Agricultural Sector and Marketing Reforms – eNAM, Model APMC Act, Eco Survey Reco, etc.

[op-ed snap] A bad policy choice

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Not Much

Mains level : Storage facilities for farm produce

Context

  • Ever since the Delhi government was ousted in 1998 by popular outrage over a spurt in onion prices, politicians have been wary of this vegetable.
  • The political response should solve, not structurally worsen, the problem that lies at the root of the occasional shortage of the vegetable.

Ban on onions export

  • The ban on export of onions that the central government has imposed follows in a traditional route and ignores the need for the farmer to get better terms of trade, paving the way for future shortage.
  • Onion is a relatively small crop, a little over 15 million tonnes in India.
  • China cultivates a lower area, but is the world’s largest producer, because its yield is about half as much higher than in India.

Hurting many

  • Bangladesh is very unhappy with India’s export ban,because that has worsened the shortage there.
  • Sudden export bans shut off the possibility of the farmer getting a bumper price for his crop, something that he feels he is entitled to, as the obverse of the distress sale he often has to undertake.
  • The sensible course is proper storage at times of harvest and steady decumulation of stocks over the year.
  • This will not help, however, in case of a sudden shortfall in output, thanks to flooding or unseasonal rains, as has happened this year.

Conclusion

  • Instead of banning exports, the government should encourage export of onion in its raw and processed forms.
  • The govt. must invest in food technology that would permit farmers to increase output without fear of distress sales, onion offtake assured because of its storage in a processed state.
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