A major chunk of India’s population depend on agriculture and allied sectors for their livelihood,yet the share of income they receive remains meager.This calls for structural reforms in the agrarian sector , which would emphasis on spherical development.The recent withdrawal of three farm acts has again brought fore the need to rethink the process not only to maximise farmers income but also to diversify the agricultural sector in a holistic manner.

In the name of farmers welfare, MSP for selected crops,fertilizers subsidy, government regulated marketing and controlled distribution of agricultural products through the agency of FCI,underlines the neglected approach which is evident from the fact that even after the 7 decades of independence small and marginal farmers are still not well equipped to improve their life standards.In fact, green revolution which was supposed to provide a Trickle down effect,further widened the hiatus between the big farmers and small farmers. Mere policies alone can’t be blamed but also the political environment which is more tilted towards vote bank rather than effective policy implementation.

What are the issues with MSP?

  • MSP is available only for 23 crops – This limited choice obstructs the farmers from diversifying their investment to other crops which could yield more in monetary terms e.g Horticulture.

  • Dominance of Wheat and Paddy – In the context of food scarcity it was a revolutionary initiative, but in present  it must be realised that India has passed that phase and the overproduction of these two crops are only incurring losses to the government which is ultimately borne by taxpayers.

  • Economic Unsustainability of MSP for Wheat and Paddy – MSP of paddy is  increased by 280% and MSP of wheat is increased by 230% but their market price remains lower.which acts to FCI economic burden and has reached 3 lacs crore.

  • Ineffective implementation of MSP scheme – As per shanta kant committee(2015), only 6% of farmers received MSP and remaining are still deprived of such benefits.

  • Allied sectors do not get MSP – To double the farmers income animal husbandry and fisheries should also get some sort of government intervention in the form of MSP, being demand driven sector, it has more potential to receive higher yields.


 What is the alternative to MSP?

  • Sustainable farming – Govt has started moving towards “ Zero Budgeting Natural Farming” but given the diverse agro-climatic zones, The method should be suitable to the region so that benefits could be maximised.Their should be incentives on organic fertilizers and bio-fertilizers.Urea should be included in Nutrient based subsidy.

  • Equity based resource distribution – Every farmer should have equal access to support structures and government designed economic packages. Subsidy and waivers should be replaced by incentives based payment which would motivate farmers to adopt effective cultivation methods.

  • Adaptation to climate change – Farmers need to be given training in terms of resources skills knowledge, mode of production, value addition and marketing for eg. local seed banks.

  • Promotion of allied activities – small scale industries, food processing centres etc help in value addition and provide employment.

  • Involvement of local public institutions – A decentralised approach would attract more rural populations towards sustainable agricultural practices and make them skilled and employed thus improving their quality lifes.



Thus a holistic and integrated approach will make a difference and transform the agrarian sector in a positive manner.Policies should be designed to be more supportive and accessible to every farmer. An equity based initiative could alone bring structural reforms in the agricultural sector and thus add quality to the lines of small farmers by enabling them to access education, health etc.

Download plutus ias daily current affairs 30 November 2021