1. SUPPORT SYSTEMS TO SECURE
FARMERS INCOME ACROSS
WORLD
Dr G. V.
Ramanjaneyulu
2. SECURING FARMERS INCOMES
To ensure parity of incomes between agriculture sector/ farmers and other sectors/
non-farmers, and thereby ensure a equality and justice in the society
• Strong motivation for govts. to put in place the support system for farmers. Equality
and justice are goals worth pursuing in themselves. This is seen regardless of
whether the country is capitalist or socialist, regardless of whether the country is
poor or rich, regardless of whether the country is a food sufficient or food-
insufficient. The difference is in the tools- direct payments or subsidies or a mix of
both.
• USA, Europe, Australia, Malaysia, Japan, China
Encourage Food Production and Ensure Food Sufficiency
• Through subsidies and direct payments not to distort the market prices. Based on
the concept of producer bonus or targeted or minimum support price
• Japan, China, Malaysia, Australia
To conserve, protect and sustain environment/ecology
• To pay for the ecosystem services
• Switzerland, USA, Australia, Coasta rica
3. UNITED STATES OF AMERICA
• Market loan program as a price-support program:
• Originally it was just a short-term loan program designed to moderate supply and
price fluctuations
• Offered marketing loan assistance to give farmers the ability hold onto their crop and
sell when it is most needed on the market… Under the program, farmers take
“nonrecourse” loans from the USDA using their crops as collateral, which allows
farmers to default on the loans without penalty
• Direct Subsidies:
• Conservation subsidies
• Risk Management Agency: Insurance against both nature failures as well as market
failures
• Disaster aid
• Export subsidies
• Decoupled Farm Income Support
4. EUROPEAN UNION
• Direct Payments to make
• agri. sustainable and environmental friendly
• parity between the farm and non-farm sectors
• crop insurance against natural failures
• payments for crop diversification and non-farm activities
• Agri. Provides 10% of employment but agri. Payments form 39% of the
total budget of EU.
• Due to WTO compulsions subsidy payments have decreased but
payments for protecting the environment and rural development have
increased
5. SWITZERLAND
1996: New article (Article 104) in the Swiss Federal Constitution which
talks about Multi-functionality and sustainability of SWISS agriculture.
Multi-functionality means, The Confederation shall ensure that
agriculture makes a major contribution through sustainable production
geared to market demands so as to
• ensuring food supplies for the population;
• maintaining the natural resources and preserving the countryside;
• maintaining a decentralised settlement pattern in rural areas.
Policy designed to Reduce subsidies Move from production based subsidies to Direct
Payments
Measured Against
Animal Welfare
Balanced use of fertilisers
Ecological Compensation areas
Instruments used
Price support
Direct payments for basic services
Ecological direct payments
6. NEW AGRICULTURAL POLICY,
SWITZERLAND
Productivity increased by 1.6% per year
Increase in gross and net calorie production by 10% and 5%
respectively
Loss of Nitrogen down 14%
Loss of Phosphorous down 70%
Livestock numbers reduce by 10%
Improvement in biodiversity
7. FARMERS INCOME SECURITY
Australia: Farm household allowance for three years, every fortnight,
equivalent to unemployment allowance is being given regardless of drought
or any problem to all farm households, in addition to exceptional
circumstances relief payments, and loan payments to farm families facing
financial hardships.
China: Support to ensure domestic food security, raise farmers incomes,
achieve sustainable development.
direct payments for grain production
subsidies for agri. Inputs, farm machinery purchase, for improved
crop varieties
minimum purchase price for rice and wheat
temporary purchase and storage policies
Environment protection policies
rural development policy.
elimination of agricultural taxes
Rural-urban income gap to be reduced
8. FARMER INCOMES FOCUS IN OTHER
COUNTRIES
South Korea:
• Direct income support
• price compensation
• payment for environment conservation
• direct payment for less favored areas
Malaysia:
• Productivity bonus
• Price compensation
• ecosystem services
• Guaranteed minimum price
• paddy price subsidy and control
• Quantitative restrictions on rice imports to ensure rice production
• Protects other crop farmers like tobacco, through high import tariffs
• Export subsidies to promote oil palm
Japan:
• Price support and direct income payments
• New farm income support from 2010 for rice farms
• High tariffs on imports are measures thru which farmers are protected
9. INDIA: FARM INCOME INSURANCE
SCHEME• Objectives
• To protect against Production Risk
• To protect against price and market risks
• Main features
• Determination of income level (Guaranteed Income) using past yield and
MSP (Reference price)
• Fixation of indemnity level and premium based on the risk exposure
• Assessment of the indemnity payments based on actual income i.e. the
difference between the product of actual yield and market price, and
Guaranteed income
• Premium 5%
• Guaranteed income = MSP x Average Yield of last 7 years x Indemnity
level (80-90%).
• Actual income = Market Price x the Actual Yield of the Unit Area which
may be Block or Tehsil (to be brought down to Panchayat level within
three years)
10. MOVING AGRO-ECOLOGICAL
APPROACH
• Integrated farming systems integrating livestock, trees etc
• Agronomic innovations like high density plantation in cotton or
SRI in paddy
• Building soil organic matter, mulches etc
• Conserving moisture and Rainwater harvesting
• Locally adopted crops and varieties-millets, pulses, oilseeds,
vegetables….
• Contingence planning
• Moving away from agro-chemical use
11. Community Managed Sustainable
Agriculture in Andhra Pradesh
Basic Principles
Regenerative, ecologically sound practices
Organized action by communities in
planning, implementing and managing the
program
Govt/ngos playing facilitating agency role
2004-05 started with 225 acres in one dist
and reached 7 lakh acres in 2007-08 in 18
dist. World Bank says this is a good tool for
poverty eradication and now promoted as part
of NRLM
With 50 % development expenditure one can
double the incomes of the farmers
13. States/UTs 2004-
05
2005-
06
2006-
07
2007-
08
2008-
09
2009-
10
kg/ha
2000-01
kg/ha
2009-10
Punjab 6900 5610 5975 6080 5760 5810 0.98 0.82
Haryana 4520 4560 4600 4390 4288 4070 0.84 0.68
Andhra
Pradesh 2135 1997 1394 1541 1381 1015 0.34 0.09
Maharastra 3030 3198 3193 3050 2400 4639 0.17 0.24
Tamil Nadu 2466 2211 3940 2048 2317 2335 0.32 0.45
Gujarat 2900 2700 2670 2660 2650 2750 0.30 0.29
Kerala 360 571 545 780272.69 631 0.31 0.26
Karnataka 2200 1638 1362 1588 1675 1647 0.17 0.14
Status of pesticide utilization in different states**
**Source: http://ppqs.gov.in/IpmPesticides.htm MT of active ingredient
1000 mt/year of a.i costs about Rs. 2000 cr/yr saving at the farmers level and Rs. 20,000 cr over
Where as investment is only on capacity building
14. AVERAGE REDUCTION IN COSTS
AND NET ADDITIONAL INCOME FOR
DIFFERENT CROPSCrops Reduction in
cost due to NPM
(Rs)
Reduction in costs due to
use of organic
fertilisers/manures (Rs)
Net additional
income (Rs)
Paddy 940 1450 5590
Maize 1319 2357 5676
Cotton 1733 1968 5676
Chillies 1733 1968 7701
Groundnu
t
1021 3462 10483
Vegetable
s
1400 390 3790
3rd Party Evaluation of Rashtriya Krishi Vikas Yojana (RKVY) : Community Managed
Organic Farming implemented by SERP
Evaluation Team
Prof. R. Ratnakar, Director, Dr. M. Surya Mani, Professor, EXTENSION EDUCATION
INSTITUTE, (Southern Region), Ministry of Agriculture, Government of India
16. BURNING STRAW IS BURNING
NUTRIENTSPunjab uses 12 % of total chemical fertilisers
184 kg/ha use is highest in the country (Nitrogen alone
accounts for 139.6 is kg/ha)
19.6 million tonnes of straw every year (rice and wheat),
worth crores of rupees and losing
38.5 lakh tonnes of organic carbon
Burnt nutrients
Fertilizer
equivalents
quantity
(tonnes)
Total subsidy
(Rs. Crore)
Farmers' cost
(Rs. Crore)
59,000 tonnes of Nitrogen Urea 128261 384.78 64.34
DAP 327778 1329.04 318.73
2,000 tonnes of Phosphorus DAP 4348 17.63 4.23
SSP 12500 7.00 4.42
34000 tonnes of Potash MoP 56667 106.32 26.25
This is equal to Rs. 800- 2000 cr nutrients and Rs. 500-1500 cr ocf subsidy
17. PAYMENT FOR ECOSYSTEM
SERVICES
Ecosystem services are the conditions and processes through which
natural ecosystems, and the species that make them up, sustain and
fulfil human life
Payments for Ecosystem services recognises that farmers contribute
not just the
tangible outputs of food, fibre, fodder and fuel to the world, but
also many
intangible benefits including the protection of biodiversity, soil and
water conservation, protection of natural land scape, ethical
treatment of animals, lower use of fossil fuels as well as reduced
levels of nitrate leeching into the soil due to changes in farming
18. ECOLOGICAL COSTS OF CONVENTIONAL
FARMING Fertiliser Use
High energy use and pollution in production -Fertilizer industry uses 25 % of Natural
Gas, 18 % of Naptha and 14 % of Fuel Oil
6% of GHGs in production
Highly subsidised Rs. 1,20,000 cr at the national level and average upto Rs.
6,000/acre
Use efficiency max 36% rest is leached into water bodies or as NO2 emissions (1.25 kg of
N2O emitted per 100 kg of Nitrogen applied) …clean up costs!
Pesticide Use
Less than 1% of pesticide use kills insects rest in air, soil and water with long half life
Insect resistance and loss of diversity-eg. Bee collapse
Pesticide residues in food
Water Use
Huge dams- Economic costs, environmental costs, displacements, GHG emissions
(18.7% GHG emissions)
19. ECOSYSTEM SERVICES THROUGH
ECOLOGICAL FARMING
Community/individual Ecosystems
Recycling of the biomass-crop n animal waste
Biodiversity conservation
Soil and Water conservations-up to 3 lakh lit/acre water can be conserved
on farm
Increased moisture holding capacity in soil to withstand prolong dryspells
Pulse crops fixes about 60 kg N/acre
SRI water saving by about 38%
Healthy, diverse and nutritive food
