💥Join UPSC 2027,2028 Mentorship (July Batch) + XFactor Notes & Microthemes PDF
Talk to Mentor

Civilsdaily

Login

Subject: Agriculture

  • Export-Import in the Agricultural sector

    Why in the news? 

    India’s agricultural exports have declined in the fiscal year ended March 31, 2024, on the back of shipment curbs on a host of commodities, from cereals and sugar to onions.

    The Need for a New Export-Import Policy for Agriculture:

    • Decline in Agricultural Exports: India’s agricultural exports fell by 8.2% in the fiscal year ended March 31, 2024, due to shipment curbs on various commodities, including cereals, sugar, and onions. This decline highlights the volatility and vulnerability of agricultural trade.
    • Impact on Export Restrictions: Export restrictions imposed by the government, such as bans on sugar and non-basmati rice exports, have led to a significant decrease in export values.
    • Market Stability: Farmers and agri-traders require policy stability and predictability to make informed decisions. Abrupt changes in export-import policies, such as sudden bans or restrictions, can disrupt trade and adversely affect agricultural businesses.
    • Need for comprehensive framework: Export-import policies should strike a balance between the interests of producers and consumers. While export restrictions may benefit consumers by stabilizing prices, they can result in revenue losses for producers. A more predictable and rules-based policy framework is needed to ensure fairness and transparency.
    • Low tariffs on certain commodities: The current import policy, characterized by low on certain commodities like pulses and edible oils, contradicts the government’s objective of promoting crop diversification.

    Measures that needs to be taken in the present scenario:

    • Long-Term Goals for the Farm Sector: A new export-import policy should align with the long-term goals of the agricultural sector, including sustainable production practices, crop diversification, and increasing farmer incomes.
      • Balancing short-term consumer needs with long-term agricultural sustainability is essential for the sector’s growth and resilience.
    • Rationalizing Export-Import Policy: The government post-election may need to rationalize the export-import policy by introducing measures such as temporary tariffs instead of outright bans or quantitative restrictions.
      • A rational and coherent policy framework will support the growth and competitiveness of India’s agricultural sector in the global market.
    • Higher Import tariffs: It could incentivize domestic production of pulses and oilseeds, reducing dependence on imports and supporting farmers.

    Conclusion: Export-import policies should strike a balance between the interests of producers and consumers. While export restrictions may benefit consumers by stabilizing prices, they can result in revenue losses for producers. A more predictable and rules-based policy framework is needed to ensure fairness and transparency.

    Mains PYQ: 

    Q In the view of the declining average size of land holdings in India which has made agriculture non – viable for a majority of farmers should contract farming and land leasing be promoted in agriculture? critically evaluate the pros and cons.(UPSC IAS/2015)

  • National Council for Agriculture and Rural Transformation (NCART): A New Vision for Agriculture Sector

    Why in the news?

    The Centre is contemplating the establishment of the National Council for Agriculture and Rural Transformation (NCART), envisioned as a federal body to formulate policies and programs for the agricultural sector.

    What is NCART?

    • The NCART is a proposed federal body aimed at coordinating and driving actions in the agriculture sector in India.
    • It would have representation of both the Centre and States.
    • The idea for NCART has been proposed by the Ministry of Agriculture and Farmers’ Welfare as part of its 100-day action plan for the new government.
    • It draws inspiration from the Goods and Services Tax (GST) Council.

    Terms of Reference of NCART:

    • Policy Formulation: NCART is envisioned as an overarching federal body responsible for devising policies and programs to promote agricultural and rural development.
    • Coordination: One of the key objectives of NCART is to ensure coordinated actions across various stakeholders involved in the agriculture sector, including the central government, state governments, and other relevant entities.
    • Consultative Body: NCART is expected to include representation from both the central and state governments, similar to the Goods and Services Tax (GST) Council, to ensure a consultative approach in decision-making.
    • Legal Status: While the GST Council is a constitutional body, the exact status of NCART is yet to be finalized.

    India’s Agriculture Expenses:

    • Despite agriculture being a state subject, the Centre has significantly increased budgetary allocations for the Agriculture Ministry.
    • Budgetary allocation for the Ministry of Agriculture and Farmers’ Welfare surged from Rs. 27,662.67 crore in 2013-14 to Rs. 1,25,035.79 crore in 2023-24 BE.

  • The poultry industry needs urgent reforms

    Why in the news?

    The current outbreak of H5N1 was a disaster waiting to happen, as experts have been sounding alarm bells on the unsafe conditions at industrial livestock production for more than 10 years now.

    Scale of spreading H5N1 virus:

    • Global Spread of H5N1 in humans: The H5N1 virus has spread globally, affecting various species including humans, polar bears in the Arctic, and seals and seagulls in Antarctica.
    • In India Spread of H5N1 in humans:  The first H5N1 patient was reported in Maharashtra in 2006. An outbreak in December 2020 and early 2021 spread across 15 States
    • Human Fatality Rate: As per WHO, the fatality rate for H5N1 among humans is estimated at 52%, with 463 deaths recorded since 2003 out of 888 diagnosed cases.
    • Transmission from Birds and Contaminated Environments: Almost all human infections with H5N1 are linked to close contact with infected birds or contaminated environments, emphasizing the importance of biosecurity measures.
    • Spread in other species: This pathogen has crossed many species barriers, causing mortality among the polar bears in the Arctic and seals and seagulls in Antarctica.

    Causes for the spread of H5N1 (avian influenza or bird flu) infection:

    • Contact with infected birds: Humans can contract H5N1 if they come into direct contact with the body fluids, such as saliva, respiratory droplets, or feces, of infected birds.
    • Poultry Trade and Movement: The transportation and trade of infected poultry, poultry products, and crowded live poultry markets provide an environment for the virus to spread between birds and potentially to humans.
    • Antibiotic Resistance: The 269th Law Commission of India Report in 2017 highlighted evidence from the Tata Memorial Centre regarding the use of non-therapeutic antibiotics in poultry farming, leading to antibiotic resistance due to unhygienic living conditions.
    • Environmental Factors: Factors like proximity to bodies of water, reduced rainfall, and presence near major highways have been associated with increased risk of H5N1 outbreaks. These environmental conditions may facilitate the spread of the virus.

    Regulation: The Central Pollution Control Board (CPCB) has classified poultry units with more than 5,000 birds as a polluting industry that requires compliance and regulatory consent to establish and operate.

    Way Forward:

    • Draft Rules for Welfare: The Law Commission 269th recommended a set of draft rules for the welfare of chickens in the meat and egg industries, aligning with existing laws and international best practices for animal care, waste management, and antibiotic use.
    • Weaknesses in Draft Rules: The Draft Rules for the egg industry released by the Ministry of Agriculture and Farmers’ Welfare in 2019 were criticized for being weak and tokenistic, failing to meet the recommendations of the Law Commission.
    • Need for Oversight and Enforcement: Given the reclassification of the poultry industry as a highly polluting ‘orange category’ industry by the Central Pollution Control Board (CPCB), strict oversight for compliance and enforcement of environmental regulations is essential.

    Mains PYQ:

    Q What is the basic principle behind vaccine development? How do vaccines work? What approaches were adopted by the Indian vaccine manufacturers to produce COVID-19 vaccines? (UPSC IAS/2022)

  • PREMIUM – Subsidies – Good or Bad for India?

    Why in the News? 

    Issues have been raised by the World Trade Organization (WTO) concerning Agricultural Subsidies in India. Major subsidies in India are on fertilizer, power, credit, output, seed, and export products.

    What is Subsidy?

    • The term subsidy refers to financial assistance in the form of discounts or monetary grants by the Central government to public entities or private institutions. 
    • The objective is to make the products offered by these institutions affordable for public consumption. 
    • The subsidized products are necessary for the larger public good and are a means of supporting the community’s welfare.

     

    Historical Background

    • Post-Independence Era (1947 onwards): The government introduced various subsidies to promote industrialization, agriculture, and social welfare, aiming to reduce poverty and achieve self-sufficiency in key sectors.
    • Green Revolution (1960s): During the 1960s and 1970s, Subsidies on fertilizers, seeds, and credit were provided to farmers to encourage the adoption of new agricultural technologies and boost food production.
    • Liberalization Reforms (1991):  While liberalization led to a reduction in some subsidies and a shift towards market-oriented policies, the government continued to provide support to sectors deemed crucial for social welfare and economic development.

    Types of Subsidies:

    • Food subsidy: The food subsidy’s main objective is to provide essential eatables to a large section of the population living below the poverty line in India. 
      • The major food items supplied to the BPL families (by PDS system) vary as per the region, it includes – Wheat, Rice, Sugar, Milk, Cooking oil, and more.
    • Education subsidy: The Central government extends the education subsidy to eligible students to pursue higher technical and professional education.
    • Export subsidy: To make exports attractive and lend support to the companies, the government offers export subsidies. 
    • Fertilizer subsidy: The fertilizer is provided at a fixed MRP that is below the actual price; the government pays the difference between the actual coat and the MRP.

    (Note: There are various types of subsidies but UPSC usually asks for Agriculture subsidies) 

    Subsidies in Agriculture:

    Direct Subsidies: 

    • Credit Subsidies: Subsidized credit programs offer farmers loans at lower interest rates or with relaxed repayment terms to finance agricultural activities, such as purchasing inputs, machinery, or land.
      • Ex-The Government of India provides interest subvention of 2% and Prompt Repayment Incentive of 3% to the farmers, thus making the credit available at a very subsidized rate of 4% per annum as per Kisan Credit Card.
    • Direct Income Transfers: Governments provide direct cash transfers or income support schemes to farmers to supplement their incomes, improve their financial stability, and alleviate rural poverty. Ex-PM Kisan Samman Nidhi Scheme under which support of Rs.6000/- per year 

    Indirect Subsidies 

    • Fertilizer Subsidies: Governments often provide subsidies on fertilizers to reduce the cost burden on farmers and promote fertilizer use, which enhances crop productivity. Ex- the Union Budget for the fiscal year 2024-25 (FY25) allocated ₹1.64 trillion for fertilizer subsidy.
    • Seed Subsidies: Subsidies on quality seeds help farmers access improved varieties that are disease-resistant, drought-tolerant or have higher yields. Ex- the government provides a subsidy of Rs. 1000/- per quintal or 50% of the cost.
    • Water Subsidies: Subsidized irrigation infrastructure and water supply schemes aim to improve water availability for agricultural purposes, especially in regions facing water scarcity. Ex- Pradhan Mantri Krishi Sinchai Yojana.
    • Minimum Support Prices (MSP): Governments guarantee a minimum price for certain crops to protect farmers from market price fluctuations and ensure stable income. Procurement agencies purchase crops from farmers at MSP, often for staples like wheat, rice, and pulses. Ex- the government of India sets the MSP twice a year for 24 commodities (23 crops + 1 sugarcane).
    • Crop Insurance Subsidies: Subsidies are offered on crop insurance premiums to encourage farmers to enroll in crop insurance schemes, which protect them against yield or revenue losses due to adverse weather, pests, or other risks. Ex- Pradhan Mantri Fasal Bima Yojana (PMFBY)
    • Subsidized Agricultural Machinery: Governments may subsidize the purchase of farm machinery, equipment, and tools to mechanize agricultural operations, increase efficiency, and reduce labor costs. Ex- Sub-mission On Agriculture Mechanization (SMAM scheme)

    Present issues raised by the WTO:

    • Market Distortion: The WTO contends that agricultural subsidies have the potential to disrupt global markets. For instance, subsidies like India’s Minimum Support Price (MSP) may result in the undervaluation of Indian agricultural goods on the international stage. 
    • Trade Barriers: Subsidies can create challenges for foreign producers without subsidies to compete effectively in markets where subsidized goods are sold.
    • Overproduction of certain crops: Subsidies can lead to overproduction of certain crops, which can further distort the market and lead to wastage.
    • Negative Environmental Impact: Overuse of fertilizers and water for irrigation, encouraged by subsidies, can lead to environmental degradation.
    • Inequity: The benefits of subsidies often go to larger farmers rather than small-scale farmers who need them the most.

    Limitations Faced by Indian Agriculture:

    • Subsidies on few crops: Subsidies like MSP, which are applicable for only a few crops, have led to cereal-centric agriculture with distorted cropping patterns, as farmers tend to grow only those crops for which they are given subsidies.
    • Benefiting only wealthy Farmers: As per the Economic Survey 2018, wealthy farmers benefited over small farmers from the farm subsidies. Thus the objective of giving subsidies is not fulfilled. This is the case frequently witnessed in Punjab and Haryana, where affluent farmers enjoy taxpayer money.
    • Fiscal deficit: Also, the subsidies lead to a substantial financial deficit and burden on the financial exchequer.
    • Cause of pollution: Subsidies for agriculture can foster the overloading of croplands, which leads to erosion and compaction of topsoil, pollution from synthetic fertilizers and pesticides, and release of greenhouse gases, among other adverse effects.

    Way Forward:

    • Diversification of Subsidies: Expand subsidy programs to cover a wider range of crops, including fruits, vegetables, pulses, and other diversified agricultural products, to promote crop diversification and mitigate the cereal-centric focus.
    • Targeted Subsidy Programs: Implement targeted subsidy schemes that prioritize support for small and marginalized farmers, ensuring that subsidies reach those who need them most and reducing the disproportionate benefit to wealthy farmers.
    • Price Stabilization Mechanisms: Develop price stabilization mechanisms beyond MSP, such as futures markets, crop insurance, and warehouse receipt systems, to mitigate price volatility and provide income security to farmers without distorting cropping patterns.

    Prelims PYQ

    In India, markets in agricultural products are regulated under the (UPSC IAS/2015)

    a) Essential Commodities Act, 1955

    b) Agricultural Produce Market Committee Act enacted by States

    c) Agricultural Produce (Grading and Marking) Act, 1937

    d) Food Products Order, 1956 and Meat and Food Products Order, 1973

    Mains PYQ 

    Q How do subsidies affect the cropping pattern, crop diversity and economy of farmers? What is the significance of crop insurance, minimum support price and food processing for small and marginal farmers? (UPSC IAS/2017) 

    Q What are the different types of agriculture subsidies given to farmers at the national and at state levels? Critically analyse the agricultural subsidy regime with reference to the distortions created by it (UPSC IAS/2013)

  • NABARD Unveils Climate Strategy 2030 for Green Financing

    Why in the news?

    The National Bank for Agriculture and Rural Development (NABARD) revealed its ‘Climate Strategy 2030’ document, aiming to address India’s need for enhanced green financing.

    Key Pillars of Climate Strategy 2030:

    • The strategy focuses on four key pillars: 
      1. Accelerating green lending across sectors, 
      2. Playing a broader market-making role, 
      3. Internal green transformation, and 
      4. Strategic resource mobilization.
    Green Financing Scenario in India

    • Despite India’s requirement of $170 billion annually for achieving sustainable development goals by 2030, the current green finance inflows remain critically insufficient.
    • As of 2019-20, India secured only about $49 billion in green financing, with a significant portion allocated to mitigation efforts, leaving minimal funds for adaptation and resilience.

     

    About NABARD:

    • It was established on July 12, 1982, based on the recommendation of the Sivaraman Committee to promote sustainable rural development and agricultural growth in India.
    • Aim:  To facilitate credit flow for the promotion and development of agriculture, small-scale industries, cottage and village industries, handicrafts, and other rural crafts.
    • It operates as a statutory body under the Reserve Bank of India (RBI) Act, 1934, with its headquarters located in Mumbai.
    • It is governed by a Board of Directors appointed by the GoI:
      • Representatives from the RBI;
      • Central and state governments; 
      • Experts from various fields related to Rural Development and Finance.

     Functions of NABARD:

    • Refinance Support: NABARD provides refinance facilities to banks and financial institutions for agricultural and rural development activities, including crop loans and rural infrastructure projects.
    • Financial Inclusion: It promotes financial inclusion by expanding banking services in rural areas, supporting SHGs, FPOs, and MFIs, and facilitating access to credit for rural communities.
    • Priority Sector Lending: NABARD plays a crucial role in channelling credit to priority sectors such as agriculture, small-scale industries, and rural infrastructure, in alignment with the Reserve Bank of India’s priority sector lending guidelines.
    • Direct Lending: It extends direct loans to institutions for specific rural development projects, such as agricultural production, rural infrastructure development, and agri-processing units.
    • Scheme Implementation: The organization administers government schemes and funds like Rural Infrastructure Development Fund (RIDF), Watershed Development Fund (WDF) to finance rural infrastructure projects and watershed development activities.
    • Credit Planning: NABARD collaborates with central and state governments, RBI, and other stakeholders to formulate credit policies and plans for agriculture and rural sectors.
    • Research and Training: NABARD promotes research and development in agriculture, supports capacity building and training programs for rural stakeholders, and facilitates technology transfer initiatives.

     

    PYQ:

    [2013] Which of the following grants/grants direct credit assistance to rural households? 

    1. Regional Rural Banks
    2. National Bank for Agriculture and Rural Development
    3. Land Development Banks

    Select the correct answer using the codes given below:

    (a) 1 and 2 only 

    (b) 2 only 

    (c) 1 and 3 only

    (d) 1, 2 and 3

  • India’s Surge in Pulses Imports: A Six-Year High

    Why in the news?

    • India’s pulses imports in fiscal 2024 witnessed a remarkable surge, soaring by 84% year-on-year to their highest level in six years.
    • Lower production levels prompted India to permit duty-free imports of red lentils (Masoor) and yellow peas (Tur/Arhar), further driving the increase in imports.

    Pulses Cultivation in India

    Details
    Seasons Cultivated in both ‘Kharif’ and ‘Rabi’ seasons. ‘Rabi’ pulses contribute more than 60% of production.

    Kharif Season Pulses:

    1. Pigeon Peas (Arhar/Toor/Red Gram)
    2. Green Beans (Moong Beans)
    3. Black Matpe (Urad/Mah/Black Gram)
    4. Black Eyed Peas (Lobia)
    5. Chick Peas (Kabuli Chana)
    6. Red Kidney Beans (Rajmash)

    Rabi Season Pulses:

    1. Bengal Gram (Desi Chick Pea/Desi Chana)
    2. Lentils (Masoor)
    3. White Peas (Matar)
    Production (2023)  Approximately 27.5 million metric tonnes

    Reported as 7.6 quintals per hectare
    Area under Cultivation Pulses account for around 20% of the area under food grains in India.
    Top Producing States Madhya Pradesh, Maharashtra, Rajasthan, Uttar Pradesh, Karnataka
    Government Initiatives National Food Security Mission (NFSM) for Pulses, Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-AASHA) Scheme
    Research and Development Conducted by Indian Council of Agricultural Research (ICAR) in collaboration with State Agricultural Universities
    Goal Aim for self-sufficiency in pulse production by 2027

     

    Pulses Import: Figures and Value

    • India imported a total of 4.65 million metric tons of pulses in the fiscal year ending March 31, 2024, marking the highest volume since fiscal 2018.
    • In terms of value, imports surged by 93% to reach $3.75 billion in the same period.

     

    Pulses Production in India: Key Facts

    • India is the largest producer (25% of global production), consumer (27% of world consumption) and importer (14%) of pulses in the world (as per FAO).
    • Pulses account for around 20% of the area under foodgrains and contribute around 7-10% of the total foodgrains production in the country (as per Vikaspedia).
    • Gram (Chana) is the most dominant pulse having a share of around 40 per cent in the total production followed by Tur/Arhar at 15 to 20 per cent and Urad and Moong at around 8-10 per cent each. (Reference)
    • Madhya Pradesh, Maharashtra, Rajasthan, Uttar Pradesh and Karnataka are the top five pulses producing States. (Reference)

     

    Global Impact of Higher Imports

    • The surge in imports by India, the world’s largest importer, producer, and consumer of protein-rich pulses, has been bolstering global prices.
    • It has also contributed to reducing stocks in exporting countries such as Canada, Australia, and Myanmar.

    Significance of Pulses Consumption

    1. Nutritional Value:
      • Pulses are considered to be ‘poor man’s protein’.
      • They contain 20-25% of protein by weight, with twice the protein available in wheat and thrice that present in rice.
      • WHO recommends 80gm/day of Pulses in the diet.
    2. Environmental Sustainability:
      • Pulses have low carbon and water footprints, making them integral to sustainable farming.
      • Water footprints for producing one kilogram of meat are five times higher than that of pulses.
      • Pulses emit 0.5 kilogram in CO2 equivalent per kilogram, while meat produces 9.5 kilograms in CO2 equivalent.

    PYQ:

    [2019] Among the agricultural commodities imported by India, which one of the following accounts for the highest imports in terms of value in the last five years ?

    (a) Spices

    (b) Fresh fruits

    (c) Pulses

    (d) Vegetable oils

    [2020] With reference to pulse production in India, consider the following statements:

    1. Black gram can be cultivated as both kharif and rabi crop.
    2. Green-gram alone accounts for nearly half of pulse production.
    3. In the last three decades, while the production of kharif pulses has increased, the production of rabi pulses has decreased.

    Which of the statements given above is/are correct?

    (a) 1 only

    (b) 2 and 3 only

    (c) 2 only

    (d) 1, 2 and 3

  • Growth in Ashwagandha Exports

    Why in the news?

    • Ashwagandha exports have surged by 8 times in the past six years, penetrating markets like the United States, Czech Republic, and Canada.
    • The Ayurvedic industry in India has been growing at a Compound Annual Growth Rate (CAGR) of 17%, with the industry size increasing from $3 billion in 2014 to $24 billion today.
    • Gujarat, with about 850 Ayurvedic manufacturing units, ranks fourth in the country after Uttar Pradesh, Kerala, and Maharashtra.
    • India leads in Ashwagandha production and export, with states like Rajasthan and Madhya Pradesh emerging as key producers.
    • The herb is exported primarily as extracts and has gained significant traction in the United States, where it competes with Chinese Ginseng.

     

    What is Ashwagandha? 

    • Also known as Indian Ginseng or Withania somnifera, Ashwagandha belongs to a group of herbs known as ‘adaptogens’( best rejuvenating agent).
    • It is available in various forms such as extracts, powder, and raw herbs, catering to domestic and international markets.

    Medicinal Properties and Usage:

    • In treatment of rheumatic pain, inflammation of joints, nervous disorders and epilepsy.
    • Used as a tonic for hiccup, cold, cough, female disorders, as a sedative, in care of senile debility, ulcers, etc.
    • Leaves are applied for carbuncles, inflammation and swellings.  Leaf juice is useful in conjunctivitis.
    • Bark decoction is taken for asthma and applied locally to bed sores.
    • Ashwagandha and its extracts are used in the preparation of herbal tea, powders, tablets, and syrups.

    Cultivation of Ashwagandha

    • Ashwagandha-growing states: Rajasthan, Punjab, Haryana, Uttar Pradesh, Gujarat, Maharashtra and Madhya Pradesh.
      • Being a hardy and drought-tolerant crop, Ashwagandha requires a relatively dry season throughout its growing period.
      • It is grown as late rainy season (kharif) crop between 600-1200 m altitudes.
      • It grows well in sandy loam or light red soil having pH 7.5 to 8.0 (alkaloid) with good drainage.
    • Black soil or such heavy soil is suitable for cultivation.

    With inputs from: https://agritech.tnau.ac.in/farm_enterprises/Farm%20enterprises_%20Ashwagantha.html

    PYQ:

    [2010] Consider the following statements:

    1. The Taxus tree is naturally found in the Himalayas
    2. The Taxus tree is listed in the Red Data Book.
    3. A drug called “taxol” is obtained from Taxus tree is effective against Parkinson’s disease

    Which of the above statements is/are correct?

    (a) 1 only

    (b) 1 and 2 only

    (c) 2 and 3 only

    (d) 3 only

  • India Initiates Review of Asean Trade Pact to Boost Domestic Manufacturing

    Why in the news?

    The review aims to address concerns such as the inverted duty structure, which puts local manufacturers at a disadvantage.

    Trade deficit issue with ASEAN 

    • High trade deficit: The trade deficit between India and the Association of Southeast Asian Nations (ASEAN) has been a significant issue, with the deficit widening to USD 43.57 billion in the last fiscal from USD 25.76 billion in 2021-22 and just USD 5 billion in 2010-11
    •  Review AITIGA:This has led to a review of the ASEAN-India Trade in Goods Agreement (AITIGA) by 2025, aiming to address concerns about trade barriers, abuse of the agreement, and the growing trade gap between India and the ASEAN region

    ASEAN-India Trade in Goods Agreement (AITIGA)

    • The ASEAN-India Trade in Goods Agreement (AITIGA) is a trade agreement between the ten member states of ASEAN and India, signed in 2009 and implemented in 2010. The agreement aims to establish a free trade area between the parties, covering trade in physical goods and products, and progressively eliminating duties on 76.4 percent of goods. 

    The trade deficit between India and the ASEAN region is primarily due to the following reasons:

    • Tariff disparities: India’s tariffs were much higher than partner countries, leading to a significant reduction in tariffs for partner countries, which in turn caused India’s imports to grow faster than exports. This imbalance has been widening since 2010-11, the year India entered into an agreement with ASEAN
    • Non-tariff barriers and regulations: India’s exports to ASEAN have been affected due to non-reciprocity in FTA concessions, non-tariff barriers, import regulations, and quotas. These factors have hindered India’s ability to fully benefit from the FTA
    • Routing of goods from third countries: There have been concerns about the routing of goods from third countries, such as China, to ASEAN countries with minimum value addition and then being imported into India, misusing the India-ASEAN FTA. This practice has contributed to the growing trade deficit
    • Limited market access for Indian products: India’s exports of products such as textile clothing, footwear, food products, and minerals don’t have a significant place in ASEAN imports, while there is a higher dependence on products such as vegetables, fuels, chemicals, and metals from ASEAN, which are essential commodities

     Conclusion 

    India’s review of the ASEAN-India Trade in Goods Agreement aims to tackle the widening trade deficit by addressing tariff disparities, non-tariff barriers, and the misuse of the agreement, crucial steps toward fostering fair and balanced trade relations.

    Mains question for practice 

    Q Discuss the factors contributing to high  deficit between India and ASEAN. 

     

  • Understanding perspectives: Farmers’ Protests raise divisive opinions

    Why in the news? 

    A recent survey conducted by CSDS-Lokniti aimed to gather opinions regarding the ongoing farmer protests.

    Opinion about the Farmer Protest:

    The major key demands of Farmers in India include:

    • On Minimum Support Price (MSP): Farmers demand a legal guarantee for MSP for crops, which is a crucial lifeline for farmers facing market uncertainties.
    • On Electricity Act 2020: Farmers are demanding the repeal of the Electricity Act 2020, which they believe will negatively impact their income.
    • On Compensation: Farmers are demanding compensation for farmers who died during the previous agitation in Lakhimpur Kheri.
    • Withdrawal of Cases: Farmers are demanding the withdrawal of cases registered against farmers during the 2020-21 agitation.

    Government Initiatives: 

    • Negotiations: The government has taken several steps to address the farmer agitation, including negotiations with protesting farmers, proposing the formation of a committee to provide statutory backing to the Minimum Support Price (MSP), and engaging in talks with farmer representatives.
    • Demands: Despite promises made to farmers in 2021, the government has not fully responded to their demands, leading to continued tensions and protests. The government’s reaction to the protest still appears to be focused on maintaining law and order rather than proactively addressing the underlying issues raised by the farmers

    Conclusion: The CSDS-Lokniti 2024 pre-poll survey highlights divisive opinions on farmer protests, citing demands for an MSP guarantee, repeal of the Electricity Act, and compensation for fatalities. Despite negotiations, unresolved grievances persist, indicating a need for proactive governmental action and dialogue

  • CDP-SURAKSHA Digital Platform for Horticulture Subsidies

    Why in the news?

    The government has introduced a new platform called CDP-SURAKSHA for disbursing subsidies to horticulture farmers under the Cluster Development Programme (CDP).

    India’s Horticulture Sector:

    • India’s horticulture sector contributes nearly 1/3rd to the agriculture GVA, making a substantial economic contribution.
    • The total production of horticulture crops has increased, from 240.53 million tonnes in 2010-11 to 334.60 million tonnes in 2020-21.

    What is CDP-SURAKSHA?

    • CDP-SURAKSHA is a digital platform acronym for “System for Unified Resource Allocation, Knowledge, and Secure Horticulture Assistance.”
    • It facilitates instant subsidy disbursal to farmers’ bank accounts using the e-RUPI voucher from the National Payments Corporation of India (NPCI).
    • It provides upfront subsidies during material purchase, and vendors receive payment only after farmers verify delivery.

    Key Features include database integration with PM-KISAN, cloud-based server space from NIC, UIDAI validation, eRUPI integration, LGD, content management system, geotagging, and geo-fencing.

    Operational Mechanism of CDP-SURAKSHA

    1. Farmer Interaction:
      • Farmers, vendors, implementing agencies (IA), cluster development agencies (CDAs), and National Horticulture Board (NHB) officials can access the platform.
      • Farmers can log in using their mobile number, place orders for planting material, and contribute their share of the cost.
    2. Subsidy Disbursement:
      • After raising the demand, farmers receive the subsidy amount automatically on the screen.
      • Upon paying their contribution, an e-RUPI voucher is generated and received by the vendor, who supplies the planting material.
      • Farmers verify the delivery through geo-tagged media, following which the IA releases payment to the vendor.

    Significance of e-RUPI

    • e-RUPI is a one-time payment mechanism redeemable without cards or digital payment apps, used for specific purposes.
    • It is shared with beneficiaries via SMS or QR code and accepted at merchants supporting e-RUPI.

    Old System vs. CDP-SURAKSHA:

    • Previously, farmers purchased planting materials independently and then approached officials for subsidy release.

    Cluster Development Program (CDP)

     

    • CDP, under National Horticulture Board (NHB), aims to leverage horticulture clusters’ geographical specialization for integrated development.
    • It is a Central Sector Scheme aimed at growing and developing identified horticulture clusters to make them globally competitive.
    • 55 clusters have been identified, with 12 selected for the pilot phase, covering 9 lakh hectares and 10 lakh farmers.
    • It provides government assistance based on cluster size—up to Rs 25 crore for mini clusters, Rs 50 crore for medium, and Rs 100 crore for mega clusters.

     

    PYQ:

    [2019]Among the agricultural commodities imported by India, which one of the following accounts for the highest imports in terms of value in the last five years?

    (a) Spices

    (b) Fresh fruits

    (c) Pulses

    (d) Vegetable oils