NITI Aayog pitches for Agricultural Reforms 

Syllabus: GS3/ Agriculture

In Context

• Niti Aayog recently pitched for reforms envisaging more private sector role in India’s agriculture sector.

Agriculture in India

• India is one of the major players in the agriculture sector worldwide and it is the primary source of livelihood for ~55% of India’s population. 
• India:
  • Has the world’s largest cattle herd (buffaloes), 
  • Has largest area planted to wheat, rice, and cotton, and 
  • Is the largest producer of milk, pulses, and spices in the world. 
  • It is the second-largest producer of fruit, vegetables, tea, farmed fish, cotton, sugarcane, wheat, rice, cotton, and sugar. 
• Agriculture sector in India holds the record for second-largest agricultural land in the world generating employment for about half of the country’s population.

About the NITI Aayog’s plan for reforms

• Focus on liberalization and changes in the old regulations:
  • NITI Aayog has called for a paradigm shift in approach towards agriculture with focus on liberalization of the sector and changes in the old regulations governing it to ensure significant and sustained increase in farmers’ income.
    • Advancement in science-led technology, 
    • An enhanced role for the private sector in both pre and post-harvest phases, 
    • Liberalised output markets, 
    • An active land lease market, and 
    • Emphasis on efficiency 
  • These will equip agriculture to address the challenges of the twenty-first century and contribute towards the goal of Viksit Bharat.
• Public and private investments: 
  • Elaborating on the need to liberalise the sectors, the paper has proposed providing a facilitating regulatory environment and responsible public and private investments in and for agriculture.
  • According to NITI Aayog, More private sector role in India’s agriculture sector will enable following:
    • Introduction and promotion of knowledge and skill intensive practices within agriculture, 
    • Private and corporate sector investments in agriculture, 
    • New institutions of producers, 
    • Integrated food system-based mechanisms, and 
    • New types of linkages between producers and end users, which in turn will lead to modernisation of the sector.
• Working on the inefficiency:
  • Identifying lack of efficiency as a bottleneck in the growth of the sector, the paper recommends a shift in emphasis from growth to efficient growth which means a cost effective increase in production.
    • “This requires deployment of state-of-the-art technology in agriculture, smart farming and maximising the value of main and by-products,” it said.
• System of competition:
  • Further, it proposes to introduce a system of competition among states to improve “ease of doing farming and farm business”.
• Achieving the benchmarks for India:
  • According to the paper, agriculture will play a key role in India in achieving the goal of Viksit Bharat, inclusive development, green growth and gainful employment during Amrit Kaal.
  • In addition, the United Nations’ Sustainable Development Agenda 2030 cannot be achieved without paying attention to agriculture, as 11 out of the 17 Sustainable Development Goals (SDGs) are directly linked to agriculture, it said. 
• Caution for MSPs:
  • Cautioning that the instrument of minimum support price (MSP) should not cause distortions in market signals, the paper suggests that India should use a combination of two instruments, namely procurement and price deficiency payment, to pay MSP to farmers.

Issues faced by the sector

• Crop productivity: 
  • India is much lower than other advanced and emerging market economies due to various factors, like fragmented landholdings, lower farm mechanization and lower public and private investment in agriculture.
• Environmental hazards: 
  • Current overproduction of crops like rice, wheat and sugarcane, has led to rapid depletion of the ground-water table, soil degradation and massive air pollution raising questions about the environmental sustainability of current agricultural practices in India.
• Overutilization of fertilisers:
  • The government spends well over ₹1-lakh crore per annum towards fertiliser subsidy translating into approximately ₹7,000 per farmer. 
    • This led to indiscriminate use of fertilisers resulting in irreparable ecological damage, soil infertility, and a toxic food chain. 
• Irrigation: 
  • Although India is the second largest irrigated country of the world after China, only one-third of the cropped area is under irrigation.
• Conventional method of cultivation:
  • In spite of the large scale mechanization of agriculture in some parts of the country most of the agricultural operations in larger parts are carried on by human hand using simple and conventional tools and implements like wooden plough, sickle, etc.
• Agricultural marketing: 
  • Agricultural marketing still continues to be in a bad shape in rural India. 
  • In the absence of sound marketing facilities, the farmers have to depend upon local traders and middlemen for the disposal of their farm produce which is sold at throw-away price.

Government initiatives for the sector

• National e-Governance Plan in Agriculture (NeGPA)
  • It was initially launched in 2010-11 in 7 pilot States as a  Centrally Sponsored Scheme
  • It aims to achieve rapid development in India through use of Information & Communication Technology (ICT) for timely access to agriculture related information to the farmers.
• Initiating National Agriculture Market (eNAM): 
  • It is a pan-India electronic trading portal which networks the existing APMC mandis to create a unified national market for agricultural commodities.
• Pradhan Mantri Fasal Bima Yojana (PMFBY): 
  • It was launched from the Kharif 2016 season and provides insurance cover for all stages of the crop cycle including post-harvest risks in specified instances, with a low premium contribution by farmers.
• National Mission For Sustainable Agriculture (NMSA): 
  • It has been formulated for enhancing agricultural productivity especially in rainfed areas focusing on integrated farming, water use efficiency, soil health management and synergizing resource conservation.
• Pradhan Mantri Krishi Sinchayee Yojana (PMKSY): 
  • It has been formulated with the vision of extending the coverage of irrigation ‘Har Khet ko pani’ and improving water use efficiency ‘More crop per drop’ in a focused manner with end-to-end solution on source creation, distribution, management, field application and extension activities.
• Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-AASHA): 
  • It is aimed at ensuring remunerative prices to the farmers for their produce as announced in the Union Budget for 2018.
• Kisan Credit Card (KCC): 
  • The Government has extended the facility of KCC to the farmers practicing animal husbandry and fisheries-related activities.
• Per Drop More Crop Initiative: 
  • Under it, drip/sprinkler irrigation is being encouraged for optimal utilization of water, reducing the cost of inputs and increasing productivity.