Subsidy to farmers during transition right way to derisk farming: Daan Wensing, CEO at development agency IDH
Mar 27, 2024
New Delhi [India], March 27 : Government subsidy to farmers during any transition is a good way to de-risk farming and leads to increasing productivity and adopting more sustainable practices, said Daan Wensing, CEO at development agency IDH, which works in the agri-value chain globally.
Wensing said subsidies, or monetary support for farmers, are common, and India is not an exception.
"The fact that government support farmers in the transition to increase their productivity, to have more sustainable practices, especially in a transition from a farming system to next. Farmers will need support, and that support sometimes is before it (the crop) becomes commercial, and there the governments can also de-risk farmers when they go through this transition," Daan Wensing told ANI.
Some developed countries have alleged that that India resorts to unfair agricultural trade practices and violates WTO rules by giving huge subsidies to farmers.
The WTO pact allows governments to provide subsidies to farmers but imposes limits: five per cent for developed countries, and 10 per cent for developing countries.
IDH's country director in India, Jagjeet Singh Kandal, weighed in on the matter and said that support to farmers is important, but contended that it is due only if there is a business plan at the end of it. IDH has its headquarters in the Netherlands.
"When we (IDH) design programmes, we keep an exit strategy where the farmers' business must be able to stand on its own," Kandal said.
On use of genetically modified crops, Kandal said they are focusing more on regenerative agriculture.
Genetically Modified (GM) crops are genetically engineered crops that undergo gene alteration and modification. Bt cotton is a genetically modified (GM) crop that was approved for commercial cultivation in 2002 by the central government.
"What we do is not really worry about whether the seed is BT cotton or non BT cotton. What we are more involved in is how the farmers actually do agriculture. We are focusing more on regenerative agriculture and the seed is only a very small part of it, as far as the supply chain is concerned," Kandal said.
"When it comes to food, I have a very different approach to it. For mustard, I would certainly look at cycle of GMO seeds. If it is mature enough where the residues do not come in to your food chain, then it's safe to eat," he argued.
India is heavily dependent on import of edible oils, and pulses to some extent, to meet its domestic requirements. Diversifying from rice and wheat, which the country produces in surplus, is seen by many as the way out in reducing the import bill and to make the country food secure.
Asked on which side of the GMO debate is IDH on, Kandal said they don't make choices.
"We work with our partners...For us, it's about how the farmers can actually adopt to sustainable practices."
On MSP demand of farmers and what could be a possible solution to the deadlock, Kandal said the government must try and find a methodology which will benefit farmers.
"If you look at support without a business plan, then that is what you will land up in. If you give too much benefit on the subsidy for one crop then it is going to be difficult for transition."
In the same breath, Kandal said the governments in India are doing well to promote cultivation of millets.
According to him, once cultivation of millets goes up, farmers taking up paddy and wheat will find millets farming more lucrative and move towards it.
India started providing subsidies to wheat and rice farmers decades back, when it particularly needed to maintain the overall food security.
Kandal said proper communication between the farmers and government is the way out, he contended.
"That's where the failure was that's why there was so much of discussion. We need to communicate better between government and the farmers," Kandal said, apparently referring to recent protest by farmers'
On diversification of crops, CEO Daan Wensing said one must come up with a story which make farmers believe.
"Seeing is believing. You need to come up with a beautiful story and if the neighbours are actually practicing it and is actually better off, then it starts spreading and people start to adopt it," Wensing said.
Referring to Vietnam, where coffee is widely grown, the IDH CEO shared an experience about how a small farmer surrendered some area under his/her coffee plantation and diversified to other crops. He said it has not only hedged the losses from the drop in coffee prices but led to profits
On India's short-term decisions concerning exports of agricultural produce, Wensing said many governments have taken such steps.
"We have seen over the last couple of years many government around the world have introduced these kind of short term ban, and most of them have been lifted within days if not weeks, because of the economic fallout of it."
India has on various occasions put restrictions on import or export of agricultural commodities when prices of such commodities rise or drop to an extent. Farmers argue that their interests are compromised by some of these decisions.
Wensing noted that such decisions are key to ensure that "you have enough for your domestic consumption".
According to Kandal, the government is right in taking such actions.
"We can't just think of farmers as one set. Yes, in this particular case, the farmers are affected as you may be stopping him getting higher prices in the outside market. But you zoom out a little bit, the farmers' biggest market is domestic. He's only going to send 10-15 per cent as exports. If he loses the domestic market, he's going to lose out in the longer term. From that perspective, if the government has to take action at times for short term, I think they are right in doing so," Kandal said.
Kandal suggested India must expand cold storage capacity.
