NEW DELHI : The agriculture sector is all set to bounce back leaving two years of drought behind and may well pull off record foodgrain output of 270 million tonnes in 2016-17 on good rains, but farmers’ woes may continue due to adverse impact of notes ban and low sales realisation.
The farm growth is estimated to rise at over 5 per cent this fiscal, from 1.2 per cent in the previous year, on the back of record kharif foodgrain production at 135 million tonnes (mt) and likely bumper output in the ongoing rabi season, helped by good monsoon in most parts of the country.
“The agriculture sector has done well during the year. We received good monsoon after facing the drought year. Kharif in general was very good and rabi sowing has been brisk. We are hopeful of bumper production this year,” Agriculture Secretary Shobhana Pattanayak said in an interview.
Although agri-experts have raised concerns about impact of demonetisation on rabi crops and the likely effect of forecast of warm winter on wheat crop, the secretary said the government is not “downgrading” the target for 2016-17 crop year.
“Our target is to achieve foodgrain production of 270 million tonnes while our last peak production was 265.04 mt in 2013-14 crop year (July-June),” he said.
“Agriculture sector growth was lower last year because of drought. But from that level, we will move higher.”
On farm sector growth, NITI Aayog Member Ramesh Chand said: “It will be spectacular growth after facing two drought years. We are expecting a growth of 5.5 per cent this year.”
The growth rate of agriculture and allied sectors will be 5.3 per cent even if wheat productivity throughout the country is lower by 3 per cent due to rise in temperature, he said.
Asked about adverse impact of demonetisation on farmers, Pattanayak said there is not much impact as the credit system has been strong in rural areas and farmers have become more resilient over the years.
“Our farmers have witnessed very strong drought in last two years and yet they have bounced back. I don’t think it has really impacted,” he said.
However, farmers’ organisations as well as former agriculture minister Sharad Pawar have expressed deep concern about impact of demonetisation, saying farmers are unable to buy quality seeds and fertilisers for their rabi crop and are also facing problems in selling crops for want of demand.
Despite record kharif production this year and expected good crop in the rabi season, farmers’ conditions continue to be grim due to lower sales realisation, with domestic and global commodity prices staying depressed.
The demonetisation of Rs 500 and Rs 1,000 notes has also affected the domestic demand of fruits and vegetables, forcing farmers to sell their produce at throwaway price.
About farmers’ woes, agri-economist Ashok Gulati said: “This year, production is likely to bounce back and therefore, much better than last year. However, farmers are already under debt. And prices of cotton, basmati rice and, with demonetisation, many fresh fruits and vegetables are depressed. Because of that, despite higher production levels, farmers have not gained much.”
2016 began on a sticky note as the country’s overall foodgrain output remained flat at 252 mt in 2015-16 crop year due to second straight year of drought.
Pulse output fell to 16.5 mt resulting in high prices for most part of the year that kept the government on its toes, which took various steps to cool prices and bring relief to consumers.
The measures like domestic procurement and import to boost local supplies helped ease the prices of tur and urad from about Rs 200 a kg, but chana continues to rule high.
As per the official estimate, wheat output rose to 93.55 mt, from 86 mt, but FCI’s procurement fell sharply and domestic prices of wheat and its products began to rise towards the end of the year. The government scrapped import duties on wheat to boost domestic supply.
To provide relief to farmers hit by the cash crunch, the government has given them an additional two months to repay their crop loans due in November-December and said prompt repayment will be eligible for the extra 3 per cent interest subsidy.
(PTI)
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