Agriculture post-COVID: An opportunity for evolution
• Indian agriculture has to tackle several issues in the value chain, including transportation, post-harvest losses, fears of food safety, processing infrastructure, etc.
• These challenges were exacerbated by unprecedented COVID-related developments such as labour migration, the coincidence of the lockdown with the harvesting season, inflation in food prices and traders in mandis testing positive for the virus.
• The government has taken important steps such as amending the Essential Commodities Act for better price realization, promotion of e-trading of agricultural produce, Operation Green to prevent distress sales, etc.
• However, there are a number of things that need to be done if we want to make Indian agriculture Covid-resilient. These include mechanization of agriculture, bringing traceability from farm to fork, promoting genetic heterogeneity to reduce the chances of infection, etc.
Agriculture has been a significant contributor to the Indian economy for quite some time, employing around 60% of its population & constituting 12.5-13% of India’s total exports. Not just that, India continues to be a major supplier to the global food basket since it is a leading producer in the world for an array of food products such as milk, wheat, pulses, basmati rice, spices, oil meals, meat, sugar cotton and castor oil. However, COVID-19 has presented a dire challenge to the sector that needs to be addressed.
Outbreak of coronavirus in India and the consequent lockdown, unfortunately, also coincided with the country’s peak harvesting time of a variety of crops of the season. This period saw another unprecedented development: the large-scale flight of labour from cities to their respective villages, fearing death by hunger as all economic activity came to a halt. This mass departure of the migrants to their homes has created serious paucity of farm labour in the states of Punjab, Haryana and Uttar Pradesh, which rely on farm labourers from eastern India.
Matters are especially worse for farmers who grow fruits and vegetables, considering that the shelf life of these commodities is usually very short. At the same time, reports of cucumbers & bell peppers rotting in the fields due to the disappearance of buyers and retailers and coffee worth US$ 52 million being piled up in warehouses due to the blockade in the supply chain, began doing the rounds. Also, as meat-eaters chickened out on account of the coronavirus scare, poultry sector in India is estimated to be sufferinglosses of over ₹ 1.6 billion a day.
For farmers, this would trickle down to having lower yields and delayed & reduced returns, besides leaving crops to weather vagaries. Further, it is also likely to lead the way to the next major challenge – a smaller window to plant next season’s crops. According to reports, planting of cotton and summer ‘moong’ pulses is a challenge for farmers in Madhya Pradesh, UP, Haryana, Punjab and Rajasthan. Plus, the remnant stranded labour available in these states, started to overcharge for their services.
These farm workers are determined to stay put in their villages and , though they’re grappling with income losses, due to the threat of being infected by this disease which is a poor man’s burden at the end of the day. But are they necessarily safe? The World Bank in its “South Asia Economic Update: Impact of COVID-19” report cautioned, “The flow of migrant workers could easily become vectors carrying the coronavirus back to other states and villages.”
The fear of the pandemic has spread to everything from seeds and sowing of crops to marketing. The International Seed Federation (ISF) stated that there is no evidence yet to say that seeds are a gateway for the virus into the food chain. The Central & State governments in India have worked hard in their respective capacities to debunk these anxieties.
Further, although the government exempted agricultural operations under the Disaster Management Act, with respect to the lock-down to avoid supply chain disruptions, there were some initial hiccups in the distribution of these goods. Transportation of public distribution system (PDS) items to last mile delivery agents was one such bottleneck, as truck drivers faced issues at state borders.
In addition, the paranoia among consumers that there could be a paucity of food items in the country led to the market becoming volatile and a spike in the prices of fruits and vegetables. The government, on its part, repeatedly tried to assure urban consumers that the ground issues were different, as panic-struck mobs rushed to stock up essentials. Another challenge that emerged was that as the food products reached sabzi mandis in the country, the dreaded virus began to rear its head once again. For example, there were reports of traders associated with Delhi’s Azadpur Sabzi Mandi having tested positive for COVID-19. This led to the fears that mandis could emerge as new ‘superspreaders’ of the contagion in the nation.
The outbreak of coronavirus also spelled bad news for Indian agricultural exports. Before the virus came to India, it had spread to the US, Europe and other parts of Asia. Consequently, traders in Singapore, Hong Kong and Dubai, who serve markets in Malaysia, Indonesia and African nations, are not coming forward to purchase Indian rice. Meanwhile, exports of perishables like bananas to West Asia have also been severely affected, leading to a dip in farm gate prices. According to industry experts, the buffalo meat industry lost business worth Rs. 1,500 crore in February itself, due to the outbreak in China.
“In addition, macroeconomic channels of transmission affect agricultural supply, trade and final demand. The precipitous fall in oil and metal prices, for instance, exerted downward pressure on the exchange rates of many commodity exporting countries (“commodity currencies”),” explains Food & Agriculture Organization. What will also hurt Indian exporters is the global fall in international prices of food items with the crisis hitting demand as millions of people are rendered unemployed and tumbling crude oil prices also reducing the need for sugarcane to produce ethanol.
The Government of India has been mindful of these issues and taken some germane measures to rectify these problems. For example, in the third tranche of the Aatma Nirbhar Bharat special economic package, it focused on long-term issues in the agrarian sector, by promising financing to strengthen infrastructure, build better logistics and ramp up storage capacities, as well as proposing major governance and administrative reforms.
Among other things, government will amend Essential Commodities Act to deregulate agricultural products listed under essential commodities. To ensure the availability of all fruits and vegetables around the country, round the year without price volatility, it also extended the ambit of Operation Greens from Tomatoes, Onion and Potatoes (TOP). The government also sanctioned a financing facility of Rs 1,00,000 crore for funding agriculture infrastructure projects at farm-gate and aggregation points and Rs 13,000 crore for National Animal Disease Control Programme for 100% vaccination of cattle, buffalo, sheep, goat and pig population. It vowed to set up a Rs 15,000 crore Animal Husbandry Infrastructure Development Fund and set aside Rs 20,000 crore for fishermen through Pradhan Mantri Matsya Sampada Yojana (PMMSY) for development of marine and inland fisheries and to fill critical gaps in the fisheries value chain.
Mr. Jayesh Gosrani, MD, GOMA Engineering Pvt Ltd. commented on the measures by the government:
“The announcement of the economic package is indeed very welcome and is the need of the hour, for bringing up the economy in coming times.”
Apart from these measures, government had earlier offered financial support to ailing farmers through the extension of both Interest Subvention (IS) and Prompt Repayment Incentive (PRI) till May 31, 2020, on short-term crop loans up to Rs 3 lakh. It had also announced cash transfers under the PM-KISAN scheme as a front-load to about 8.69 crore farmers.
Ms. Namita Kumar, Director, Param Dairy opines:
“Allotment of Rs 13,343 crores for vaccination of cattle, buffalo, sheep, and goat will decrease the mortality rate in cattle and save them from many diseases, increasing milk production. Increased milk production will help companies to run at a better production level in the lean season.”
Never waste a good crisis
Indian agriculture needs to emerge more resilient from the pandemic on a holistic basis. The present situation can be leveraged to undertake targeted interventions towards this goal.
There is a requirement to promote genetic heterogeneity. This will help to preserve and cultivate a range of varieties, be it of potato or other crops, and keep viruses, bacterial and fungal infections at bay. This will also help in ensuring food and nutrition security. However, it is essential to ensure that seeds are made available to farmers who are preparing for kharif sowing in adequate quantity.
Secondly, production & marketing practices must adapt to changing times. Farmers should be encouraged to adopt mechanization of farming processes and domestic companies should be incentivized to produce farming implements at affordable rates to minimize human interface. At the same time, measures need to be taken to sensitize all the players involved in this activity about the need to frequently wash their hands and wear masks.
Similarly, farmers should be pushed to sell their produce through e-NAMs. It is believed that the government is already working towards that. Sales through this online portal will kill two birds with one stone: it will reduce human contact and mitigate the spread of COVID-19 through mandis. At the same time, it will minimize post-harvest losses as farmers will have the freedom to sell their crops through this platform.
More infrastructure needs to be facilitated to minimize post-harvest losses like hermetic storage, investing in cold storages and refrigerated transport. Relevant incentives for the food processing industry will help grow the share of value added products like pickles, jams, ketchups, wine, dairy products and so forth.
There is also a need to ensure that food supply is not disrupted to the countries to which India exports agricultural commodities. This can be done only if appropriate biosecurity arrangements are in place. They will require changes in how food is produced, consumed and distributed, while also ensuring that COVID-19 related sanitary and phytosanitary requirements remain science based.
Technologies like blockchain and cloud computing must be harnessed to ensure food traceability in food chains. These technologies will also enable farmers to use knowledge-based repositories containing a wealth of information related to farming practices, crops input, agricultural innovations, pesticides, seeds, fertilizers, nutrients and weed resistance, as well as on equipment. Also, efforts to boost international co-operation must be made in order to overcome the impact of reduced air and sea cargo possibilities.
Thus, to some up, the road to making Indian agriculture resilient post-COVID lies in addressing the longstanding issues that have been peculiar of Indian agriculture. It is critical for the world at large that India addresses them, considering the pressing food security issues that could overwhelm several national governments in the coming months.