Opinion: It’s time to reimagine MSP for better ecology and economy

Should we let the MSP system, the primary incentive for spreading paddy-wheat monocultures in the northwestern agrarian belts and destroying the ecology, spread to other areas in the same form? No. We can’t afford to deplete our groundwater and poison our soils.

Farmers once again marching forward to reassert their demands for a Minimum Support Price (MSP) for their produce has led to a politically fragile situation. But it has also opened up an opportunity to reimagine the MSP system to deal with newer challenges of water scarcity, soil degradation and ecological concerns.

MSP in a nutshell

The pros of MSP first. This system began as a price floor mechanism for procuring Green Revolution crops like paddy and wheat from regions of Punjab. Rice is not a staple of Punjab, and hence, when Green Revolution farming was introduced in the region, farmers wanted guaranteed procurement. The government responded with the introduction of agricultural produce market yards, APMC mandi, where the Food Corporation of India (FCI) and other government agencies would directly procure paddy and wheat.

India was battling cereal grain shortages in the 1960s and 70s, and Punjab and Haryana farmers helped India achieve cereal surpluses. In under 50 years, India became a major exporter of rice and wheat. Farmers from the region received a steady cash income and the APMC taxes helped build rural infrastructure like roads, storage, market yards, etc. The rural economy thrived and Punjabi farmers became a model for prosperity in the country.

Eventually, Green Revolution technology spread to other regions, increasing cereal production beyond demand, but APMC market yards did not. Nor were government procurements diversified towards other states. Most cereal procurement was still sourced from Punjab and Haryana.

Over time, heavy cereal demand weakened soil and water in Punjab. Excessive chemical use plagued the soil, causing cancer trains to run from Punjab to hospitals in Rajasthan. The groundwater level fell drastically and surface water was contaminated with agri-chemicals. There are also reports of heavy metal poisoning in the groundwater due to this overexploitation.

Industrial systems of agriculture supplanted biodiversity-based farming. Increasing irrigation facilities also prompted farmers to switch to paddy and wheat cycles. Stubble burning is another problem which stems from the same cause.

So, do we let the MSP system, the primary incentive for spreading paddy-wheat monocultures in the northwestern agrarian belts and destroying the ecology, spread to other areas in the same form? No. We can’t afford to deplete our groundwater and poison our soils. We can reimagine the MSP regime to address modern challenges.

Challenges ahead

The first of those challenges is diversification. Industrial agriculture relies heavily on the taxpayers for fertilisers, water, and energy subsidies. So, a step away from industrial agri-chemicals is not only good for the ecology but also for taxpayers. The government needs to incentivise organic production with the MSP programme, and if possible, ensure that the FCI and other government agencies’ first preference of procurement is from small and medium organic/regenerative farmers. This way, India can become a global leader in organic food systems.

This would be a big push for ecology, water conservation, and soil rejuvenation. Organic practices help heal the soil and also bring back diversity in fields, protecting farms from climate and economic fluctuations. Instead of monocultures, organic farmers will practise mixed cropping patterns. For example, wheat with chana, mustard, or methi will help produce more nutrition per acre.

Of course, the price floors for organic crops or any other crops like legumes or oilseeds should ensure that farmers’ profit per acre from an industrial farming operation and organic farming operations remains the same. This can be easily achieved if we compare the true costs of industrial farming, which is eating into our soil, water, and biodiversity. If subsidies are removed from industrial agriculture, the per-acre cost of production will rise drastically. Organic farmers require fewer market-based inputs — their incomes will go up as they don’t rely on fertiliser subsidies. By creating organic clusters linked with FCI-based procurement, the government can solve both farm and ecological problems with one policy.

How much would such a programme cost?

Government revenues will only increase if this step is successfully implemented. The first step is expanding the role of the FCI and the National Agricultural Cooperative Marketing Federation of India (NAFED). At the end of harvest, these agencies should be given soft loans to procure organic agricultural produce like wheat, rice, legumes, oilseeds, etc., from various organic clusters from around the country.

After procurement, these agencies will store and sort the produce to meet the national demands and supply it to the public food distribution systems. Any surpluses that can be marketed directly to the international markets for a premium — organic certification will bring in more agri-dollars.

Farming clusters can be organised under cooperatives for farmer-producer organisations that will annually participate in discussions on setting price floors and also help in enforcing per-farmer growing quotas to regulate supply.

Why will farmers shift or diversify?

Farmers’ factions refused the government’s proposal for diversification and a five-year procurement of five crops. The government proposal was rejected because it required a lot more sincerity. All farmers know the importance of good soil and water — their lives depend on it. But currently, they are caught between the market system and economic destitution. They are forced to follow the industrial logic for getting a cash income.

This is why they won’t shift to legumes or maize from paddy and wheat. Per acre profit from moong or oilseed production is much less when compared to paddy or wheat. Hence, there is greater hesitancy.

The absence of farm machinery for harvest and small tools also makes legume and oilseed production a little strenuous for the farmers.

The solution is simple: get farmers to enrol in government procurement-backed programmes and organic farming programmes under the existing Pradhan Mantri Paramparagat Krishi Yojana. FCI, NAFED, and the Agricultural and Processed Food Products Export Development Authority can be three agencies responsible for supply management and marketing.

The Commission for Agricultural Costs and Prices (CACP) can be given legal status and reoriented to measure the full costs of industrial agriculture — and reward organic farmers using financial incentives and fair price floor. Within three years, the government can convert vast swathes of land and farmers towards organic biodiversity-based farming.

In under five years, supplies will stabilise and India will have the world’s largest biodiversity-based Public Distribution System, potentially doubling farmers’ incomes, and also conserving our water and soil.

Content Source – It’s time to reimagine MSP for better ecology and economy (indiatoday.in)