New Delhi: Farmer unions have described the proposals in the Union Budget 2024-25 placed by Finance Minister Nirmala Sitaraman on February 1 as “dangerous to agriculture, employment generation and overall development of the people”. The government has proposed to “promote private and public investment in post-harvest activities, including aggregation, modern storage, efficient supply chains, primary and secondary processing and marketing and branding”.
The peasants are suspecting that it as an attempt to leave the farming community at the mercy of corporates. “It is nothing but handing over the agriculture sector on a platter to the corporate houses – both domestic and foreign,” said the Samyukta Kisan Morcha (SKM) – an umbrella body of farmer unions.
It said not opening the agriculture sector to foreign and Indian monopoly capital for profiteering has been the policy the State of India since independence and that it has helped ensure self-reliance and food security of the country.
“Instead of strengthening the public sector, cooperatives and the MSMEs, allowing corporate houses to take over post harvesting operations is a policy change that will pave way for the back entry of the three black farm laws – which the (Narendra) Modi-led government in the Centre was forced to repeal as a result of pressure of historical farmers struggle at Delhi borders. The SKM will vehemently oppose this proposal and ensure it is not be enforced,” it said.
The budget proposal says that “the gross and net market borrowings through dated securities during 2024-25 are estimated at Rs 14.13 and 11.75 lakh crore respectively” and that “both will be less than that in 2023-24”.
The lower borrowings by the Central government, said the unions, indicate the severe vulnerability of the economy – especially in the context of the recent warning by the International Monetary Fund (IMF) that India will cross 100% Debt-GDP ratio if the borrowing rate persists.
In 2014-15, the net liability of India was Rs 56 lakh crores; and in 2022-23, it rose to Rs 161 lakh crores. “It denotes the gross mismanagement of the economy by the BJP-led government in the past 10 years,” the SKM alleged.
Though the national economy has become “vulnerable”, it alleged, the government is not ready to tax the rich and super rich and has decreased corporate tax rate from 30 percent to 22 percent for existing domestic companies and to 15 percent for certain new manufacturing companies.
Pitching “First Develop India”, the Union Finance Minister while presenting the budget argued the government is “negotiating bilateral investment treaties with foreign partners” to “encourage sustained foreign investment”.
The SKM said the proposal will result into a situation that any foreign investor can invest, develop and then operate to make profiteering in India if the notion of “First Develop India” is accepted.
“This is a disturbing reference that denigrates the status of India as a sovereign country – which has no foreign partners. The finance minister shall explain who these foreign partners are,” it said, adding that she will have to withdraw it.
Following 2020–2021 farmers’ protest against three farm acts that were passed by Parliament in September 2020, the Central government had given written assurance on December 9, 2021 to implement the minimum support price (MSP) as per the C2+50% formula – which includes the input cost of capital and the rent on the land (called C2) to give the farmers 50% returns.
But even after over two years, it has not been implemented. “Not announcing it in the present budget is a gross betrayal of the assurance given to farmers and the people in general,” said the farmers’ body.
The Bharatiya Janata Party, which is ruling Centre, had promised in its 2014 election manifesto to give farmers MSP as per C2+50% formula if elected to power. But the promise never turned into a reality in the past 10 years.
Though the government claimed an emphasis on employment generation in the Budget 2024-25, yet no substantial allocation seems to have been made for the purpose. There is no assurance of minimum wage and the MSP, for loan waiver and to reduce price rise. It also does not have any mention of higher allocation for MNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) and 200 work days and Rs 600 as daily wage
The SKM said the widely proclaimed ‘PM Kisan Samman Nidhi’ (an initiative by the Government of India that gives farmers up to Rs 6,000 per year as minimum income support) is to “deceive” farmers to “deny them their due right of MSP at the rate of C2+50%.
The current MSP of paddy (Rs 2,183 per quintal – a hike by Rs 143) for the crop year 2023-24 is based on A2+FL – which means costs incurred by the farmer and the value of the family labour. As per the 2006 recommendation of the National Commission of Farmers chaired by Dr M S Swaminathan, C2 means comprehensive cost, which is A2+FL plus imputed rental value of owned land plus interest on fixed capital, rent paid for leased-in land.
If calculated, it amounts to Rs 2,866.5 as per the year 2023-24. Therefore, the present MSP based on A2+FL formula is lesser by Rs 683.5 per quintal,” it said.
If the government implements MSP at C2+50%, claimed the SKM, considering the average productivity of paddy (25 quintal per acre) and existence of the mandi system for procurement, a farmer from Punjab will get the benefit of Rs 17,075 per acre multiplied by Rs 683.5 per quintal.
“Since the farmers grow two crops per year, the benefit will be at around Rs 34,150. Even after getting Rs 6,000 per year from the PM Kisan Samman Nidhi, the farmers from Punjab face a loss of Rs 28,150 per acre per year,” said the unions’ forum.
It further said in Eastern Uttar Pradesh, where there is no mandi system in place for procurement, farmers get only Rs 1,800 per quintal (Rs 1,066 lesser than that of Rs 2,866.5 – if calculated at MSP@C2+50%). For 25 quintal per acre, the loss goes up to Rs 26,650; and for two crops per year, it is estimated at Rs 53,300 per acre per year.
“So, even after getting Rs 6,000 per year from PM Kisan Samman Nidhi, the loss suffered by the farmers from Eastern UP is at Rs. 47300 per acre per year,” it added.
The Bharatiya Kisan Union (Apolitical) or BKU (Apolitical) also expressed its disappointment and said the budget has no new initiative for agricultural welfare. It said the budget failed to provide any relief for farmers even in the Goods and Services Tax (GST).
“If there can be ‘One Nation, One Tax’, why cannot the same – ‘One Nation, One Crop’ – be applied in the farm sector?” questioned the union’s national spokesperson Dharmendra Malik.
He said there has been no increase in allocation even in the Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA) scheme – which is aimed at ensuring remunerative prices to farmers for their produce. It is also unfortunate, he said, that the coverage of crop insurance scheme is not working on ground.
He said though the farmers did not have much expectation from this budget because it is an interim budget, yet it was expected from the 2014 Lok Sabha elections that the peasants will get a fair price of wheat and paddy produce in lines with Rajasthan and Chhattisgarh as guaranteed by Prime Minister Modi. “But unfortunately, it did not happen yet again,” he said.
Calling it an “anti-farmer”, “anti-worker” budget, the SKM has appealed to all farmers to burn the copies of the “Pro-Corporate Budget” at village level on February 3. It has urged people across the country to make the proposed ‘Grameen Bandh and Industrial/Sectoral Strike’ successful.
A joint forum of central trade unions/federations/associations and farmers bodies have given a call for a Grameen Bandh (rural close down) and a nationwide general strike to protest against the “anti-worker, anti-farmer and anti-national policies” of the central government.
The forum is pressing for their demands – which include higher minimum support price (crop MSP), minimum wage of Rs 26,000 per month for workers, repeal of four labour codes, repeal of amendments made to Indian Penal Code (IPC)/ Code of Criminal Procedure (CrPC), guaranteed employment as fundamental right, etc.