Today's Editorial

21 January 2017

Less-cash agriculture



Source: By Vivian Fernandes: The Financial Express



In Madhya Pradesh’s tribal districts of Dewas and Khargone, the NGO, Samaj Pragati Sahayog, discourages cash transactions for agricultural inputs. The interest rates are usurious and vary according to commodities. For fertiliser, it is dheda—loan for the stuff has to be repaid 1.5 times over by the end of the harvest season. For pesticides it is sawa, or 1.25 times. Even barter can be extortionate. One quintal of seed has to be repaid duguna or twice the quantity. The grain given in repayment may not fetch the same price as seed, but could be 1.6 times the value, for a four-month period. Such transactions are more like wealth transfer operations.


The dozen youth from JNU and Delhi University, who forsook a career in academics for rural development work inspired by Muralidhar Devidas ‘Baba’ Amte about three decades ago, therefore, continue to advocate low-input, self-reliant and sustainable agriculture, where the emphasis is not so much on productivity as on incomes. PS Vijayshankar, or Viju, one of the founders of the NGO, lists markets as one of the “threats” faced by the mainly Korku and Bhilala tribals its works with, though it has done pioneering work in getting the erstwhile Forwards Markets Commission and capital market regulator SEBI, to get farmers onto commodity exchanges to hedge price-risks.


SPS discourages the use of hybrid seeds. Though high-yielding, the seeds have to be bought year after year, as saved seeds, if sown, lose hybrid vigour. They have to be nourished with chemical nutrients, and protected with pesticide sprays, so they can deliver high output. For smallholder, rain-dependent farmers, who have little insurance against weather and price risks, such agriculture can be a slide into deeper debt. So, farmers are encouraged to use save-and-sow seeds, which have been primed for the region’s soil and climatic conditions over many generations.


They are persuaded to produce own manure using vegetable shavings, crop waste and animal droppings, enhanced with bacterial cultures. Chemical pesticides are strictly prohibited, as even benign ones are believed to harm beneficial microbes and insects. Non-pesticide management (NPM) is a tenet of faith. Repellents made from neem oil and kernel, as well as the extracts of poisonous weeds are used. There are reservations also about Bt cotton, which is genetically-engineered to be naturally toxic to bollworms, and therefore low in pesticide use. Is this leftism, with its abhorrence of the private sector and western technology, dressed up as environmentalism? How different is the elevation of native wisdom different from the right-wing glorification of tradition?


“We do not agree with a single uniform mode of science,” says the CEO, a young graduate from the Indian Institute of Rural Management, who is four months into the job. “We focus on livelihoods and incomes and minimising environmental damage. We are not romanticising tradition.”


The farming practices which SPS advocates are prompted by experience. Soon after dropping anchor in Neemkheda in Dewas district’s Bagli tehsil, the pioneers focussed on watershed development, as this is a rain-dependent area, where rainy days (2.5 mm or more) are few and far between. Once the water table rose, the emphasis shifted to growing crops like soybean and maize that can do with little irrigation. To ensure that farmers retained a greater share of the output price, self-help groups were formed. The poor are unbankable because banks are not sure of their credit-worthiness. They also cannot provide collateral as security.


SHGs have intimate knowledge of their members—how much they can borrow and for what purpose. Peer pressure ensures there is low or no default. The banks were hesitant initially. They wanted the groups to be all-male, while those of SPS are all-female. But they have shed their reluctance now. Viju believes the SHG-bank linkage model is the answer to rural indebtedness. (Though, most members of SPS are in debt, and farming is entirely based on credit. But the loans are not of the kind that drives farmers to suicide.)


From the money they borrow, members repay moneylenders first. Banks used to lend only for productive purposes. But for the poor, the distinction between productive and consumption expenditure is blurred, says Viju. Shedding their dependence on traders for loans was a necessary condition for farmers to be able to aggregate their produce and sell directly in the local mandi. Earlier, they were compelled to sell to traders soon after harvest, when prices are low, to settle their dues.


Chintabai Trigram was a pioneer of the local self-help group movement, 11 years ago. We catch her gleaning soybean in a harvested field. She has picked about 10 kg, which she will sell. Trigram has no land. She rears goats. She started with one and now has 11. They are like family. She remembers their birth-dates. With income from that activity, she has brought up three children on her own. She has not only repaid a loan of R40, 000, but has savings of R20,000.


Trigram is unlettered, but not lacking in initiative. When a mithan (male-friend in the local lingo) came to her village to propagate the virtues of SHGs, she acted as a go-between for the female folk. They thought he was selling a ponzi scheme and would decamp with their savings. It took time to win trust. Now, there are six federations of SHGs. One of them with 162 groups has formed the RamRahim Pragati Producer Company, which aggregates soybean and maize and sells them directly in local mandis. The company also takes futures positions on the NCDEX commodity exchange. In some years, it has made profits, and lost in others. The emphasis now is to get farmer-members to produce marketable quality that can be sold in standardised lots. Trigram is a director of the company.

The SPS model is quite different from that of Gujarat’s Van Bandhu Kalyan Yojana for tribal upliftment. In that programme, Secretary Anand Mohan Tiwari, who initiated it and stayed on for the first six years, wanted to bring high-input, high-output Green Revolution agriculture to the state’s tribal belt. It started with promise but the gains were not sustained because the programme lacks an organisation like SPS to hand-hold the farmers in new agricultural practices, provide access to less expensive finance and do the marketing. Without such networks, motivated either by altruism or mutual profit, it is difficult to push poor farmers up the income ladder.

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