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Subject: Agriculture

  • [pib] Glycemic Index in Rice

    The Union Minister of Agriculture and Farmers Welfare has provided some useful information about some indigenous varieties of rice.

    Try this PYQ from CSP 2018:

    Q.With reference to the Genetically Modified mustard (GM mustard) developed in India, consider the following statements:

    1. GM mustard has the genes of a soil bacterium that give the plant the property of pest-resistance to a wide variety of pests.
    2. GM mustard has the genes that allow the plant cross-pollination and hybridization.
    3. GM mustard has been developed jointly by the IARI and Punjab Agricultural University.

    Which of the statements given above is/are correct?

    (a) 1 and 3 only

    (b) 2 only

    (c) 2 and 3 only

    (d) 1, 2 and 3

    Indigenous varieties of rice

    • Indigenous varieties of rice are being promoted through varieties of programmes.
    • 574 indigenous varieties of rice have been propagated and tested at more than 10,000 farmers’ fields.
    • Nutritional profiling of 300 selected rice varieties has been done for market linkage and better price to the farmers.
    • Farmers are also being trained on conservation, improvement and use of traditional/ indigenous varieties through participatory variety selection.
    • Further, for access to seeds of these indigenous varieties, community seed banks have been established.

    Key varieties

    • Lalat and Improved Lalat (GI value: 54) as Low GI
    • Swarna, Sambha Mahsuri and Shaktiman (GI value <60) as intermediate GI have been identified

    There is no certification for GI (Glycemic Index) in rice in India.

    What is Glycemic Index (GI)?

    • GI is a number from 0 to 100 assigned to food, with pure glucose arbitrarily given the value of 100, which represents the relative rise in the blood glucose level two hours after consuming that food.
    • The GI of a specific food depends primarily on the quantity and type of carbohydrate it contains.
    • But it is also affected by the amount of entrapment of the carbohydrate molecules within the food, the fat and protein content of the food, the number of organic acids (or their salts) in the food, and whether it is cooked and, if so, how it is cooked.
    • A food is considered to have a low GI if it is 55 or less; high GI if 70 or more, and mid-range GI if 56 to 69.

  • Minimum Selling Price for Sugar

    The Indian Sugar Mills’ Association (ISMA) has asked for an increase in the Minimum Selling Price of Sugar.

    Try this PYQ:

    Q.The Fair and Remunerative Price (FRP) of sugarcane is approved by the:

    (a) Cabinet Committee on Economic Affairs

    (b) Commission for Agricultural Costs and Prices

    (c) Directorate of Marketing and Inspection, Ministry of Agriculture

    (d) Agricultural Produce Market Committee

    Minimum Selling Price (MSP) for Sugar

    • The price of sugar is market-driven & depends on the demand & supply of sugar.
    • However, with a view to protecting the interests of farmers, the concept of MSP of sugar has been introduced since 2018.
    • MSP of sugar has been fixed taking into account the components of Fair & Remunerative Price (FRP) of sugarcane and minimum conversion cost of the most efficient mills.

    How is the pricing of Sugarcane done?

    • With the amendment of the Sugarcane (Control) Order, 1966, the concept of Statutory Minimum Price (SMP) of sugarcane was replaced with the Fair and Remunerative Price (FRP)’ of sugarcane in 2009-10.
    • The cane price announced by the Central Government is decided on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP).
    • This is done in consultation with the State Governments and after taking feedback from associations of the sugar industry.

  • [pib] ‘Red Rice’ exports from Assam to the US

    In a major boost to India’s rice exports potential, the first consignment of ‘red rice’ was flagged off today to the USA.

    Try this PYQ from CSP 2019

    Q.Among the following, which one is the largest exporter of rice in the world in the last five years?

    (a) China

    (b) India

    (c) Myanmar

    (d) Vietnam

    Red Rice

    • Iron rich ‘red rice’ is grown in the Brahmaputra valley of Assam, without the use of any chemical fertilizer.
    • The rice variety is referred to as ‘Bao-dhaan’, which is an integral part of Assamese food.
    • Much like brown rice and white rice, red rice also comes with many incredible health benefits.
    • Due to the presence of a component called anthocyanin, this rice is usually consumed either partially hulled or unhulled.
    • Red rice derives this eye-grabbing colour from this component and has much more nutrient value as compared to other varieties of rice.

  • Operation Green

    The article compares the performance of  Operation Flood with Operation Green and offers several lessons for the success of Operation Green.

    Operation Green and its expansion

    • There were three basic objectives when OG was launched.
    • First, that it should contain the wide price volatility in the three largest vegetables of India (TOP).
    • Second, it should build efficient value chains of these from fresh to value-added products with a view to give a larger share of the consumers’ rupee to the farmers.
    • Third, it should reduce the post-harvest losses by building modern warehouses and cold storages wherever needed.
    • The Union budget for the FY 2021-22 proposes the expansion of Operation Green (OG) beyond tomatoes, onions, and potatoes (TOP) to 22 perishable commodities.
    • The move reflects the government’s intentions of creating more efficient value chains for perishables.

    Comparing performance of OG with horticulture sector

    • A closer examination of the scheme reveals that it is nowhere near achieving its objectives.
    • ICRIER research reveals that price volatility remains as high as ever.
    • It also reveals that farmers’ share in consumers’ rupee is as low as 26.6 per cent for potatoes, 29.1 per cent in the case of onions, and 32.4 per cent for tomatoes (see graph).
    •  In cooperatives like AMUL, farmers get almost 75-80 per cent of what consumers’ pay.
    • Operation Flood (OF) transformed India’s milk sector, making the country the world’s largest milk producer, crossing almost 200 million tonnes of production by now.
    • Although OG is going to be more challenging than OF there are some important lessons one can learn from OF.

    Lessons from operation flood

    • First and foremost is that results are not going to come in three to four years.
    • OF lasted for almost 20 years before milk value chains were put on the track of efficiency and inclusiveness.
    • There has to be a separate board to strategise and implement the OG scheme, more on the lines of the National Dairy Development Board (NDDB) for milk.
    • Second, we need a champion like Verghese Kurien to head this new board of OG.
    • The MoFPI can have its evaluation every six months, but making MoFPI the nodal agency for implementing OG with faceless leaders is not very promising.
    • Third, the criteria for choosing clusters for TOP crops under OG is not very transparent and clear.
    • The reason is while some important districts have been left out from the list of clusters, less important ones have been included.
    • What is needed is quantifiable and transparent criteria for the selection of commodity clusters, keeping politics away.
    • Fourth, the subsidy scheme will have to be made innovative with new generation entrepreneurs, startups and FPOs.
    • The announcement to create an additional 10,000 FPOs along with the Agriculture Infrastructure Fund and the new farm laws are all promising but need to be implemented fast.

    Consider the question “What are the objectives of Operation Green? How far has Operation Green succeeded in achieving its objectives?”

    Conclusion

    These lessons from Operation Flood will help in securing the success of the expanded Operation Green.

  • [pib] PM-KISAN Scheme Completes Two Years

    The PM-Kisan scheme, launched with an aim to ensure a life of dignity and prosperity for farmers has completed two years of successful implementation.

    PM-KISAN

    • Under this programme, vulnerable landholding farmer families, having cultivable land upto 2 hectares, will be provided direct income support at the rate of Rs. 6,000 per year.
    • This income support will be transferred directly into the bank accounts of beneficiary farmers, in three equal instalments of Rs. 2,000 each.
    • This programme will be entirely funded by the Government of India.

    Note: Aadhaar was made optional for availing the first instalment (December 2018 – March 2019). But now it is mandatory.

    Exclusion categories

    The following categories of beneficiaries of higher economic status shall not be eligible for benefit under the scheme.

    1. All Institutional Landholders
    2. Farmer families in which one or more of its members belong to the following categories
    • Former and present holders of constitutional posts
    • Former and present Ministers/ MP/MLAs/Mayors /Chairpersons of District Panchayats
    • All serving or retired officers and employees of Central/ State Government Ministries (Excluding Multi Tasking Staff /Class IV/Group D employees)
    • All superannuated/retired pensioners whose monthly pension is ₹10,000/-or more (Excluding Multi Tasking Staff / Class IV/Group D employees) of the above category
    • All Persons who paid Income Tax in the last assessment year
    • Professionals like Doctors, Engineers, Lawyers, Chartered Accountants, and Architects registered with Professional bodies and carrying out the profession by undertaking practices.

    Do you know?

    West Bengal is yet to implement the PM-KISAN scheme while the farmers have completed their registrations!

  • Animal Husbandry Infrastructure Development Fund (AHIDF)

    Importance of animal husbandary and dairy sector

    • As an allied industry of agriculture, the animal husbandry and dairy sector collectively employs more than 100 million people.
    • Since the bulk of establishments in this sector is concentrated in rural India, the socio-economic relevance of this sector cannot be overstated.
    • the Central government unveiled a string of measures to cushion the economy, as a part of which the Animal Husbandry Infrastructure Development Fund (AHIDF) was announced.

    More about AHIDF

    • The AHIDF has been set up with an outlay of ₹15,000 crore.
    • As per the provisions of AHIDF, a project will be eligible for a loan amount that covers up to 90% of the estimated cost –
    • There will be interest subvention of 3% for all eligible entities.
    • Applicants can submit the proposal with a complete Detailed Project Report through the Udyami Mitra Portal.
    • The fund includes a diverse set of stakeholders such as FPOs, private dairy players, individual entrepreneurs, and non-profits within its ambit.

    Strengthening dairy value chain

    • There is a pressing need to enhance chilling infrastructure at collection centres by setting up bulk milk coolers.
    • If the infrastructure needs for milk processing and distribution are included, then the overall potential investment opportunity is to the tune of ₹1,40,000 crore across the dairy value chain.
    • There is also considerable potential to increase the productivity of cattle, especially by enhancing the quality of animal feed.
    • With this in mind, the AHIDF has been designed to support the establishment of animal feed plants of varying capacities.
    • The infrastructure gap of 10-18 MMT in the production and supply of affordable compound cattle feed translates into an investment potential of around ₹5,000 crore.

    Boosting the poultry industry

    • There are not only economic but nutritional benefits to boosting the poultry segment’s output, efficiency and quality.
    • India is the fourth largest chicken meat producer and the second largest egg producer in the world.
    • India is well-positioned to help mitigate rampant malnutrition given that chicken meat provides the cheapest source of protein per unit.
    • With eggs being introduced as part of the mid-day meal within several anganwadis in the country, an upgradation in poultry infrastructure would be closely intertwined with social justice outcomes too.
    • Macro benefits regarding climate change and employment are linked to this sector.
    • Enhanced infrastructure can make processing units more energy-efficient and help mitigate their carbon footprint.

    Consider the question ” As an allied industry of agriculture, the animal husbandry and dairy sector are important for rural area and the socio-economic relevance of this sector cannot be overstated. In light of this, examine the role Animal Husbandry Infrastructure Development Fund (AHIDF) could play in transforming rural economy.”

    Conclusion

    The AHIDF also has the potential to create over 30 lakh jobs, even as it overhauls domestic infrastructure towards giving greater prominence to India’s dairy and livestock products in the global value chain.

     

  • Farm laws must reflect regional and crop diversities

    The article argues for consideration of the regional variation in the conditions of farmers and their concerns in the context of recently introduced farm laws.

    Argument against diversification

    • In Punjab, Haryana and western UP, minimum support price (MSP)-based agriculture has a logic.
    • Not all regions must diversify.
    • The region has great alluvial soil, good irrigation and almost a century-long tradition of the application of science to agriculture.
    • In south Punjab, with less irrigation, and parts of Haryana not covered by the Indira Gandhi Canal, some diversification to pulses, cotton etc. could work but the solid specialisation in this region remains.

    Issue of middlemen

    • Arhtiyas (middlemen) are important in Indian agricultural markets.
    • They are a part of the supply chain in north-west India.
    • Here they are not like the middlemen elsewhere.
    • They function simply as agents of the procurement agencies.
    • This was done by the past government to reduce overhead costs of procurement.

    Steps need to be taken

    • The e-markets, forwards and farmer-managed companies are not the dominant mode of rural organisations.
    • Agriculture is the one good sector in otherwise dismal year.
    • So, we need to strengthen it, not feed off on its glory, even outside north-west India.
    • We have the largest spread of agricultural markets in the world according to spatial maps.
    • But they are not APMCs.
    • With weak markets (outside of grains) and without first-stage processing and other infrastructure, the farmer knows he is at the mercy of the trader and comes out on the streets when that is not understood.

    Evolution of MSP

    • The MSP played a crucial role in the days of compulsory procurement and zonal restrictions.
    • Each crop had its own report then.
    • Later separate reports were replaced by two reports, one for kharif and another one for rabi, apart from one for sugarcane (an annual crop).
    • The 1982 rabi report stated that relative prices and, in that context, MSP had the role of an intervention mechanism when markets failed, outside the compulsory procurement area.
    • Later, the concept of transport costs and managerial costs became important.

    Way forward

    • The Essential Commodities Act should be ditched.
    • Good laws are good because progress starts with them, but not all laws are good everywhere.
    • A modified version of the laws with a roadmap can be on the agenda — not everywhere, but most places outside the lands of the five rivers.

    Conclusion

    The amended laws should be considered in the context of regional variation in the country and necessary changes should be made to address the concerns of the farmers.

  • Farm lessons from China, Israel

    China and Israel offer two important lessons for India to transform its agriculture: agri-market reforms and water accounting.

    Lessons from Israel and China

    • India, China and Israel — started off their new political journey in late 1940s, but today China’s per capita income in dollar terms is almost five times that of India, and Israel’s almost 20 times higher than India.
    • China produces three times more agri-output than India from a smaller arable area.
    • China started off its economic reforms in 1978 by taking up agriculture first.
    • It dismantled its commune system of land holdings and liberated agri-markets that allowed farmers to get much higher prices.
    • As a result, in 1978-84, farmers’ incomes in China increased by almost 14 per cent per annum, more than doubling in six years.
    • Israel cultivates high-value crops for exports (citrus fruits, dates, olives) by using every drop of water and recycling urban waste water for agriculture, by de-salinisation of sea waters.
    • Water accounting in Israel is something exemplary.

    Need for agri-reform in India

    • The average holding size in China was just 0.9 ha in 2016-18, smaller than India’s 1.08 ha in 2015-16.
    • So there is no doubt that small holders can do wonders, if they are given the right incentives, good infrastructure and research support, and the right institutional framework to operate.
    • In India, the 1991 reforms did not include agriculture.
    • Indian agri-food policies remained more consumer-oriented with a view to protect the poor.
    • Export controls, stocking limits on traders, movement restrictions, etc all continued at the hint of any price rise.
    • The net result of all this was farmers’ incomes remained low and so did those of landless agri-labourers.

    Way forward

    • India needs to change its policy framework from being subsidy-led to investment-driven, from being consumer-oriented to producer-oriented, and from being supply-oriented to demand-driven by linking farms with factories and foreign markets, and, finally, from being business as usual to an innovations-centred system.
    • Until India breaks away from the policy of free power for agriculture, there would be no incentive for farmers to save water.
    • In a state like Punjab where almost 80 per cent of blocks are over-exploited or critical, meaning the withdrawal of water is much more than the recharge.
    • Highly subsidised urea and open-ended procurement have become a deadly cocktail that are eating away the natural wealth of Punjab.
    • Out-of-box thinking is needed to break this regressive cycle for a brighter future for Punjab, for our own children.

    Consider the question “What are the implications of subsidy oriented policies for Indian agriculture.”

    Conclusion

    Lessons from China and Israel suggest that India need reform in agri-food policies and water accounting to address several issues plaguing agriculture.

  • Dairy Industry in India : An analysis

    The article highlights the issues facing the dairy sector and explains the utility of IVF technology for crossbreeding.

    Importance of dairy sector

    • The dairy sector assumes significance on account two reasons:
    • 1) It has to do with the socio-cultural affinity towards cows and dairy products in large parts of the country.
    • 2) As an industry, it employs more than 70 million farmers.
    • Need of the hour is for us to identify ways in which we can enhance the return on investment for our farmers.

    India’s journey from milk deficit country to one of surplus

    • Initiated in 1970, Operation Flood transformed India into one of the largest milk producers.
    • The per capita availability of milk in 2018-19 was 394 grams per day as against the world average of 302 grams.
    • Today with an annual production of 187.75 million tonnes India accounts for about 22% of the world’s milk production.
    • However, India is yet to join the ranks of major milk exporting nations, as much of what we produce is directed towards meeting domestic demands.

    Making India milk exporting nation

    • Indigenous cows produce 3.01kgs of milk per cow per day, while the yield of exotic crossbred cows is 7.95kgs.
    • Crossbreeding has taken off in a big way because of the advancements in reproductive technologies like In vitro fertilization (IVF), embryo transfer process, and artificial insemination.
    • Out of these processes, IVF and artificial insemination have proven to be the most popular and effective methods.
    • The NAIP (Nationwide Artificial Insemination Programme) Phase-I was launched in September 2019.
    • Every animal in the programme was assigned a 12-digit unique identification number under the Pashu Aadhar scheme.
    • NAIP Phase-II was initiated on 1 August 2020 with an allocation of ₹1,090 crore in 604 districts covering 50,000 animals per district and is on track to be completed by the 31 May 2021.
    • Under the programme, 9.06 crore artificial inseminations will be performed and is expected to lead to the birth of 1.5 crore high yielding female calves.
    • Consequently, 18 million tonnes of additional milk will be produced as average productivity will be enhanced from 1,861kg per animal per year to 3,000kg per animal per year.
    • Artificial insemination (AI) technology has been the most used method in India, but its success hinges upon accuracy in heat detection and timely insemination.
    • And this is where In Vitro Fertilization (IVF) technology will prove to be more effective.

    Conclusion

    In keeping with our ethos of ‘Jai Kisan, Jai Vigyan’ the marriage of rural farming with the latest innovations in technology will usher in unprecedented transformation in our dairy industry.

  • Laws that have distorted agriculture and labour markets need to go

    The article suggests the two steps to ensure growth while protecting the poor. The first is the creation of social safety net and next is factor market reforms.

    Issue of farmers’ income

    • An Indian engaged in industry or any aspect of the services sector (this includes a waiter in a restaurant) earns more than an average farmer.
    • This is an anomaly.
    • So, despite all the pro-farmer laws and protection, why do farmers in India earn less?
    • A recent study by RBI showed that across all crops, the farmgate price is 40-60 per cent less than the consumer price.
    • The real challenge is how to encourage growth while protecting the poor.

    Encouraging growth while protecting the poor: 2 steps

    • 1) A social safety net needs to be created to provide direct income transfers to the vulnerable.
    • 2) Factor markets involving labour and agricultural land need to be reformed to ensure productivity-enhancing growth.
    • Only way to ensure growth which benefits the poor is through employment creating in the manufacturing and services sector.

    1) Social safety nets in India

    • Despite a narrow tax base, India has created a comprehensive social safety net, which can cushion growth-enabling market reforms.
    • Accurate targeting under India’s Food Security Act to the bottom 67 per cent through Aadhaar identification and digital ration cards paired with E-POS machines has considerably reduced the leakage of subsidised grains.
    • The National Social Assistance programme intends to provide direct income support to over 40 million elderly landless agricultural workers, poor women-headed households and families with physically-challenged children.
    • India also provides income support annually to 145 million farmers, paying out Rs 75,000 crore.
    • This benefits all farmers while MSP benefits only 6 per cent of farm produce.

    2) Factor market reforms

    • If state support for social safety net has to become sustainable, wide-ranging growth, which will broaden the tax base, is essential.
    • India’s growth itself can be designed to reduce the number of people who need state support.
    • The agriculture and labour reforms recently passed create the conditions for productivity-enhancing growth, benefiting millions of small farmers and unorganised workers.

    Let us take a look at what the farm laws achieve and how they will change the status quo

    1) Amendment to Essential Commodities Act

    • The stock limits under the Essential Commodities Act do not enable large tur or moong and rice processors to procure in bulk for their entire season’s processing requirements.
    • This restricts large-scale processing units which can run throughout the non-harvest season.
    • This draconian anti-farmer rule has now been done away with.
    • This will enable the expansion of agro-processing and supply chains.
    • A larger share of the produce procured for agro-processing increases its shelf life, enabling the farmer to retain a greater value.
    •  30-40 per cent of the post-harvest value, particularly in vegetables and fruits, is lost due to inadequate storage, processing and transportation facilities.
    • Removal of stock limits and the accompanying contract farming act will bring in investments to tap the wasted resource.

    2) APMC regulation

    • The second law, removes another distortion: Only traders registered in APMCs can buy farmers produce.
    • Even though conditions for perfect markets exist, the APMC regulation creates this bottleneck.
    • Intermediaries extract a greater share of value as they are price makers while farmers are price takers.
    • This situation is further aggravated as farmers are restricted to selling within the taluka boundaries or limits of the APMC, and if they have to sell in other APMC, they have to pay the APMC tax.
    • The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill 2020 confines the authority of the APMC to levy fees and give trader licences within the boundary of the market yard.
    • Farmers will continue to have the option to sell in APMCs but any private market/non-APMCs registered trader can also set up an agricultural market and compete with APMCs to buy the same produce.
    • Karnataka implemented the Uniform Market portal in 2014, enabling trade across taluka APMC limits without APMC fees.
    • An analysis by researchers at the MIT Sloan School of Management has shown that prices of many agricultural goods increased by 3.5 to 5.1 per cent.
    • Significantly, profit margins of small farmers increased by more than 36 per cent.

    Labour reforms

    • Apart from agriculture, the abundance of labour is the second greatest comparative advantage of India.
    • However, multiple labour laws instead of encouraging employment, have created disincentives for job creation due to high costs of compliance.
    • While India’s employment elasticity with respect to GDP growth is only 0.2, China’s is at 0.44. Even for Bangladesh, the elasticity is 0.38.
    • India’s path-breaking labour reforms leverage the true comparative advantage of the country’s factor endowments to promote growth with higher employment elasticity.
    • The old labour laws protected existing jobs at the cost of preventing new job creation through creative destruction.
    • Bangladesh has shown the way to increase formal jobs by legalising fixed-term employment and banning union activity in FDI industries.
    • Raising the threshold for seeking prior permission for laying off workers will enable capital and land locked in sunset industries to move freely to new sunrise industries.

    Consider the question “An Indian engaged in industry or any aspect of the services sector earns more than an average farmer. What are the factors responsible for this anomaly? Suggest ways to achieve growth that could ensure sustainable safety net?”

    Conclusion

    The need of the hour is to continuously communicate with those unhappy with the reforms to explain how the current status quo is hurting farmers and informal workers.