The committee has worked as per the sound advice of the Minister of Agriculture and Farmers Welfare, Shri Radha Mohan Singh and Dr. The seventh part of the Commission for the Doubling of Farmers' Income (DFI) report examines how to improve resource use efficiency and total factor productivity in the agricultural sector.
I NTRODUCTION
In this context, an analysis is made of the current pattern of input use and costs defining selected crops over the decade from 2004-05 to 2014-15, with the selection of 2 main crops under each of the crop groups, namely cereals, pulses, oilseeds and commercial crops.
C EREALS
The share of fertilizer cost has declined in the major cereal growing states except Andhra Pradesh (in the case of paddy fields) and Uttar Pradesh (in the case of wheat). In addition, the lower proportion of fertilizer costs in paddy compared to wheat indicates the cost-effectiveness of the former.
P ULSES
Extensive mechanization prevails in wheat cultivation in Punjab as shown by the large share of machine labor in total operational cost (Table 0.2). The share of fertilizer cost in case of both pulses has also increased from 6 per cent to 10 per cent in the total operational cost in Maharashtra.
O ILSEEDS
The share of seed costs in total operational costs has declined over time in all major groundnut producing states. However, in Madhya Pradesh, a reverse pattern can be observed when it comes to the share of fertilizer costs in total operational costs.
C OMMERCIAL C ROPS
The breakdown of operating costs suggests that labor costs (human, animal and machine) have remained a significant component of operating costs over the decade, with fertilizer being the other significant component. All three selected states show an increase in the percentage of human labor as a component of total operating costs.
C ONCLUSION
Seed, fertilizer and labor (both human and machine) constitute a major cost component in the case of all selected crops. The cost of cultivation in case of all crops in all selected states has increased significantly in the ending year as compared to the first year of the decade (2004-05 to 2014-15) taken up for study.
Soil Health and Nutrient Management
I NTRODUCTION
Increasing the efficiency of nutrient use will be essential for sustainable agricultural production, reducing the cost per unit of cultivation and increasing farm incomes in the years to come. Surprisingly, some states still prescribe fertilizer schemes containing only NP or NPK, while widespread deficiencies of secondary nutrients and micronutrients, especially those of sulphur, zinc and boron exist in the soil.
S OILS OF I NDIA
- Alluvial soils
- Red soils
- Black soils
- Desert soils
- Laterite and lateritic soils
- Forest and hill soils
- Salt-affected soils
This ground is found in Madhya Pradesh, Maharashtra, Rajasthan, Puducherry, Tamil Nadu, Uttar Pradesh, Bihar, Odisha, Andhra Pradesh and Gujarat with a total coverage of about 54,7 Mha. Lateritiese grond is wydverspreid in die state Maharashtra, Andhra Pradesh, Karnataka, Tamil Nadu en Noordoos-streek.
P ARADIGM SHIFT IN FARMING
High salt concentrations in saline soils cause problems with the absorption of water and nutrients. Sodic soils have high exchangeable sodium (Na) content, resulting in soil spreading, compactness, poor aeration, reduced condition and limited drainage.
S ECOND G ENERATION P ROBLEMS - N ATURAL R ESOURCES ARE A C ASUALITY
- Changes in soil organic matter under intensive cropping
- Poor soil fertility status
- Decline in Soil Physical Conditions
- Acidification, Salinization, Alkalization and Waterlogging
- Induction of Poor Lands into Agriculture
- Imbalanced Use of Plant Nutrients
- Decline in Factor Productivity
All India Coordinated Project on Soil Test Crop Response Correlation, Indian Institute of Soil Science, Bhopal. The rate of extraction of nutrients from soil is further aggravated due to unbalanced use of fertilizers.
S OIL T ESTING FOR S OIL H EALTH M ONITORING
- Weaknesses of Soil Testing Service
The quality of the soil analysis is extremely important for the desired effect of the soil testing service. One of the most important reasons for poor sales of soil testing services among farmers is the suboptimal and incomplete fertilizer recipes offered by STL.
S OIL H EALTH C ARD S CHEME
S OIL H EALTH M ANAGEMENT
- Site-specific nutrient management
- Integrated nutrient management
- Ingredients of INM
- Real-time N management
- Decision support tools for enhancing NUE
- Management of problem soils
- Conservation agriculture (CA)
Studies have revealed that high productivity goals, say up to 80 percent of the variety-specific genetic yield potential, can be achieved following SSNM. Experimental evidence indicates the possibility of limiting up to 50 percent of fertilizer P amounts with the use of P solubilizers, by dissolving sparingly soluble P in soil.
R ECOMMENDATIONS
- Revamping soil testing services
- Strengthening Soil Health Card
- Promoting balanced and integrated use of fertilizers
This component is rightly included in the ongoing SHC scheme, although an effective mechanism for it needs to be developed. Timely availability of all fertilizers recommended in the SHC is a prerequisite for the adoption of SHCs.
A NNOTATION
With the introduction of the SHC scheme, the soil testing service has taken center stage in soil health management and expectations of this service have increased. Establishing a statewide soil health monitoring staff would go a long way toward improving the overall effectiveness of soil testing and fertilizer recommendations.
Water Management in Agriculture
I NTRODUCTION
Furthermore, the Indian climate, which is predominantly tropical and subtropical, receives most of its rainfall from the southwest monsoons with high intensity leading to high runoff and land mass degradation. One of the important interventions needed to double farmers' income is higher productivity of water that improves the efficiency of the existing irrigation systems.
C URRENT P RACTICES AND C HALLENGES
Unbalanced use of groundwater: Groundwater has become a major source of growth in irrigated areas and now accounts for more than 63 percent of the country's irrigated area. Climate change is projected to reduce wheat yields by 6–25 percent toward the end of the century, with large spatiotemporal variations.
C ONTOURS OF W ATER M ANAGEMENT
- Irrigated areas
- Rainfed areas
Climate change will have negative effects on irrigated crop yields across regions, including in India, both due to temperature rise and changes in water availability, while rainfed agriculture will be affected mainly due to rainfall variability and reduction in number of rainy days. Careful attention to the management of water budget based on the measurement of availability of water and its use/demand for alternative purposes.
G OVERNMENT I NITIATIVES
Improving water use efficiency through a mix of agronomic practices and the use of technologies (eg micro-irrigation). Out of 6.4 million ha of net irrigated cultivated area in the country, micro irrigation (MI) coverage was about 9.5 million ha by the end of 2016-17.
P OLICY R ECOMMENDATIONS
- Suggestions for irrigated areas
- Suggestions for rainfed areas
- Suggestions common to both irrigated and rainfed area
Protective furrows on crops increase yield in the range of 8 to 40 percent. In medium rainfall regions, the broad bed and furrow (BBF) system increases yield (especially soybean yield in Vertisols) by up to 83 percent.
A NNOTATION
Increasing water productivity using micro-irrigation, supplementary irrigation and deficit irrigation is only possible through joint efforts of the Ministries of Agriculture, Water Resources and Energy. Of the total available water in the country, more than 80 percent is used in the agricultural sector, with no further scope for additional diversion.
Seed
- S EED - A C RITICAL I NPUT
- Quality of breeder seed
- Millets and Wheat Over Rice and Wheat
- Changing climate puts India at risk
- S EED D ELIVERY S YSTEM
- A SSESSING S EED R EQUIREMENT
- District level committee
- State level consolidation of the requirement
- Block level committee
- Basis of assessing seed requirement
- S EED P RODUCTION AND S UPPLY C HAIN
- B REEDER S EED P RODUCTION AND V ARIETAL S TATUS IN S EED C HAIN
- I MPACT OF C LIMATE
- Production of abiotic & biotic stress tolerant varieties
- I MPROVING THE SRR, VRR AND SMR
- Present status vs future prospects
- Varietal Replacement Rate (VRR)
- Production of certified seeds
- S TRATEGIES FOR E NERGISING S EED P RODUCTION AND S UPPLY C HAIN
- Effective input management in seed sector
- Seed vision
- Strategy
- S EED P ROCESSING AND S TORAGE
- S EED D ISTRIBUTION
- F OCUS ON S EED C HAIN OF V EGETABLE / OTHER H ORTICULTURE C ROPS
- F OCUS ON N UTRI - CEREALS
- P ILOT M ODEL S EED P LATFORM
- S COPE FOR S EED E XPORT
- U SE OF ICT- R EAL T IME D ATA
- A NNOTATION
For each variety, targets for the amount of seed production and distribution are given to all seed producers in both the public and private sectors. A systematic, strong and vibrant seed production system is essential for the country's food security.
Pest Management
I NTRODUCTION
Implementation of the provisions of the Act is the responsibility of both the Central and State Governments. The central government is responsible for the registration of insecticides, while the state governments are responsible for licensing and enforcing regulations relating to the manufacture, sale, transport, distribution and use of pesticides.
C HALLENGES
- Quality of pesticides
- Optimum application of pesticides
- Limited reach of IPM techniques
- Price of generic pesticides
A comparison of the annual testing capacity of all the state laboratories with the total number of registered pesticide dealers gives a very disturbing picture. The use of pesticides can be effectively minimized, by adopting IPM approach, and realize higher income of the farmers.
I NTERVENTIONS
- Interventions by central government
- State government interventions
- Interventions by research organizations (ICAR/SAUs)
Special encouragement should be given to the discovery and manufacture of the active ingredients in India. This should be supported by appropriate policies which are binding for all to adopt based on the prescriptions listed in the CPR.
R EDUCING P ESTICIDE C ONSUMPTION IN I NDIAN A GRICULTURE
UAVs (Unmanned Aerial Vehicles) can be deployed to avoid poisoning incidents associated with pesticide and fertilizer application. Such applications may be localized, limited, or specific in nature to avoid exposure of spray operators during application.
S OME S TRATEGIC I NTERVENTIONS
- Access or Accessibility
- Cost
- Awareness & education for effective and safe use
- Early warning and preventive measures
- Prophylactic measures
- Registration of pesticides
This will enable the identification of the required type of pesticides and their design to producers and. The risks involved in crop production can be reduced by preventive practices that include selective use of pesticides based on pest monitoring and forecasting technologies.
A NNOTATION
Greater focus should be given to the research and promotion of bio-pesticides, especially those indigenous to the country. Bio-pesticides should be encouraged for seed treatment; The Package of Practices issued by the respective countries may take into consideration the specificity of the agro-climatic zone.
Agricultural Mechanisation
- F ARM M ECHANISATION – M EANING AND R ELEVANCE
- D EFINING A GRICULTURAL M ECHANISATION
- A GRICULTURAL M ECHANISATION AND S USTAINABILITY
- S TATUS OF F ARM M ECHANISATION
- S TRATEGY AND R ECOMMENDATIONS TO SUIT I NDIAN A GRICULTURE
- A GGREGATION P LATFORM
- A PPROPRIATENESS OF M ACHINERY
- G OING B EYOND M ECHANICAL P OWER
- A NNOTATION
Indiscriminate deployment of mechanization can result in great damage to the agricultural sub-sectors in the long term. Agricultural mechanization is an important input to achieve higher productivity and mitigate costs in the agricultural sector.
Credit and Capital Formation in Agriculture
C ONTEXT
In 2003, out of 89.35 million farm households, 48.6 percent were reported to be in debt, with the average outstanding loan amount per household being Rs 12,585 at the all-India level. 47,000, where 52 percent of agricultural families are estimated to be in debt; and 60 percent of the outstanding loans were from institutional sources, which is a small improvement in terms of institutional coverage.
G ROWTH IN A GRICULTURAL C REDIT
Data submitted by banks in ENSURE portal in respect of cooperative banks and regional rural banks and data provided by banks through post in respect of commercial banks. Source: Data submitted by banks in ENSURE portal in respect of cooperative banks and regional rural banks and data provided by banks through post in respect of commercial banks.
S HORT T ERM C REDIT AND I NVESTMENT C REDIT (LT)
Data based on information provided by SLBCs in respect of commercial banks and reporting banks in respect of RRBs and co-operative banks. However, with the renewed emphasis on term loans, the share of investment credits in total agricultural credit has started showing signs of improvement, compared to 35.30 percent in the year 2016-17.
G ROUND L EVEL C REDIT – S HARE OF V ARIOUS A GENCIES
It is interesting to note that the share of outstanding debt of cultivator households to commercial banks decreased from 35.2 percent in 1992 to 30.7 percent in 2013, indicating that such loans are going to non-cultivating households.4 This is not a good sign from the point of view of agriculture. During the period 2007-08 to 2016-17, on an average, cooperative banks funded about 267 lakh farm accounts annually, while the corresponding figure in the case of commercial banks was 329 lakh.
R EGIONAL I MBALANCE IN C REDIT D ISBURSEMENT
- The regional trends in agricultural credit flow
I NCLUSIVENESS OF A GRICULTURE C REDIT S YSTEM
Out of the total agricultural credit disbursed by 3 categories of lenders namely commercial banks, cooperative banks and RRBs during the period 2007-08 to 2016-17, the share of loan to small and marginal farmers (SMF ) 68.67 per cent or Based on the average number of accounts, the share of SMFs in commercial banks, cooperative banks and RRBs in the same period was 68.67 percent.
C ONSTRAINTS IN F INANCING S MALL AND M ARGINAL F ARMERS
- Declining size of land holding
- Lack of proper Record of Right
- Increased share of tenant farmers/share croppers
- Notion of high NPAs
Ever-increasing urbanization and migration from rural areas, together with fragmentation of land ownership, has accelerated the spread of tenant farming in the country. As at March 2014, RBI (2014) reported that the overall NPA has increased across sectors and that the phenomenon is not limited to agriculture alone.
C OERCIVE ACTION FOR REPAYMENT
Besides higher transaction costs, another reason often cited for the tepid response to agricultural lending, especially to small farms, is the high number of non-performing assets (NPAs) in the sector. However, such an argument is not supported by any data as NPAs in agriculture are almost comparable to other sectors covered by priority sector lending.
A NOMALIES IN THE P RIORITY S ECTOR L ENDING (PSL) IN A GRICULTURE
- Strict adherence of target group stipulations
- Farmers’ mobilisation
- Joint Liability Groups (JLGs)
- Land lease markets
- Land records and digitisation
- Infrastructure and common assets
There is a need for a legal framework that ensures the tenants freedom of operation during the contract period as well as the landowners' right to resume use of the land after the end of the contract period. State Governments can issue Land Pattas/Record of Rights to all farmers who have inherited land through sub-division of their family property, irrespective of the size of the land holding that they have inherited.
O THER B ANK RELATED C ONCERNS
Such investments have taken place among women's SHGs in the country, translating into a significant SHG-Bank linkage leading to the inclusion of the excluded. At this point, Andhra Pradesh's experience with its statute called Licensed Cultivators Act, which gives a Loan Eligibility Card (LEC) to tenants, while protecting the landlord's right to land, is worth exploring and improving.
W AY F ORWARD
I NCONSISTENT ABOUT C APITAL F ORMATION
T RENDS IN A GRICULTURAL C APITAL F ORMATION SINCE THE 1990 S
The ratio between capital formation in agriculture (GCFA) and total GDP has stagnated at a level below 3 per cent.
- Rural Infrastructure
- Crucial role of states/UTs
S HARE OF P UBLIC AND P RIVATE S ECTOR IN GCFA
As detailed in the above section, private sector capital formation includes the private business sector and the individuals/household sector. In a scenario where almost 85 per cent of capital formation comes from the private sector, the role of institutional credit in financing agriculture hardly needs emphasis.
P RIVATE S ECTOR C APITAL F ORMATION AND L ONG TERM CREDIT
The GCF for the public and private sectors grew by 4.6 percent and 7.4 percent respectively. Capital formation in agriculture is therefore mainly dependent on what happens to the (long-term) investments within agricultural credit.
I NCREASING I NVESTMENT C REDIT
- Investment Credit Achievements
- Tapping the potential for funding investment credit
- Interest subvention for direct investment credit
NABARD has prepared Potential Linked Credit Plans (PLPs) at the district level where sub-sector wise estimates of the potential for investment credit are available. Such a move will have the effect of increasing the flow of investment credit, thereby increasing the much-needed capital formation at the farm level.
P OLICY I NITIATIVES FOR A GRICULTURE
The Pradhan Mantri Fasal Bima Yojana (PMFBY) is a pioneering program that aims to provide farmers with insurance cover and financial support in case any of the notified crops fail due to natural disasters, pests and diseases. The interventions and initiatives discussed in the previous section demonstrate various ways in which more capital is being mobilized in the agricultural sector, both from budgetary and non-budgetary sources.
R OLE OF B ANKS & F INANCIAL I NSTITUTIONS
The KCC scheme has since been streamlined, which includes providing an ATM-enabled debit card with one-time documentation options, built-in capping, any number of withdrawals within the limit, etc. Some of the specific areas where NABARD/FI and the banking system can play a catalytic role are as follows:
S TRATEGIC AREAS
- Cost reduction strategies
- Risk mitigation measures
Proper education and awareness on nutrient application based on soil tests, integrated pest and nutrient management, organic farming, etc. should be popularized and promoted among farmers through forums like SHGs, JLGs , Farmers' Clubs, FPOs, etc. Due to lack of proper tenancy laws, there is no written document available to farmers (for leased land) to submit to banks as collateral.
A GRICULTURE C REDIT – M ANAGEMENT I NFORMATION S YSTEM
- Returns as now submitted by Banks
R ECOMMENDED APPROACH
Credit Guarantee Trust Fund for Term Loans`
B ACKGROUND
Moreover, the risk management framework of banks/financial institutions is not able to measure such external risk in the long term.
N EED FOR A G UARANTEE S CHEME : CGFT-TL
O BJECTIVES OF THE S CHEME
The extent of loan coverage and the percentage of guarantee available to a lending agency may be adjusted in an inverse relationship, ie, the rate may be such as not to make it a burden or disincentive to the farmer-borrower.
Policy Recommendation
S OIL H EALTH M ANAGEMENT – B ALANCED N UTRIENTS
It is critical that all states review the 'General Fertilizer Recommendations' for needs-based improvements. CFs should also get a level playing field by offering them subsidy on par with straight fertilisers.
W ATER U SE M ANAGEMENT
This program deserves to be scaled up widely in the rain-fed areas of the country. Due to overexploitation, large areas, including the country's food belts (Punjab, Western Uttar Pradesh, Haryana), have been turned into 'dark zones'.
S EEDS
It is therefore proposed that once the Sub-Committee has approved for the release, pending notification under the Seeds Act, at least 75 per cent of the test stock (one which is with the Breeder but cannot yet be termed as a core seed) ) can be considered as. Based on the diverse agro-climates, various geographical zones in the country have emerged as ideal seed storage locations under environmental conditions.
P EST M ANAGEMENT
All molecules for which registration application has been filed with the regulator for use in the country for the first time shall be registered as done earlier by clubbing section 9(3) along with 9(3B) of the Insecticide Act, 1968. This center shall be able to provide all the necessary alerts across all districts for each of the crops grown.
A GRICULTURAL M ECHANISATION
These centers at various levels should be supported to expand their technologies to include modern systems such as drones, sensor-based applications, etc. as well as those needed in the livestock, fishing, etc. sub-sectors. Some of the services offered are pesticides, fertilizer and seed retailers, I.T. additional services based etc. ii) SHG/FPO/Trust/PACS based CHCs. iii) NGO/CSR (Corporate Social Responsibility) based CHC and AMB.
A GRICULTURAL C REDIT
Many of the FPOs/FPCs find it difficult to establish and start their businesses in the initial years. This is the critical period when, if no business is started, members may lose confidence in the effectiveness of the FPOs/FPCs.
