Covid 19 - Impact on Agricultural

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  Covid 19 - Impact on Agricultural

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• In a country like India which lacks the medical resources social distancing and living under a lockdown appear to be the only effective ways of dealing with the pandemic although there is limited evidence to suggest that this strategy may be working but its after-effects on thousands of migrant workers is already out in the open. Migrants are not the only ones who are facing the after-effects of the lockdown. With the economy coming to a complete halt in most of the informal and formal enterprises in urban areas, the lockdown is also likely to affect the large population in rural areas, a majority of whom are dependent on agriculture. 
• At a time when the rural economy was witnessing declining incomes, both for casual workers and self-employed workers, even before the pandemic broke out, this lockdown is only going to hurt the agricultural economy further.
• Breakdown of supply chains - A breakdown of supply chains of agricultural produce with no facilities for transportation of produce likely to hurt those engaged in the production of fruits and vegetables, which are perishable goods and cannot be stored.
• Rabi crops - There will also be impacts on foodgrains and other rabi crops that were ready to be harvested at the beginning of April. It will be difficult for farmers to harvest the agricultural produce in the surplus States of Punjab, Haryana and Uttar Pradesh in the absence of migrant labourers. Even if standing crop is harvested, April is the labour-intensive month. Labourers are required for packing, processing, transporting and selling the produce. 
• Decline in prices - Some of the short-term impacts may affect price realisation by farmers but the real worry for farmers is going to be the decline in prices for the majority of agricultural produce. There are already signs of a collapse in agricultural prices, which predates the outbreak of the pandemic.
• What the government can do –

1. Release the food stocks through the public distribution system. The Central government has already announced that for the next three months, 5 kg of free grains will be distributed in addition to what people are entitled to under the National Food Security Act, but this has not yet reached the State governments due to the lockdown. While this may free up FCI godowns to some extent, it will be prudent to extend the scheme to all residents, particularly migrants who may not be able to avail of free grain in urban areas.
2. The state is also expected to intervene and assure remunerative incomes to farmers. One way of ensuring this is to reduce the input costs through existing schemes of subsidies such as the fertilizer subsidy and through price reduction in petrol/diesel meant for agricultural purposes. But for the immediate short-term, farmers need to be compensated for the loss of income and the best way to do it is through the PM-KISAN scheme. 

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