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Scrutiny
 
INDIAN FARMERS: MIDDLEMEN WOES
No middle path needed!
Mandis have to be made more accessible across India so that farmers can get the right prices for their produce
Issue Date - 18/08/2011
 
Food price inflation rate is showing a continuous upward trend while the number of farmer suicides is also increasing at an alarming rate. A record 0.25 million farmers committed suicide in the last 13 years (1997-2009) as per data published by the National Crime Records Bureau (NCRB); with 2009 being the worst (since 2004) with close to 17,000 farmer suicides.

Farmers in the country face a host of problems, and uncertain weather conditions is just one of those. In most of the cases, those are the middle-men who enjoy the fruits of such an increase in prices – created by an artificial shortage of supply. Small and poor farmers, who cultivate the land (mostly leased) by taking loans from the lenders at very high rates, have no other alternative but to sell their produce to private dealers at very low prices. These middle-men take advantage of the inability of farmers to store their produce and be able to directly negotiate with end buyers as they have to repay the loans immediately.

Such a situation happens because of the absence of well-laid out supply side network, further hampered by India’s weak road infrastructure. Mandis can rescue distressed farmers and bring a green revolution. Punjab is a success case study, all due to a well laid out network of mandis. Such an enabling environment ensures that farmers get the right price for their produce and come out of financial distress. The UP government has laid out a plan to expand the network of mandis by adding 2105 mandis in the next four years, which will eventually reduce the average distance that a farmer has to cover to around 7 km. If executed in the same spirit, this can prove to be a valuable precedent for other states too.

 

Mrinmoy Dey           

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