Lockdown 2.0: Farm sector may be sole bright spot this year, says govt

Labourers sort onions after harvesting at a field. Photo: PTI
Agriculture may be the sole bright spot in the overall gloomy economic outlook for the country due to the Covid-19 lockdown. The sector may push up the country’s gross domestic product (GDP) for 2020-21 by 0.5 to 1 percentage points, the Centre said on Wednesday.

The government is placing its optimism on projections of a ‘normal’ monsoon for 2020 that addresses 60-70 per cent of the sector’s worries.

It said growth in agriculture and allied activities will not be much lower than the 3.7 per cent expected in real terms for 2019-20.
“We are hopeful that agriculture growth won’t get impacted by the Covid-19 lockdown in 2020-21 and won’t be much below 3.7 per cent expected in 2019-20,” agriculture and rural development minister Narendra Singh Tomar told reporters during a briefing on farm sector and Covid-19.

NITI Aayog member and agriculture economist Ramesh Chand, who was also present at the briefing, said that farm sector may record a growth of 3 per cent which is on par with long-term average for the sector.

Most global and Indian rating agencies and even multilateral funding agencies such as World Bank and IMF have projected the Indian economy to grow by less than 2.8 per cent in 2020-21, Chand said that if agriculture performs well, it is poised to give a 0.5-1.0 percentage point push to the country’s overall GDP.

Tomar said the first economic activity that was allowed by the government after the lockdown was imposed was agriculture and related sectors and the farmers have also responded favourably. This is why despite all difficulties, almost 90 per cent of the rabi crop has been harvested and a significant quantity has also been procured.

He said the forecast of ‘normal’ monsoon has also given hope that sowing for kharif crops, which is due in the next few weeks, will be good and the country will be on track to achieve the targeted 298.3 million tonnes of foodgrains production in 2020-21.

“We have taken all possible measures to ensure that maximum crops produced by farmers are procured so that their income doesn’t come down. We plan to purchase 5.44 million tonnes of rabi oilseeds and pulses from the growers this year for which a sum of Rs 25,637 crore has already been allocated,” Tomar added.

Of this, around 0.5 million tonnes of pulses and oilseeds have already been procured. This is in addition to 11.7 million tonnes of wheat and 1.8 million tonnes of rice, purchased so far.

Tomar said against 1,485 oilseeds and pulses procurement Centres in 2019, this year, their number has been raised by almost 88 per cent to 2,790. More centres will be added as the procurement processes gets underway.

He said to enable farmers get higher price for their produce, 100 new mandis will be added to the electronic-national agricultural market (e-NaM) platform by May first week, taking their total to 685. The number will be increased to 1,000 by the end of the month.

On MGNREGA, Tomar said an advance allocation of Rs 33,000 crore has been made while all states and district officials have been instructed to provide as much work as required under the scheme to support the rural sector.

“In April 14, when work under MGNREGA was exempted from the lockdown, around 1.7 million persondays of work was provided, which today (April 29, 2020) has risen to almost 17 million persondays,” Tomar said.

He said in 2019-20, around 66 per cent of the work undertaken under the scheme was related to agriculture, while in 2020-21, the target is to undertake around 77 per cent of agriculture-related works.

On the Centre’s ambitious target of Doubling Farmers Income by 2022, the agriculture and rural development minister said that though the Covid-19 crisis has put some hurdles, the government is confident of achieving the same within the targeted time frame.
Meanwhile, Chand said that their assessment shows that mandi prices of wheat, gram, rapeseed, potato and onion is more than last year which means farmers’ realisation is better.

“In April 2020 alone, the offtake of fertilisers has grown by 5 per cent as compared to same period last year, while distribution of seeds through the Krishi Vigyan Kendras (KVKs) has risen by 20 per cent,” Chand added.


Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel