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Reversing the slowdown

In keeping with its commitment to step up investment and raise productivity in agriculture, the United Progressive Alliance government at the Centre has decided to enhance funding for farm schemes, along with the States. The sub-committee headed by Agriculture Minister Sharad Pawar has recommended a significant increase in the outlay for the sector — from Rs.83,000 crore in the 10th Plan to Rs.133,000 crore in the 11th. This in itself may not be enough. But as Prime Minister Manmohan Singh has pointed out, it is imperative that the schemes are sharply targeted so that the benefits reach the small and marginal farmers, the groups that are in dire straits. Now that the National Farmers Commission, chaired by Dr. M.S. Swaminathan, has handed in five reports, and various other bodies, including the Sharad Pawar committee, have submitted their recommendations, it is up to the Planning Commission and the Government of India to put together an effective and viable plan to revitalise the agriculture sector during the 11th Plan period. With a national and political consensus on giving top priority to agriculture and irrigation already in place, there should be no difficulty in getting the National Development Council to endorse such a plan.

It has become clear that for India to sustain a Gross Domestic Product growth rate of 8 per cent and perhaps move on to an even higher trajectory, the agriculture sector needs to attain a 4 per cent growth rate. Unfortunately, it has been languishing over the past few years at just around 2 per cent. Despite a fairly good monsoon at least over the past two years, regional disparities in rainfall distribution have hit several crops across the country. Between 2003 and 2005, farmers in many States were badly hit by disasters — ranging from cyclones and droughts to the catastrophic tsunami of December 2004. Though cooperative loans have been waived or rescheduled in many States, farmers who had borrowed from the commercial or scheduled banks did not get the same relief. Indebtedness of the farmers — in some States leading to suicides — remains a major challenge. At a time when many State governments have substantially increased their outlay on farm sector, especially irrigation, the Centre and the States would do well to address the problems related to farm loan in the 11th Plan so that the farmers are enabled to pull themselves out of the debt trap. Equally important, the nagging inter-State river water disputes have to be sorted out to ensure adequate water storage and supply for the crop seasons in all the riparian States on an equitable basis.

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