Indian farmers address the prime minister

Indian Coordination Committee of Farmers’ Movement

Dear Shri Manmohan Singh ji,

Thousands of farmers, representing Bhartiya Kisan Union and other farmer unions affiliated to the Indian Coordination Committee of Farmers’ Movement (ICCFM), organised a massive demonstration in Delhi today protesting against “pro-corporate and anti farmer Budget of 2010-11” by the United Progressive Alliance (UPA) government under your leadership. The farmers are also agitated over the faulty agrarian policies by your government causing extreme hardship to Indian farmers and exacerbating agrarian crisis in the country.


Pro-Corporate and Anti-Farmer Budget (2010-11):

Though the Finance Minister have boasted that the 2010-11 Budget “belongs to the farmer and the agriculturist”, but it is actually a ‘anti farmer budget’ given the increase in diesel and urea prices besides allowing decontrolling of fertilizer prices leaving big fertilizer companies free to fix prices. The 2010-11 budget would cause increase in production cost which is already resulting in farm debt and increasing farmer’s suicide. Moreover the Budget did nothing to check food inflation which is creating hunger and malnutrition in among the small and marginal farmers. Neither does the budget provide any substantial hike in public investment in agriculture or irrigation, nor any increase in rural credit outflows. While the farmers’ fertiliser subsidy was cut, the corporate sector got a whopping gift of over Rs. 500,000 crores through direct and indirect tax concessions and write-offs in the 2010-11 Budget which is almost seven times of the farmers debt relief provided in 2008. Even the corporate agriculture and food processing industry got a much better deal unlike the countless millions of small and marginal farmers through the budgetary allocation under the “reduction in wastage of produce” and “agricultural credit” programmes which would mainly benefit the “corporate farmers” who have entered into Indian agriculture through their retail chains, like Reliance and Bharti groups.

Implement Swaminathan Committee Recommendation for Minimum Support Prices (MSP):

The increasing cost of cultivation and ever rising food inflation are killing Indian farmers, because the rise in food retail prices are not translating into any benefit to the Indian farmers. It is mainly because the farm gate prices in India are far way below the retail prices, which is benefitting the food speculators and middlemen and not the farmers. We would therefore like to reiterate our long pending demand for implementing the Swaminathan Committee recommendations for Minimum Support Price (MSP) which basically suggest that the MSP should be at least 50% more than the weighted average cost of production. Presently the cost of production is invariably much higher than the minimum support price, due to ever-increasing prices of diesel and other inputs. In view of this the government must review the calculation of MSP which take into consideration the ever increasing prices of diesel, the rent of the land, farmers wage as an skilled worker, farmer’s family labour besides the cost of inputs like seeds and fertilisers. As per this calculation, we demand an MSP of Rs. 2250 per quintal for wheat and rice. The higher MSPs would certainly help in easing farmers’ pressure and would be quite helpful in restricting farmers’ suicide.

Direct Income Support for Farmers:

As per the 59th report of the National Sample Survey Organisation (NSSO), the average monthly per capita income of farm household is merely Rs. 503/- (in the year 2003). The report of the National Commission for Enterprises in the Unorganised Sector, also claim that 836 million (77%) of Indian live below Rs. 20/- a day. The previous budgets by this United Progressive Alliance (UPA) government did not provide much support for increasing the income for the rural population who are under utter poverty and destitution. The ICCFM would therefore demand that the UPA must provide a direct income support to the majority of small and marginal farmers and landless labourers to cope with the increasing cost of living in today’s globaliased India. Given the increasing agrarian distress, the government must also focus on promoting rural industries which would provide an alternate source of income to farmers.

Introduce Universal Public Distribution System (PDS) ensuring Food Security for All:

The continued rise in food inflation, production shortfall in key crops, falling area under cultivation and the decline in food grain production have been causing great hardship to the rural India, where majority are dependent upon agriculture. Today more and more rural people are seeking below poverty line status due to increasing poverty due to declining farm income. Recently, a committee headed by your Economic Advisor, Suresh Tendulkar, established that in 2004, more than 42% of the rural people were under poverty, which must have increased substantially in last five years. We therefore demand for introducing Universal Public Distribution System (providing food grains at the BPL rate) in order to ensure food security of the rural population. This has also been recommended by the Centre for Budget and Governance Accountability (CBGA) which pointed out that it is only through the universal public distribution system that can improve the food availability for people under poverty and bring down food prices. This would put an extra burden of just Rs 84,399 crore on the state exchequer, which is less than a fifth of the revenue foregone by the government through tax exemptions in 2008-9, which stood at a whopping Rs 418,096 crore. Increasing the ambit of the PDS system would also help in effectively utilizing the food surplus (over and above the standard buffer stocks) which are rotting with the Food Corporation of India (FCI).

Check Price Rise – Ban Future Trading:

India is already facing a problem of food security with the decline in food production and increasing hunger deaths and increasing cases of malnutrition among poor children. This situation is getting worse with the entry of agri-business corporations in the agriculture marketing which has led to price rise mainly through the manipulation of commodity market through forward trading or future trading. The corporations provide slightly higher price for agricultural commodities to capture the market and thus dismantles the government procurement system which affects the rise in prices. The present rise in prices benefits only traders and corporates, whereas the farmers and consumers suffer due to the higher prices. We therefore demand that the government immediately withdraw the provisions of Future Trading/ Forward Trading in order to curb the price rise.

Provide Fertiliser Subsidy based on Farmers Land Holding:

The ICCFM reiterate our long standing demand for providing fertiliser subsidy directly to the farmers based on his/her land holding. This need to be given to only practising farmers as per the state land holding limitation laws in order to check the benefit of this provision to companies and industries who at present own huge land. However, the ICCFM is surprised with the government’s decision to bring in a Nutrient based Fertiliser subsidy regime to provide fertiliser subsidy directly to farmers based on its soil condition. Our main concerns are “who would decide about the soil condition and how”. Moreover, the NCCFM would like to demand for a complete control over the fertiliser prices because one the fallout of the new policy would be ‘fixed subsidy-floating price’ system which would mean increased prices for fertiliser and a price instability regime.

Increase Credit facility for Farmers:

Despite the farm loan waiver of around Rs. 70,000 crores in 2008, more than 16,196 farmers committed suicides in India in that year, according to the National Crime Records Bureau. This is a proof that the farmers in general didn’t get the benefit because it only helped those farmers who have taken loans from government banks, leaving out a large number of them who have borrowed from private moneylenders. Therefore we reiterate our demand for a complete debt relief not only from institutional debt but also of private money lenders. Secondly, after the loan waiver in 2008, farmers are facing shrinking of credit facility especially in those regions where farmers’ suicides are rampant. We therefore demand that the UPA government bring policy to provide agricultural credit to small and marginal farmers at the nominal rate of interest.

Reduce Interest rate to 4% for all Agricultural Loans:

The ICCFM would like to demand that the government, as per the recommendation of the Swaminathan Committee report of 2007, must fix a maximum interest rate of 4% on all agricultural loans. With the increasing cost of production and increasing food inflation, this would be a big relief for the Indian farmers and would help in preventing the farmers’ suicide in the country.

Crop Insurance to Compensate farmers in case of Natural Calamity:

We would like to draw your kind attention on the anomaly in the current Crop Insurance Scheme where a block or tehsil (not even a village) is considered as a unit and unless a natural calamity hit the whole block or tehsil, farmers are not compensated. We therefore demand that under the Crop Insurance Scheme, each farmer and his/her crop should be considered as a unit. In case of natural calamity like drought, floods, fire, hailstorm or frost which destroys standing crop of a farmer or groups of farmers, they must get compensation. The UPA government must also institute a policy for an Emergency Fund to compensate farmers (who don’t have crop insurance) in case of a natural calamity like drought, floods, fire, hailstorm or frost.

No Acquisition of Farmers Land for Development Projects and SEZs:

The ICCFM would like to demand that the state and the Centre Government stop all land acquisition in the name of ‘public purpose’. There must not be any forceful acquisition of farmers land and selling of the land by the government, acquired on the pretext of “public purpose”, for any development projects, to industry or SEZs.

Strengthen Agricultural Extension Offices:

Given the deteriorating condition of the Indian agriculture, the ICCFM would like to demand that your government must give proper attention towards strengthening of the agricultural extension department. We have a long standing demand for increasing the allocation of the extension department of the Ministry of Agriculture which is completely crippled under this liberalisation era and farmers are forced to depend on the technical advice of the agents of pesticide and seed companies who often mislead the farmers for their own interest.

Impose Permanent Ban on GMOs:

All farmers unions as part of the ICCFM welcome the government of India’s decision to ban the genetically engineered Bt. Brinjal. But this is just a two year temporary ban. We would like to demand for a permanent ban on the research, production, and imports of all genetically modified seeds, crops and foods. Instead of promoting GMOs, we demand that the government must support ecological agriculture and provide proper incentives for growing toxic free foods through organic farming.

No to WTO and FTAs:

The ICCFM are quite upset with the UPA-2 agenda for trade liberalization through speeding up of the WTO negotiations towards its conclusion in 2010 and signing of FTAs with ASEAN and South Korea. The WTO negotiations have failed in regulating the huge subsidies of developed countries. Given this imbalances, we urge the Government of India to demand for ‘Keeping Agriculture out of WTO’.

In view of the recent trend in signing bilateral and regional trade agreements, we would assert that the government must ensure against opening up of the agriculture market under the Free Trade Agreement (FTAs) that are being signed with the European Union, China and many other countries.

We are therefore hoping that the UPA government, under your leadership, will immediately take notice of our demands and take necessary actions.

Signed by:

Ch. Mahender Singh Tikait, President, Bhartiya Kissan Union,
Ajmer Singh Lakhowal, State President, BKU Punjab,
Gurnam Singh, State President, BKU Haryana,
Puranmal Sunda, BKU Rajasthan,
S.S. Cheema, BKU Uttranchal,
Yudhvir Singh, Spokesman, Indian Coordination Committee of Farmers Movements (+91-9868146405).