Thursday, July 14, 2011


Why is that in India agriculture is still based mostly on manual operations while mechanization of these activities could have raised agriculture productivity to much higher levels? Though there are no simple answers to this complex question, one of the main reasons is the fragmented nature of the land holdings that does not make mechanization a viable option to the farmers. Added to this is the extreme poverty under which Indian farmers live making it difficult to invest in mechanical gadgetry. If this is so how can an organization like CII push for greater mechanization in the farmlands of the country? How can such an exalted ideal be achieved given the farming environment in the country? Agro-industries Corporations in various states were set up precisely for the purpose of helping the farmers but these public sector bodies have done precious little either in agriculture or in agri-processing area as reflected by their sordid performance records!

"The Confederation of Indian Industry, a premier Industry body has recommended intensification of agricultural activity through increased farm mechanization, given limited availability of land and imperative for food security in India. According to the CII press release, it is time to move the policy from 'Rupees per Kilo' to 'Rupees per Acre'. The policy framework should encourage farmers to move towards greater use of farm equipment which will lead to higher agricultural productivity and thus higher farm incomes and crop yields. CII proposes an action agenda covering policy framework, availability of farming machinery and equipment, and financial measures for promoting farm mechanization. To begin with, CII recommends that a joint government and private sector working group be established to suggest a roadmap. A National Mission on Farm Mechanization should undertake activities in an intensive manner, suggests CII. According to CII, availability of farm implements and machinery would hinge on maintaining a stock of such equipment at state agro corporations or agri universities for deployment on farms when needed. This could be done on a hire-purchase or lease basis so that small and medium farmers as well as large farms could access them as required. CII suggests a range of measures such as accelerated depreciation, tax exemptions, zero duties, etc to incentivize purchase of machinery."Identification of farm mechanization needs and development of need based farm implements are of prime importance" stated Rakesh Bharti Mittal, Chairman, CII National Council on Agriculture".

"Access to technology would also be a point to consider, says the CII press release. Technology transfer from foreign firms could be promoted through joint ventures. R&D facilities could also be established, recommends CII, while learning for farmers could be carried out through tailored distance programs leveraging IT and telecom. The participation of private industry in farm mechanization would be critical, feels CII. Dedicated extension programs in public-private partnership mode would be needed. Suitable solutions taking into account crop types, seasons, and soil types must be developed which would be facilitated through industry. Chandrajit Banerjee, Director General, CII, said, "While selective mechanization in our country has improved agricultural conditions in certain parts of the country, it is still a bottom of the pyramid story and it will remain so unless concrete measures are taken to propel farmers towards adoption of efficient farm mechanization practices. Setting up of a farm mechanization mission is thus the need of the hour." Despite significant improvements in crop productivity during the Green Revolution, yields in India have nearly stagnated for two decades and are around 35-50% below international averages. Yield differences are also apparent across states, pointed out the CII press release. Experts estimate that by 2025, agriculture productivity should increase by 100% to sustain the projected population of 1.363 billion. According to CII, this can only be achieved through intensifying agriculture which is aided by mechanization inputs. However, huge gaps exist in the levels of mechanization in India in comparison to the world. For example, in Argentina, a food exporting nation, 9.4% of the population is engaged in agriculture and the level of mechanization is 75%, while in China the respective proportions are 64.9 and 38. In India, 52% of the population works in agriculture, but the level of mechanization is just 30%.
CII also suggests a complete finance mechanism for facilitating leasing of farm machinery by small, medium and large farmers. Loans should be offered on agricultural interest rates and lending norms should be liberal, flexible and transparent".

It is easy to compare India with China or Argentina but the socio-economic and governing systems are totally different in these countries. In India land is the "sacred cow" and the political class does not want to bring out any land reforms for consolidation and improved viability. Cooperative movement in agriculture has not been a success though milk sector is an exception. What a successful cooperative strategy can achieve has been amply demonstrated by the Tibetan refugees in Karnataka and if this state is the leading producer of Maize in the country, thanks are due to this hard working immigrant population. The CII proposal is laudable indeed but there must be a will on the part of the ruling elite to work for such a transformation.

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