Updated: December 13, 2020 11:03:33 pm
Farmers shout slogans as they block a road during a protest against new agricultural laws on the Delhi-Uttar Pradesh border (Photo: AP)
Many countries experiencing rapid growth and increasing prosperity, which may even last a few decades, have at some point been caught in a “middle income trap”. It can be said that the agricultural economy of Punjab has been suffering from this fate for quite some time.
The seeds of the barn state’s postcard rural wealth story of the 1960s were literally sown by high-yielding varieties of wheat and rice. Kalyan Sona and Sonalika launched in the mid-1960s, followed by HD-2285 and HD-2329 in the early 1980s, raised average wheat yields in Punjab from 1.2 tons to more than 3.7 tons per hectare between 1960 -61 and 1990-91. IR-8 (introduced in 1966) and PR-106 (1977) also raised yields per hectare in rice from 1.5 tons to 4.8 tons.
The upgrading efforts of the Indian Agricultural Research Institute and scientists at Punjab Agricultural University were accompanied by investments in rural link roads, electrification, well and canal irrigation, organized agricultural credit and, of course, APMC mandis. (Committee on the Market of Agricultural Products). Asphalt roads in 98% of Punjab’s 12,188 villages in 1980, APMC yards within bullock cart distance, and public procurement at minimum support prices (MSP) ensured that increased production from the new semi-dwarf varieties, which responded to the application of fertilizers and water translated into higher income for farmers.
In the process, a new post-Green Revolution agrarian middle class emerged in Punjab, not “rich” or “kulak” farmers, as armchair experts would believe. They were a confident middle class and very confident of their future in agriculture. And like all the middle classes, it was aspirational and identified its interests with those of India (Bharat, in this case).
That rural middle class is now waging war in New Delhi, the very establishment that once fueled its rise. Their fight is not about upward mobility, agriculture can no longer be a conduit for that, but about defending the achievements of the past. 📣 Follow Express explained on Telegram
Average monthly farm household income, according to the NABARD All India Rural Financial Survey 2016-17, was the highest in Punjab. At 23,133 rupees, it was more than 2.5 times the national average of 8,931 rupees and was ahead of Haryana (18,496 rupees) and Kerala (16,927), with Uttar Pradesh (6,668 rupees) and Bihar (7,175 rupees) far behind. But this remains the well-known “middle-income trap” that Brazil, Mexico, Argentina, and other large Latin American economies hit in the 1960s, failing to transition into the league of the rich.
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Punjab’s failure in this regard is mainly due to stagnant yields. Since 1990-91, its average yield per hectare has increased from 3.7 to 5.2 tons for wheat and from 4.8 to 6.5 tons for rice. There have also been new highly successful varieties such as PBW-343, HD-2987 and HD-3086 for wheat, and PR-121 and PR-126 for rice. But their genetic yield gains are not comparable to those of the early Green Revolution varieties.
Regardless of yields, the Punjab farmer faces pressure from rising input costs, be it labor, fertilizers, crop protection chemicals or diesel. Some of these cost pressures have been absorbed by the government through subsidized urea and free electricity for irrigation, although they have taken their own heavy price for soil degradation and groundwater depletion. The government has also persisted with the MSP increases and the acquisition of grains from the state’s 154 primary APMC mandis and the attached seasonal sub-yards / purchasing centers. There really was no other option when India desperately needed Punjab grain.
Today, the government does not feel the need to buy much from Punjab. Economists also see it as an unnecessary tax burden. The feeling of being unwanted and an arrogant disregard for your concerns can be an affront to any proud middle class.
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