Prepared as part of the course
Development Communication And Information Management
Dr. M. Ashokan. Prof (Agrl Extension)
Dr. S. R. Padma. Asst Prof (Agrl Extension)
Department of Agricultural Extension and Rural Sociology
Tamil Nadu Agricultural University
I M.Sc. Agrl. Extension
Effect of Lockdown on Agriculture
Effect of Lockdown on Agriculture
Topic Pg. no
Agriculture in India - overview 5
Data point 9
Grim on Indian agriculture 10
Crisis in global agriculture - COVID-19 13
Crisis in Indian agriculture - COVID-19 16
Revamping the Agricultural sector 18
Response of the Government of India 23
With a population of 1.27 billion India is the world's second most
populous country. It is the seventh largest country in the world
with an area of 3.288 million sq kms. It has a long coastline of over 7,500 kms.
India is a diverse country where over 22 major languages and 415 dialects are
spoken. With the highest mountain range in the world, the Himalayas to its
North, the Thar desert to its West, the Gangetic delta to its East and the Deccan
Plateau in the South, the country is home to vast agro-ecological diversity. India
is the world's largest producer of milk, pulses and jute, and ranks as the second
largest producer of rice, wheat, sugarcane, groundnut, vegetables, fruit and cot-
ton. It is also one of the leading producers of spices, fish, poultry, livestock and
plantation crops. Worth $ 2.1 trillion, India is the world's third largest economy
after the US and China.
India's climate varies from humid and dry tropical in the south to temperate al-
pine in the northern reaches and has a great diversity of ecosystems. As a fact of
globalization—the supply chain of all the goods and services were interrupted
due to COVID19 lockdown. The agricultural sector of India largely engaging mar-
ginal and small farmers, employing daily wage earners and migrant labours were
far more affected due to the lockdown, the disruption of supply chains breaking
the movement of agri-inputs, agro-produce and agro-products. Though the
COVID19 led lockdown have slashed the demand reducing the prices of the
commodity, but in some cases the supply chain bottlenecks due to containment
plans and transport restrictions the reduction in price was not felt by the
consumers in some places.
The government is keen to keep the supply chain viable, to hold the
menace of COVID 19 affecting the food security of Indian population. The govern-
mentt have taken many steps to ensure the movement of agricultural commodi-
ties from direct procurement to door delivery, although the future is uncertain
meeting the food security demands must be prioritized for every government pol-
icy in the aftermath COVID-19.
Agriculture in India - overview
Agriculture is the primary source of livelihood for about 59 per cent of India’s
population. India has the 10th-largest arable land resources in the world. With
20 agri-climatic regions, all 15 major climates in the world exist in India. The
country also possesses 46 of the 60 soil types in the world. India is the largest
producer of spices, pulses, milk, tea, cashew and jute; and the second largest
producer of wheat, rice, fruits and vegetables, sugarcane, cotton and oilseeds.
Further, India is second in global production of fruits and vegetables and is the
largest producer of mango and banana.
India's economic growth in financial year 2018 is expected to accelerate to 6.75
percent in 2018 on improved performance in both industry and services. Agri-
culture accounted for 23% of GDP, and employed 59% of the country's total
workforce in 2016.
Agriculture, with its allied sectors, is the largest source of livelihoods in India. 70
percent of its rural households still depend primarily on agriculture for their liveli-
hood, with 82 percent of farmers being small and marginal.
During 2018-19 crop year, food grain production is estimated at record 283.37
million tonnes. As of August 2019, total area sown with kharif crops in India
reached 92.6 million hectares. Gross irrigated area under food grains is estimat-
ed to have grown to 64.8 million hectares in FY19.
Total agricultural exports from India grew at a CAGR of 16.45 per cent over FY10-
18 to reach US$ 38.21 billion in FY18. In FY19, agriculture exports were US$
38.54 billion. India is also the largest producer, consumer and exporter of spices
and spice products.
India is among the 15 leading exporters of agricultural products in the world. Ag-
ricultural exports from India reached US$ 38.54 billion in FY19 and in FY20 US$
22.69 billion (till November 2019).
Exports of ready to eat items from India reached Rs 4,766.14 crore (US$ 681.95
million) in FY19 from Rs 4,821.71 crore (US$ 689.80 million) in FY18. India's
exports of processed food were Rs 31,111.90 crore (US$ 4.45 billion) in 2018-
The Electronic National Agriculture Market (eNAM) was launched in April 2016 to
create a unified national market for agricultural commodities by networking ex-
isting Agriculture Produce Marketing Committees (APMCs). Up to June 2019,
16.4 million farmers, 124,000 traders were registered on the e-NAM platform.
585 mandis in India have been linked while 22,000 additional mandis will be
linked in 2021-22
The Government of India has introduced several projects to assist the agriculture
sector. They are Pradhan Mantri Gram Sinchai Yojana: The scheme aims to irri-
gate the field of every farmer and improving water-use efficiency to achieve the
motto `Per Drop More Crop’. Overall the scheme ensures improved access to irri-
gation. Around 285 new irrigation projects will be undertaken in 2018 to provide
irrigation for 18.8 million hectares of land. As per Union Budget 2019-20 the
scheme has been allocated Rs 3,949.90 crore (US$ 565.16 million).
Paramparagat Krishi Vikas Yojana (PKVY): The scheme aims to motivate groups
of farmers to take up organic farming and as per the revised estimate for 2018-
19, government had allocated Rs 77,752 crore (US$ 11.12 billion).
As per Union Budget 2020-21, allocation of Rs 2.83 lakh crore (US$ 40.06 bil-
lion) was made for the Ministry of Agriculture. Ministry of Food Processing has
been allocated Rs 1,233 crore (US$ 176.42 million). PM-KUSUM scheme was
expanded to provide 20 lakh farmers for setting up stand-alone solar pumps and
further help another 15 lakh farmers solarise their grid-connected pump sets.
Achievements in the sector
Foreign direct investments (FDI) in India's food processing sector is stood at
US$ 628.24 million in 2018-19.
Sugar production in India has reached 33.16 million tonnes (MT) in 2018-19
sugar season and is expected to produce 26.85 MT in 2019-20, according to the
Indian Sugar Mills Association (ISMA).
By early 2019, India will start exporting sugar to China.
The Electronic National Agriculture Market (eNAM) was launched in April
2016 to create a unified national market for agricultural commodities by net-
working existing APMCs. Up to May 2018, 9.87 million farmers, 109,725 traders
were registered on the e-NAM platform. 585 mandis in India have been linked
while 415 additional mandis will be linked in 2018-19 and 2019-20.
Agriculture storage capacity in India increased at 4 per cent CAGR between
2014-17 to reach 131.8 million metric tonnes.
Coffee exports stood at 286.95 million tonnes in FY20 (April-September’19).
Between 2014-18, 10,000 clusters were approved under the Paramparagat
Krishi Vikas Yojana (PKVY).
Agri food start-ups in India received funding of US$ 1.66 billion between
2013-17 in 558 deals.
FCI stocks as of Mar 2020 Rice - 309.76 lakh MT
Wheat - 275.21 lakh MT
Total - 584.97 lakh MT
Some of the recent major government initiatives in the sector are as follows:
In September,2019, Prime Minister, Mr Narendra Modi launched the National
Animal Disease Control Programme (NADCP), expected to eradicate foot and
mouth disease (FMD) and brucellosis in livestock.
In May 2019, NABARD announced an investment of Rs 700 crore (US$ 100
million) venture capital fund for equity investments in agriculture and rural-
As per the Ministry of Agriculture, during 2019-20, Rs 1.50 crore (0.21 mil-
lion) has been allocated to state of Andaman and Nicobar as a central share for
implementation of per drop more crop component of Pradhan Mantri Krishi Sin-
chai Yojana (PMKSY).
Under Budget 2019-20, Pradhan Mantri Samman Nidhi Yojana was intro-
duced under which a minimum fixed pension of Rs 3000 (US$ 42.92) to be pro-
vided to the eligible small and marginal farmers, subject to certain exclusion
clauses, on attaining the age of 60 years.
Prime Minister of India, launched the Pradhan Mantri Kisan Samman Nidhi
Yojana (PM-Kisan) and transferred Rs 2,021 crore (US$ 284.48 million) to the
bank accounts of more than 10 million beneficiaries on February 24, 2019.
The Government of India has come out with the Transport and Marketing As-
sistance (TMA) scheme to provide financial assistance for transport and market-
ing of agriculture products in order to boost agriculture exports.
The Agriculture Export Policy, 2018 was approved by Government of India in De-
cember 2018. The new policy aims to increase India’s agricultural exports to
US$ 60 billion by 2022 and US$ 100 billion in the next few years with a stable
trade policy regime.
In September 2018, the Government of India announced Rs 15,053 crore
(US$ 2.25 billion) procurement policy named ‘Pradhan Mantri Annadata Aay
SanraksHan Abhiyan' (PM-AASHA), under which states can decide the compensa-
tion scheme and can also partner with private agencies to ensure fair prices for
farmers in the country.
In September 2018, the Cabinet Committee on Economic Affairs (CCEA)
approved a Rs 5,500 crore (US$ 820.41 million) assistance package for the sug-
ar industry in India.
The Government of India is going to provide Rs 2,000 crore (US$ 306.29 mil-
lion) for computerization of Primary Agricultural Credit Society (PACS) to ensure
cooperatives are benefitted through digital technology.
With an aim to boost innovation and entrepreneurship in agriculture, the Gov-
ernment of India is introducing a new AGRI-UDAAN programme to mentor start-
ups and to enable them to connect with potential investors.
The Government of India has launched the Pradhan Mantri Krishi Sinchai
Yojana (PMKSY) with an investment of Rs 50,000 crore (US$ 7.7 billion) aimed
at development of irrigation sources for providing a permanent solution from
The Government of India plans to triple the capacity of food processing sector
in India from the current 10 per cent of agriculture produce and has also com-
mitted Rs 6,000 crore (US$ 936.38 billion) as investments for mega food parks
in the country, as a part of the Scheme for Agro-Marine Processing and Develop-
ment of Agro-Processing Clusters (SAMPADA).
The Government of India has allowed 100 per cent FDI in marketing of food
products and in food product e-commerce under the automatic route.
The government of Tamil Nadu is promoting contract and collective farming
for instance the government have allocated 100 crore for supporting FIG FPG
The Tamil Nadu government recently announced the Cauvery delta zone as
special agricultural zone to protect the agricultural land degradation and sale.
Sowing Area Coverage of Summer Crops:
Rice: About 34.73 lakh ha area coverage under summer rice
as compared to 25.22 lakh ha during the corresponding period
of last year.
Pulses: About 5.07 lakh ha area coverage under pulses as
compared to 3.82 lakh ha. during the corresponding period of
Course Cereals: About 8.55 lakh ha area coverage under
coarse cereals as compared to 5.47 lakh ha. during the corre-
sponding period of last year.
Oilseeds: About 8.73 lakh ha area coverage under oilseeds as
compared to 6.80 lakh ha. during the corresponding period of
India has the 10th-largest arable land resources in the world.
Agriculture is the primary source of livelihood for about 59 per cent of India’s population.
70 percent of its rural households still depend primarily on agriculture for their livelihood,
82 percent of farmers being small and marginal.
India is the largest producer of spices, pulses, milk, tea, cashew, jute, mango and banana
Second-largest producer of rice, wheat, sugarcane, cotton, oilseeds, ground nut, fruit and vege-
Total food grain production-275 million tonnes (MT) - 2017-18, 283.37 MT –2018-19
In 2019-20, Government of India is targeting foodgrain production of 291.1 million tonnes.
Gross irrigated area under food grains is estimated to be 64.8 million hectares in FY19
India is the largest producer (25% of global production), consumer (27% of world consumption)
and importer (14%) of pulses in the world.
The second-largest fruit and vegetable producer accounting for 10.9% and 8.6% of the world
fruit and vegetable production, respectively.
Production of horticulture crops at a record 313.9 million metric tonne (MMT) in 2018-19
India's annual milk production was 165 MT (2017-18), 176.3 MT during FY18, while meat pro-
duction was 7.4 MT
India has the largest livestock population of around 535.78 million which translates to around
31 per cent of world population.
Milk production was estimated at India is the world's sixth-largest economy by nominal GDP and
the third-largest by purchasing power parity (PPP).
The country ranks 139th in per capita GDP (nominal) with $2,134 and 122nd in per capita GDP
(PPP) with $7,783 as of 2018 (World Bank data).
The Indian food and grocery market are the world’s sixth largest,
India is among the 15 leading exporters of agricultural products in the world. Agricultural exports
from India reached US$ 38.54 billion in FY19 and in FY20 US$ 22.69 billion (till November
Union Budget 2020-21, allocation of Rs 2.83 lakh crore (US$ 40.06 billion) was made for the
Ministry of Agriculture. Ministry of Food Processing has been allocated Rs 1,233 crore (US$
Up to June 2019, 16.4 million farmers, 124,000 traders were registered on the e-NAM platform.
585 mandis in India have been linked
*Data in “Overview of Indian agriculture” is summed up here
Grim on Indian agriculture
India is expected to achieve the ambitious goal of doubling farm income by
2022. The agriculture sector in India is expected to generate better momentum
in the next few years due to increased investments in agricultural infrastructure
such as irrigation facilities, warehousing and cold storage. Furthermore, the
growing use of genetically modified crops will likely improve the yield for Indian
farmers. India is expected to be self-sufficient in pulses in the coming few years
due to concerted efforts of scientists to get early-maturing varieties of pulses
and the increase in minimum support price. And the agri exports from India are
likely to reach the target of US$ 60 billion by the year 2022.
While agriculture in India has achieved grain self-sufficiency but the production
is, resource intensive, cereal centric and regionally biased. The resource inten-
sive ways of Indian agriculture has raised serious sustainability issues too. In-
creasing stress on water resources of the country would definitely need a realign-
ment and rethinking of policies. Desertification and land degradation also pose
major threats to agriculture in the country.
India also needs to improve its management of agricultural practices on multiple
fronts. Improvements in agriculture performance has weak linkage in improving
nutrition, the agriculture sector can still improve nutrition through multiple ways:
increasing incomes of farming households, diversifying production of crops, em-
powering women, strengthening agricultural diversity and productivity, and de-
signing careful price and subsidy policies that should encourage the production
and consumption of nutrient rich crops.
The social aspects around agriculture have also been witnessing changing
trends. The increased feminisation of agriculture is mainly due to increasing rural
-urban migration by men, rise of women-headed households and growth in the
production of cash crops which are labour intensive in nature. Women perform
significant tasks, both, in farm as well as non-farm activities and their participa-
tion in the sector is increasing but their work is treated as an extension of their
household work, and adds a dual burden of domestic responsibilities.
However, India still has many growing concerns. As the Indian economy has di-
versified and grown, agriculture's contribution to GDP has steadily declined from
1951 to 2011. While achieving food sufficiency in production, India still accounts
for a quarter of the world’s hungry people and home to over 190 million under-
nourished people. Incidence of poverty is now pegged at nearly 30 percent. As
per the Global Nutrition Report (2016), India ranks 114th out of 132 countries
on under-5 stunting and 120th out of 130 countries on under-5 wasting and
170th out of 185 countries on prevalence of anemia. Anemia continues to affect
50 percent of women including pregnant women and 60 percent of children in
Diversification of agricultural livelihoods through agri-allied sectors such as ani-
mal husbandry, forestry and fisheries has enhanced livelihood opportunities,
strengthened resilience and led to considerable increase in labour force partici-
pation in the sector.
While agriculture’s share in India’s economy has progressively declined to less
than 15% due to the high growth rates of the industrial and services sectors, the
sector’s importance in India’s economic and social fabric goes well beyond this
First, nearly three-quarters of India’s families depend on rural incomes. Second,
the majority of India’s poor (some 770 million people or about 70 percent) are
found in rural areas. And third, India’s food security depends on producing cereal
crops, as well as increasing its production of fruits, vegetables and milk to meet
the demands of a growing population with rising incomes. To do so, a productive,
competitive, diversified and sustainable agricultural sector will need to emerge
at an accelerated pace.
Three agriculture sector challenges will be important to India’s overall develop-
ment and the improved welfare of its rural poor:
1. Raising agricultural productivity per unit of land:
Raising productivity per unit of land will need to be the main engine of agricultur-
al growth as virtually all cultivable land is farmed. Water resources are also lim-
ited and water for irrigation must contend with increasing industrial and urban
needs. All measures to increase productivity will need exploiting, amongst them:
increasing yields, diversification to higher value crops, and developing value
chains to reduce marketing costs.
2. Reducing rural poverty through a socially inclusive strategy that comprises
both agriculture as well as non-farm employment:
Rural development must also benefit the poor, landless, women, scheduled
castes and tribes. Moreover, there are strong regional disparities: the majority of
India’s poor are in rain-fed areas or in the Eastern Indo-Gangetic plains. Reach-
ing such groups has not been easy. While progress has been made - the rural
population classified as poor fell from nearly 40% in the early 1990s to below
Nearly three-quarters of India’s families depend on rural incomes.
The majority of India’s poor (some 770 million people or about 70 per-
cent) are found in rural areas.
India’s food security depends on producing cereal crops, as well as in-
creasing its production of fruits, vegetables and milk to meet the de-
mands of a growing population with rising incomes.
3. Ensuring that agricultural growth responds to food security needs:
The sharp rise in food-grain production during India’s Green Revolution of the
1970s enabled the country to achieve self-sufficiency in food-grains and stave
off the threat of famine. Agricultural intensification in the 1970s to 1980s saw
an increased demand for rural labour that raised rural wages and, together with
declining food prices, reduced rural poverty. However agricultural growth in the
1990s and 2000s slowed down, averaging about 3.5% per annum, and cereal
yields have increased by only 1.4% per annum in the 2000s. The slow-down in
agricultural growth has become a major cause for concern. India’s rice yields are
one-third of China’s and about half of those in Vietnam and Indonesia. The same
is true for most other agricultural commodities.
“ In May 2017, the Centre informed the Supreme Court that more than
12,000 farmers commit suicides in India annually since 2013. One of the
reasons behind this disturbing trend is said to be the existence of middle-
men, who allegedly exploit the farmers with the promise of future payments
that never materialize. “
“Food Corporation of India (FCI) has allowed 46,658 tonnes of food grains to
rot in its 1,889 warehouses across the country in three years, while another
143.74 tonnes were reported stolen. Together, this could have fed nearly 8
lakh people from priority families under the National Food Security Act for an
entire year “
Watch it !!!
Indian Agriculture Faces Complex Problems - PBS
Crisis in global agriculture - COVID-19
The world is sliding rapidly towards a recession. The Covid--19 pandemic will
shut down large parts of the world economy for at least a few months more. IMF
managing director Kristalina Georgieva stated on March 23, 2020 that the out-
look for global growth in 2020 was “negative.” Recovery, if any, is expected only
in 2021. According to the International Labour Organisation (ILO), the rise in un-
employment because of Covid--19 could be up to 25 million worldwide.
What does a lockdown mean? In practice, it means that all economic activities
are shut down, which means, in turn, that the production and supply of goods
and services are disrupted, if not halted. Goods and services are not supplied in
adequate quantities to meet existing demand. But at the same time, as econom-
ic units are shut down, people lose jobs and wages. In addition, because there is
a lockdown, people do not venture out to purchase goods and services. Thus, as
a result of reduced consumption, overall demand also falls. Recent crises in the
global real economy have been caused by either demand slowdowns or supply
shocks or financial crises.
The Covid-19 lockdown is unique in that both demand and supply have fallen.
This is not a normal circumstance; rarely in history does such a convergence of
decline of demand and supply occur, and for a non-economic, external reason.
Globally, the Food and Agriculture Organisation (FAO) expects shifts in the supply
of and demand for food. It warns of a world “food crisis” if countries do not pro-
tect vulnerable people from hunger and malnourishment, and de--clog food sup-
ply chains. Similarly, the United Nations has warned that the Covid-19 crisis
could trigger “food shortages” around the world. The World Food programme
(WFP) has noted that the Covid-19 crisis is “threatening to affect millions of peo-
ple already made vulnerable by food insecurity [and] malnutrition.” The Ebola
outbreak in Sierra Leone (2014--16) led to a major rise in hunger and malnutri-
tion. Small and marginal farmers will also be badly affected if they are unable to
continue working their land, earn remunerative product prices, and gain access
to markets for purchase or sale.
Infla & fluctua - tion
World agricultural prices show signs of a rise from the third week of March 2020.
The increases are marked for rice and wheat. One reason for this rise has been
the stockpiling by households of rice and wheat, and the restrictions imposed by
different countries on food exports.
For instance, Vietnam, the world’s third largest rice exporter, has stopped ex-
ports, which may reduce the global rice exports by 15 per cent. If India and Thai-
land too ban exports, world rice prices may rise sharply soon.
Russia, the world’s largest wheat exporter and the largest wheat supplier to
North Africa, is expected to restrict its exports. Kazakhstan, one of the world’s
biggest sources of wheat flour, has already banned its exports. Similar trends are
noted in other crops too. Serbia, to cite an example, has stopped the export of its
sunflower oil. Commentators have wondered if these policies indicate the onset
of a “wave of food nationalism” that would disrupt the nature of trade flows that
have existed after the 1990s.
Demand = supply
At the same time, estimates also show that the world supply of rice and wheat
are satisfactory. According to USDA data, the total world production of rice and
wheat will be a record 1.26 billion tons this year. This is more than the total com-
bined annual consumption of rice and wheat. There is also likely to be an in-
crease in the year--end inventories of rice and wheat to a record 469.4 million
tons. These estimates, however, assume normalcy in the supply chains of these
goods. USDA data also show that many countries, with variations, have invento-
ries of rice enough to feed their populations for about 1 or 2 months. If the lock-
down continues beyond 2 months, these countries, mainly rice importers, will be
Poultry and diary
In the case of egg, milk, and meat prices. In the USA, there are supply shortages
and a sharp rise in retail egg prices. The wholesale prices of eggs are estimated
to have risen by 180 per cent since the beginning of March 2020, as customers
were purchasing 44 per cent more eggs in the week ending March 14, 2020
than at the end of the corresponding week in 2019. Retailers are reportedly or-
dering six times the quantity of eggs to fulfil rising demand.
In milk, China is a major importer. According to Rabobank, Chinese imports of
milk are likely to fall by 19 per cent in 2020. At the same time, the growth rate of
milk production is increasing in exporting regions such as New Zealand, Austral-
ia, and the EU. Covid--19 is not expected to reduce the production of milk in the
exporting countries. In the circumstances, expectations are that global milk pric-
es will tend downwards. This had led to major worries among milk producers in
these exporting countries. At the same time, local supply chain bottlenecks are
likely to keep upward pressure on the retail prices of milk in most countries.
The meat sector has been in crisis for a different reason. The crisis is partly be-
cause of widespread safety fears related to meat consumption despite scientific
clarifications that meat consumption is safe. Two factors at play here are China
and the African Swine Fever.
By the end of 2018, the African Swine Fever had hit large parts of China, killing
about 50 per cent of all pigs in the country. This led to a spike in pork prices in
China, and a major shift of consumers from pork to beef consumption. Beef pric-
es rose. The Covid-19 pandemic has led to a reduction in beef consumption in
China, as well as in other major markets such as the USA.
Yet, there has been heightened retail demand and panic buying of beef in March
2020; in the week ending March 15, 2020, retail beef sales in the USA rose by
77 per cent on a w-o-w basis. This is leading to a rise in the prices of beef
and live/feeder cattle. This rise in beef prices has, however, not benefited farm-
ers much and much of the gains have been cornered by the meat processors
and packers. This is the reason why meat farmers in the USA have been asking
the government to intervene even as retail beef sales and prices have been ris-
Globally, agriculture has also been hit hard by labour shortages. There are
heightened fears that the absence of the seasonal migrant labour force may dis-
rupt harvests in USA, Europe, and Australia. France estimates that its agriculture
would need 200,000 people in the next three months to compensate for the ab-
sence of migrant seasonal labour. French minister of agriculture, Didier Guil-
laume, is quoted as saying: “I am calling on the men and women who are not
working and locked indoors to join the great army of French agriculture,”
and that “we need to produce to feed the French population.” Germany wishes
to address the labour shortage in agriculture by encouraging unemployed cater-
ing workers to shift to agricultural work. Germany faces a shortage of about
300,000 seasonal workers who annually migrate to the country to harvest fruits
In the UK, the shortfall of seasonal workers is estimated to be 80,000. Farm un-
ions in the UK have demanded that the government grant them a £9.3m support
package in order to pay for a “land army” of workers in fruit and vegetable pro-
In the USA, seasonal farm workers, largely from Mexico, are employed intensively
from March-April onwards. These workers come in on an H-2A visa; estimates are
that the H-2A visa workers constitute about 10 per cent of the crop farmworkers
in the USA. New visa processing rules after Covid-19 may lead to a shortfall of
about 60,000 H-2A workers. There is some news that the US government is cur-
rently considering liberalising visa rules in view of the labour crisis
Crisis in Indian agriculture - COVID-19
As India moves from regulations and controls to a total lockdown, the impact of
the Covid-19 pandemic on the economy is becoming even more acute. The Indi-
an economy, which was already facing a sharp downturn by the end of 2019, will
surely record an extraordinarily poor growth rate for the months of March, April,
and May 2020 (though they technically fall into different quarters of the financial
year). If the lockdown continues beyond a month, the impact is likely to be even
more severe - on the working people and on the economy as a whole.
In India , the banking sector was reeling under high levels of NPAs and little de-
mand for fresh credit even before the pandemic erupted. Lower economic activi-
ty implies that most debt repayments stop. A prolonged lockdown would certainly
lead to a banking crisis as well.
Sectors of the economy highly dependent on exports, such as the spice and plan-
tation sectors in India, will face a fall in export demand and prices. Sectors of the
economy dependent on imports of intermediary goods or raw materials will see
imports halted and production stopped. Above all, remittances fall, adversely af-
fecting the nation’s foreign exchange reserves. The fall in oil prices is a cushion,
but the fall in domestic demand for oil counteracts this effect.
It is important to note that even before the Covid-19 pandemic began, Indian
economy was facing a rise in food prices. Data show that food inflation had be-
gun to rise from the middle of 2019, reaching, by January 2020, levels previous-
ly attained in 2013-14.
Data on the wholesale price indices (WPI) for selected crop groups, available on-
ly till February 2020, show that while WPI for food articles has been rising from
August 2019 onwards, the rise was driven by a rise in the prices of vegetables;
within vegetables, the price of onions, followed by potato and tomato. While on-
ion prices have come down, vegetable prices remained high even in February
India’s food grain output is projected to be at 292 million tonnes in 2019-20, up
by 2.4 per cent from 2018-19. According to reports, the stocks of wheat and rice
with the Food Corporation of India (FCI), as on March 1, 2020, was 77.6 MMT.
This quantity is more than three times the specified minimum operational buffer-
cum-strategic stock of 21.04 MMT. With the rabi wheat harvest, which should
come in by April 2020, the situation is expected to ease further.
Similarly, for pulses, the National Agricultural Cooperative Marketing Federation
of India (NAFED) is reported to have stocks of 2.25 MT as on March 19, 2020.
Between 2014-15 and 2018-19, NAFED has made an unprecedented record
procurement of 91.1 lakh MT of oilseeds and pulses (61.3 lakh MT of pulses and
30.3 lakh MT of oilseeds) under the Price Support Scheme, up by 1205 per cent
from the 7 lakh MT procured between 2009-10 and 2013-14. Here again, the
inflow of rabi pulses into the market in April 2020 is expected to ease the situa-
In the case of milk, AMUL has noted that its procurement from 36 lakh farmers
across India is proceeding smoothly. In terms of quantity, this amounts to distrib-
uting 1.50 lakh litres of milk every day across India. As the lockdown proceeds,
AMUL expects milk demand to decline.
In the first 3-4 days [of the shutdown], there was a panic sale and sale of AMUL
increased by 15% or 20% as people started buying more. And after that, sales
declined by 30%. The reason is very simple that people had done the panic buy-
ing and the second reason for the reduction in sales is the closure of hotels, res-
taurants, tea shops, etc. The AMUL sales will be 10-12% lower than the average.
In other words, the overall supply situation of essential food items does not ap-
pear to be too worrisome in India at this point. However, if the lockdown pro-
ceeds beyond a month, the supply situation will become tighter. Coupled with
supply bottlenecks, prices may begin to rise. The price curve may begin to look
like a U-shaped curve, with a sharp fall in prices in the initial days of the lock-
down replaced by a sharp upturn in prices in the later days.
The COVID-19 measures may help in limiting the health crisis, but—as in other
countries—the complete shutdown of all economic activities except essential ser-
vices will create an economic crisis and misery for the poor, with massive job
losses and rising food insecurity. The economic shock will likely be much more
severe for India, for two reasons.
First, pre-COVID-19, the economy was already slowing down, compounding
existing problems of unemployment, low incomes, rural distress, malnutrition,
and widespread inequality.
Second, India’s large informal sector is particularly vulnerable. Out of the na-
tional total 465 million workers, around 91% (422 million) were informal workers
in 2017-18. Lacking regular salaries or incomes, these agriculture, migrant, and
other informal workers would be hardest-hit during the lockdown period.
Ministry of Agriculture & Farmers Welfare had launched “Kisan Rath” App on
17 April 2020. KISAN RATH Mobile App facilitates the farmers and
traders across the country for transportation of agri-produce by con-
necting them with the transporters. The app interfaces with leading
transport aggregators and individual transporters for providing a wide
range of transport vehicles at required date and place, in a quick and
easy way. The app also provides a feature to the transporters to register their vehi-
cles and provide services to farmers and traders.
The transporters can view the posted loads and respond back with their availability
and quotes. The farmers and traders can view the responses to their posted loads,
communicate with the transporters to finalise the deal, and can provide a rating for
the transporter once the trip is completed.
Till date, total of 80,474 farmers and 70,581 traders are registered on this App.
Revamping the Agricultural sector
Regardless of the apparently comfortable situation with respect to overall supply,
it is important that we underline some concerns that exist at the ground level,
particularly with regard to the supply chain and the smooth organisation of farm
Meeting the agro-demands
Harvesting and marketing crops at the farm level is in crisis across the country,
the following key issues has to be addressed,
(a) disruptions in the procurement of food grains by government agencies;
(b) disruptions in the collection of harvests from the farms by private traders;
(c) a shortage of workers to harvest the rabi crop;
(d) a shortage of drivers in the transportation sector;
(e) blockades in the movement of agricultural commodities across the major
(f) closure or limited operations of APMC mandis; and
(g) shutdowns in the retail agricultural markets. These factors have led to a crisis
in a range of crops too: wheat, grapes, watermelons, bananas, muskmel-
on, chana, cotton, chillies, turmeric, cumin, coriander, onion, and potato.
The bottlenecks have led to a fall in the farm prices of a range of commodities in
agriculture. Tomato growers in Maharashtra are reported to be receiving not
even Rs 2 per kg. Grape growers are reported to be facing an aggregate loss of
Rs 1000 crore because of the crisis, as demand has fallen. Wheat prices in
Madhya Pradesh are reported to have fallen from Rs 2200/Q to about Rs 1600/
Q by March 25, 2020.
For many crops, these prices are also below the Minimum Support Prices an-
nounced. In Punjab, vegetables that were sold at Rs 15/kg are reportedly being
sold at a mere Rs 1/kg. In Delhi’s mandis, the price of broiler chicken has fallen
from Rs 55/kg in January 2020 to Rs 24/kg in March 2020. In Tamil Nadu, egg
prices are reported to have fallen from Rs 4/egg to Rs 1.95/egg over the same
As the lockdown proceeds, these prices can be expected to rise, just as in the
Western economies, the rise driven by panic buying and supply bottlenecks.
Despite such price rises, farmers are unlikely to be the beneficiaries; most bene-
fits are expected to flow to wholesale and retail traders as well as other middle-
Mobilizing Labour force
There are about 40-50 million seasonal migrant workers in India. The return of
many migrant workers to their homes has meant that harvest operations are not
taking place smoothly, and many farmers are being forced to leave the crop in
the field. Losses to farmers will be the highest in such cases. While mechanical
harvesters can be used, lockdown regulations disrupt their free movement. Fur-
ther, in some places, a shortage of drivers/operators for these harvesters has
also been reported. As machine repair shops are closed and mechanics become
unavailable for work, spare parts are not easily available, leading to many ma-
chines being left unused. In the rice mills of Kerala, reports indicate a shortage
of migrant workers, which has led to these mills not procuring adequate supplies
of paddy from farmers.
Farmers have either not harvested at all, or have harvested and left the product
near the fields. Labour shortages are also being experienced in most milk pro-
cessing plants, cold storage units, and warehouses. According to the Chairper-
son of AMUL, most milk processing plants are currently operating with half of the
labour force. Many workers are not reporting for work or have returned home al-
so because of the fear of police atrocities.
Linking Supply chains
Supply chains have been disrupted across the country for a range of commodi-
ties. The first official notification on lockdowns appears to have been ill-thought
out, leading to the exclusion of a number of activities from the list of essential
items (this included even soap and sanitary pads till March 28, 2020). A second
notification has corrected this, at least partially. Yet, major highways and entry
points to States are seeing a pile up of trucks unable to move forward. Lorry
transport is in major shortage at many places, leading to the extremely slow
movement of goods across the country. APMC mandis are not functioning every
day; while some have closed down, others are operating only twice or thrice a
week. The bottlenecks due to the lockdown are marked as crosses at the appro-
priate locations. The information for this purpose has been sourced from news
reports and are hence to be considered preliminary. Also, the presence or ab-
sence of bottlenecks may differ widely across States/regions.
Farmers must have continued access to markets. This can be a mix of private
markets and government procurement.
Small poultry and dairy farmers need more targeted help, as their pandemic-
related input supply and market-access problems are urgent.
At several places, there are reports of distress sale of vegetables and fruits
by farmers. Despite the Union government’s clear instructions, police have
been restricting movement, due to which farmers are selling in distress and
consumers are paying 15-20 percent higher prices
Lockdown has risen the demand for home delivery of groceries and
E-commerce. This trend should be encouraged and promoted.
The government should promote trade by avoiding export bans and import
Our survival is dependant on agriculture and a good harvest depends on quality
seeds delivered to farmers by the seed sector, both public and private. As we are
in the midst the coronavirus crisis, it is imperative that good seeds and other
farm inputs reach farmers in time for the kharif season.
India needs about 250 lakh quintals of seeds for the kharif season. The prepara-
tion of seeds happens between March and May. It begins from the farmers’
fields, where pollination etc are monitored by teams, and after harvest, drying
and selection, the seeds are sent to processing plants. From there they are sent
to labs for testing and, finally, are packaged for supply to the farmers.
This is a time-consuming process. The complete seed production ecosystem is
complex and requires the help of allied sectors such as transport, testing labs
and the packaging industry. The Centre and State governments have done a
great job to allay the fear and quickly announced exemptions for the agriculture
sector – seeds, labourers, and farm related activities, thus rebooting the seed
production sector is the prerequisite to prevent the food production in near fu-
The agro input sector including fertilizer, crop chemicals and pesticide has been
badly hit by the COVID19 led supply chain disruptions, although the shares of
these sectors were doing good onpar with the online markets. The raw material
mobilizations poses grim on these sectors. With the lockdown impositions, ban
of air cargo, Indian input companies who largely rely upon China, EU and USA for
raw materials has now find a shortage and delay in the delivery of raw chemicals
from these parts of the world.
Keeping supply chains functioning well is crucial to food security. It should be
noted that 2 to 3 million deaths in the Bengal famine of 1943 were due to
food supply disruptions—not a lack of food availability.
According to the Solvent Extractors Association, India consumes about 23
million tonnes of edible oils, out of which only about 8 million tonnes is pro-
duced domestically and the remaining 15 million tonnes is imported. An ef-
ficient global supply chain has ensured that Indian consumers have so far
not faced any shortage, nor any price rise.
The disruptions on input industry will directly have an effect on agriculture in-
creasing the cost of cultivation there by increasing the cost of commodity.
Allying Allied sector
The shortage of livestock feed and their availability is raising the costs of produc-
tion in many animal husbandry units. This is despite the fact that poultry has
been declared as an essential item. This is leading to the death of many birds at
the farm, or farmers undertaking panic selling at very low prices and so the live-
stock sector needs special attention to sustain the supply chains.
Food and nutrition security.
Government warehouses are overflowing with 71 million tons of rice and wheat.
In order to avoid exclusion errors, it is better to offer universal coverage of distri-
bution in the next few months.
Nutrition programs like Integrated Child Development Services (ICDS), mid-day
meals, and Anganwadis (rural child care centers) should continue to work as es-
sential services and provide rations and meals to recipients at home. Eggs can
be added to improve nutrition for children and women. Several state govern-
ments have started innovative programs to help informal workers and the poor.
For example, the Kerala government is providing meals with diversified diets at
the doorsteps of households and the Tamil nadu government provding foods at
rational price through Amma canteens.
Unemployed informal workers need cash income support. The government has
provided Rs. 500 ($6.60) per month to the bank accounts of 200 million women
via the Jan Dhan financial inclusion program. But this too is insufficient. We need
to have a minimum of Rs.3000 ($40) per month in cash transfers for the next
Using social safety nets as a bridge between health shock & economic shock
The lockdown has choked off almost all economic activity. In urban areas, lead-
ing to the widespread loss of jobs and incomes for informal workers and the
poor. Estimates by the Centre for Monitoring Indian Economy show that unem-
ployment shot up from 8.4% in mid-March to 23% in the first week of April. In ur-
ban areas, unemployment soared to 30.9% as of April 5.
For holding government stocks of food grain, India has a silo capacity of just
6.6 lakh tonnes. The storage and movement of food grains, whether by rail-
way rakes or by trucks, is in gunny bags which results in losses. As of January
31, about 13.2 million tonnes of wheat was stored in covered and plinth stor-
age (CAP) in open fields, mostly in Punjab. By the time Rabi procurement ends
in June, there could be much more wheat in CAP storage, some on totally un-
scientific and ‘kutcha’ plinths. India must quickly invest in modern steel silo
storage capacity in major procuring states so that wheat procured by the gov-
ernment is not required to be stored in CAP.
The shutdown will cause untold misery for informal workers and the poor, who
lead precarious lives facing hunger and malnutrition. The best way to address
this urgent need is to use social safety nets extensively to stabilize their lives
with food and cash.
The Indian government has quickly responded to the crisis and announced a
$22 billion relief package, which includes food and cash transfers. Several state
governments have announced their own support packages. The central govern-
ment’s relief package, called Pradhan Mantri Garib Kalyan Yojana (Prime Minis-
ter’s plan for well-being of the poor), is aimed at providing safety nets for those
hit the hardest by the COVID-19 lockdown. However, it is inadequate compared
to the enormous scale of the problem.
Nobel Prize economists Esther Duflo and Abhijit Banerji say that the government
should have been much bolder with the package’s social transfer schemes. The
$22 billion in spending is only 0.85% of India’s GDP. This is much lower than
the packages passed by the United States, European and some Asian countries.
India should think bigger, and be spending at least 4% to 5% of GDP. The central
and state governments must spend more, even if there is one-time hike in the
Across the country, the India Post is leveraging its network to deliver essential
items such as medicines, masks and personal protection equipment (PPE)
during the ongoing coronavirus crisis.
Also, the Karnataka Horticulture Department has tied up with India Post to
deliver mangoes sourced from farmers. The department introduced a por-
tal where people can order mangoes online which would be delivered by the
The inflation in food basket slipped to 8.76 per cent in March 2020, com-
pared to 10.81 per cent in Feb 2020, as per the CPI data released by
the National Statistical Office (NSO)
Vegetables inflation eased to 18.63 per cent in March against 31.61 per
cent recorded in February this year
While prices of cereals and products climbed marginally to 5.30 per cent
versus 5.23 per cent in February, pulses and products inflation stood at
15.85 per cent against 16.61 per cent in preceding month
Response of the Government of India
1. It has announced that most agricultural activities will be in the essential list. It
has exempted farm workers in the fields, farming operations by farmers,
agencies engaged in procurement of agriculture products including
MSPs, mandis notified by the State Governments, inter- and intra-state move-
ment of harvesting and sowing related machines and manufacturing, packaging
units of fertilizers, pesticides, and seeds among others.
2. It has announced that the first instalment of the PM-Kisan payment to farm-
ers, i. e., Rs 2000, will be paid up front to farmers. It has also announced that
the wages under MGNREGS will be raised from Rs 182 to Rs 202 per day.
3. The Reserve Bank of India (RBI) has announced a moratorium on agricultural
term loans (including crop loans) for a period of three months..
Prime Minister Narendra Modi has actively discussed proposals to ease the lock-
down selectively for rural areas to allow harvesting of Rabi crops.
4. Based on the policy directions of the Indian government, various Ministries/
Departments of state governments have issued implementation guidelines to
facilitate continuation of activities related to agriculture and its allied sectors.
5. Indian Council of Agricultural Research (ICAR) has also issued an agro-
advisory to maintain hygiene and social distancing among farmers working on
6. The central government have disbursed the crop insurance claims worth of
2424 crores to the farmers under PMFBY
7. The Indian Railways has been roped in to ease transport logistics of agricultur-
8. The Punjab government has ensured that the transportation of wheat to
mandis be done in a staggered manner to ensure social distancing. All this is be-
ing taken care of by the district administration with the help of police. Farmers
will be given passes to go to mandis with their produce. They have also asked
the central government for incentives for farmers who delay bringing their food-
grains to mandis. The government has also increased the number of purchase
centres and sheller yards to spread out the operations.
9. The government has initiated a dialogue with the exporters of agri and allied
commodities to gain a first-hand account of the problems being faced by the ex-
porters of such commodities and initiate necessary steps by making meaningful
interventions for early redressal of their problems.
10. Allowing critical agricultural activity, filling in gaps in agricultural supply
chains and ensuring farmer’s ease is imperative for the smooth functioning of
the backbone of our economy.
11. The common issues highlighted by exporters of all agri commodities related
to availability and movement of labour, inter-state transport bottlenecks, short-
age of raw materials due to closure of mandis, phyto-sanitary certification, clo-
sure of courier services thereby, hampering movement of shipping documents,
availability of freight services, access to ports/yards and clearance of goods for
imports/exports is being worked out across levels.
12. Tamil Nadu Chief Minister K Palaniswami announced sops to farmers, which
include waiver of cold storage user fee and facilitation in marketing and logistics.
Besides, loans upto Rs 10 lakh would be offered to farmer producer firms aimed
at benefiting both ryots and consumers.
13. TN exempted traders from paying one per cent market fee for procuring farm
produce from farmers as part of efforts to ensure reasonable prices for consum-
ers. The Chief Minister also said 500 vans would be deployed additionally to sell
vegetables and fruits to people in urban neighborhoods
14. "Considering the present circumstances and in view of expectations that
mango production is likely to increase in 15 days, cold storage user fee shall not
be levied for farmers till April 30 and the government will bear it," and its been
if we consider the responses of governments across the world, these interven-
tions appear insignificant. In fact, the up front payment to farmers from the PM-
Kisan scheme is not even worth calling a package, as this money was anyway
going to be paid to the farmers between April and June.
US Relief package
The US Congress has passed a Covid-19 stimulus package of $2 trillion, of which
$9.5 billion is earmarked for the agricultural disaster fund. In addition, there is a
$14 billion funding for the Commodity Credit Corporation (CCC) that can be used
by the US Department of Agriculture (USDA) to assist producers. These packages
will assist livestock and dairy producers, growers of fruits, vegetables and nuts,
and small businesses related to agriculture. Other key components of the pack-
age relevant for rural areas are:
$8.8 billion for child nutrition programs.
$450 million for The Emergency Food Assistance Program, or TEFAP, which
funds food distribution to food banks.
$33 million to the Food Safety and Inspection Service to cover the cost of
temporary and intermittent workers, relocation of inspectors and overtime costs.
The intervention of the Government of India shall be considerably enhanced in
the following ways. These are immediate measures to be considered. As and if
the crisis grows, these measures will have to be updated.
1. The payment to farmers through PM-Kisan should be raised to at least Rs
12,000 per year, and 50 per cent of this amount (Rs 6,000) should be paid im-
mediately. Tenant farmers should be included as beneficiaries of the scheme.
2. There should be an immediate expansion of the Pradhan Mantri Fasal Bima
Yojana (PMFBY) to ensure compensation payments to farmers affected by the
3. Holders of all MGNREGS job cards should be provided an unemployment al-
lowance or assistance, worth at least half the payments to be received by them,
assuming 100 days work/year.
4. The Government should take steps to ensure that food grain is distributed to
all households outside the priority list also for a period of three months at the
rate of 5 kg per capita per month.
5. There should be efforts to arrange food, shelter, and clothing to all migrant
workers in villages. Steps should be explored to provide migrant workers with
cooked food by the government agencies.
6. The Government should consider waiving the interest costs of all outstanding
crop loans and ensure a fresh flow of credit to small and marginal farmers for
the kharif season of 2020.
7. MSPs for farmers in the 2020-21 seasons should be substantially raised to
1.5 times the C2 cost of production. Procurement should also be significantly ex-
8. In case the crisis prolongs to beyond two months, the government should pre-
pare itself for the take-over of large parts of the procurement and supply of es-
sential food items from the private sector, including trucks, warehouses, go-
downs and establishments.
9. The farmers should be adequately trained to face the situation, advisory on
crop selection to the farmers to prevent over production or less production of the
10. Government has the ease the functions of MSME’s who has their part in val-
ue addition of the agri commodities, it must also ease the restriction over the
commodities like flowers and spices to safeguard the farmers from distress sale.
Although no substantial data is available on the extent of the impact of the cur-
rent pandemic on the agricultural sector, yet there is no denying to the fact that
the existing catastrophe will not spare the Indian Agricultural. Broadly speaking
the long-term impact would mainly be due to a reduction in demand because of
economic dip. It may be hard for the central as well as state administrations to
deliver any further backing due to limited fiscal space, which might further less-
en due to various socio-economic factors. Reverse migration is another im-
portant factor in the recent situation. So this shockwave shall further push the
government’s target of doubling farmers’ income in two years or so. Moreover,
loss of earning prospects for various populations will likely be a reason for the
drop in the demand for food products which may further aggravate the business
settings of farmers. As a result, the food supply chain will be disrupted.
The ongoing nationwide lockdown needs to be reviewed and replaced with clus-
ter specified restrictions (as required) based on epidemiological assessment, as
there is no conceivable scenario of control or elimination in a short period. An
interdisciplinary team of public health specialists and social scientists, along with
grassroots political and social leaderships and volunteers, should continue rais-
ing awareness about the COVID-19 modes of transmission and methods of pre-
vention in the community.
India needs to create more synergies in food technology, agriculture, biotechnol-
ogy. Prioritizing and adaption of innovation should act as main drivers of produc-
tivity growth and improved sustainability. We should not forget to leverage availa-
ble resources in the right manner. The adequate, appropriate and available re-
sources should flow in the right direction.
Facilitation of migrant workers to return to jobs after the lockdown otherwise sta-
ple food production can be affected leading to a grave impact on food security.
There should be a provision of quality seeds to farmers by the seed sector-- both
public and private
Amidst the current tensions, good seeds and other farm inputs must reach farm-
ers in time for kharif season. Automated machines should be introduced for the
planting of seeds which need only a machine driver for sowing and harvesting.
Indigenous manufacturing of automated machines should be promoted by the
government to cut down the overall cost. Subsidies should be provided to the
manufacturers of such machines so that farmers can buy them at economical
prices. Fostering Genetically Modified Organisms (GMOs), using genetic engi-
neering is another way of contributing to food and nutrition benefits while boost-
ing agricultural production besides reducing a post-harvest loss.
There should be a proper implication of digital technologies to directly sell the
produce (E-Commerce) so that farmers can sell their product directly to the con-
One post-COVID-19 challenge will be to restore economic activities including
those in food and agriculture. The government should address these concerns
with a more coherent policy environment to meet food demand sustainability.
Recommended policies can include-- encouraging collaboration of knowledge
generation and transfer between public and private actors, transparent dissemi-
nation of information to strengthen government management over food market,
guide framers to make rational production decision, streamline risk manage-
The policies of the government should have priority over the input sector,
reorganizing the supply chains to withhold the price and availability of the inputs
from seeds, fertilizers and pesticides to the farmers. The noble practices like
INM , IPM should be promoted as an alternative best method of crop production,
integrated farming system could be promoted to keep viable the Agri-allied sec-
tors, supplying the local demands and also income assurance to the farmers.
The COVID-19 situation will demand the co-operation and collaboration of all the
stakeholders from farmers, input dealers, market agents, extension functionar-
ies to bureaucrats in order to overcome the blockade posed by the corona over
the farming sector.
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