Financial Daily
from THE HINDU group of publications

Wednesday, October 31, 2001



Letters | Next

Stake in agriculture

A. Jacob Sahayam, Karigiri

Your editorial, `Farm stakes' (Business Line, October 29) has pointed out that the country's stake in agriculture is simply too large and has called for a drastic change in its favour. The need to realise the vast untapped potential and to invest in such areas as irrigation, technology, education, and infrastructure have been emphasised.

In fact, even if there is a bumper crop the farmer, especially the small and marginal ones will not benefit due to the fall in prices or otherwise. In this context, the Finance Minister Mr Yashwant Sinha's statement: ``We have to look into what has to be subsidised and what not. What must not be subsidised are inefficiencies in the system", is relevant. If the system of MSP is found to be an inefficient one, alternatives may be to subsidise in such a way that it spurs growth and benefits the farmer. And it could be in the form of inputs.

There is a strong opinion against power subsidy to farmers. "Power subsidy costs outweigh gains" (Business Line, October 29). If small farmers do not benefit from the free supply of power, how could they benefit when they are charged? And irrigation faci lities differ from region to region. If power supply is used for ground water tapping, it is because it has helped to cultivate waste lands and drought-hit areas to the benefit of the farmer. So what is needed may be only a nominal charge for farmers, to eliminate pilferage and introduce income tax for rich farmers. If farmers do not get subsidy in any form, while their counterparts in foreign countries are getting it, how will they be able to compete? We should have our own independent policy rather th an to depend on the World Bank for everything.

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Farm stakes

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