Agriculture

Context: The Union Ministry of Agriculture and Farmers Welfare has recently released the draft National Policy Framework on Agricultural Marketing (NPFAM). Samyukt Kisan Morcha (umbrella organisation of farmers’ outfits) has raised concerns regarding the new draft Policy, labelling them worse than the three repealed farm laws.

Relevance of the Topic: Mains: Draft National Policy Framework on Agricultural Marketing -Salient Features.

Policy Interventions in the new draft NPFAM

1. Market Architecture:

• Market density: minimum one market for 80 sq.km area.
• Farm-Gate Accessibility: Warehouses and cold storages to be declared sub-market yards.
• At least one private market per revenue division to be introduced.
• Grameen Haat Development: Annually, 300 Grameen Haats to be developed into GrAMs, with 50 in hilly/North-Eastern regions.
• Futures Trade Integration: DA&FW to work with SEBI to integrate more Farmer Producer Organizations (FPOs) with futures platforms.
• e-NAM Integration: APMC markets and private markets to be linked to the e-NAM platform.

2. Agri-Value Chain and Marketing Infrastructure:

• Establish Infrastructure Gap Analysis Committees (IGACs) at the district level.
• Constitute state-level IGACs to oversee the process of gap analysis.

3. APMC Reforms:

• Dedicated spaces within APMC markets for organic and natural farming produce.
• APMCs should evolve beyond regulatory enforcement and fee collection to offer value-added services.
• Infrastructure development in PPP mode.

4. Export-Oriented APMCs:

• States to identify potential APMCs for export-oriented development.
• Dept. of Agriculture to provide technical and financial support.

5. Professional management of APMCs:

• Appointing qualified secretaries for APMCs, with expertise in agri-value chain services.

6. Digitisation and Ease of Doing Agri-Trade:

• Collaborate with state governments to digitize processes across all states/UTs.
• Reducing turnaround time and delays in the supply chain.
• Indexing for Ease of Doing Agri-Trade (sharing regular updates with states)

7. Robust Market Information & Intelligence System:

• Develop Digital Public Infrastructure (DPI) on federated model in the name of “Market-Stack Or Unified National Market Portal (UNMP)” on the lines of Agri-Stack.
• Market Information Registry: capturing accurate and real time data at states’ level with respect to prices and arrivals.

8. Market/Price- Risk Mitigating Measures:

• Contract Farming as Tools for Market and Price Risk Mitigation.
• Market linkage through FPOs.
• Price Insurance Scheme on the lines of PM- Fasal Bima Yojana (PMFBY).

9. Marketing System for North-Eastern and Hilly Region:

• Create market ecosystems tailored to local needs while supporting regional, national, and international value chains.
• Emphasise branding, packaging, quality testing, certification, and organic/natural produce marketing.
• Focus on fruits, vegetables, spices, medicinal plants, and black scented rice.
• Branding as organic produce for domestic and international markets.

10. Marketing System for States/ UTs with No APMC Acts:

• DA&FW to collaborate with states/UTs to identify and strengthen potential non-regulated wholesale markets and grameen haats.
• Integrate upgraded markets with eNAM.

11. Capacity Building:

• Market Committees to undertake awareness programmes among the farmers.
• Prepare strategic training programmes for marketing personnel and marketing functionaries.

Concerns raised about the Draft Policy:

• Impact on federalism: Implementation of new draft policy might erode the power of states to regulate agri-marketing within their state.
• Endanger farmers: Farmers might not have bargaining power with private storage infrastructures during price volatility.
• Uniformity affects diversity: neglects the different aspirations of farmers in different states.
• Ignoring price assurances: Lack of provision for minimum support prices or to support farmers during distress sale.

Context: The Union Cabinet has announced the continuation of the Pradhan Mantri Fasal Bima Yojana and Restructured Weather Based Crop Insurance Scheme till 2025-26.

Major Highlights:

The Union Cabinet has- 

• Approved the continuation of Pradhan Mantri Fasal Bima Yojana and Restructured Weather Based Crop Insurance Scheme till 2025-26 with a total budget of ₹69,515.71 crore.
  • The aim is to provide risk coverage to farmers against natural calamities.
• Approved setting up of Fund for Innovation and Technology (FIAT) for upgradation in farm technology by revitalising research and development, with an allocation of ₹824.77 crore. Key initiatives include:
  • Yield Estimation System using Technology (YES-TECH) which uses remote sensing for crop yield estimates.
  • Weather Information and Network Data System (WINDS) for augmenting weather data through automatic weather stations. Implementation of WINDS to assist state governments will begin in 2024-25.
• Approved the extension of the subsidies on DAP. DAP is Diammonium Phosphate, a fertiliser that contains a mix of nitrogen and phosphate. 

Yield Estimation System using Technology (YES-TECH)

• Yield Estimation System using Technology (YES-TECH) uses Remote Sensing Technology for yield estimation with minimum 30% weightage to technology-based yield estimates. 
• Under YES-TECH Claim calculation and settlement has been done for 2023-24. Madhya Pradesh has adopted 100% technology based yield estimation. 
• 9 Major States are currently implementing (namely AP, Assam, Haryana, Uttar Pradesh, MP, Maharashtra, Odisha, Tamil Nadu & Karnataka). Other States are also being on-boarded expeditiously. 

Weather Information and Network Data System (WINDS): 

• Weather Information and Network Data Systems (WINDS) envisages setting up Automatic Weather Stations (AWS) at block level and Automatic Rain Gauges (ARGs) at panchayat level.
• Under WINDS, 5 times increase in current network density is envisaged to develop hyper local weather data. Under the initiative, only data rental costs are payable by Central and State Governments. 

About PM FASAL Bima Yojana

• Pradhan Mantri Fasal Bima Yojana is a flagship crop insurance scheme launched in 2016 to promote crop insurance penetration among the farmers.
• Objectives: Providing financial support to farmers in case of unforeseen circumstances; stabilising farmers income; encouraging farmers to adopt modern technology; and ensuring flow of credit to the agriculture sector. 
• Coverage of the scheme:
  • Food crops (Cereals, Millets and Pulses) 
  • Oilseeds 
  •  Annual Commercial/Annual Horticultural crops
• The scheme also covers the post-harvest losses due to rainfall, hail storm or any such negative externality within 14 days of harvesting.
• Farmers pay a nominal premium:
  • 2% for Kharif crops.
  • 1.5% for Rabi crops.
  • 5% for commercial and horticultural crops.
  • The remaining premium is shared between the central and state governments. In the ratio of 50:50 in normal states and 90:10 in the case of north-eastern.
• Use of Remote Sensing Technology, Smartphones & Drones for quick estimation of crop losses to ensure early settlement of claims.

Benefits of the decision to Extend Schemes:

• Protecting from vulnerability: Indian farmers are prone to vulnerabilities like monsoon dependency and pest attack along with the risks of seed productivity. Extension of scheme will reduce such vulnerabilities by insuring farmers against risks.
• Reducing input cost: Extending the subsidies for DAP fertiliser will reduce the input cost of the farmers reducing expenditure burden.
• Boost to North-East: Special treatment in insurance premium to north-eastern states will reduce the regional disparities.
• Promoting R&D: Institutionalisation and fund allocation to FIAT will revitalise the research and development in the farm sector in India making it more productive and gender neutral in nature.

Conclusion: PM FASAL and fertiliser subsidies are key for boosting the farmer’s income in India. But more funds need to be allocated in the research and development to enhance the overall productivity and optimum utilisation of the resources. India should take a slight turn from subsidies based support to innovation and capital generation based support to make agriculture sustainable.

Context: India has witnessed 83% increase in fish production, making India the second largest producer of fishes. Such a rise makes strengthening the fisheries extension services crucial. 

Relevance of the Topic: Mains: Fisheries sector in India; Challenges and scope. 

About Fisheries Extension Sector

• Fisheries extension services are specialised programs and activities aimed at improving the knowledge, skills and practices of fishers and aquaculture stakeholders. 
• These includes:
  • Disseminating information
  • Promoting sustainable practices 
  • Facilitating access to modern technologies.

Government Schemes to Enhance Extension Services

• Matasya Sampada Kendra:
  • The flagship scheme provides a one-stop solution to the fishers by providing trained professionals sharing their expertise to boost production. 
  • Government assistance up to 60% is provided to set up such centers for women and weaker sections. 
  • Notable examples:
    • Kendra at Tissue Kerala provides a well-equipped lab for water, soil and microbial analysis. 
    • Kendra at Nashik focuses on capacity building of Fishers and Fish Farmers on various seed/feed inputs. 
• Sagar Mitra: 
  • Sagar mitras in coastal areas are a vital interface between government and sea-borne fishers. 
  • They compile information and data on daily marine catch, price fluctuations, requisite market needs at fish landings harbours. 
  • They disseminate information on local regulations, weather forecast, natural calamities, hygienic fish handling and potential fishing zones in the sea. 

Lacuna in Fisheries Extension Services in India

• Limited Reach: Insufficient number of Sagar Mitras and training centers leaves a large section of fishers unaddressed and vulnerable. 
• Shortage of Infrastructure: There is an acute shortage of refer vans and cold storage to enhance the shelf life of the fishes. 
• Sustainability Issue: There are issues like overfishing and habitat degradation. Also, practices like electrocution are criticised during fish export. 
• Quality Issue: Export quality fish production remains a challenge due to pollutants in fishes. E.g., Tamil Nadu fishes were banned by the EU due to the high amount of pollutants in them. 

Ways to Improve Extension Services

• Institutional Integration: A convergence is needed between the Matasya Kendras and 700 Indian Council of Agricultural Research centers to promote the sharing of machineries. 
• Promoting Digital Outreach: The National Fisheries Development Board has initiated a nationwide virtual learning platform i.e., 'AquaBazaar’. 
• Learning from Global Best Practices:
  • Norway: Sustainable fishing technology like satellite mapping and digital monitoring. Also, fishing monitoring ensures sustainable yields and boosts exports. (Norway exports 95% of its seafood.)
  • Japan Model: Japan's co-management model involving Fisheries Cooperative Associations to educate fishers about sustainable practices. 
• Promoting Climate Adaptation: As climate change is impacting the fishing grounds and yield of fishing. E.g., FAO’s Blue Growth Initiative is focusing on climate resilient fishing. 
• Value Addition: Along with the market access, there is a dire need of value addition of the fish production. E.g., Vietnam's focus on value-added shrimp products has enhanced its global competitiveness. 

Conclusion: Strengthening fisheries extension services can drive India towards becoming a global leader in sustainable fishing. Adopting best practices from countries like Norway and Japan, along with the localised innovations, can improve productivity, sustainability, and livelihood of millions dependent on this sector.

Context: The Parliamentary Standing Committee on Agriculture has recently recommended that the Government should legalise Minimum Support Price (MSP) to ensure price stability and promote investment by farmers. On the other hand, the Supreme Court appointed Committee of Farm laws has opined that such a move would go against the interests of farmers as well as Indian Agriculture.

Details about Minimum Support Price (MSP) regime:

• Declaration of MSP by Cabinet Committee on Economic Affairs (CCEA) based on the recommendations of the Commission on Agricultural Costs and Prices (CACP). 
• Coverage of Commodities: 22 commodities, which comprise 7 cereals (paddy, wheat, maize, sorghum, pearl millet, barley and ragi), 5 pulses (gram, tur, moong, urad, lentil), 7 oilseeds (groundnut, rapeseed-mustard, soyabean, sesamum, sunflower, safflower, Niger seed), and 3 commercial crops (copra, cotton and raw jute). 

Determinants of MSP: 

• Demand and Supply
• Cost of Production
• Price trends in the market, both domestic and international
• inter-crop price parity
• Terms of Trade (ToT) between agriculture and non-agriculture: ToT refers to the ratio of Prices received by Farmers on agricultural commodities to the Prices paid by the Farmers to purchase non-agricultural goods and services. 
• Likely implications of MSP on consumers of that product.

How are the MSPs fixed?

• MSP is fixed at 1.5 times the cost of production. 

Approaches to measure the cost of production: 

• A2 Approach, which includes the cost of inputs such as seeds, fertilizer, labour. 
• A2+FL Approach, which includes A2 and the implied cost of family labour (FL).
• C2 Approach, which includes the implied rent on land and interest on capital assets and A2+FL. 

Note: Presently, India follows A2+FL approach to declare MSP at 1.5 times the cost of production.

Difference between FRP and MSP: 

• Fair and Remunerative Price for Sugarcane is declared under Sugarcane control order 1966 issued under Essential commodities Act, 1955 and hence it enjoys legal status. It means that it is legally binding for the sugarcane Industries to purchase sugarcane from farmers at FRP, else it would be considered illegal. 
• However, MSP does not enjoy statutory recognition. This means that there is no onus on the traders to buy crops at MSP. 

Debate about Legalisation of MSP:

Way Forward

As highlighted by Eco Survey 2019-20, in any free-market economy, Government intervention, sometimes though well intended, often ends up adversely affecting the market. Hence, rather than legalising MSP, the Government can focus on the following strategies:

• Flexibility to the States: Legalisation of MSP can be prerogative of the States as per their specific agricultural policy priorities. The States can provide for a legal backing for such procurements at their own costs - as the recent Punjab Amendment Act does. Similarly, Kerala has recently announced MSP for fruits and vegetables. Some States also announce bonuses on the MSP announced by the Centre.
• Reintroduce Farm laws (SC Appointed Committee on Farm Laws) to liberalise agriculture marketing and give freedom to farmers to sell the commodities wherever and whomever they want.  
• Promote Inverse Fork-to-Farm Strategy (Dalwai Panel): Encourage farmers to grow crops based upon the prevailing demand as it would fetch them higher prices.
• Enhancing Bargaining power of Farmers: Even though the Government does not declare MSP for Milk, Farmers get higher prices as they have been organised into cooperatives. Hence, bargaining power of farmers can be enhanced through:
  • Organising Farmers into FPOs.
  • Strengthening E-NAM
  • Promotion of Contract Farming
  • Promotion of Negotiable Warehousing Receipts (NWRS)
  • Strengthen futures market for efficient price discovery and hedging of risks by farmers (Eco Survey 2023-24)
• Replace Open-ended Procurement policy by Closed ended procurement policy to discourage cultivation of Rice and Wheat. (SC appointed Committee on Farm Laws)
• Bring Agricultural Marketing (Dalwai Panel) under Concurrent list for greater coordination between Centre and States.

Context: Recently, the 13th National Seed Congress (NSC) 2024 was held at the International Rice Research Institute South Asia Regional Centre (ISARC) in Varanasi, Uttar Pradesh. It urged the Centre government to revisit and modernise the Seeds Bill of 2004 and the Seeds Policy of 2002 to incorporate the latest developments in the seed sector.

Relevance of the topic: Mains: Need for New Seeds Act and Policy and the changes it should incorporate.  

The Seed Act, 1966, the National Seed Policy, 2002 from the basis of promotion and regulation of the Indian Seed Industry.

Why is a New Seeds Act and Policy Needed?

India's agricultural landscape has undergone significant changes since 1966, necessitating modern legislation to address emerging challenges:

1. Outdated Provisions:

• The Seeds Act, 1966, and Seeds Rules, 1968, and existing National Seed Policy, 2002 have not been revised to align with advancements in seed technology or international standards.
• India’s seed quality assurance system and certification standards are much lower than global benchmarks. It needs to be strengthened to adhere to international standards.

2. No clear definition of seeds: 

• Lack of clear definitions for "farmer seeds" and "commercial seeds" creates policy ambiguities, intellectual property disputes, quality control issues, and challenges in balancing rights of both farmers and commercial seed companies.

3. Issue with voluntary registration of Varieties:

• The current system allows voluntary registration of seed varieties which leads to discrepancies in seed quality and traceability. Mandatory registration would enhance accountability.
• Smallholder farmers rely heavily on informal seed systems, so often access lower-quality seeds.

4. Regulatory issues and poor implementation:

• Delay in clearing license: The companies who invest six to eight years in R&D and develop new varieties of hybrid seeds have to wait for three more years to get required permissions from the Centre and States (difficulties of obtaining licences in every State). Because of this, the access to new technology for farmers is delayed. There is a need for a "One Nation, One Licence" policy to streamline approvals for hybrid seeds across states.
• The outdated legislations overlap between Central and State jurisdictions, and the inconsistent implementation of policies across sectors lead to:
  • High reliance of farmers on informal seed systems.
  • Conflicts between proprietary technologies and farmers’ rights.
  • Conflicts over royalties and technology-sharing agreements.

This creates roadblocks for the seed sector’s development.

5. Lack of consensus on GM Crops and Technology:

• Lack of consensus and regulatory framework on genetically modified (GM) crops delays self-sufficiency in critical sectors, like edible oil production. E.g., India imports edible oil from Canada, U.S. and Brazil, etc., but they use genetically modified seeds.

6. Limited Research and Development (R&D):

• Limited investment in research and development and over-dependence on imported germplasm for advanced hybrids. 

7. For preservation of traditional seed varieties: 

• For e.g., India over 3,000 varieties of traditional rice and their seeds should be preserved.

Changes that New Seeds Act and Policy should incorporate:

• The Regulation should include seed pricing, seed supply and decentralised seed planning/ production in addition to regulation of quality.
• Must uphold farmers' rights of breeding, selecting, saving, using, exchanging/ bartering, distributing and selling seeds.
• Simplified licensing and certification processes, strengthening intellectual property protections to uphold the rights of companies, foster innovation and enhance ease of doing business. 
• Each license should be reviewed after some years (3- 5 years) and renewal should be allowed based on actual performance. 
• Strong punitive clauses which act as deterrents, based on standard formulae to calculate penalties.
• Appropriate compensation clauses for speedy redressal to farmers who have incurred losses due to seed failure - this should be linked to an insurance system and should be based on calculations that consider loss in yields as well as cost of cultivation.
• Multi-Iocational agronomic trials of seeds before commercialisation to be undertaken in a scientific manner to ensure region-specific performance.
• Should exclude traditional practices of farmers of seed production, sale and exchange from its purview.
• Harmonisation of the new legislation with the Protection of Plant Variety and Farmers Rights Act (PPV & FR), 2001 and the Biodiversity Act, 2002.

Way Forward:

• Build a road map to ensure that farmers receive high-quality seeds at reasonable prices and on time. (Good quality seeds can boost production by 20%) 
• Invest in promoting innovative seed technologies for farmers including hybrid and biofortified crops, stress-tolerant varieties, and accelerated breeding cycles. 
• Developing seed parks, enhancing seed entrepreneurship, improving supply chains, and building capacity among farmers through Public-Private Partnerships in the sector.
• Utilising advanced technologies and satellite data to optimise crop production. E.g.,
  • The Ministry of Agriculture has released an ‘Abstract Compendium’ and the ‘Rice Fallow Webpage and Atlas’ for Bihar, Chhattisgarh, Jharkhand, and West Bengal. 
  • The atlas will use geospatial technology to map and analyse fallow lands in eastern India to optimise crop planning, enhance system intensification, and improve food security in the region. 

Conclusion: The New Seeds Act and Policy must be in tune with the contemporary situation in the seeds sector and must incorporate the concerns of farmers. A balanced focus on innovation, farmer empowerment, and policy reforms can pave the way for a resilient and globally competitive seed industry.