Critical Agri Challenge
By Dhurjati Mukherjee
The agricultural sector is expected to be affected in most districts due to deficient rainfall at the right time and other factors. As per government data, about 45 percent of the net sown area is rain fed and due to a weak monsoon in around 380-400 districts, production is sure to decrease. It is understood that the total acreage under three crop categories has fallen sharply – coarse cereals, pulses and oilseeds by over 40 percent. This doesn’t augur well for a country which ranks 102 of 123 in the 2025 World Hunger Index, scoring 25.8 placing it in the ‘Serious’ hunger category.
As is well known, pulses are a key source of protein and India imports a fifth of its requirement. The fall in production will result in increased imports, affecting the economy. But what is most disturbing is the fact that pulses, which are the poor man’s source of protein, will affect this section as prices are expected to rise.
For edible oils, about 53 percent of requirement is normally met through imports and the present situation is not quite encouraging. Meanwhile, reports confirm that domestic urea manufacturing has been hit in the West Asia crisis with production falling to 18 lakh tonne in March from an earlier average of 24 lakh tonne. It is well known that the Gulf region accounts for around 20-25 percent of India’s urea exports, 30 percent of dia-ammonium phosphate (DAP) and 50 percent of LNG. The crisis has pushed up costs of inputs such as LNG, ammonia and sulphur, besides increasing freight charge.
However, the government maintained there is adequate stock of fertilisers and has been tapping alternative sources to boost supplies, even as urea units had taken annual maintenance shutdowns. The Centre asked states to monitor any abnormal spike in fertiliser sales during the current ‘lean season’ to prevent stockpiling and black marketing. On diversification of sources, ministry officials noted a global tender has been floated and long-term arrangements have been tied up with countries such as Saudi Arabia and Oman. In addition, sourcing is proposed to be expanded to countries including Russia, Australia, Indonesia, Malaysia and Canada.
The government spent Rs 70,709 crore, nearly 40 percent of the fertilizer subsidy allocated for the current fiscal in the first three-and-a-half months, indicating the bill is set to exceed the budget estimates due to West Asian conflict. Out of the allocation of Rs 1.8 lakh crore, it is felt it may have to be increased due to global price levels of soil nutrients. The government informed through the Rajya Sabha that the fertiliser department has taken several measures to diversify import sources by engaging with Indian missions in several countries to identify additional suppliers and strengthen the fertiliser supply chain.Meanwhile, urea continues to be sold at Rs 266.50 per 45 kg bag against the global prices exceeding Rs 4000 a bag. Despite global price fluctuations, the retail price of DAP is maintained at Rs 1350 per 50 kg for farmers.
Some agro economists are of the opinion that the government should increase the cost of urea by 50 percent and compensate farmers with PM Kisan payout. Around 89 percent cultivators are yet to benefit. The danger of late and deficient rainfall, which is now projected of being 21 percent as in July-end, may not have much effect on the farming community, more so since there may be improved rainfall in south peninsular rainfall. It is predicted that the possibility of a positive Indian Ocean Dipole (IOD) could offset the negative impact of El Nino. Though there may be an inflationary spiral, the effect as of now, may not be much.
Keeping in view the monsoon situation, some of the decline is possibly unavoidable. But measures need to be taken to ensure that groundwater depletion should be kept at the minimum level. Moreover, there should be efforts to promote dryland farming and incentives need to be given for such crops that need very little water.
On the other hand, water conservation measures must be intensified through sensitising farmers at the grass-root levels. In fact, like fertilisers, water is indeed a key input vis-à-vis agricultural production and productivity is concerned. However, per capita water availability is declining every year and India may soon become a water-stressed country, affecting not just the agriculture sector but also domestic and industrial output as well as the domestic sector.
However, it may be pointed out that India’s economy has become less reliant on monsoon than commonly perceived with expanding irrigation networks and changing cropping patterns, according to the brokerage firm, Bernstein. It stated that the traditional narrative that nearly 60 percent of India’s agriculture depends on monsoon rainfall no longer reflects the ground realities, arguing that the country’s relationship with rainfall has undergone a ‘structural reset’.
Though the argument per se is debatable, it is a fact that dependence on monsoon rainfall has considerably reduced. Historically, deficient monsoon often translated into sharp declines in agricultural output and rural incomes. In 2002, for instance, rainfall fell to 81 percent of the long-period average, leading to a steep drop in foodgrains production and a severe contraction in rural disposable incomes. This situation may have changed and in 2018-19 and later in 2023-24, India registered rising foodgrains production despite below-normal monsoon, the brokerage noted.
As per latest reports, it is encouraging to note that acreage under staples is increasingly shifting to hardy crops and vegetables that require less water. Latest government data shows acreage under sunflower jumped 61.6 percent from a year earlier while the area sown under mum, kulith (horse gram), jute and mestahas also rise by over 8 percent, 15 percent, 2 percent and 3.7 percent respectively. Seed companies are witnessing the change in demand. Farmers are increasingly opting for short-term vegetables, prompting companies to import additional seeds of coriander, cabbage and temperate cauliflower.
The dependence on water as well as fertilisers needs to be reduced for which there has to be a shift in cropping pattern towards crops that need low water. Experiments need to be carried out by Indian Institute of Agricultural Research (ICAR) and others such as IITs and sensitise the farmers, keeping in view their incomes. But the thrust on research is somewhat piecemeal, considering the large number of people involved in farming, directly or indirectly.
If one considers the aspect of productivity, most emerging economies are far ahead of India as research in those countries have been successfully translated to field practices. Not that India has not made any tangible progress, but a greater thrust is necessary in the coming years. — INFA
