Punjab Newspaper

Member Parliament and working president of Shiromani Akali Dal (SAD) Mr. Sukhbir Singh Badal today asked the Centre to reimburse subsidies given by the states to the farmers to meet food deficit needs of the country.
Delivering the key note address on “Roundtable discussion on agrarian crisis and food security of India” organised by Institute for Development and Communication (IDC) here at UT Guest House, Mr. Sukhbir Badal said: ” Not only this, the Central Government for federal financial transfers should include performance of states in terms of their contributions to meet the food security of the nation.” He said we have already taken up these issues with the Prime Minister of India.
Dwelling on the agrarian scenario in the State, Mr. Badal said that Punjab had been growing food for social good and to attain self-sufficiency in food production for the whole country. About 50 per cent of food procured for the central pool was contributed by Punjab alone. “We have paid heavy price in terms of environment degradation, falling water table etc.” asserted Mr. Badal.
Elaborating further, he said that the very people who were involved in food production were increasingly coming under debt, their income levels were declining and consequently, they were being pushed on the margins of new economic reforms. The economic condition of the people had become so bad that for the first time in the electoral history of Punjab, both the Akali-BJP coalition and the Congress party have to promise Atta-Dal to these families on subsidised rates. This promise was made in view of the fast rising prices of food products leading to major hardships to the poor in the state. The prices were rising at a fast rate mainly due to the macro economic policies. The states have no autonomy to reverse the price rise, and therefore they were forced to subsidise the BPL families who could not pay for their food at the prevailing high prices. This had put excessive burden on the states finances.
Expressing deep concern over the sustainability of wheat production in Punjab at the present level, Mr. Badal said that it had become difficult due to alarming depletion of micro-nutrients in the soil, and continuous fall in ground water level. As a result, wheat yield in Punjab had fallen by about 22 per cent over the last 5 years (from 23 quintal per acre to 18 quintal per acre). If this fast decline in wheat yield in Punjab was not arrested in time, the wheat self-sufficiency of the country would be seriously endangered. Arresting and reversing the downward trend in wheat yield in Punjab requires financial resources that were beyond the reach of the state on its own.
“There is a need to reformulate the new scheme proposed for ‘Wheat Enhancement” by the central government. It is interesting that the programme has been conceived keeping in view states other than Punjab,” observed Mr. Badal.
He said that these states did not have specialization in wheat production. The programmes should not target districts but also support the restructuring of macro infrastructure like irrigation network, electricity supply system etc.
Highlighting issues related to the state’s agrarian economy, Mr. Badal said that the prevalent canal irrigation system in Punjab was 50 years old and very extensive that required upgradation and updating. For this purpose a total expenditure of at least Rs. 3000 crore was needed. The state was not in a position to generate this huge amount from its own resources. The central government should share this burden on 50:50 basis and provide a subsidy of Rs. 1500 crore for this purpose.
Justifying the rationale for providing a huge subsidy to supply power to tubewells and canal water to farmers, Mr. Badal pointed out that this subsidy served the national interest by keeping the cost of production of wheat and rice down and helped the Centre in procuring wheat and paddy at lower rates. These subsidies had to be maintained and were not excessive on any count. The power and canal water subsidy given by Punjab to its farmers does not make even 5 per cent of their incomes. To sustain their commercial farms developed countries are giving huge subsidies. According to a recent estimate (Economist, London, 7 th August 2004), 52 per cent of American farmer’s income comes from government subsidies, 46 per cent of European Union farmer’s income comes from subsidies and 56 per cent of Japanese farmer’s income comes from government subsidies. In comparison to that Punjab farmers are getting less than 5 per cent of the income from subsidy to maintain equally commercialized and high productivity farming.
Mr. Badal also strongly pleaded that Minimum Support Price (MSP) of wheat and paddy should be announced at the time of sowing and adequately increased every year so that profitability of wheat and rice production was maintained.
Mr. Sukhbir Badal said that after a long time there appeared to be consensus amongst policy planners that food production had to be enhanced.
“We should increase food productivity and release land for industrial and commercial crops. There is also a need to release pressure of people from land by generating income from other sectors of economy. As a layman, I am of the view that without generating income with the people, fiscal health of the state cannot be improved” said Mr. Badal. The roundtable discussion was inaugurated by the Governor of Punjab General (Retd.) S.F.Rodrigues, pvsm,vsm.
Prominent amongst others who participated in the discussion included ; Prof. Y.K. Alagh, former Minister for Planning, Government of India, Prof. G.S. Bhalla, former member Planning Commission and Dr. Pramod Kumar, Director Institute for Development and Communication, Chandigarh besides the distinguished economists and academics.