Why Farmers are in Distress

Often I read in newspaper and hear on TV that farmers are in distress. I hear farmers are committing suicide because of crop failure. Recently, farmers marched on foot for hundreds of kilometers from different parts of Maharashtra to Mumbai to put forward their demand. Many commentators believe farmer distress is going to play a decisive role in defeating BJP government in Madhya Pradesh, Rajasthan and eventually in general election.

So why are farmers agitated and angry? I am not a farmer. I am far away from their problems and from ground reality. A cursory reading suggested the following reasons:

Profitability : Farming sector is not financially remunerative. So much so that farmers were seen dumping their produce, rather than sell to customers. Because, farmers claim they do not get right price. Whatever farmers produce, they sell it to middleman or wholesaler. It is the middleman that sells farm produce to retailers at high price and makes profit, depending upon demand. Many a time, middle men hoard farm produce to jack up price and create an artificial shortage. Obvious question is why farmers do not sell their produce directly to customers?

Minimum Support Price : Many farmers are asking for minimum support price be fixed for their produce. Recently, government has announced that a farmer will get 150% (1.5 times) more, for certain crops, than the money he has invested. Farmers investment is calculated using a formula : A2 + FL. Where A2 represents all paid out cost and FL represents value of family labor in the production of cost. Crops that will come under this scheme include cereals – paddy, jowar, bajra, ragi, maize, and pulses.

This minimum support price will cost government around 80000 crore rupees. Farmers still want a better formula for calculation of their investment amount and give fifty percent more than their investment.

Experts believe, minimum support price only covers a few food grains that government buys. Such a scheme will lure many farmers to engage in growing water intensive crops, which may impact ground water level. High basic price of food grains may affect export competitiveness of Indian farmers. Besides, by raising procurement price by law, would food items not become costlier, creating another problem for government?

Technique and Technology : Farming in India is done using outdated technology. Our farming is monsoon dependent. If there is drought, which happens more often than not, farmer sows seed but does not get any return. Many farmers used to commit suicide due to crop failure. Instead of flooding the field with water, can farmer not adopt less water intensive crop and less water intensive technique like a sprinkler or drip method of irrigation? Maharashtra government has taken initiative, in consultation with villagers, to encourage water harvesting. As a result, water scarcity that we heard a few years before, has not been reported this year.

Scientific Knowhow : Many a time a farmer is not aware of what to grow. Government should take initiative to advice farmers about what to sow, when to sow, if soil chemistry is proper for certain produce etc. Encourage water harvesting, use of technique and technology that uses less water, such that dependency on monsoon becomes less. If a majority of farmers from a region produce only a certain fruit or vegetable, and all of them get a bumper harvest, then price of produce automatically comes down. In that case, either each farmer should sow different product or a farmer should be able to store his produce for selling at a different point in time. Government must build such storage facilities. Food processing industry must come up in different parts of a state that will buy farmers produce.

Instead of helping farmers by solving basic problem, governments are busy giving loan waivers. Loan waiver makes the giver look good. Giver actually is paying someone elses money. Meanwhile, problem keeps coming back again and again.


1. Five ways to reduce farm distress in India | IFPRI


2. Why are farmers distressed across India? – The Hindu

http://www.thehindu.com › News › National

3. India’s Agriculture Crisis- Business News – Business Today


4. Modi Government Approves Hike in MSP for Khariff Crops


5. Looking Beyond Loan Write offs for Farmers


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