Renu Pokharna

Archive for the ‘Agriculture’ Category

Attention Whole Foods Shoppers

In Agriculture, Climate Change on May 28, 2012 at 6:35 am

From Whole Foods recyclable cloth bags to Michelle Obama’s organic White House garden, modern eco-foodies are full of good intentions. We want to save the planet. Help local farmers. Fight climate change — and childhood obesity, too. But though it’s certainly a good thing to be thinking about global welfare while chopping our certified organic onions, the hope that we can help others by changing our shopping and eating habits is being wildly oversold to Western consumers. Food has become an elite preoccupation in the West, ironically, just as the most effective ways to address hunger in poor countries have fallen out of fashion.

Helping the world’s poor feed themselves is no longer the rallying cry it once was. Food may be today’s cause célèbre, but in the pampered West, that means trendy causes like making food “sustainable” — in other words, organic, local, and slow. Appealing as that might sound, it is the wrong recipe for helping those who need it the most. Even our understanding of the global food problem is wrong these days, driven too much by the single issue of international prices. In April 2008, when the cost of rice for export had tripled in just six months and wheat reached its highest price in 28 years, a New York Times editorial branded this a “World Food Crisis.” World Bank President Robert Zoellick warned that high food prices would be particularly damaging in poor countries, where “there is no margin for survival.” Now that international rice prices are down 40 percent from their peak and wheat prices have fallen by more than half, we too quickly conclude that the crisis is over. Yet 850 million people in poor countries were chronically undernourished before the 2008 price spike, and the number is even larger now, thanks in part to last year’s global recession. This is the real food crisis we face.

It turns out that food prices on the world market tell us very little about global hunger. International markets for food, like most other international markets, are used most heavily by the well-to-do, who are far from hungry. The majority of truly undernourished people — 62 percent, according to the U.N. Food and Agriculture Organization — live in either Africa or South Asia, and most are small farmers or rural landless laborers living in the countryside of Africa and South Asia. They are significantly shielded from global price fluctuations both by the trade policies of their own governments and by poor roads and infrastructure. In Africa, more than 70 percent of rural households are cut off from the closest urban markets because, for instance, they live more than a 30-minute walk from the nearest all-weather road.

Poverty — caused by the low income productivity of farmers’ labor — is the primary source of hunger in Africa, and the problem is only getting worse. The number of “food insecure” people in Africa (those consuming less than 2,100 calories a day) will increase 30 percent over the next decade without significant reforms, to 645 million, the U.S. Agriculture Department projects.

What’s so tragic about this is that we know from experience how to fix the problem. Wherever the rural poor have gained access to improved roads, modern seeds, less expensive fertilizer, electrical power, and better schools and clinics, their productivity and their income have increased. But recent efforts to deliver such essentials have been undercut by deeply misguided (if sometimes well-meaning) advocacy against agricultural modernization and foreign aid.

In Europe and the United States, a new line of thinking has emerged in elite circles that opposes bringing improved seeds and fertilizers to traditional farmers and opposes linking those farmers more closely to international markets. Influential food writers, advocates, and celebrity restaurant owners are repeating the mantra that “sustainable food” in the future must be organic, local, and slow. But guess what: Rural Africa already has such a system, and it doesn’t work. Few smallholder farmers in Africa use any synthetic chemicals, so their food is de facto organic. High transportation costs force them to purchase and sell almost all of their food locally. And food preparation is painfully slow. The result is nothing to celebrate: average income levels of only $1 a day and a one-in-three chance of being malnourished.

If we are going to get serious about solving global hunger, we need to de-romanticize our view of preindustrial food and farming. And that means learning to appreciate the modern, science-intensive, and highly capitalized agricultural system we’ve developed in the West. Without it, our food would be more expensive and less safe. In other words, a lot like the hunger-plagued rest of the world.

Thirty years ago, had someone asserted in a prominent journal or newspaper that the Green Revolution was a failure, he or she would have been quickly dismissed. Today the charge is surprisingly common. Celebrity author and eco-activist Vandana Shiva claims the Green Revolution has brought nothing to India except “indebted and discontented farmers.” A 2002 meeting in Rome of 500 prominent international NGOs, including Friends of the Earth and Greenpeace, even blamed the Green Revolution for the rise in world hunger. Let’s set the record straight.

The development and introduction of high-yielding wheat and rice seeds into poor countries, led by American scientist Norman Borlaug and others in the 1960s and 70s, paid huge dividends. In Asia these new seeds lifted tens of millions of small farmers out of desperate poverty and finally ended the threat of periodic famine. India, for instance, doubled its wheat production between 1964 and 1970 and was able to terminate all dependence on international food aid by 1975. As for indebted and discontented farmers, India’s rural poverty rate fell from 60 percent to just 27 percent today. Dismissing these great achievements as a “myth” (the official view of Food First, a California-based organization that campaigns globally against agricultural modernization) is just silly.

It’s true that the story of the Green Revolution is not everywhere a happy one. When powerful new farming technologies are introduced into deeply unjust rural social systems, the poor tend to lose out. In Latin America, where access to good agricultural land and credit has been narrowly controlled by traditional elites, the improved seeds made available by the Green Revolution increased income gaps. Absentee landlords in Central America, who previously allowed peasants to plant subsistence crops on underutilized land, pushed them off to sell or rent the land to commercial growers who could turn a profit using the new seeds. Many of the displaced rural poor became slum dwellers. Yet even in Latin America, the prevalence of hunger declined more than 50 percent between 1980 and 2005.

In Asia, the Green Revolution seeds performed just as well on small nonmechanized farms as on larger farms. Wherever small farmers had sufficient access to credit, they took up the new technology just as quickly as big farmers, which led to dramatic income gains and no increase in inequality or social friction. Even poor landless laborers gained, because more abundant crops meant more work at harvest time, increasing rural wages. In Asia, the Green Revolution was good for both agriculture and social justice.

And Africa? Africa has a relatively equitable and secure distribution of land, making it more like Asia than Latin America and increasing the chances that improvements in farm technology will help the poor. If Africa were to put greater resources into farm technology, irrigation, and rural roads, small farmers would benefit.

There are other common objections to doing what is necessary to solve the real hunger crisis. Most revolve around caveats that purist critics raise regarding food systems in the United States and Western Europe. Yet such concerns, though well-intentioned, are often misinformed and counterproductive — especially when applied to the developing world.

Take industrial food systems, the current bugaboo of American food writers. Yes, they have many unappealing aspects, but without them food would be not only less abundant but also less safe. Traditional food systems lacking in reliable refrigeration and sanitary packaging are dangerous vectors for diseases. Surveys over the past several decades by the Centers for Disease Control and Prevention have found that the U.S. food supply became steadily safer over time, thanks in part to the introduction of industrial-scale technical improvements. Since 2000, the incidence of E. coli contamination in beef has fallen 45 percent. Today in the United States, most hospitalizations and fatalities from unsafe food come not from sales of contaminated products at supermarkets, but from the mishandling or improper preparation of food inside the home. Illness outbreaks from contaminated foods sold in stores still occur, but the fatalities are typically quite limited. A nationwide scare over unsafe spinach in 2006 triggered the virtual suspension of all fresh and bagged spinach sales, but only three known deaths were recorded. Incidents such as these command attention in part because they are now so rare. Food Inc. should be criticized for filling our plates with too many foods that are unhealthy, but not foods that are unsafe.

Where industrial-scale food technologies have not yet reached into the developing world, contaminated food remains a major risk. In Africa, where many foods are still purchased in open-air markets (often uninspected, unpackaged, unlabeled, unrefrigerated, unpasteurized, and unwashed), an estimated 700,000 people die every year from food- and water-borne diseases, compared with an estimated 5,000 in the United States.

Food grown organically — that is, without any synthetic nitrogen fertilizers or pesticides — is not an answer to the health and safety issues. The American Journal of Clinical Nutrition last year published a study of 162 scientific papers from the past 50 years on the health benefits of organically grown foods and found no nutritional advantage over conventionally grown foods. According to the Mayo Clinic, “No conclusive evidence shows that organic food is more nutritious than is conventionally grown food.”

Health professionals also reject the claim that organic food is safer to eat due to lower pesticide residues. Food and Drug Administration surveys have revealed that the highest dietary exposures to pesticide residues on foods in the United States are so trivial (less than one one-thousandth of a level that would cause toxicity) that the safety gains from buying organic are insignificant. Pesticide exposures remain a serious problem in the developing world, where farm chemical use is not as well regulated, yet even there they are more an occupational risk for unprotected farmworkers than a residue risk for food consumers.

When it comes to protecting the environment, assessments of organic farming become more complex. Excess nitrogen fertilizer use on conventional farms in the United States has polluted rivers and created a “dead zone” in the Gulf of Mexico, but halting synthetic nitrogen fertilizer use entirely (as farmers must do in the United States to get organic certification from the Agriculture Department) would cause environmental problems far worse.

Here’s why: Less than 1 percent of American cropland is under certified organic production. If the other 99 percent were to switch to organic and had to fertilize crops without any synthetic nitrogen fertilizer, that would require a lot more composted animal manure. To supply enough organic fertilizer, the U.S. cattle population would have to increase roughly fivefold. And because those animals would have to be raised organically on forage crops, much of the land in the lower 48 states would need to be converted to pasture. Organic field crops also have lower yields per hectare. If Europe tried to feed itself organically, it would need an additional 28 million hectares of cropland, equal to all of the remaining forest cover in France, Germany, Britain, and Denmark combined.

Mass deforestation probably isn’t what organic advocates intend. The smart way to protect against nitrogen runoff is to reduce synthetic fertilizer applications with taxes, regulations, and cuts in farm subsidies, but not try to go all the way to zero as required by the official organic standard. Scaling up registered organic farming would be on balance harmful, not helpful, to the natural environment.

Not only is organic farming less friendly to the environment than assumed, but modern conventional farming is becoming significantly more sustainable. High-tech farming in rich countries today is far safer for the environment, per bushel of production, than it was in the 1960s, when Rachel Carson criticized the indiscriminate farm use of DDT in her environmental classic, Silent Spring. Thanks in part to Carson’s devastating critique, that era’s most damaging insecticides were banned and replaced by chemicals that could be applied in lower volume and were less persistent in the environment. Chemical use in American agriculture peaked soon thereafter, in 1973. This was a major victory for environmental advocacy.

And it was just the beginning of what has continued as a significant greening of modern farming in the United States. Soil erosion on farms dropped sharply in the 1970s with the introduction of “no-till” seed planting, an innovation that also reduced dependence on diesel fuel because fields no longer had to be plowed every spring. Farmers then began conserving water by moving to drip irrigation and by leveling their fields with lasers to minimize wasteful runoff. In the 1990s, GPS equipment was added to tractors, autosteering the machines in straighter paths and telling farmers exactly where they were in the field to within one square meter, allowing precise adjustments in chemical use. Infrared sensors were brought in to detect the greenness of the crop, telling a farmer exactly how much more (or less) nitrogen might be needed as the growing season went forward. To reduce wasteful nitrogen use, equipment was developed that can insert fertilizers into the ground at exactly the depth needed and in perfect rows, only where it will be taken up by the plant roots.

These “precision farming” techniques have significantly reduced the environmental footprint of modern agriculture relative to the quantity of food being produced. In 2008, the Organization for Economic Cooperation and Development published a review of the “environmental performance of agriculture” in the world’s 30 most advanced industrial countries — those with the most highly capitalized and science-intensive farming systems. The results showed that between 1990 and 2004, food production in these countries continued to increase (by 5 percent in volume), yet adverse environmental impacts were reduced in every category. The land area taken up by farming declined 4 percent, soil erosion from both wind and water fell, gross greenhouse gas emissions from farming declined 3 percent, and excessive nitrogen fertilizer use fell 17 percent. Biodiversity also improved, as increased numbers of crop varieties and livestock breeds came into use.

Seeding the Future

Africa faces a food crisis, but it’s not because the continent’s population is growing faster than its potential to produce food, as vintage Malthusians such as environmental advocate Lester Brown and advocacy organizations such as Population Action International would have it. Food production in Africa is vastly less than the region’s known potential, and that is why so many millions are going hungry there. African farmers still use almost no fertilizer; only 4 percent of cropland has been improved with irrigation; and most of the continent’s cropped area is not planted with seeds improved through scientific plant breeding, so cereal yields are only a fraction of what they could be. Africa is failing to keep up with population growth not because it has exhausted its potential, but instead because too little has been invested in reaching that potential.

One reason for this failure has been sharply diminished assistance from international donors. When agricultural modernization went out of fashion among elites in the developed world beginning in the 1980s, development assistance to farming in poor countries collapsed. Per capita food production in Africa was declining during the 1980s and 1990s and the number of hungry people on the continent was doubling, but the U.S. response was to withdraw development assistance and simply ship more food aid to Africa. Food aid doesn’t help farmers become more productive — and it can create long-term dependency. But in recent years, the dollar value of U.S. food aid to Africa has reached 20 times the dollar value of agricultural development assistance.

The alternative is right in front of us. Foreign assistance to support agricultural improvements has a strong record of success, when undertaken with purpose. In the 1960s, international assistance from the Rockefeller Foundation, the Ford Foundation, and donor governments led by the United States made Asia’s original Green Revolution possible. U.S. assistance to India provided critical help in improving agricultural education, launching a successful agricultural extension service, and funding advanced degrees for Indian agricultural specialists at universities in the United States. The U.S. Agency for International Development, with the World Bank, helped finance fertilizer plants and infrastructure projects, including rural roads and irrigation. India could not have done this on its own — the country was on the brink of famine at the time and dangerously dependent on food aid. But instead of suffering a famine in 1975, as some naysayers had predicted, India that year celebrated a final and permanent end to its need for food aid.

Foreign assistance to farming has been a high-payoff investment everywhere, including Africa. The World Bank has documented average rates of return on investments in agricultural research in Africa of 35 percent a year, accompanied by significant reductions in poverty. Some research investments in African agriculture have brought rates of return estimated at 68 percent. Blind to these realities, the United States cut its assistance to agricultural research in Africa 77 percent between 1980 and 2006.

When it comes to Africa’s growing hunger, governments in rich countries face a stark choice: They can decide to support a steady new infusion of financial and technical assistance to help local governments and farmers become more productive, or they can take a “worry later” approach and be forced to address hunger problems with increasingly expensive shipments of food aid. Development skeptics and farm modernization critics keep pushing us toward this unappealing second path. It’s time for leaders with vision and political courage to push back.


May 2010, Foreign Policy

Building a generation of cooperatives

In Agriculture on May 18, 2012 at 5:14 am

n a nation where farmers are giving up land, and sometimes their lives, in desperation, Anil Shinde of Bhatwadi village in Nashik district of Maharashtra decided to give up his factory job and take up farming.

Shinde faced derision two years ago when he quit his 10-year job as a helper in a glass factory of Larsen and Toubro Ltd in nearby Sinnar. Yet, his move back to the farm seems to have paid off, as his monthly income from his 10-acre plot has increased fivefold, to Rs.25,000, thanks to the modern farm practices he has adopted.

The 32-year-old Shinde has also helped organize farmers to form a producer company in which he is now a director, even as he is finding followers among young men who are leaving their city jobs to take up farming.

Hardly looking the part of a company director, Shinde sports a perpetual expression of amazement as he narrates the story of his life, the firm he helped found, and the man behind his success: social activist Sunil Pote.

Pote, 40, heads a non-governmental organization (NGO) Yuva Mitra and has spent the better part of the last decade in Sinnar block, mobilizing farmers to make farming more remunerative. The Devnadi Valley Agricultural Producers Co. Ltd, a 550-farmer-strong producer company that Pote has created, buys farm inputs at bulk rates for its members and will soon open retail outlets after tying up with firms to sell crops and packaged food directly to consumers. A graduating student of the US-based Kellogg School of Management, Bryan Lee, is in talks with the company to set up a processing unit as a joint venture between his start-up social enterprise named Kisan First, and Devnadi Valley.

Small farmers do not have adequate bargaining power when they are either buying inputs or selling their produce to traders. Incomes suffer. Low bargaining power both in the market for inputs and outputs leads to worse prices for small farmers, studies by Food and Agriculture Organization show.

A producer company helps small farmers consolidate their buying and selling, and earn more. The number of such producer companies in India, with farmers as sole shareholders, has shot up, nearly doubling to 270 over the past year. Western Indian states such as Maharashtra, with a history of rural cooperatives, are leading the surge.

Aware of the greater bargaining power a collective offers, but wary of traditional cooperatives, farmers are turning to the producer-company model, which marries the ethos of the cooperative with the flexibility of a corporate structure.

On the recommendations of a committee led by economist Y.K. Alagh, a special section was introduced in the Companies Act in 2002 that allowed primary producers to start their own company while retaining the cooperative principle of “one vote, one share”.

Pote’s venture is probably the most organized version of efforts under way across Maharashtra (see box) to build a new generation of cooperatives that tie farmers directly with the market, minimizing the role of the middlemen. The common goal in these initiatives is to deliver higher returns to farmers and make small farms sustainable by shortening the chain between farms and markets.

Indian agriculture is dominated by small landowners, with 83% of farmers tilling plots less than five acres. Although small farmers reap higher yields, they have lower incomes or profits compared with big farmers, and borrow more for consumption than for investments, according to National Sample Survey data. Around half of such farmers do not want to continue farming, according to the same survey conducted in 2004-05.

Our focus as a nation has been far more on farm output than on farm incomes, said Pote. “The aim at Yuva Mitra was to ensure a decent and steady flow of income to farmers and we realized that can happen on a sustained basis only when farmers are trained and organized,” he said.

Initially, Pote formed a farmers’ club with around 15 members and tied up with Tata Chemicals Ltd to sell vegetables. The arrangement lasted six months and made the farmers realize the need for a larger grouping and more organized structure—and Devnadi Valley was born.

So far, two main kind of producer companies have cropped up in the country. The first and more numerous variety is of companies such as Devnadi, initiated by NGOs, often by bringing together pre-existing groups.

The second breed are those initiated or supported by companies. These firms include those in the retail, packaged goods or agri-inputs sectors that aim to strengthen their supply chains. They also include distributors of farm produce such as Tata Chemicals that save costs in dealing with large groups of farmers directly, and had helped set up five producer companies in Punjab. “The producer-company model is the most efficient and transparent way for companies to work with farmers,” said Sukhpal Singh, a professor at the Indian Institute of Management, Ahmedabad (IIM-A), who has studied such groups extensively.

As Pote started mobilizing farmers to form their own company and establish a market chain, he found their need for a reliable input chain was greater. Farmers complained of being taken for a ride by retailers, who bundled several inputs together and sometimes sold fakes.

Inspired by the experiences of similar organizations in Gujarat, Devnadi Valley set up an agri-mall in September 2011 that buys fertilizers and pesticides at bulk rates from dealers or firms, offers cheaper tractors and makes it easier for members to get bank loans. It has a mark-up of 7% over wholesale rates, but is still able to save around 30% of input costs on average for members; retail margins for some inputs being as high as 50%.

In its first four months of operation, the agri-mall saw an average turnover of Rs.3.5 lakh as members purchased inputs for the rabi crops—sown in autumn and harvested in winter. “It is too early to judge the performance of Devnadi Valley, but Sunil’s initiative appears promising,” said Singh of IIM-A.

Pote’s initial success in mobilizing farmers revolved around water. He successfully revived a 140-year-old network of canals built by the British around the Devnadi river that had dried up by the late 1990s.

Expectedly, Pote faced hurdles from panchayats (village councils) and local politicians. He also found it difficult to convince villagers that he did not have any political motive, or that his efforts would eventually bear fruit. After the district collector of Nashik, P. Velrasu, visited Sinnar and took a liking to Pote’s idea, the resistance waned and people contributed voluntarily to the canal rejuvenation project.

Pote’s biggest success came in the tribal village of Andhewadi, where he was able to source water from a spring atop a hill nearby, an achievement that led Marathi dailies to hail his achievement as a real life version of Swades, the Ashutosh Gowariker-directed Hindi movie with the same theme. It was only when he started working with farmers on their water needs that Pote was able to identify the factors that could make a difference to farming. Pote, a persuasive speaker, held workshops to popularize the idea of the Rs.1,000-a-day model: that involves growing three or four vegetables on a1-acre plot that will generate a daily harvest and coupled with money earned by selling milk, ensure a steady income stream. It was after attending one of these workshops that Shinde decided to take up farming.

The Andhewadi project also brought Pote in close contact with Somdutt Lad, a Pune-based builder who decided to use his business skills in helping Yuva Mitra form Devnadi Valley and raise funds from the National Bank for Agriculture and Rural Development (Nabard). “We often have a typical NGO attitude and remain contented in social mobilization, but one must think like a businessman to run a company and Lad’s presence helps in restoring that balance,” said Pote.

Not all farmers’ collectives have a smooth transition to a producers company. A farming community in the nearby block of Dindori that runs a successful network of water cooperatives, had started a producer company—Waghad Agricultural Producer Co. Ltd—two years ago. It is making losses and still struggling to find its feet, and is taking Devnadi Valley’s help in framing a new business plan.

Two other producer companies, one of cotton-growers in Vidarbha, which plan to set up a ginning plant, and another of prosperous horticulturists in Pune, who plan to set up a processing unit for export markets, have also turned to Pote for help. Devnadi Valley now acts as a consultant for them in preparing detailed project reports required for Nabard loans.


17 May 2012, MINT


‘Annual Action Plans had unrealistic targets’

In Agriculture, Bureaucratic Delays, Corruption, Gujarat, Poverty Eradication, Property Rights on April 5, 2012 at 10:39 am

The Comptroller and Auditor General of India (CAG) has noted a shortfall of 8 to 100% in the implementation of Annual Action Plan (AAP) for 2010-11 and said its targets were not realistic.

It also noted that the government had acquired only 75% of the surplus land under the Gujarat Land Ceiling Act, and was not able to distribute all of it to the poor agricultural labourers.

CAG, in its annual civil performance report for the state, observed, “The AAP was being prepared setting out financial and physical targets for various activities to be undertaken. Audit analysis have revealed that the AAP prepared by the settlement commissioner and director of land records was not realistic and there were persistent shortfalls (eight to 100 %) in achievement of physical targets fixed.”

The report added: “As per Gujarat Land Ceiling Act, 1960, government shall take possession of land beyond ceiling limit from land owners and distribute it among agricultural workers or to needy agricultural labourers of SC/ST (categories) and other weaker sections as per yearly targets. We observed from the records of commissioner of land reforms that as on November 2009, as against declaration of 2,38,339 acres of land as surplus, possession of only 1,79,327 acres of land was taken by the government, of which 15,587 acres were yet to be distributed (March 2011) among the beneficiaries.”

It further noted the entitled groups were either agricultural workers/ labourers belonging to SC and ST categories, who needed financial assistance. But “all of them were not provided financial assistance”. It added that nothing was found on record to show that the beneficiaries were motivated to file applications for financial assistance and to avail the benefits of the scheme.


31 Mar 2012, Indian Express

World’s Poor Pay Price as Crop Research Is Cut

In Agriculture, Climate Change, Foreign Aid, Malnutrition, Poverty Eradication on February 3, 2012 at 2:07 pm

LOS BAÑOS, Philippines — The brown plant hopper, an insect no bigger than a gnat, is multiplying by the billions and chewing through rice paddies in East Asia, threatening the diets of many poor people.

The damage to rice crops, occurring at a time of scarcity and high prices, could have been prevented. Researchers at the International Rice Research Institute here say that they know how to create rice varieties resistant to the insects but that budget cuts have prevented them from doing so.

This is a stark example of the many problems that are coming to light in the world’s agricultural system. Experts say that during the food surpluses of recent decades, governments and development agencies lost focus on the importance of helping poor countries improve their agriculture.

The budgets of institutions that delivered the world from famine in the 1970s, including the rice institute, have stagnated or fallen, even as the problems they were trying to solve became harder.

“People felt that the world food crisis was solved, that food security was no longer an issue, and it really fell off the agenda,” said Robert S. Zeigler, the director general of the rice institute.

Vital research programs have been slashed. At the rice institute, scientists have identified 14 genetic traits that could help rice plants survive the plant hopper, which sucks the juices out of young plants while infecting them with viruses. But the scientists have had no money to breed these traits into the world’s most widely used rice varieties.

The institute is the world’s main repository of rice seeds as well as genetic and other information about rice, the crop that feeds nearly half the world’s people.

But nowadays at the International Rice Research Institute, greenhouses have peeling paint and holes in their screens and walls. Hallways are dotted with empty offices. In the 1980s, the institute employed five entomologists, or insect experts, overseeing a staff of 200. Now it has one entomologist with a staff of eight.

“We’ve had an exodus here,” said Yvette Naredo, an assistant geneticist.

Similar troubles plague other centers in Asia, Africa and Latin America that work on crop productivity in poor countries. Agricultural experts have complained about the flagging efforts for years and warned of the risks.

“Nobody was listening,” said Thomas Lumpkin, director general of the International Maize and Wheat Improvement Center in Mexico.

Now, a reckoning is at hand. Growth of the global food supply has slowed even as the population has continued to increase, and as economic growth is giving millions of poor people the money to buy more food.

With demand beginning to outstrip supply, prices have soared, and food riots have erupted that have undermined the stability of foreign governments. World leaders are scrambling to respond. On May 1, President Bush asked Congress for an extra $770 million to pay for food aid and to help farmers improve their productivity.

But cuts in agricultural research continue. The United States is in the midst of slashing, by as much as 75 percent, its $59.5 million annual support for a global research network that focuses on improving crops vital to agriculture in poor countries. That network includes the rice institute.

Robert Bertram, who oversees the funding for the United States Agency for International Development, said he was still trying to stop the cuts and argued that research to improve crop yields was “like putting money in the pockets of poor people, and I mean billions of poor people.”

The Agency for International Development is the primary vehicle for the American government to finance development projects abroad. James R. Kunder, its acting deputy administrator, said the agency hoped to reconsider the cutbacks if Congress allows extra money.

Crop by crop and country by country, agricultural research and development are lagging.

The center in Mexico has created drought-tolerant corn for Africa and higher-yielding, disease-resistant wheat for South Asia. But it does not have the money to get the varieties into the hands of poor farmers.

In Africa, where yields have remained stagnant since the 1960s, efforts to bolster them have been hampered by cuts not only in research but also in programs like fertilizer distribution.

Even in the United States, long a world leader in agricultural research, some money has been shifted away from crop-productivity work into issues like nutrition and food safety.

The biggest cutbacks have come in donations to agriculture in poor countries from the governments of wealthy countries and in loans from development institutions that the wealthy governments control, like the World Bank. Such projects include not only research on pests and crops but also programs to help farmers adopt improved methods in their fields.

Adjusting for inflation and exchange rates, the wealthy countries, as a group, cut such donations roughly in half from 1980 to 2006, to $2.8 billion a year from $6 billion. The United States cut its support for agriculture in poor countries to $624 million from $2.3 billion in that period.

“Agriculture has been so productive and done so well, people have kind of lost sight of how fragile it really is,” said Jan E. Leach, a plant pathologist at Colorado State University who works with rice. “It’s as if we have lost track of the fact that food is linked to agriculture, which is linked to human survival.”

Cooperation on Crops

Agricultural research and development work is never done. The demand for food keeps growing. Insects and plant diseases adapt, overcoming efforts to thwart them.

In the 1960s, population growth was far outrunning food production, threatening famine in many poor countries. But then wealthier nations joined forces with the poor countries to improve crop yields. Countries like India and Pakistan embraced new plant varieties, irrigation projects and fertilizer programs in a vast effort that came to be known as the Green Revolution.

Yields soared, and by the 1980s, the threat of starvation had receded in most of the world. With Europe and the United States offering their farmers heavy subsidies that encouraged production, grain became abundant worldwide, and prices fell.

Many poor countries, instead of developing their own agriculture, turned to the world market to buy cheap rice and wheat. In 1986, Agriculture Secretary John Block called the idea of developing countries feeding themselves “an anachronism from a bygone era,” saying they should just buy American.

Additional factors prompted wealthy countries to shift their donations away from agriculture. For instance, advocacy groups criticized some of the environmental problems arising from intensive farming, weakening support for the Green Revolution. And urgent new priorities like the AIDS crisis in Africa captured the world’s attention.

Advocates for agriculture fought a losing battle to stop the cutbacks — nowhere more than in the World Bank, the huge institution in Washington that makes low-interest loans to poor countries for development projects.

Adjusted for inflation, the World Bank cut its agricultural lending to $2 billion in 2004 from $7.7 billion in 1980.

The Green Revolution had led to creation of a global network of research centers focusing on agriculture and food production, with 14 institutes — including the International Rice Research Institute — scattered across Asia, Africa and Latin America, in addition to a research office in Washington. The centers, known collectively as the Consultative Group on International Agricultural Research, carry much of the burden of improving crop yields in developing countries.

As the world lost its focus on crops, the budgets of some of the centers were cut. At others, the budgets stayed level or even rose, but donors increasingly directed the money toward worthwhile but ancillary projects like environmental research. Spending fell on the laborious plant-breeding programs needed to improve crop productivity.

As these trends played out, the stage was being set for a food emergency.

From 1970 to 1990, the peak Green Revolution years, the food supply grew faster than the world population. But after 1990, food’s growth rate fell below population growth, according to a report by Ronald Trostle, a researcher at the Agriculture Department.

Around 2004, the world economy began growing more quickly, about 5 percent a year. So as the food supply was lagging, millions of people were gaining the money to improve their diets.

The world began to use more grain than it was producing, cutting into reserves, and prices started rising. Early this year, as stocks fell to perilous levels, international grain prices doubled or even tripled, threatening as many as 100 million people with malnutrition.

Slow Recovery for Aid

At the World Bank, agricultural financing has begun to recover. Under a new president, Robert B. Zoellick, the bank has decided to double its lending for such programs in Africa. After President Bush’s request to Congress, other wealthy countries are joining the United States in increasing their support.

But the case of the brown plant hopper shows there will be no quick fix for the years of neglect.

The insect is not a new problem. In the 1960s, the rice institute, nestled between jungle and the bustling town of Los Baños, pioneered ways to help farmers grow two and even three crops a season, instead of one.

But with rice plants growing more of the year, the hoppers — which live only on rice plants — had longer to multiply, and became a bigger concern.

The institute responded by testing thousands of varieties of wild rice for natural resistance. Researchers found four types of resistance and bred them into commercial varieties by 1980.

But brown plant hoppers adapted swiftly, and the resistant strains started losing their effectiveness in the 1990s. An important insecticide lost its punch, too, as the hopper developed the ability to withstand up to 100 times the dose that used to kill it.

While the insect was adapting, the rice institute was being gutted.

Its money comes come from government donations, foundation grants and assistance from development institutions like the Asian Development Bank. After peaking in the early 1990s, the rice institute’s budget has been cut in half after adjusting for inflation, a reflection of the larger cutbacks in global agriculture.

Several dozen important varieties of rice have been lost from the institute’s gene bank through poor storage. Promising work on rice varieties that could withstand high temperatures and saltier water — ideal for coping with global warming and the higher sea levels that may follow — had to be abandoned.

A potential solution is at hand for the plant hopper problem. No fewer than 14 new types of genetic resistance have been discovered. But with the budget cuts, the institute has mounted no effort to breed these traits into widely used rice varieties.

Doing so now would take four to seven years, if money could be found. In the meantime, the hoppers have become a growing threat. China, the world’s biggest rice producer, announced on May 7 that it was struggling to control the rapid spread of the insects there. A plant hopper outbreak can destroy 20 percent of a harvest; China is trying to hold losses to 5 percent in affected fields.

“We must stay ahead of rapidly evolving pests — and increasingly, a changing climate — to assure global food security,” said Mr. Zeigler, the rice institute’s director. “Cutting back on agricultural research today is pure folly.”


18 May 2008,  The New York Times


Green shoots

In Agriculture, Gujarat on February 3, 2012 at 1:56 pm

NDIA is the third-biggest producer of potatoes in the world. The humble spud finds itself stuffed into flatbread, encrusted in cumin seeds or tucked into pancakes. But the truckloads of large, oblong potatoes that arrive at the McCain Foods plant in the Mehsana district of Gujarat face a more exacting ordeal. Ferried by a conveyor belt and propelled by water, they are sized, steam-peeled, sliced, diced, blanched, dried, fried (for precisely 42 seconds in vegetable oil at 199ºC), chilled, frozen, bagged and then boxed.

The 15kg boxes of fries that emerge at the other end of this pipeline supply the growing chain of McDonald’s restaurants in India. When McDonald’s first entered India in 1996, the food-processing industry was confined largely to ice cream and ketchup. Even importing frozen fries was complicated by the fact that such an exotic item did not appear on India’s schedule of tariffs and quotas. It took McDonald’s roughly six years and $100m to weld a reliable supply chain together.

For fries, that supply chain begins with 2,000 acres of potato fields in Gujarat, cultivated by 400 farmers under contract with McCain Foods. These cultivators belong to a profession which still employs about half of India’s workforce. In Gujarat, agriculture is growing almost as quickly as the rest of the Indian economy. But elsewhere, agriculture is said to be in crisis. The average size of farmers’ landholdings is only about 1.3 hectares. If their fields are irrigated at all, they are flooded wastefully, with water flowing down furrows on either side of the crop, taking valuable nitrogen with it. India produces more tractors than any other country, but many farmers still use bullocks instead. They sell their produce at controlled prices in government mandis: marketplaces regulated by the state with the aim of protecting farmers from exploitation by unscrupulous traders.

State governments once took it upon themselves to spread know-how, market intelligence and the fruits of agricultural research to smallholders. But the agricultural extension system is now in some disrepair. Public investment in agriculture has stagnated over the past few years as the government’s subsidy bill for food, fertiliser and fuel has risen.

In the absence of public investment, Indian agriculture is increasingly dependent on private outlays, which now account for three-quarters of total investment in the sector. McCain Foods, for example, invested $25m in the Mehsana plant. And in the absence of government extension services, some private companies are finding alternative ways to let farmers know what the customer expects, and how to meet that expectation.

Hitesh Patel, for example, used to grow cottonseed on his six hectares in Idar village, about 125km (80 miles) from the Mehsana plant. Four years ago he planted a hectare of potatoes at McCain Foods’ urging and under its guidance. Now he plants potatoes on all of the six hectares he owns and another 1.6 he has leased.

McCain Foods offers him an assured price of 6.50 rupees ($0.14) per kilogram of potatoes, a better rate than the mandi. But they will not buy just any potato. India’s common varieties are too small, watery and sugary, caramelising when fried.

Potatoes fit for processing are usually grown in more temperate latitudes. The tuber likes warm days and cool nights. “Wherever are the best regions for wine, potato is not far behind,” says Ghislain Pelletier, a McCain agronomist. Firms before McCain had tried and failed to produce potatoes in India that were suitable for processing into fries. Even Harrison McCain, one of the company’s founders, doubted it could be done.

But after several years of experimentation, McCain can now supply all of McDonald’s needs in India, as well as producing some creations of its own, like Masala Fries. “We used to struggle for size; now we struggle to reduce the size,” says Devendra Kumar of McCain India.

McCain’s agronomists would first visit farmers like Mr Patel every other day. Now they check in once a week. They insist that farmers give up flooding their furrows with water in favour of drip irrigation, which flows through a pipe punctuated with small nozzles laid along the crop-bed. Drip irrigation produces “more crop per drop”, as Mr Pelletier puts it. It moistens the soil at each root, but leaves the ground otherwise dry. This in turn reduces the humidity that attracts pests and blight.

This kind of contract farming began with Punjabi farmers growing tomatoes for Pepsi’s food business in the 1980s. But its spread was hampered by tight regulations at the state level on who could buy produce and how. Most states have now eased those restrictions, raising hopes that contract farming—which only accounts for a small fraction of India’s annual agricultural output of $220 billion—will flourish.

As incomes in India rise, tastes are changing. Staples are receding in importance. In 1983 food grains accounted for 32% of India’s agricultural output; 15 years later they accounted for less than a quarter, according to Ashok Gulati of the International Food Policy Research Institute. But food grains still occupy nearly 64% of India’s farmland and an even higher fraction of government concern and energy. “In India, cereals are being increasingly overtaken by fruits, vegetables, milk, eggs and poultry,” Mr Gulati argues.

McDonald’s, for example, recently introduced the Chicken McNugget to India, where it counts as a premium product: all white meat without any bone. When the firm first entered the country, it struggled to find poultry suppliers who could debone meat. Because the chain’s products are delicate or perishable they must be handled with far more care than rice or wheat. Frozen fries, for example, are so brittle that they must be handled like eggs. But McDonald’s also found that the few refrigerated lorries in the country were mostly devoted to transporting ice cream.

Investments by multinationals like McDonald’s can spread into the wider economy. McDonald’s, for example, invited East Balt Commissary of Chicago, whose founder supplied buns to Ray Kroc’s first McDonald’s franchise, to go to India to train the Cremica bakeries in Delhi and Mumbai. East Balt is what Abhijit Upadhye of McDonald’s India calls a “good system player”. It also asked Schreiber International, which supplies sliced cheese, to tie up with Dynamix Dairy in India. As a result, many other companies, including Nestlé, Unilever and Pepsi, started doing business with Dynamix.

The economic benefits to Gujarat’s farmers will also spread. Mr Patel, for one, cannot wait to harvest his potatoes and receive his payment from McCain. He wants to trade in his Maruti-Suzuki car for a grander model made by Honda.


11 Mar 2010,  Economist

Shankar Acharya: Agriculture: be like Gujarat

In Agriculture, Gujarat on January 23, 2012 at 6:49 am

In the 60 years since 1950 Indian agriculture has recorded an average growth rate of 2.7 per cent per year. In the past 30 years, the rate has crept slightly above three per cent, well short of the four per cent target set in successive recent Five-Year Plans. Most analysts infer that it would take great good luck (with weather) or a sweeping revolution in policy design and implementation to achieve and sustain four per cent growth. Is that really so?

For a more optimistic answer let’s look at the variation in agricultural performance across India’s 20 largest states (by population) in the last decade (see Table). It’s striking that agriculture in seven sizeable states (Gujarat, Chhattisgarh, Rajasthan, Maharashtra, Andhra Pradesh, Madhya Pradesh and Orissa) grew faster than four per cent between 2000-01 and 2007-08. And that fact doesn’t change when the relatively bad agricultural years of 2008-09 and 2009-10 are included. What’s more, most of these states are more water-stressed than average. The star performer is semi-arid Gujarat, clocking eight per cent (nearly triple the national average) agricultural growth over the decade.

So let’s dig a little deeper into the reasons behind Gujarat’s stellar agrarian success, especially as it comes after the decade of the nineties when growth averaged less than five per cent. The story is persuasively documented in the recent monograph compiled by Indian Institute of Management, Ahmedabad, professors Ravindra Dholakia and Samar Datta: High Growth Trajectory and Structural Changes in Gujarat Agriculture (Macmillan, 2010). Broadly speaking, professors Dholakia, Datta et al (henceforth, DDEA) identify six factors that were given a concerted push by the Gujarat government from 2002-03 onwards:

  • a sustained programme of water conservation and management;
  • a massive and well-coordinated extension effort;
  • a successful overhaul of rural electricity distribution;
  • a strong emphasis on non-food crops like horticulture, Bt cotton, castor and isabgol;
  • sustained and comprehensive support to livestock development;
  • major revamping of agriculture-supporting infrastructure, including roads, electricity and ports.

Some of these factors merit elaboration.

With only a quarter of its agricultural land irrigated, efficient conservation and management of water has been a continuing challenge for Gujarat’s agriculture. Three major programmes received a fresh impetus from 2000 onwards. With assistance and encouragement from the Planning Commission, watershed development programmes were rapidly scaled up, adding about 100,000 hectares per year. By 2009, nearly 2,000 projects covering 2 million hectares had been completed and another 900,000 hectares were under execution. Second, the Jal Kranti programme for constructing check dams, recharging wells and reviving village ponds/tanks was vigorously pursued. By the end of 2008, “a total of 113,738 checkdams, 55,917 bori bandhs and 240,199 farm ponds were constructed by the Water Resources Department” (page 25, DDEA book). Third, micro-irrigation (through drips and sprinklers) received an enormous boost in the past decade spearheaded by the Gujarat Green Revolution Company. During 2006 to 2010 nearly 2 lakh hectares were covered, benefiting a similar number of farmers.

AGRICULTURE GROWTH (GROSS VALUE ADDED) ACROSS INDIAN STATES                                                                       (Percentage)
Sectoral share of
agriculture in state
GSDP* (2007-08)1
Gujarat 11.7 8.0 16.0
Chhattisgarh 9.4 6.7 17.0
Rajasthan 5.8 3.5 23.9
Maharashtra 5.6 4.0 13.0
Andhra Pradesh 5.6 4.7 22.4
Madhya Pradesh 5.5 6.2 24.2
Orissa 4.6 4.8 23.3
Himachal Pradesh 4.0 1.6 19.4
Jammu and Kashmir 3.6 3.1 24.1
Haryana 3.6 3.4 21.0
Uttarakhand 2.5 2.2 16.1
Tamil Nadu 2.5 2.0 12.2
Punjab 2.4 2.2 31.7
West Bengal 2.1 2.0 18.5
Uttar Pradesh 1.7 1.8 27.3
Bihar 1.5 1.1 23.0
Karnataka 1.2 0.6 15.4
Kerala 0.7 0.9 12.4
Assam 0.5 1.6 24.6
Jharkhand -0.7 1.1 8.6
(1)  Based on national income data at 1999-2000 prices
(2)  1999-2000 prices data up to 2007-08 and 2004-05 base data for growth in 2008-09 and 2009-10
*Gross state domestic product                                                    Source: Central Statistical Organisation

As in the rest of India, the system of agricultural extension established in the years 1950 to 1970 had suffered serious entropy and decay in next 30 years. In the early noughties, a systematic and massive renewal of agricultural extension systems was carried out under the Krishi Mahotsav programme. It included an “ambitious programme for issuing soil health cards and kisan credit cards for each farmer and micro level planning for each block and village for recommending profitable alternative crop patterns…” (page 27, DDEA book). The programme required a month-long deployment of about 100,000 personnel from across 18 government departments. It has been carried out each year since 2005.

Along with revamping water management and extension services, the Gujarat government also achieved a major breakthrough in rural electrification. The Jyotigram Yojana was launched in 2003 and ensured 100 per cent electrification of the state’s villages and reasonably regular supply in three years. The scheme included a crucial component of power supply for groundwater management with eight hours a day of full voltage power made available on a pre-announced schedule.

These major initiatives on the supply side facilitated a robust response of the agriculture sector to the changing composition of demand as Gujarat’s overall economy grew at double-digit rates during the decade. The state was quick to seize the opportunities for diversification into non-food crops. Despite some controversy, Gujarat was an early and successful adopter of Bt cotton, which fuelled rapid growth in cotton production. Other commercial crops such as castor and psyllium (isabgol) also did very well. Household incomes grew apace, so did the market for horticulture products. The production of both fruit and vegetables was about four times higher in 2008-09 compared to 1991-92 and the output of spices was almost five times greater. This robust growth in horticulture owed a lot to improvements in infrastructure and marketing.

Apart from crop production, agricultural policies also encouraged rapid expansion of the livestock sector. During the past decade, milk production grew at five per cent per year, egg production at 19 per cent and meat output at 10 per cent. With rapidly rising incomes the mainly vegetarian orientation of the state’s population has gradually lessened. Besides, cross-border sales have also grown.

How much of Gujarat’s agricultural success story can be replicated in other Indian states? In the preface to their book, professors Dholakia and Datta claim that “this story is certainly replicable by other states and regions within and outside the country”. Well, maybe. A few sentences earlier they write “It is not a miracle that happened exogenously. It is fully endogenous, systematically led by long-term vision and comprehensive strategy requiring solid commitment and dedication to the cause, political will to pursue market-oriented reforms of policies and institutions, interdepartmental and inter-ministerial coordination and cooperation, and a responsive and entrepreneurial farming community”. Well, in much of today’s India that doesn’t sound too “endogenous”; it seems closer to an “exogenous” miracle!


14 July 2011, Business Standard

A costly morality

In Agriculture, Bureaucratic Delays, Corruption, NREGA, PDS, Politics on January 11, 2012 at 6:16 am

It is election time, perhaps even time for mid-term polls, after the assembly elections in February. Time, therefore, for a mid-term review of the UPA 2’s policies. Much has been written about the lack of leadership on the part of Prime Minister Manmohan Singh. So in interests of balance and “equal opportunity”, I would like to discuss the performance of the chairperson of the UPA, Sonia Gandhi. Actually, there is more than equality that dictates that her performance be judged — she has been, after all, the major leader of the Congress for almost 15 years.

It was March 31, 1997 when Sitaram Kesri was ousted from the Congress party leadership and Sonia Gandhi assumed leadership. Her political acumen was tested a year later in February 1998. In the general elections, Ms Gandhi was able to garner 141 seats — one more than those obtained in 1996. But this wasn’t really a test of her political leadership because she had only a year to gear up the moribund Congress, a party in steep decline because of the lack of a Nehru-Gandhi at the helm. A year and a half later, in September 1999, there was yet another general election, this one precipitated by Sonia Gandhi’s statement that she was ready to take over the government because she had 273 seats. In the 1999 Lok Sabha, the Congress hit a historical low of 114 seats.

But it wasn’t really a test of Sonia Gandhi’s leadership because in India, coalition politics really determines who wins. In the May 2004 elections, Gandhi chose well and was able to bring up the Congress tally back up to the 1996 and 1998 mark of 145 seats! So a decade after the decline of the Congress, and with seven years at the helm, she was not able to make any difference to the misfortunes of the Congress party. The political record got much better in the most recent May 2009 election, when the Congress-led UPA came back with the solid achievement of 206 seats. How much of this was due to her leadership, and how much due to the solid 8 per cent-plus GDP growth rate, and how much due to Manmohan Singh’s honesty, is a matter that historians will decide. What we do know is that the accelerated GDP growth rate had precious little to do with any policies that the Sonia Gandhi-Manmohan Singh government introduced between 2004-2009.

Indeed, the populist policies that were introduced by UPA 1 sowed the seeds of the economic disaster that India has witnessed since 2008. Our GDP growth rate has decelerated more than most other countries, and there has been more volatility in inflation, especially food inflation, in India than any other country in the world. This volatility has been induced and juiced up by the populist policies of UPA 1 and 2. It is an open question whether these economic policies were the doing of Mr Singh or of Ms Gandhi.

The PM can be blamed for many things, including the unnecessarily tight monetary policy, but it is incredible to think that a fiscal conservative like him approved of the Greece and Venezuela-like populism that has been engineered by Gandhi and her social and economic think (not)-camp called the National Advisory Council. Whether it is loan melas for farmers, destructively high procurement prices for foodgrain, employment programmes or the food subsidy bill, it is Gandhi and her NAC who should get the credit — or the blame.

Words come cheap, so let us look at some facts. Soon after Sonia Gandhi came to power, she introduced the national employment scheme, NREGA. True to expectations, the Congress introduced the employment guarantee scheme as its own invention, so it could ostensibly get political and “left intellectual” credit for caring so much about the poor. Proclaiming morality has always come easy to the hubris-filled chests of the Congress leaders. Never mind that the employment scheme was as old as 1973, when it was first introduced by the Mahrashtra government as a “food for work” programme for the poor. Since then, it had been introduced all over the country as an anti-poverty programme. With economic growth and economic development unknown only to the Congress party leadership, such programmes had declined in importance. Until in-your-face populism was introduced by Sonia Gandhi and the NAC, and expenditures on such programmes averaged Rs 40,000 crore over the last few years.

Today it is acknowledged that the NREGA scheme is rife with corruption. But Sonia Gandhi and the NAC want to introduce the food security bill. Again, much like the “invention” of employment programmes, the Congress believes it is introducing this morality into Indian policy making for the first time.

Morality does not come cheap and maybe accompanied with intolerable corruption. At present, the public distribution scheme (PDS) works as follows — the government procures the foodgrain from the farmer and ostensibly delivers the same to the poor at heavily subsidised prices. The table shows the performance of this scheme in 2004-05 and 2009-10, the two years for which NSS data are available, data that can cross check the government’s claims of expenditure. The first two rows show the discrepancy in terms of tonnes of food that disappear into thin air. In 2004-05, the government claimed to have delivered 41.5 million tonnes to the PDS shops for delivery to the people. Only 13.2 tonnes actually got delivered. The difference, 28 million tonnes, was not delivered to the poor or the rich by the PDS shops. This food went from the PDS shops to the market and the market sold it to the poor at, well, market prices.

We can all take heart from the fact that the situation improved in 2009-10 — now close to half of the food delivered to the PDS shops were bought from these shops. How much got lost? 24 million tonnes. The subsidy value of this taxpayers’ loss, and the gain for so-called middle men and women, was a healthy Rs 30,000 crore. This number closely matches the lower bound estimate of 2G corruption.

Scams like the 2G scam happen once in a decade. PDS corruption goes on every year. And the food security bill will only enhance and glorify this ongoing corruption. To be sure, the bill enhances the moral stature of the Congress, Sonia Gandhi and the NAC. But it enhances corruption even more. Anti-corruption stalwarts like Vinod Rai, or even Team Anna, where are you when we really need you?

7 Jan 2011, Indian Express

Message from Wukan

In Agriculture, Bizarre Laws, Bureaucratic Delays, Civil Services Reforms, International Relations, Progressive Panchayat on January 2, 2012 at 8:55 am

China’s state-run media have had a field day this autumn with Occupy Wall Street, spinning an almost daily morality play about capitalism gone amok and an American government unable or unwilling to aid the victims of a rapacious elite.

Occupy Wukan is another matter entirely. The state press has been all but mute on why 13,000 Chinese citizens, furious over repeated rip-offs by their village elite, sent their leaders fleeing to safety and repulsed efforts by the police to retake Wukan. But the village takeover can be ignored only at Beijing’s peril: There are at least 625,000 potential Wukans across China, all small, locally run villages that frequently suffer the sorts of injustices that prompted the outburst this month in Wukan.

“What happened in Wukan is nothing new. It’s all across the country,” said Liu Yawei, an expert on local administration who is the director of the China program at the Carter Center in Atlanta. A second analyst, Li Fan, estimated, in an interview, that 50 per cent to 60 per cent of Chinese villages suffered governance and accountability problems of the sort that apparently beset Wukan. Li leads the World and China Institute, a private nonprofit research centre based in Beijing that has studied local election and governance issues.

On paper, the Wukan protests never should have happened: China’s village committees should be the most responsive bodies in the nation because they are elected by the villagers themselves.

Village self-administration, as the central government calls it, is seen by many foreigners as China’s democratic laboratory—and while elections can be rigged and otherwise swayed, many political scientists say they are, on balance, a good development.

Actually running the villages, however, is another matter. Village committees must provide many of the services offered by governments, such as sanitation and social welfare, but they cannot tax their residents or collect many fees. Any efforts to raise additional money, for things like economic development, usually need approval from the Communist Party-controlled township or county seats above them.

In practice, the combination of the villages’ need for cash and their dependence on higher-ups has bred back-scratching and corruption between village officials and their overseers. China’s boom in land prices has only broadened the opportunity for siphoning off money from village accounts.

“Land sales are where the big money is,” Edward Friedman, a political science professor and a China scholar at the University of Wisconsin-Madison, said. The opportunities to get that share are vast, apparently. In 2003, a candidate for village committee chairman in Laojiaotou village, in Shanxi Province, spent two million renminbi—then about $245,000—to campaign for an office that paid 347 renminbi a month, the Chinese journal Legal News reported at the time.

In interviews this month, leaders of the Wukan protest said it was common knowledge that local government and Communist Party officials had spent millions of renminbi to buy potentially lucrative posts.

Many details of the practices that incited Wukan’s protests are murky. Even before the residents chased their village committee leaders from town on December 11, the village committee’s accounting ledger had been taken away, ostensibly for an audit.

Leaders of the protest contend, however, that the village committee sold off or granted long-term leases to nearly 60 percent of the village’s 11 square miles over an 18-year period beginning in 1993. Just how the land was sold remains unclear. Under Chinese law, such sales are supposed to require approval of the villagers, who collectively own the land and are supposed to share in the proceeds. But the approval process is vague; in practice, most decisions are left to the elected village committee or an appointed village legislature that acts on behalf of the residents.

The sales also required approval by Donghai township, the level of government just above Wukan. The land went to hotels, homes, factories, power companies and even private funerary temples. One wealthy villager, Chen Wenqing, gained a business interest in Wukan’s harbour and a 50-year lease on a large tract of land. A plan this year to sell Chen’s farm and an equal amount of villagers’ farmland to developers of a luxury housing was the final straw, though, mobilising villagers to protest.

Villagers say they have no idea where the proceeds from any of the sales or rentals went.

It took a de facto revolt by Wukan’s residents to force Guangdong Province officials to step into the crisis, calling the villagers’ grievances legitimate and promising to address them. Wukan’s village committee chief and its party secretary are under investigation, a move that probably will end in stiff punishment.

The state-run press has hailed the Guangdong response as a model of government responsiveness and a template for handling public grievances in the future. Yet some observers of Chinese governance are less sanguine. In their view, Wukan’s uprising highlighted systemic defects in China’s local governments, and only a housecleaning—not an isolated slap on the wrist—will address them.


 27 Dec 2011, Indian Express

Sugar solution eludes Maharashtra

In Agriculture on December 12, 2011 at 11:10 am

Sugarcane farmers in Maharashtra are on the warpath. Demanding a higher price, they have launched an agitation that threatens to delay the crushing season due to start on October 1, and possibly to take retail prices higher if their demand is met. At stake is an estimated 80 lakh tonnes from the country’s largest sugar producer.

The agitation reached flash point last week when thousands of farmers confined over 200 government employees, including the state sugar commissioner and four joint directors of agriculture for six hours in the building in Pune that houses the commissioner’s office. They relented after Cooperatives Minister Harshavardhan Patil promised them a meeting with Chief Minister Prithviraj Patil. Since then, government sources have indicated the meeting will take place early next month, well after the scheduled start of crushing.

Farmers in Maharashtra have been demanding Rs 2,350 per tonne of sugarcane. They are paid Rs 1,375 per tonne, the price worked out from factors such as the national standard, the quantity of sugar produced per tonne of cane in the state, and the amount spent in cutting and transportation (see box).

“If the government forces the factories to pay about Rs 2300 per tonne to sugarcane the retail price would go up by at least Rs 5 to Rs 35-37 a kilo or more,” said Vijay Gujrathi, chairman of the Sugar Traders’ Association.

Farmers have cited rising costs of labour and other aspects, demanded a price equivalent to the market retail rate after deducting the cost of conversion, and challenged the Commission for Agriculture Cost and Prices benchmark as well as a State Cooperative Bank order that factories paying more than Rs 1,375 would become ineligible for loans. Last year, agitating farmers had successfully got their prices raised — from Rs 1,450 per tonne to between Rs 1,500 and Rs 2,000 — but the Cooperative Bank order will now restrain factories.

Over the last one month, the Cooperatives Ministry and the Sugar Commissioner have held dialogues with farmers’ groups and factory owners. “We met Patil and discussed the price. We remained firm that we would not settle for anything below Rs 2,350 as the first instalment,” said Raju Shetty, MP and president of the Swabhimani Shetkari Sanghatana that organised last week’s protest.

Factories pay in instalments timed with the release of bank loans. Sugar commissioner Vijay Singhal said, “If farmers are paid what they are demanding then the retail price of sugar will go up in the entire country. The next time they will ask for Rs 2,500, Rs 3,000, anything.”

Raghunath Patil, Maharashtra president of the Shetkari Sanghatna, alleged that some private factories have offered even less than the government rates. The minister said, “I agree there are some factories which haven’t followed the payment guidelines. We have issued notices.”

Unless they get their prices, Patil warned, “The country will have to do with only 50 lakh tonnes of sugar in storage from the last season, because there will be no supply from Maharashtra this year.” Maharashtra last year accounted for 90 lakh tonnes of the country’s total produce of 220 lakh tonnes.

At a public function in Satara during the weekend, the Cooperatives Minister urged Union Agriculture Minister Sharad Pawar to help resolve the issue. “I am not the Co-operatives Minister,” Pawar said. “Patil [should be] able to do the job.”

Money Matters
Rs 1,450/tonne

This is the FRP (fair and remunerative price) fixed for sugarcane by the Commission for Agriculture Cost and Prices. It is based on a recovery rate of 9.5 per cent, a measure of the sugar extracted from every tonne; 9.5% signifies 95 kg per tonne.

Rs 1,375/tonne

Price fixed for farmers in Maharashtra, where the recovery rate is 11.3%. It has been worked out on the basis of the CACP standard at 9.5%, with Rs 146 added for every percentage point of additional recovery, after which cutting and transportation costs are deducted from the total.

Rs 2,350/tonne

The demand by farmers who agitated last week. They estimated that a tonne of cane produces sugar that would fetch Rs 3,000 on retail, and deducted Rs 700 per tonne spent by cooperatives that are supposed to be “no-profit units”. This works out to Rs 2,300, which they scaled up. Another group wants Rs 2,200.

Rs 30-32/kg

The retail price sugar now fetches in and around Pune, where the agitation has been centred. If the government accepts the farmers’ demand of Rs 2,300 per tonne of cane, then the retail price will rise by around Rs 5, touching Rs 35-37 per kg, as per Sugar Traders’ Association estimates.


Last year, the FRP was fixed at Rs 1,450 but farmers agitated successfully for a raise. Based on the varying rates of recovery, farmers in Western Maharashtra got about Rs 2,000 per tonne while those in other parts of the state got between Rs 1,500 and Rs 1,800.


27 Sep 2011, Indian Express

Selling bamboo, Gadchiroli village becomes crorepati

In Agriculture on September 30, 2011 at 5:02 pm

A tribal village in Gadchiroli that has pioneered the community management of forest land and produce, this week added a new feather in its cap — it became the first village in the country to earn a massive Rs 1-crore revenue from bamboo sales, carried out through a transparent and independent tendering process.

The revenue, according to the gram sabha of Mendha-Lekha village, is nearly 150 per cent more than what the forest department raised in a neighbouring village recently.

The gram sabha led by Devaji Tofa issued tender notices — drafted by local activists Mohan Hirabai Hiralal and Subodh Kulkarni — in two newspapers on August 26. Forms were priced at Rs 2,000, four times the normal forest department price, to discourage non-serious applicants,” said Hiralal.

“Nine forms were sold until September 14, the last date. Tenders were received from places in Madhya Pradesh, Chhattisgarh and Maharashtra,” Hiralal said. An executive committee of the gram sabha, aided by Hiralal and Kulkarni, accepted four of the bids.

“If the government forces the factories to pay about Rs 2300 per tonne to sugarcane the retail price would go up by at least Rs 5 to Rs 35-37 a kilo or more,” said Vijay Gujrathi, chairman of the Sugar Traders’ Association.

Farmers have cited rising costs of labour and other aspects, demanded a price equivalent to the market retail rate after deducting the cost of conversion, and challenged the Commission for Agriculture Cost and Prices benchmark as well as a State Cooperative Bank order that factories paying more than Rs 1,375 would become ineligible for loans. Last year, agitating farmers had successfully got their prices raised — from Rs 1,450 per tonne to between Rs 1,500 and Rs 2,000 — but the Cooperative Bank order will now restrain factories.

Over the last one month, the Cooperatives Ministry and the Sugar Commissioner have held dialogues with farmers’ groups and factory owners. “We met Patil and discussed the price. We remained firm that we would not settle for anything below Rs 2,350 as the first instalment,” said Raju Shetty, MP and president of the Swabhimani Shetkari Sanghatana that organised last week’s protest.

Factories pay in instalments timed with the release of bank loans. Sugar commissioner Vijay Singhal said, “If farmers are paid what they are demanding then the retail price of sugar will go up in the entire country. The next time they will ask for Rs 2,500, Rs 3,000, anything.”

Raghunath Patil, Maharashtra president of the Shetkari Sanghatna, alleged that some private factories have offered even less than the government rates. The minister said, “I agree there are some factories which haven’t followed the payment guidelines. We have issued notices.”

Unless they get their prices, Patil warned, “The country will have to do with only 50 lakh tonnes of sugar in storage from the last season, because there will be no supply from Maharashtra this year.” Maharashtra last year accounted for 90 lakh tonnes of the country’s total produce of 220 lakh tonnes.

At a public function in Satara during the weekend, the Cooperatives Minister urged Union Agriculture Minister Sharad Pawar to help resolve the issue. “I am not the Co-operatives Minister,” Pawar said. “Patil [should be] able to do the job.”

Money Matters
Rs 1,450/tonne

This is the FRP (fair and remunerative price) fixed for sugarcane by the Commission for Agriculture Cost and Prices. It is based on a recovery rate of 9.5 per cent, a measure of the sugar extracted from every tonne; 9.5% signifies 95 kg per tonne.

Rs 1,375/tonne

Price fixed for farmers in Maharashtra, where the recovery rate is 11.3%. It has been worked out on the basis of the CACP standard at 9.5%, with Rs 146 added for every percentage point of additional recovery, after which cutting and transportation costs are deducted from the total.

Rs 2,350/tonne

The demand by farmers who agitated last week. They estimated that a tonne of cane produces sugar that would fetch Rs 3,000 on retail, and deducted Rs 700 per tonne spent by cooperatives that are supposed to be “no-profit units”. This works out to Rs 2,300, which they scaled up. Another group wants Rs 2,200.

Rs 30-32/kg

The retail price sugar now fetches in and around Pune, where the agitation has been centred. If the government accepts the farmers’ demand of Rs 2,300 per tonne of cane, then the retail price will rise by around Rs 5, touching Rs 35-37 per kg, as per Sugar Traders’ Association estimates.


Last year, the FRP was fixed at Rs 1,450 but farmers agitated successfully for a raise. Based on the varying rates of recovery, farmers in Western Maharashtra got about Rs 2,000 per tonne while those in other parts of the state got between Rs 1,500 and Rs 1,800.


27 Sep 2011, Indian Express