India needs to attain self-sufficiency on both Agricultural inputs as well as outputs. The following are some of the important areas where India can attain self-reliance:
- India can emerge as an important seed producer and a large exporter of seeds to many developing countries in South and South-east Asia as well as Africa.
- The country can produce very competitively-priced seeds for hybrid rice, hybrid corn, hybrid Bt HT cotton, and several vegetables including tomato, potato and okra.
- For this to happen, we have to set our regulatory system right.
- Let’s use the case of cotton.
- India’s decision in March 2002 to allow Bt cotton made India the largest producer of cotton in the world and the second-largest exporter of cotton by 2013-14.
- But due to policy changes since 2014-15 and issues such as trait fees companies stopped the introduction of new generation of seeds
- Now there is an “illegal” spread of Bt HT cotton in Maharashtra.
- This is partly because our regulatory system is complex.
- And more so because the present government has ideological blinkers against modern science.
- This is the biggest bottleneck holding India back from becoming the seed capital of the developing world.
- India has been a net importer of fertiliser nutrients (NPK) for almost two decades.
- In 2019-20, India imported fertilisers worth $6.7 billion, topping the list is urea $2.9 billion.
- We are totally dependent on imports and likely to remain so in case of MOP and in the case of DAP.
- In the case of urea, India wants to be atmanirbhar by opening up five new urea plants in the public sector with a total capacity of 6.35 MMT.
- Almost 70 per cent of the gas being used in urea plants is imported at a price much higher than the price of domestic gas.
- The cost is going to be more than $400/tonne when the international price generally hovers between $250-300/tonne.
- The government should allow existing private sector urea plants to expand and produce at a much lower cost.
- The best way to achieve self-reliance in fertilisers is to change the system of fertiliser subsidies.
Suggestion on changes in fertiliser subsidies
1) Deposit equivalent cash directly into farmers’ accounts, calculated on a per hectare basis.
2) Free up fertiliser prices.
3) Allow the private sector plants to compete and expand urea production in a cost-competitive manner.
3) Farm machinery
- Before the Green Revolution, India produced only 880 tractor units.
- It increased to about 9,00,000 units in 2018-19.
- So, India is the largest tractor manufacturer in the world.
- India also exported almost 92,000 tractors, largely to African and ASEAN countries.
- Though Green Revolution gave tractor production a push, the real break-through came after de-licensing in 1991.
- The new class of entrepreneurs and start-ups are coming up with special apps for “Uberisation of tractor services”.
- In an economy of small landholders, owning a tractor is a high-cost proposition as it is not fully utilised.
- This needs to be made more efficient by creating a market for tractor services.