With the three farm laws now gone, what options do we have now?

Описание: #centrerepealfarmlaws #threefarmlaws #greenhousefarming

Chapters:
00:00 Introduction
02:00 So, what were these laws about?
00:34 Why did the Government Pass these Laws?
09:04 Bigger Farms = More Farmers Income?
23:01 Bigger Farms a necessary condition to Increase Farmers Wealth?
32:00 Israel Farming Techniques
36:08 What happened in Soviet Union?
37:35 Bad Politics affect good policies
42:45 How Govt. should have conducted itself

With the three farm laws now gone, what options do we have now?

Before I begin with the topic, I am happy that democracy prevailed towards the end, this is how a functioning democracy looks like. A party with more than full majority, and with all its conviction behind these laws, at the end had to withdraw them by bowing down before the voice of the farmers. So, without getting into the merits and demerits of the laws, I would like to first say that it’s a victory of democracy!

So, what were these laws about?

They essentially paved the path for investments into farming and farm marketing by the private players. Which would eventually change the holding pattern and structure of the farm lands. Today it is very fragmented, the average farm size in India is about 1.2 hectare and post these laws slowly the farm size would have increased. Bigger the farm size the better it is to bring in innovations, as big farms provide scale. So, this was the broad idea behind these laws.

Why did the government think this is essential for India’s farming?

More than half of the Indians depend upon Agriculture while it contributes only 16% of India’s GDP. For perspective only 3% Americans depend upon Agriculture, as it is a very low profitable occupation. Growing at the rate of 3 to 4%, while overall India has been growing at a substantially higher rate. Which means families that are agriculture dependent are becoming poorer and poorer when compared to the other Indian families. So, by these reforms if the Agriculture productivity increases and its growth rate increases then it would not only create wealth for the farmers but it would eventually push India’s growth rate further. Plus, today India has around 81M tonnes of grains in its FCI storages while the ideal buffer storage should be around 31M tonnes of grains. So, the government has already procured 2.5 times more grains than what it needs, and it has spent 1.5 lakh crores for this procurement. With these laws the government was aiming to open up the market for the private players and thereby reduce its burden of procurement to some extent. Government has also considered the depleting environmental conditions due to the over production of grains, the water table in Punjab is depleting by one foot every year and in central Punjab by 1 meter. We are over producing, since water is a free commodity plus the electricity needed to pump that water is given free or on subsidy for farming by the state governments. Agriculture also produces high levels of methane which is 80 times more dangerous than carbon dioxide and every year we see the pollution in and around Delhi caused due to stubble burning. So, considering both the economic prospects and the environmental aspects, the government has mulled these laws.

Now, let’s question whether this understanding of bigger farms would mean more profitable farming, is correct or not?

Statistically, a 1% increase in farm size is associated with a 0.3% and 0.5% decrease in fertilizer and pesticide use per hectare, respectively, and an almost 1% increase in agricultural labor productivity, while it only leads to a statistically insignificant 0.02% decrease in crop yields. While economic growth has been associated with increasing farm size in many other countries, in China this relationship has been distorted by land and migration policies, leading to the persistence of small farm size in China. Removing these distortions would decrease agricultural chemical use by 30–50% and the environmental impact of those chemicals by 50% while doubling the total income of all farmers including those who move to urban areas. Removing policy distortions is also likely to complement other remedies to the overuse problem, such as easing farmer’s access to modern technologies and knowledge, and improving environmental regulation and enforcement.

India is blessed with the highest gross irrigated crop area in the world with abundant rain and sunlight, but China with lesser land has been producing double the grains that we do! India’s average farm size holding is little over 1 hectare and in China its 2.5 hectare, very similar size of holding when compared the west, the average farm size in the US is 444 hectares! So, how is China producing higher throughputs? Over the past four decades China has caught up to the agricultural development that took the Western world 150 years to achieve—and reimagined it to boot.

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