Sunday, January 2, 2011

Lobbying against cotton farmers-Indian Express

Indian Express

Lobbying against cotton farmers

Milind Murugkar Posted online: Mon Jan 03 2011, 03:15 hrs
It has been two decades since India embarked on market-oriented reforms — and yet, in the political discourse, the market is not considered a social force for poverty alleviation. It is not hard to understand why. Although India’s liberalisation has been responsible for unprecedented growth, the benefits of market expansion have gone disproportionately to the relatively well-off. They have bypassed the vast majority of the poor, especially in the villages. A lack of education and infrastructure continues to hold down the capability of the poor to benefit from market opportunities.

No wonder, “market” remains a word without much appeal for the poor. This widespread feeling of disappointment serves well the cause of certain lobbies that can successfully shield themselves through protectionist policies at the cost of the poor. It also enables politicians to use a clever vocabulary that makes them appear “pro-poor” while tacitly defending anti-poor protectionist lobbies.

Newly appointed Maharashtra Chief Minister Prithviraj Chavan and Union Agriculture Minister Sharad Pawar, speaking from a common platform recently, promised the state’s cotton growers that they would try to increase the export of raw cotton. Pawar assured the audience that since cotton was the main crop of Maharashtra, its export will be “encouraged”. He stated his commitment to step up cotton exports before American cotton arrives in the world market this month.

Such statements might appear as balm to the aggrieved cotton farmers of Vidarbha, a region that has witnessed many farmers’ suicides. But, ironically, they are made even as cotton growers are being unfairly denied higher international prices, by imposing restrictions on export. By choosing not to speak against this policy, these leaders are in fact acting as apologists of such policies. Cotton exports need no “encouragement”, as these leaders want farmers to believe. All that is needed is that the government does not come in the way of farmers who want to take advantage of the opportunities that trade presents. It is a cruel joke on farmers when the agriculture minister talks of the need to step up exports before the arrival of American cotton lowers the world market prices — because, if exports had been free, Indian farmers would have already seized the opportunity.

It is bad to do nothing about poor irrigation, as well as the ineffective extension of services; but it is worse to control or ban exports that directly affect farmers’ incomes. However, nobody has come forward to resist such policies. Civil society groups by and large are sceptical of markets and do not find the issue appealing enough.

The Indian textile sector benefited immensely from the expiry of the Multi-Fibre Agreement in 2005, since that facilitated the removal of restrictions on the import of textile products to developed countries. But the benefit of this trade liberalisation can flow to the rural poor only if the textile lobby purchases cotton at international prices. Instead, every year before the harvesting season, this lobby clamours for restricting — preferably banning — the export of cotton, and the government inevitably yields to their pressure.

Our cotton growers have to put up with poor infrastructure at home. They also have to bear the brunt of high subsidies doled out to cotton growers in the US, against whom they have to compete in the international market. But despite such odds, Indian cotton farmers have proved themselves competitive internationally. We should encourage them by providing the infrastructure they require. Instead, we continue to subject them to unfair taxation. Would we tolerate such a policy for, say, software exports? There is no dearth of experts who wax eloquent on the benefits of free trade. But they rarely make the case for cotton growers.

Is there a case for supporting the textile industry, as a labour-intensive industry that creates demand for poor unskilled labour? If it is so, the government should support it directly through financial assistance, and not by allowing the industry to ride on the back of farmers. And let us not forget that cotton is a highly labour-intensive crop too. Cotton prices thus matter not only to the cotton growers, most of whom are poor, but also to the labourers.

The writer is a Nashik-based food and agriculture policy,

No comments: