1st April 2019 BUSINESS STANDARD
(*The writer is a corporate advisor and Distinguished Professor of IIT Kharagpur. He was formerly Vice Chairman of Hindustan Unilever and Director, Tata Sons.)
The cacophony and energy around Startup India and entrepreneurship has bypassed the agri-preneur. It is time to reverse this unfortunate and cumulative neglect. In economic terms, it is a bit like setting right traditional caste discrimination in social development!
Entrepreneurs promote enterprise through meeting six challenges: (i) creating products or services for which he must find a market and customers (ii) adapting to changing consumer requirements and technological possibilities (iii) experiencing great psychological stress due to unparalleled unpredictability (iv) attracting social approbation and disapproval if he fails (v) working incredibly hard and with great passion, year after year and (vi) suffering from a poor ecosystem for management advice, mentorship, fund-raising and risk management.
These six challenges are faced by the farmer, and, therefore, they can be regarded as India’s greatest entrepreneurs–land, fish, poultry and dairy farmers—17 crores of them, bearing on their shoulders the economic wellbeing of 70 crore people, assuming four to a family. Many people mouth politically correct things about farmers but are unable to influence positively the farmers’ lot.
Farmers constitute a big, but fragmented, vote bank, so politicians do not care enough about this heterogenous bunch. Farmers are at the heart of employment generation and national economic growth, but economists do not give them enough attention. The city folks take the farmers’ wellbeing for granted and think of the rural people only as consumers of their products. Almost every Prime Minister and Finance Minister has demonstrated good intent but, exceptions apart, has found it difficult to do what is needed.
India must do what has not been done before through a six-point plan. These may appear a bit glib due to the brevity of this article, but surely the suggestions are meaningful.
- India needs an influential Agriculture Minister, as strong as the Finance or Home Minister. The constitutional accountability for agriculture is with the States. Yet the farmers and public look to the Centre for action, which is why it becomes so important in national politics, whether it is farmers’ livelihood or an onion crisis. That is presumably why India has a Union Agriculture Minister. Usually that job is assigned to an unknown and uninfluential political person. That needs to change.
- India needs a formal framework and a National Agricultural Development Policy. Believe it or not, India has no politically approved, National Agricultural Development Policy, whereas it does have a National Industrial Development Policy, a National SME Policy and an Entrepreneurship/ Startup India initiative. Whenever a coordinated, systems approach to transformation/change is required, management folks advise having a common framework. One such approach has been mooted1.
- India needs a Council of Ministers for Agriculture. Doing anything for the farmers requires active and deep cooperation between States and Centre. State-Centre relations are at a new low currently. Such collaboration needs to be revived. Farming is not like telecom, roads, electricity and other reform-seeking sectors because it has vectors of economic, social, political and power dimensions. It needs a mechanism like the National Development Council or the GST Council.
- Marketing must be freed up from the tangled web of controls and hindrances in which it is mired. In the past, farming initiatives were focused on increasing production. This was important to feed a growing population. To conserve the output, which increased gradually, frictional restrictions were placed in the marketing chain: regulations on where farmers can sell, restrictions on exports, taxation at mandi level and compulsory government procurement. Arbitrary restrictions on farmers’ marketing options cannot continue, looking to the future.
- Farmer Producer Companies must be accelerated with the same zeal and energy as initiatives like Jan Dhan Yojana or Swach Bharat. Farmers must be actively trained to organize themselves into FPCs (Farmer Producer Company). We will be better off with 1 crore FPCs (like SMEs in the industrial sector) instead of 17 crore individual farmers. A national drive on FPCs is crucial as a vehicle to implement ideas and modernization. May be NABARD should be tasked to drive this single-mindedly.
- A National Technology Policy must be developed and executed with urgency. A modern and futuristic approach must be implemented with regard to adoption of modern technologies. India cannot afford to debate old-fashioned technology ideas concerning land, soil, water, seeds and nutrients.
The time to act with statesmanship and national leadership will arise again after the current bout of elections in May 2019. This six-point program could be considered.