By VIKAS BAJAJ
Published: February 11, 2011
Lack of Attention to Farming Is Catching Up With India
BAMNOD, INDIA — The 50-year-old farmer knew from experience that his onion crop was doomed when torrential rains pounded his fields throughout September, a month when the Indian monsoon normally peters out.
For lack of modern agricultural systems in this part of rural India, his land does not have adequate drainage trenches, and he has no safe, dry place to store onions. The farmer, Arun Namder Talele, said he had lost 70 percent of the onion crop on his two-hectare, or five-acre, farm here, about 150 kilometers, or 95 miles, north of the western city of Aurangabad.
“There are no limits to my losses,” Mr. Talele said.
Mr. Talele’s misfortune, like that of many other farmers, is a grim reminder of a persistent fact: India, despite its ambitions as an emerging economic giant, still struggles to feed its 1.1 billion people.
Four decades after the Green Revolution had seemed to be solving the country’s food problems, nearly half of Indian children 5 years old or younger are malnourished. And soaring food prices, a problem around the world, are especially troubling in India.
Globally, floods in Australia and drought in China have helped send food prices soaring everywhere, on fears that the world will see a repeat of the shortages of 2007 and 2008 that caused food riots in some poor countries, including Egypt.
While India’s agricultural problems are part of this bigger global picture, in many ways its food challenges are more entrenched and systemic than those faced elsewhere.
Western investors may take eager note of India’s economic growth rate of nearly 9 percent a year. But that statistic rings hollow in its vast rural areas. Agriculture employs more than half the population, but it accounts for only 15 percent of the economy — and it has grown an average of only about 3 percent annually in recent years.
Critics say Indian policy makers have failed to follow up on the country’s investments in agricultural technology of the 1960s and ’70s; they have focused on more glamorous, urban industries like information technology, financial services and construction.
There is no agribusiness of the type known in the United States, with highly mechanized farms growing thousands of hectares of food crops, because Indian laws and customs bar corporations from farming land directly for food crops, and they make it difficult to assemble large land holdings.
Yet, even with India’s farming still dependant on manual labor and the age-old vicissitudes of nature, demand for food has continued to rise, driven by a growing population and rising incomes, especially in the middle and upper classes. As a result, India is importing ever greater amounts of staples like beans and lentils (up 157 percent from 2004 to 2009) and cooking oil (up 68 percent in the same period).
Food prices are rising faster in India than in almost any other major economy, faster than they did during the 2007-8 surge.
In December 2010, food prices in India had jumped 13.7 percent from the level of a year earlier, while the inflation rate for all commodities — heavily weighted by the food number — stood at 8.4 percent.
A snapshot number released in mid-January showed Indian food prices rising even faster — more than 17 percent over the same period in 2010 — as the cost of onions, fruit, eggs, milk and other commodities rose.
Food inflation hits especially hard in India because Indians, most of whom live on less than $2 a day, spend a bigger portion of their disposable incomes on food than people in other big developing economies like China and Brazil.
“This is the worst form of taxation on the poorest of the poor,” said Ashok Gulati, Asia director for the International Food Policy Research Institute, based in Washington.
Indian government officials have scrambled to make up the shortage of vegetables like onions by importing them. These short-term efforts have helped: Onions are now available at 20 rupees a kilogram, or about 20 cents a pound, in Mumbai, down more than 70 percent from their recent highs.
But experts say the widening gap between agriculture’s anemic supply and the demand for food calls for fundamental changes in farming policies.
During the Green Revolution, the government invested heavily in rural agriculture, with an emphasis on hybrid seeds, fertilizers and irrigation canals.
More recent policy makers have not built on that early success. Most Indian farmers still do not have irrigation systems, and waste and inefficiency have severely depleted precious groundwater.
Although many farmers have access to free or subsidized electricity that can be used to pump water, few receive power for more than a few hours a day. Mr. Talele, the farmer in Bamnod, gets electricity for only four hours during the day and four hours at night. During those periods, he pumps well water with which he floods into his fields, because he cannot afford the sprinklers or drip irrigation that would more efficiently and effectively water his crops.
And rural India has far too few temperature-controlled warehouses that could help farmers and the nation build up reserves as a hedge against poor growing seasons.
When Mr. Talele’s vegetables are ready for harvest, he immediately takes them to wholesale markets, which are controlled by committees of local traders. “Whatever the market decides, that’s the price we get,” he said.
Indian officials acknowledge that the country needs to increase investment in irrigation, encourage competition in wholesale and retail markets and provide specific food subsidies for the poor. And they also have to provide more education and jobs for villagers, so fewer people must live off the land.
Experts say India needs to make changes like some of those China made beginning in the late 1970s, when it started investing heavily in agriculture and eased regulations on farming.
As recently as 1977, Chinese and Indian farmers harvested about the same amount of wheat for each hectare they planted. But by 2009, U.N. data show, wheat yields in China were 1.7 times as high as those in India.
Kaushik Basu, a professor at Cornell University in upstate New York who is also the chief economic adviser to India’s finance minister, says he now sees more willingness on the part of Indian officials to overhaul agriculture policies.
But outside experts like Mr. Gulati are skeptical that real change will come from the government. The governing coalition has been hobbled by corruption scandals, and an energized opposition effectively blocked proceedings in Parliament last year.
Some Indian farmers are investing on their own, finding ways to circumvent the government when necessary and using subsidies when they are available.
About 50 kilometers from Mr. Talele’s farm in the village of Pahur, Sandeep Ram Karshanbakr has seen his yearly income from farming jump to 200,000 rupees, or about $4,400, from 80,000 rupees three years ago. He credits his fortune to a drip-irrigation system he bought from an Indian company, Jain Irrigation.
The government paid half the 128,000-rupee cost of the system. That has cut the amount of water and electricity Mr. Karshanbakr uses by about half on his 1.2 hectares, while improving yields twofold to fivefold for his crops of chilis, cauliflower, eggplant, tomatoes and cotton.
Mr. Karshanbakr says he is considering buying or leasing more land. But many farmers, like Mr. Talele, say they simply cannot afford such irrigation equipment, even with government subsidies that are as high as 50 percent of the sticker price. “It’s still too expensive,” he said.
Anil Jain, managing director at Jain Irrigation, said India needed to help farmers like Mr. Talele invest. “Agriculture can grow at 6 to 8 percent,” he said. “But we have to create opportunity and income in rural areas.”
http://www.nytimes.com/2011/02/12/business/global/12food.html?hp=&pagewanted=all
Published: February 11, 2011
Lack of Attention to Farming Is Catching Up With India
BAMNOD, INDIA — The 50-year-old farmer knew from experience that his onion crop was doomed when torrential rains pounded his fields throughout September, a month when the Indian monsoon normally peters out.
For lack of modern agricultural systems in this part of rural India, his land does not have adequate drainage trenches, and he has no safe, dry place to store onions. The farmer, Arun Namder Talele, said he had lost 70 percent of the onion crop on his two-hectare, or five-acre, farm here, about 150 kilometers, or 95 miles, north of the western city of Aurangabad.
“There are no limits to my losses,” Mr. Talele said.
Mr. Talele’s misfortune, like that of many other farmers, is a grim reminder of a persistent fact: India, despite its ambitions as an emerging economic giant, still struggles to feed its 1.1 billion people.
Four decades after the Green Revolution had seemed to be solving the country’s food problems, nearly half of Indian children 5 years old or younger are malnourished. And soaring food prices, a problem around the world, are especially troubling in India.
Globally, floods in Australia and drought in China have helped send food prices soaring everywhere, on fears that the world will see a repeat of the shortages of 2007 and 2008 that caused food riots in some poor countries, including Egypt.
While India’s agricultural problems are part of this bigger global picture, in many ways its food challenges are more entrenched and systemic than those faced elsewhere.
Western investors may take eager note of India’s economic growth rate of nearly 9 percent a year. But that statistic rings hollow in its vast rural areas. Agriculture employs more than half the population, but it accounts for only 15 percent of the economy — and it has grown an average of only about 3 percent annually in recent years.
Critics say Indian policy makers have failed to follow up on the country’s investments in agricultural technology of the 1960s and ’70s; they have focused on more glamorous, urban industries like information technology, financial services and construction.
There is no agribusiness of the type known in the United States, with highly mechanized farms growing thousands of hectares of food crops, because Indian laws and customs bar corporations from farming land directly for food crops, and they make it difficult to assemble large land holdings.
Yet, even with India’s farming still dependant on manual labor and the age-old vicissitudes of nature, demand for food has continued to rise, driven by a growing population and rising incomes, especially in the middle and upper classes. As a result, India is importing ever greater amounts of staples like beans and lentils (up 157 percent from 2004 to 2009) and cooking oil (up 68 percent in the same period).
Food prices are rising faster in India than in almost any other major economy, faster than they did during the 2007-8 surge.
In December 2010, food prices in India had jumped 13.7 percent from the level of a year earlier, while the inflation rate for all commodities — heavily weighted by the food number — stood at 8.4 percent.
A snapshot number released in mid-January showed Indian food prices rising even faster — more than 17 percent over the same period in 2010 — as the cost of onions, fruit, eggs, milk and other commodities rose.
Food inflation hits especially hard in India because Indians, most of whom live on less than $2 a day, spend a bigger portion of their disposable incomes on food than people in other big developing economies like China and Brazil.
“This is the worst form of taxation on the poorest of the poor,” said Ashok Gulati, Asia director for the International Food Policy Research Institute, based in Washington.
Indian government officials have scrambled to make up the shortage of vegetables like onions by importing them. These short-term efforts have helped: Onions are now available at 20 rupees a kilogram, or about 20 cents a pound, in Mumbai, down more than 70 percent from their recent highs.
But experts say the widening gap between agriculture’s anemic supply and the demand for food calls for fundamental changes in farming policies.
During the Green Revolution, the government invested heavily in rural agriculture, with an emphasis on hybrid seeds, fertilizers and irrigation canals.
More recent policy makers have not built on that early success. Most Indian farmers still do not have irrigation systems, and waste and inefficiency have severely depleted precious groundwater.
Although many farmers have access to free or subsidized electricity that can be used to pump water, few receive power for more than a few hours a day. Mr. Talele, the farmer in Bamnod, gets electricity for only four hours during the day and four hours at night. During those periods, he pumps well water with which he floods into his fields, because he cannot afford the sprinklers or drip irrigation that would more efficiently and effectively water his crops.
And rural India has far too few temperature-controlled warehouses that could help farmers and the nation build up reserves as a hedge against poor growing seasons.
When Mr. Talele’s vegetables are ready for harvest, he immediately takes them to wholesale markets, which are controlled by committees of local traders. “Whatever the market decides, that’s the price we get,” he said.
Indian officials acknowledge that the country needs to increase investment in irrigation, encourage competition in wholesale and retail markets and provide specific food subsidies for the poor. And they also have to provide more education and jobs for villagers, so fewer people must live off the land.
Experts say India needs to make changes like some of those China made beginning in the late 1970s, when it started investing heavily in agriculture and eased regulations on farming.
As recently as 1977, Chinese and Indian farmers harvested about the same amount of wheat for each hectare they planted. But by 2009, U.N. data show, wheat yields in China were 1.7 times as high as those in India.
Kaushik Basu, a professor at Cornell University in upstate New York who is also the chief economic adviser to India’s finance minister, says he now sees more willingness on the part of Indian officials to overhaul agriculture policies.
But outside experts like Mr. Gulati are skeptical that real change will come from the government. The governing coalition has been hobbled by corruption scandals, and an energized opposition effectively blocked proceedings in Parliament last year.
Some Indian farmers are investing on their own, finding ways to circumvent the government when necessary and using subsidies when they are available.
About 50 kilometers from Mr. Talele’s farm in the village of Pahur, Sandeep Ram Karshanbakr has seen his yearly income from farming jump to 200,000 rupees, or about $4,400, from 80,000 rupees three years ago. He credits his fortune to a drip-irrigation system he bought from an Indian company, Jain Irrigation.
The government paid half the 128,000-rupee cost of the system. That has cut the amount of water and electricity Mr. Karshanbakr uses by about half on his 1.2 hectares, while improving yields twofold to fivefold for his crops of chilis, cauliflower, eggplant, tomatoes and cotton.
Mr. Karshanbakr says he is considering buying or leasing more land. But many farmers, like Mr. Talele, say they simply cannot afford such irrigation equipment, even with government subsidies that are as high as 50 percent of the sticker price. “It’s still too expensive,” he said.
Anil Jain, managing director at Jain Irrigation, said India needed to help farmers like Mr. Talele invest. “Agriculture can grow at 6 to 8 percent,” he said. “But we have to create opportunity and income in rural areas.”
http://www.nytimes.com/2011/02/12/business/global/12food.html?hp=&pagewanted=all
