India needs a big push to boost its agricultural sector, which has been reeling under the impact of consecutive droughts, the Economic Survey 2015-16 tabled in Parliament on Friday said. However, it seemed to fall short on suggesting path-breaking steps and harped largely on existing programmes to bring about the transformation.

In some suggestions like replacing the Soil Health Cards scheme with soil fertility maps, capping sale of subsidised fertilisers and batting for market-driven seed prices, the Survey seemed to go against existing central government policies.

It identified the difficulty in exiting from well-established practices like preference for growing cereals over cash crops like pulses and oilseeds as being a primary problem, and suggested a rainbow revolution where production is in accordance with changing dietary patterns.

It also talked about rural roads, crop insurance and other programmes to improve the rural sector, but the key remains agriculture. The survey said the system of direct benefits transfers (DBT) may be considered to replace subvention of interest rates and favoured adoption of the Amul model of cooperative farming for pulses and oilseeds.
 

The Survey, which reflects the priorities of the government and lays down the ground work for the Union Budget that follows, has after a long-time clearly identified genetically modified and hybrid seed varieties as definite pathways to boost productivity.

It said engineering a switch towards pulses and economising water usage were cital for improving productivity. "The adoption of hybrid and high-yielding variety seeds is one definite pathway to raising productivity in Indian agriculture," the Survey said.

On irrigation, the Survey said there is scope for increasing coverage of irrigated area across the country. For this, it suggested higher public investment.

It also advocated a larger share of funds to be pumped into the Mahatma Gandhi National Rural Employment Guarantee Scheme and other employment generating schemes for creating and maintening community assets, including for removing silt from and repair of tanks and water bodies used for irrigation.

The Survey said, given that minimum support price has been largely ineffective, a deficiency price payment system where farmers are compensated directly for any drop from a fixed floor rate be considered, endorsing a suggestion of the NITI Aayog.

It batted against a recent Central government decision to control sale price of cotton seeds, including the Bt variety, saying markets should be allowed to determine price. However, it also called for enhancing competition as that can take care of cases of price rigging and cartelisation.

The Survey said given the past experiences and limitations in administratively fixing prices in India, it is desirable to let markets determine the price of seeds. The Central government through a circular issued on December 2015, had decided to fix a uniform retail price of cotton seeds in the country in the interest of farmers.

The survey also was not in favour of the initiative to provide soil health cards to farmers and said they should instead be provided with soil fertility maps to improve nutrient management.

"With over 120 million farm holdings in India, it is a big challenge to provide soil-testing facilities for overcoming the multi-nutrient deficiencies in soils to improve agricultural output."

On fertiliser subsidy, the Survey suggested that as last-mile financial inclusion in rural India is poor, which would make replacing the fertiliser subsidy with cash difficult, an alternative could be to set a cap on the number of subsidised bags each household can purchase and require biometric authentication at the point of sale.