The Borlaug Blog

As Prime Minister Narendra Modi readies for a second term in office, one of his greatest challenges will be India’s persistent agrarian crisis.  Five decades after the launch of Dr. Norman E. Borlaug’s Green Revolution, India has achieved national self-reliance in food grain production but failed to make farm livelihoods viable and eliminate hunger and malnutrition.

Over the last two decades the real incomes of small and marginal farmers have fallen due to rapidly increasing input costs, weather-related shortfalls in yields, widening price swings, and lack of access to technology, finance and markets.

The socio-economic costs of India’s new agrarian crisis have been heavy. Farmer indebtedness has risen rapidly, leading to over 300,000 farmer suicides since 1995 and farmer unrest in many areas of the country. Farm distress has now emerged as a major political issue and figured prominently in the just-concluded national elections.

Nor have India’s increases in total food production translated into proportionate decreases in malnutrition. While declining poverty and the availability of staples have reduced undernutrition, malnutrition remains widespread, especially for children under five.  Today India ranks 103rd out of 119 countries on the International Food Policy Research Institute’s 2018 Global Hunger Index. The fault for both the farm income and nutrition deficits rests squarely on the Green Revolution policies that once produced miracles and now too often produce misery.  Those policies remain focused on wheat and rice production, skewing production toward staple grains and away from higher-value crops and more nutritious diets for all Indians.

Improving Farm Incomes
Greater returns to farming are possible where cultivators are enabled instead to diversify their production to include vegetables, fruit and livestock.  In order to diversify, small farmers need non-price distorting policies, less costly and readier access to financing, technology and inputs, and fewer barriers to the sale, storage and transport of more perishable products.

The single greatest opportunity to improve farmers’ income security is better price realization for their produce. Farmers face many obstacles to getting better prices, including long distances from markets, dependence on local moneylenders for production loans, limited knowledge of markets and prices, dependence on rapid cash payment at harvest, and control of markets by trader cartels.

During his first term as prime minister, Mr. Modi announced the creation of an electronic national agricultural market (eNAM) to improve price transparency and market access for farmers. Its effectiveness depends on the so far incomplete participation of traders in those markets who resist the loss of price-setting power. 
A more promising possibility is the creation of local or regional farmer producer organizations (FPOs) through which several hundred to over a thousand local farmers could gain market power and better price realization. This may be a case where government could provide an enabling regulatory environment and perhaps initial financing.

Farming in India has become more risk-prone in recent years. Weather is the main source of risk, as it has long been for agriculture everywhere.  In three of the last five years, drought, excessive rain or extreme temperature have reduced harvests in several parts of India.

Many Indian farmers now also face a new type of risk: increased price volatility due to cycles of over- and under-production of certain crops. The risks are much magnified for small and marginal farmers who lack access to early warnings of weather and production shifts, especially for those growing perishable commodities such as fruit and vegetables.   

Most farmers do not have any form of crop insurance to hedge against sudden and sometimes total losses. Digital innovations to improve weather forecasting and connecting smallholders to crop insurers could help once they are widely available.  Governments could also encourage the construction and operation of local, inexpensive crop storage facilities through financing guarantees and/or tax incentives.

Reducing Malnutrition
Malnutrition in India today is concentrated among children under 5.  While the rates of child malnutrition have diminished over the last decade or two, child wasting and stunting are still widespread. According to the 2018 Global Nutrition Report, in 2015 about 21% of all children under 5 were wasted and 38% stunted. Clearly one cause of persistent child malnutrition in India is still high rural poverty—25% nationally and higher in poorer states. Not surprisingly then, the incidence of malnutrition, especially stunting, is higher in both rural and lower income households, that is, farm households!

A second cause of persistent child malnutrition is the inefficiencies and distortions of the Green Revolution agriculture and food policies already described.  Public distribution is heavily weighted toward food grain calories.  Programs focused on child nutrition such as the Integrated Child Development Scheme launched in 1975 and the Mid Day Meals Scheme introduced in 1995 have not corrected the bias toward calories. Subsidies continued the reliance on rice and wheat and did not include more varied and nutritious food.

Today the task of securing India’s food future must address the challenge of providing income security for its farmers and improving nutrition, especially for children. The agricultural policies framed to support India’s Green Revolution are long past their sell-by date. They distort prices, divert resources to unproductive uses, and disincentivize crop diversification to higher value and more nutritious crops while adding little to national food security.

Looking ahead, feeding India securely in every sense will require meeting three challenges: improving nutrition especially for children, increasing income security for marginal and small farmers, and ensuring India’s agricultural sustainability over the long run. Bringing about these changes would ensure Prime Minister Modi’s legacy as a transformative leader for India.