July 05, 2015
Array

The NDA’s War on Rural Poor

Veeraiah Konduru

THE NDA government waged an incessant war on rural poor immediately after coming into power. As a key strategy of this war, the Modi-led government made an explicit commitment to remove any kind of State intervention which hinders the free play of market forces. The key elements of this strategy are allowing foreign and domestic private capital to poach the vast rural market through various means of market instruments. The precondition for such facilitation lies in the limiting the role of government agencies, systems that govern the economic activity in an agrarian economy. That is why it wants to dismantle all the protective institutions and arrangements that were handy and played an important role in transforming India into a self-reliant economy until 1990s. Just because of these inbuilt protective mechanisms, India could withstand not only the ongoing crisis of finance capitalism that shook the world economy for almost a decade but also the decade-long draught and distress. This compels us to look at NDA’s policy prescriptions toward rural India and their impact on farmers and agricultural workers that are key constituents of rural economy. Immediately after coming to power the NDA government has taken a policy decision limiting the states’ power to declare bonus on minimum support price fixed by the centre. In a written reply in Rajya Sabha, the minister of state for agriculture and food processing industries said, “in case a surplus state undertaking procurement in decentralised mode (DCP) declares bonus for wheat and paddy from Kharif marketing season 2014-15 and Rabi season 2015-16 onwards, the central government will limit the procurement for central pool to the extent of requirement of foodgrains for TDPS/ other welfare schemes allocations of that state.” Those non-DCP states that announce bonus will have to take care of their own procurement and storage cost, which until then was being born by the centre. This is nothing but arm twisting the state governments to fall in line or face consequences. This decision caused a loss of more than Rs. 10000 crores to the farmers across nine states. Not only that. The BJP came to power on a promise of “ensuring enhancing the profitability of agriculture by ensuring at least 50 percent profits over cost of production”. When the question came up before the Supreme Court of India through a public interest litigation, unmindful of its own election manifesto, the Additional Solicitor General stated before a two judge bench of Supreme Court, “ It may be noted that pricing policy is not a ‘ cost plus’ exercise though cost is an important determinant of MSP… Hence prescribing an increase of at least 50 percent on cost may distort the market.” Around the same time in October, 2014, Department of Economic Affairs released a working paper (04/2014-DEA) exploring the “steps to be taken that would enable the Indian agricultural market to asymptotically approach a Pareto efficient perfectly competitive market by the removal of various interventions.” The working paper argues that the interventionist mechanisms that are in place in India’s agrarian produces procurement market goes against the mandate of WTO regulations and batted for replacing the government intervention with open market competition in procurement of agrarian produces. The procurement of levy rice by Food Corporation of India has been found one of such market distorting state intervention in India. The findings of so called High Level Committee (HLC) which was chaired by former NDA minister, Shanta Kumar failed to demarcate themselves from the policy imports of WTO which are leaking into indigenous policy recommendations in the form of Working Papers by various government departments and agencies. The above mentioned is one such example of policy imports. ENTRY OF FDI IN RETAIL The timing of the constitution of HLC and release of its report are crucial. The WTO summit at Bali mandated the governments to stay off from the market distorting economic activities. The terms of reference were tuned to satisfy the WTO stipulations. Even before the Bali summit and prelude to that, a section of economic think tanks in India started similar argument and toed the line of WTO. Those who argued on these lines suggested privatising the procurement of agricultural produce. Procurement by private players is a vital link for establishing the back supply chain for the sustenance of the large scale retailers such as Wallmart and others. The entry of FDI in to retailing is governed by this. Thus, the withdrawing the state intervention in procuring agricultural commodities through various channels such as FCI, STC, MMTC, CCI is only to meet the dual tasks that feed the entry of private capital both foreign and domestic. The same recommendations were given primacy in the Economic Survey 2014-15. Both these measures expose NDA’s commitment in transforming agriculture into a viable profession. At a time when the monsoon is expected to play havoc not only on the lives of rural poor but also on country’s economy, the government’s policy prescriptions should be of such that it can guard its people from starvation deaths. This would have been done by strengthening the procurement mechanisms inter alia strengthen the rural economy. Against this, the above mentioned steps are going to cripple the agrarian economy which will force the farmers and agricultural workers to end their lives. Last year witnessed a whopping 26 percent increase in farmers suicides as was stated by the government itself on the floor of parliament. Had we added more than 1000 farmers who ended their lives under distress in the newly carved out state of Telangana, it would amount to more than 50 percent rise in farmers suicides. In this situation, the government has allowed to import more than 10 lakh tones of wheat from abroad at a cost of $ 225 – 275 per ton. This translates into average cost of Rs 1625.60 , which is almost Rs 200 higher than the minimum support price given to wheat growers in the country. Thus the government is going to feed the farmers abroad at the cost of locals. This is what the government is doing under the guise of Make in India slogan, transforming the farms into death fields. WAR ON RURAL POOR Similarly the government’s attitude towards the implementation of National Food Security Act 2013 should be called into question. As it was rightly pointed by Biraj Patnaik, principle adviser to the Commissioner of the Supreme Court in Right to Food Case, the government deffered the deadline for commencement of the Act repeatedly with out informing the parliament. It even refused to accept the request from Tripura government which was ready to implement the NFSA Act as early as in October 2014 itself on some technical objections. On the other hand, the modifications of Forest Rights Act also were not brought back for the scrutiny of parliament where it has a majority. These two instances confirm not only the step-motherly attitude towards the poor and rural India but also marks a brazen violation of parliamentary democracy. The NDA’s enmity towards MNREGA, which is wellknown from the statement of none other than the prime minister himself, had to be mollified under the threat of poor monsoon and impending economic hardship to the government itself. The next element of this incessant war on rural poor lies in the budgetary allocations for the food security. According to the department related parliamentary standing committee on food and consumer affairs, and public distribution system, the total coverage under targeted public distribution system is limited to mere 8134.91 lakhs beneficiaries where as the officially recognised number of BPL families are fare more than that. To implement, the NFSA needs budgetary allocation of Rs 1,31,086 crore where as the 2015-16 stands at Rs 100505 crore, which is almost 25 percent less than the requirement. The standing committee itself found that shortage of funds for food subsidy rose from Rs 32,743 crore in 2012-13 to Rs 53,458 crore in 2013-14 and may go upto Rs 60,730 crore in current year. Instead of finding ways to mobilise required resources that guarantee food security to its people, the government came out with an order that paves way to food insecurity. This is in this context that the Targeted Public Distribution System (Control) Order 2015 should be seen. The sole guidance of the said order is to restrict the number of beneficiaries under TDPS which was made explicit at the end of each clause and sub clause in the order. More over, the order said, “when an Antyodaya household becomes ineligible on account of migration outside state, improvement of social or economic status, death etc, no new Antyodaya household shall be identified in that state and the total number of Antyodaya households shall be reduced to that extent.” This means, nothing but gradual phasing out of the scheme which was started in the year 2000 by NDA government itself. And also the order contains more dangerous stipulation that excludes large number of rural poor. Discontinuing the existing practice of providing new ration cards based on annual census data at the satisfaction of state government, the order mandates the state governments, “there shall be no increase in the state-wise number of persons covered under TDPS till the data from next population census becomes available”. That means, no women wedded into a house would be enrolled as new beneficiary for another ten year nor the family separated from parents, nor a newly born baby. The infants also fail to get benefit out of ICDS whose allocations have been cut down to half of what it was last year. This raises the danger of malnutrition and infant mortality. The latest Order mandates the proof of citizenship to become beneficiary under TDPS. All this is aimed at reducing the number of beneficiaries and thereby the quantum of subsidy and benefits that the rural poor are availing till date. Unfortunately, it is this war waged by the central government against the rural poor failed to find its place in recently pronounced verdicts on first anniversary of NDA. This war must be fought out at all levels to ensure safety and security of lives of rural poor.