Agriculture and its allied activities were part of Indian civilisation for ages. But yet India remains far behind other countries in agricultural production, yields and water management. It continues to focus more on rice and wheat even though its share in the food basket continues to shrink for consumers. This is because consumers want nutrition once the basic grain intake requirements are met. As a result, Indian farmers continue to struggle to make non-rice and wheat agriculture a viable profession.
But this year could usher in changes not envisaged earlier. The economic slowdown exacerbated by COVID-19 has caused India’s economic revival depend on agriculture much more than before. It is the 50 per cent of India’s population that will create the consumption demand that industry requires. That is why there is an urgent need to make agriculture a sustainable activity for all involved even after the COVID-19 pandemic is over.
These were the issues discussed at the first session (six more are to follow) titled ‘Why agriculture matters for India’. All the sessions will form part of the ‘Future of Agriculture’ series which has been organised by SIES College of Arts, Science and Commerce and Free Press Journal (FPJ) in association with NSE, NCDEX Investor (Client) Protection Fund Trust, and East West Seed.
The panellists in this session included (in alphabetical order) Dilip Rajan, MD, East West Seed India; Arun Raste, Executive Director, NDDB; and Simon Thorsten Wiebusch, COO, Bayer Crop Science. The session was moderated by RN Bhaskar, Consulting Editor, FPJ and the opening remark was delivered by Uma Maheshwari Shankar, Principal of SIES College of Arts, Science and Commerce.
Given below are edited excerpt:
What agriculture means for India
Dilip Rajan, Managing Director, East West Seed India: Agriculture has always mattered to India. At this COVID-19 times, the significance of agriculture has gained momentum.
Since Independence, India has seen recession thrice — 1958, 1966 and 1980. Each time the reason was the same and that was a monsoon shock that hit agriculture. At that time, agriculture was a sizable part of the economy. At present, we are undergoing another recession. The only difference this time is that India will be bailed out largely by agriculture. In the past agriculture was the cause of the recession, this time it can be the cure.
Agriculture accounts for 15-20 per cent of the Indian GDP and employs half of India’s population. This percentage of employment will rise even further due to reverse migration that took place (during the lockdown). This provides livelihood and sustainability to the entire nation.
Arun Raste, Executive Director, NDDB: While agriculture was developed by the human race many centuries ago, the evolution in agricultural operations was not that old. For over 1,000 years, there has been no change in agricultural practices, not just in India but across the globe. On the production side, there were a couple of changes which impacted not only agriculture but other areas as well. Due to the use of pesticides and insecticides, the environment was affected. Other impacts of agriculture were soil erosion and water depletion.
The share of agriculture in the Indian economy is going down. Agriculture has seen a 25 per cent decline in its share of GDP from the 40 per cent during the last 50 years.
Agriculture is the sweet spot due to COVID-19
Dilip Rajan: In this gloomy economy, agriculture can be the sole bright spot. Agencies like the World Bank and International Monetary Fund, are projecting (poor growth rates for) the Indian economy in FY 2020-2021. Experts believe that agriculture alone can boost the Indian economy (GDP) by 0.5-1 per cent. This means agriculture can support India’s stalled economy and infuse the much-needed demand into the system.
2020 could very well become 1991 of Indian agriculture (economic liberalisation took place in 1991). With its robust demand, attractive opportunity, timely support offered by the governments and unique competitive advantage, the renewed focus on this sector is encouraging.
Simon Thorsten Wiebusch, COO, Bayer Crop Science for India, Bangladesh & Sri Lanka: It did not even take seven days (during the first lockdown announcement) for the government to realise that agriculture needed to be supported. The supply chain disruption in agriculture or agribusiness has the potential of turning a health crisis into a hunger crisis for a country like India. It was also impressive to see how quickly India got the agri-chain working in the country. Moreover, digital pilots became mainstream in the case of serving the country and farmers.
Dilip Rajan: COVID-19 may bring about a significant change in the eating habits of people as well. This might lead people to grow their agri products in their homes. This would need different technology and systems.
A shift from food security to nutrition security
Arun Raste: For many years, India has been following unscientific ways of cultivation, this was mainly to feed the rising population in the country. While land and water were limited, the population in the country was increasing. Therefore, we had to use every single resource at our command to feed our populace. It was during this stage, India welcomed the green revolution. Today, we are self-sufficient in our food needs as a country. We are the second-largest grower of fruits and vegetables in the world. India is the largest dairy producer and pulse producer in the world.
While the rest of the world is looking at becoming vegetarian now, more than 50 per cent of the Indian population has been vegan for generations. The biggest challenge for us is getting them nutritional security (not just food security).
Dilip Rajan: Going forward, it will be nutrition security and not food security.
The resource constraint will continue. So, India will have to adopt newer technologies faster — whether it is precision agriculture or circular agriculture. From a nutritional point of view, even today India’s consumption of fruits and vegetables is far below international standards.
There is a twin dilemma in the country —on the one hand, there is malnutrition and on the other hand, there is obesity. The challenge is to have a balance. So, today the move should be towards food and nutrition security.
Agribusiness, not agriculture
Dilip Rajan: India is a small-holder farmer country, this is exactly where it needs to start from. These small-holding farmers will need support not just to increase productivity but to market their produce. In the case of doubling farmers’ income, we need to address issues such as access to credit, post-harvest technology, market the produce, and investments in agriculture.
It is time India moves to call it agribusiness and not agriculture. It is a slight nuance change, but it changes the perspective. There needs to be a concentrated and coordinated effort to promote farming as an economically viable profession for all — the marginal farmers, migrant workers and the youth.
Technology will disrupt the value chain. It will drive productivity and create new channels to the market. This pandemic has shown immense value in digital tools.
Agriculture cannot be left behind. So, India will need to adapt to a systemic application of digital tools for both production and supply.
India will need to break new ground by deploying new solutions for rapid, sustainable and resource-efficient growth. It will make the agriculture sector and intellectually satisfying and economically gratifying profession.
The path to sustainable agriculture, food security or agrarian prosperity lies in the hands of educated youth. The untapped demographic dividend will become our greatest strength if the youth is able to adopt agriculture and its allied activities based on integrated science and social wisdom.
Simon Thorsten Wiebusch: Agriculture is still very traditional in India. It is not because Indian farmers are backward. But it is mainly because it has not been able to build market connections and manage the risk that farmers face.
In the case of the government, it should only regulate what needs to be regulated. In the current environment that we are in, the government should set the right parameters and actively pull itself out (from areas where interventions are not needed) which they did recently at the mandi level. While this opens up huge opportunities, one should not underestimate the risks due to this move.
In the case of mandis, they were consolidators. It has to be noted that to buy produce in the country there is a need to have a consolidator and that is where Farmers' Producer Organisation (FPOs) can play an important role. These entities will have to be staffed by smart talent who have an economic understanding and can manage activities in rural India.
Arun Raste: Land is limited in the country. So, we would need new resources to take care of the growing population. Globally, the sea is one resource that has not been looked at to support agriculture. Then there are new concepts like aquaponics, which could very well be the future of agriculture in India. However, these activities have to be done in harmony with nature.
Such innovative concepts will be appealing to the new generation as it is a new and exciting concept. India has a long coastline which is vastly under-utilised and it can be explored in the future.
Post COVID-19, we need to reboot our agriculture. This is possible if young people with new ideas enter agriculture.
We need to promote the demand side of agriculture. The export of India is hardly two per cent (in agri produce), whereas smaller countries like Thailand export much more than India.
India needs to become the food basket of the world which China is to the world in the case of industry.
The food demand of the world can be met by India. This is because it is the only country in the world which has over 15 agro-climatic zones. India can grow anything and everything (if managed well).
India needs three major things: demand-side innovation, major changes in the way water is utilised and the government needs to reduce intervention in the sector that will encourage youth to take agriculture in their hands.
Simon Thorsten Wiebusch: In the future, the focus will be the way we grow food and if the method is economically viable. India has to put a price on water and land. Most importantly, India will have to put a price to human labour — this puts social aspects into consideration. This will change things significantly. From India’s point of view, in terms of resource input which includes human cost, we are utterly inefficient. But before becoming the food basket, we need to fix India.
India’s water costs
Arun Raste: In the past, south and east of India were the major producers of rice. But today, it is Punjab and Harayana, which never consumed rice, but are today the major producers of the paddy crop. Rice was produced in these regions mainly because there is plenty of water available. However, today the (ground) water level there is already very low.
Simon Thorsten Wiebusch: Basmati rice has a lot of merits. However, exporting commodity rice at a lower price than the intervention price to farmers (is not a right move) to countries like Indonesia and Vietnam who then turn the rice into a value-add product — noodles. So, some countries make sure that the cheapest of cheap commodities become expensive by getting it under a brand name which is then sold in a supermarket.
Rice is a profitable crop, but not for the one who produces it. This is where government intervention and politics make growing a resource guzzling crop an attractive proposition. The government needs to make sure that tweaking of policies does not mean incentivising crops in the wrong way.
Dilip Rajan: Countries like Israel have cutting-edge technology in the case of water management. But if you look at India things are different. In India, there are two crops — rice and sugarcane — that are water-guzzling crops. There is politics around it.
There is a need to understand the carbon footprint of fruits and vegetables is less than most other crops. Meanwhile, every kilo of rice that is exported from India, it is exporting 2, 000 litres of water — this is what it takes to grow a kilo of rice. The narrative has to change to the carbon footprint.
Taxing water
Arun Raste: If urban consumers are willing to pay for water, then over time even rural consumers will start paying if politics does not come in between. At present, industries are already paying for water. In rural India (in some areas), if the wells dry up and people opt for tap water, then they have to pay for it.
In Argentina, there was a protest against taxing water. However, over a period of time, water will have to be monetised. In addition, the cost of water will have to be put as an input cost (in the case of farming). The earlier we do that the better it is.
Dilip Rajan: We are still at a nascent stage when it comes to water taxation. In this case, the focus should be on agronomics. The starting point of this would be providing benefits like micro-irrigation, drip irrigation among other water management processes. Moreover, crops should be grown based on the amount of water it consumes. So, a balance should be struck between crops based on this.
Simon Thorsten Wiebusch: Last year, India was consumed by the pain of water shortage and delay in monsoon. But this year COVID-19 is the focus.
We quickly forget the pains. This year there was no conversation around water (even though it affected people).
We are already pricing carbon around the world, so it is time we price water too. There are several measures required to save water. This includes putting a price on water and also harvesting of (or managing) rainwater. In areas where there is abundant rainfall, there is a need to find a solution to conserve this water and prevent it from going into the sea. It needs a lot of reshaping.
Given below is the lecture series:
