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Cold comfort -- Subsidies offer no real solution
About 100 DAYS AGO, The Akali Dal Government in Punjab celebrated its accession to power by giving out free electricity to farmers. Now, it is putting up a production line to make air-conditioned tractors with canned music in the cab. Even to the untrained eye, there would seem to be a glaring contradiction in policy here. No one can possibly deny that the Indian farmer is a hard-working individual. No one can grudge him his creature comforts. But one can question the wisdom of a Government which freely distributes agricultural subsidies while putting climate-controlled farm equipment on the market. True, the average farmer in Texas or Tennessee does own such equipment and takes the mickey out of Washington in State subsidies. But India neither needs nor can afford that particular economic system, because agriculture here is not organised enough to produce huge national surpluses. Even in the distant future, it is impossible to visualise a situation where Delhi will pay Indian farmers to destroy their crops. The world over, farm subsidies have always been highly politicised. In some European nations, subsidy rollbacks have been responsible for more political unrest than any other factor. But rarely have they been used proactively, as a political strategic weapon, with as much consistency as in India. But now, subsidies that do not serve core agricultural interests should be reappraised. Fertiliser subsidies are all very fine, because there are not too many alternative uses for nitrate and superphosphate other than farming and making bombs at home. But energy is a completely different area. Government, which often does not have the infrastructure to collect on power bills, certainly does not have the wherewithal to check if farm connections are actually being used for running pumpsets. Besides, the lion's share of the oil pool deficit is accounted for by loss of revenue on diesel sales. Yet this highly subsidised fuel, which is primarily intended for farmers' tractors and for transporting essential commodities -- which, again, are produced by the same farmers -- also finds use in the tanks of a growing number of luxury cars in the cities. This subsidy to the farmer becomes doubly indefensible when the said farmer is traversing his fields in air-conditioned comfort, slowly jiving to bawdy lyrics in stereo. Surely, there are other ways of bettering the lot of the farmer. Especially that of the small farmer, who is responsible for the bulk of the sector's productivity. Some concern for agricultural infrastructure, an area which last got the attention it deserves in Indira Gandhi's time, would result in far better profit margins than any subsidy. Better access to markets and storage facilities would also bring in more assured incomes. And if the government were to act as an honest broker and connect local farmer communities with markets overseas, profits would jump several-fold. But of course, political imperatives will ensure that steps along these lines will never be taken. Every government wants to keep its farmers in a dependent position, hand outstretched for the next dole. Even when they ride up in air-conditioned comfort. Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.
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