India's rain brings crop of doubt
By Santwana Bhattacharya
NEW DELHI - Some rain over the past two weeks has offered hope that the drought
that threatened India, after a late and fickle monsoon, might not be as severe
or as damaging as threatened at the end of June - or so some politicians and
economists would like the public and business to believe.
Low reservoir water levels and a crop-sowing calendar already gone awry made
the outlook six to eight weeks ago appear dire - and not just to those who
worked directly on the land. But others, not least in government, warned
against "alarmist" forecasts, and argued for a more optimistic outlook.
July and August were still left, and even if particular crop patterns were
disrupted, late rains could always make the final figures look more
respectable. Roughly speaking, if there is pain across the
map, ignore it. At least technically, there wouldn't be a deficit.
It's as if someone has to be held accountable for the weather. The flinching
from responsibility, the denial of a crisis until it can be postponed no more,
suggests anticipatory guilt, as if the electorate might see some causal link
between poor rains and the government.
About two months down the line, as of the first week in September, 252 out of
about 600 districts in the country - or about half of India - have been
officially declared to be hit by drought. The kharif, or summer monsoon,
crop output - mostly paddy - is projected to be down by 20%.
As numerous mini-disasters pile up, their combined effect threatens to pull
down India's growth rate from the 6.1% recorded during the first quarter of the
financial year. This has brought the problem more urgently to the attention of
macro economists.
The monsoon did partially keep to schedule, but debate remains over whether it
was too little and/or too late. Good rains in the past fortnight, especially in
hitherto dry areas, have brought down the total deficit from the 55% of
June-end to 23% now. But much of the damage in agricultural terms (and thus on
the economy) has already been done. The present rains merely offer the
possibility that further damage might be limited.
Many farmers will be praying that is the case, particularly after the the
untimely, and deeply ironic, death last week of the charismatic Andhra Pradesh
chief minister YS Rajasekhara Reddy in a helicopter crash. Often described as a
farmers' leader and a son-of-the-soil, YSR was on one of his periodic trips to
the rural areas to check the drought situation. Taking off in bad weather, the
chopper rammed into a hill in the middle of a forest - in conditions of zero
visibility and blinding rain.
The rains have not been playing truant in India alone. Seven other countries
have been severely hit by drought and are staring helplessly at the resultant
agriculture crisis.
Parts of the United States, China, Australia, Cambodia, Argentina, Kenya and
Somalia are reeling under its effects - the difference being only in their
ability to cope. Even in Europe, television pictures show townspeople, driven
to distress by temperatures in the 40s Celsius, using public fountains to cool
down.
Yet some experts and governments, in full cognizance of the facts, want us not
to create panic and paint a picture of parched crops and a looming food crisis.
This, they say, would push up food prices unnaturally, lead to hoarding and
ultimately result in a situation where many more millions across the world
would go hungry. And whether it is the developing world or the developed, it is
those at the bottom of the pyramid who are the most affected in such scenarios.
This leads to a confusing divide between reality and government pronouncements,
or even between the perspectives of government departments.
The Indian government, for one, claims that it will be able to insulate the
bottom rung of society from the vagaries of drought. The class of landless
agriculture labor, bereft of any farm work, has been promised sustenance wages
through public works initiated under the welfarist National Rural Employment
Guarantee Act (NREGA).
But perhaps they are not the worst victims. For that, one may have to look at
the next tier on the economic pecking order - the small and medium farmer,
whose heavily debt-powered investments on often merciless plots of farmland
represent one of the riskier forms of venture capital the world has known. It
is from these strata that one hears news of farmers' suicides.
In the six weeks up to August 27, more than 150 farmers committed suicide in
Andhra Pradesh alone, according to an Associated Press report citing opposition
parties and farmers' groups. That was six times the official toll of 25 farmer
suicides in the state, where 70% of the 80 million population depend on
agriculture, the report said.
The landless do lead hard-scrabble lives, but they have always migrated to
where there is work and food. For those committed to their own hectare or so of
land, even the laborer's financial security, by way of the expanded NREGA
program, is a point of distress for the small employer: for, over and above his
other expenses, he now has to pay higher wages too.
To ease the distress building up at this level, the government has designed a
little stimulus package that would allow the farmer to take some advantage of
late monsoon showers by sowing short-duration crops - anything to help him cut
his losses and keep him from taking a big swig of that bottle of pesticide.
Before the crisis management plan rolled out, even the economist and Prime
Minister Manmohan Singh had shown signs of alarm. "No one can control drought
and it is a severe drought," he said in a public speech. Last Tuesday, when he
addressed the Planning Commission of India, his first such meeting since he won
the general election in May, the tone was more confident. "We are in a very
strong position to manage the consequences of drought. Our food stocks in
particular are very high. We should not be over-pessimistic," he said. The
prime minister projected a buffer food stock of 50 million tonnes.
Meanwhile, Finance Minister Pranab Mukherjee, a veteran troubleshooter for the
government, who was giving detailed responses on the drought situation to
assuage fears, put out more conservative figures. He also claimed that "there's
no need for panic" - but his surplus estimates were far lower.
Totting up the wheat and rice buffer stock, he put the food surplus at a modest
16 million tonnes (10 million tonnes of wheat, six million of rice). These
reserves are substantial and domestic food availability will not be a problem,
according to Mukherjee.
Paddy, which has been badly hit by drought, will naturally have lower stock. By
October 1, the rice stock is likely to be 13.7 million tonnes. (Given a normal
buffer of 5.2 million tonnes and strategic reserves of 2 million tonnes, nearly
6 million tonnes will be surplus.) This despite the rainfall deficiency of 26%
up to the end of August, which has brought down grain production by between 15
and 20%.
There is some aggressive, rearguard action unfolding on the paddy fields too.
The government hopes to recoup the shortfall in grain production in the
northern states of Uttar Pradesh and Bihar with the help of some never-say-die
methods adopted by farmers in the rich states of Haryana and Punjab. The
standing crop in the grain basin, it seems, has not all been allowed to wither.
This was done by tapping into underwater reserves, pumped up through machines
running on diesel subsidy.
Thus, Mukherjee said, there's going to be some good harvesting news as well.
Dwelling on this in a recent interview, he quipped, "The situation could be
bad, but that does not mean we should start eating lizards. We have the
experience of tackling the drought of 1987-88, the worst of the century."
Well, that is an official admission about how bad the current drought is - if
its psychological burden has to be alleviated by stories of worse nightmares.
Mukherjee is in any case known for being a walking encyclopedia of sorts, an
oral historian, even if he sometimes gives the impression of still being in the
20th century.
To put the final guarantee on demand-supply management, the government is also
considering imports of food grain. The date and timing have not been indicated
so that international prices do not shoot up in anticipation of a huge import
order. Once the decision is taken, India could turn out to be a big buyer.
But the real battle is unfolding in India's innumerable, kerchief-sized farm
plots. In badly affected districts, the central government, in tandem with the
states, plans to introduce short-duration crops - pulses, oilseeds and others -
on farms that have been slightly moistened in the late phase of the monsoon.
The government still hopes some of the rain shortfall may be made up during the
next week or so. With some luck, the 81 reservoirs in catchment areas will be
back to nearly full. These are currently running at an average 39% of capacity.
Meanwhile, over and above a $2 billion diesel subsidy, short-term crop loans
have been provided to some thousands of farmers across India. The Agriculture
Ministry has convinced the Finance Ministry to give those who return their
loans on time another 1% rebate on interest. The procurement price for any rice
saved from the clutches of drought will be 1,000 rupees (US$20) per quintal
(about 100 kilograms) up from 850 rupees last season.
The other aspect of drought is the impact it has on manpower utilization. With
parched lands offering little job options to the landless labor, it typically
sets off a wave of exodus to urban areas. This is what targeted welfare schemes
such as the NREGA are intended to offset. According to one proposal, even those
recruited to work on short-term crops should get coverage - that will provide
labor wages and also, in effect, subsidize the farmer in another way.
All this adds up to an unplanned burden on government finances. The Reserve
Bank of India sounded a warning in a recent report that deficient monsoons will
not only affect agriculture output and put pressure on food prices, but raise
demand for more subsidies and relief measures and thus push up fiscal deficit.
The Central Statistical Organization, too, says the effect of drought has not
been reflected in the first quarter data. It is certainly going to show up in
the coming quarters.
So, despite the brave posturing, it's little wonder that the United Progressive
Alliance government has quietly deferred its plan of introducing its proposed
food security bill, which was to provide 25 kilograms of rice and/or wheat at
three rupees to each family below the poverty line.
Santwana Bhattacharya is a New Delhi-based journalist who writes on
politics, parliament and elections. She is currently working on a book on
electoral reforms and the emergence of regional parties in India.
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