering 43% of the suicides by farmers in Maharashtra were due to bankruptcy and indebtedness, while 18% suicides were due to crop failures.

Further, data from the National Sample Survey Organisation’s situation assessment survey of farm households released in December 2014 showed 57% of such families were indebted in Maharashtra, compared to 52% for all of India. The average debt of a farm household in Maharashtra was Rs54,700 (during 2013), compared to Rs47,000 for the entire country.

For now, protesting farmers have rejected chief minister Devendra Fadnavis’s offer of a “never seen before” loan waiver by October, and a proposal to make purchasing farm produce at lower than support prices illegal. They want a more immediate resolution to their chronic problems.

To make things worse, protests have also spread to Madhya Pradesh where sporadic violence was reported in the past few days, prompting chief minister Shivraj Singh Chouhan to call a meeting with farmer organisations.

On Monday, India’s chief economic advisor Arvind Subramanian told a gathering of leading agriculture scientists in Delhi that a median farm household in India earns a paltry Rs1,600 per month. “The truth is,” he said, “it simply does not pay to be a farmer in India.” Farmers in Maharashtra will agree.

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