Yesterday's  Economic Times carries an article that brings to light that in the FY07, the actual fertilizer subsidy expense of  $12 billion was double that budgeted by the state. The article goes on to suggest that it's probably time to look at the much talked about organic farming which can potentially lower the subsidy bill to its one-fourth. If this claim is even partially true, then this definitely calls for policy stances favoring organic farming. But, is this one of those tall claims about organic farming's potential?

Many reputed organizations such as CAPSA, UN's subsidiary agency, claim that organic farming can reduce rural poverty. It seems to be an ideal solution for poverty especially in Asia Pacific region because it is labor intensive, uses no chemical and has higher return on investment, with a price premium of 25-30% that it can command. However, with 85% of the organic production in India exported due not so attractive domestic demand, the paradox is, it is mainly the rich farmers who are already producing for export who are benefiting from this booming sector. In a global market where certification is needed to show and guarantee the consumer that the product has been produced in consistency with organic standards, small farmers, who are often denied government's assistance in storing, processing, certifying and exporting their produce, fail to realize the potential benefits of organic farming.

The sad irony however is the need for certification given that most of India's farms are organic by default. Traditional agriculture which dates back to 7500-6500 BC in India has relied on scientific approach to organic farming. The seminal works of Vedic period (1000-600 BC) such as Vrksayurveda and Krishisastra , have a corpus of textual knowledge on organic agriculture practices. Sadly, in the last five decades, with our traditional knowledge and organic practices eroded with the influx of modern practices, small farmers have to pay extra to certify their produce.

The strong proponents of organic farming's potential to cure poverty claim that if the state comes up with a policy that supports these small farmers by say subsidizing the certification cost, then majority of the farming community would switch to organic farming to pocket the extra premium. However, what about those consumers, either below or just above poverty line, who cannot even afford to pay for the subsidized ration? Can those who struggle to pay even 4 Rupees for a Kilogram of Rice be expected to pay for the "organic premium" for the claimed extra health advantage? Would majority of households in the low and low-middle income class categories be able to afford the near 25% rise in her shopping bill?

Well, for now,  it evades my comprehension as to who are the true beneficiaries of organic farming.

~ Santosh

 
 

 A casual glance in to ones wallet and one would wonder where the 50 Paisa and 1 Rupee coins have disappeared. These once ubiquitous coins in the wallets, have today somehow slowly, but definitely, seem to have gotten lost amongst the bunch of bigger, yet lighter currencies, and plastic monies stuffed in their place. Is this any indication that one has graduated from transacting in such smaller currencies? Or is it just that these currencies are much less than their metal value owing to inflation and hence are  economically meaningless?

There is no doubt that there are many gradations of response one could get to these questions. Those 85% of the country's population, who have been just lucky to have gotten their foot on the first rung of development ladder, still transact in these denominations -whether it is buying confectionery, biscuits, shampoo sachet or gutka. However, for those in the higher rungs of the economic growth it is probably deemed shameful to transact in any non-plastic currency let alone such lowly denominations. I might be here accused of discounting those who still keep a bunch of these coins only to fling them occasionally at beggars crowding their cars in the traffic lights, probably not knowing that traffic department in their city has issued a notice forbidding motorists to give to beggars. But, is this act of charity inspired because their hearts are touched by the deprivation in a world of plenty or because they believe in superstitious cleansing of their sins?  

For now, the more important question is what about those poorest of poor in constant hunger and illness fighting for survival every moment? How would Farida Bibi, a landless woman with three-children who dream of food all the time, look at the same one rupee coin? Could the one rupee have saved the 12-year old Kolkatta girl? How would, who died of starvation in Rajasthan, have seen the same currency? Would the skeletal figures lying listlessly, who knew that that death could only be postponed by a few hours with the little food that this could probably buy, glow at the sight of this currency?

However, the same one rupee has been attracting the attention of marketers from financial services to FMCG to telecom to even matrimonial services, to bridge an untapped market. While the effort from the businesses such as HLL in serving the "consumption" class of the poor is commendable, the question is whether this unidimensional approach any enough? What about those who are chronically hungry and lack access to basic amenities and who have never had a purchasing power of any kind? Can the corporates afford to turn a blind to these who struggle to get a foot on the first rung of development ladder?

~ Santosh

 
 

zhu men jiu rou chou
lu you dong si gu


Behind the gates of the wealthy
food lies rotting from waste
Outside it's the poor
who lie frozen to death
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As I stumble upon these emotive lines from Du Fu , a 8th century Chinese poet, on the PovertyNet website, I wonder whether such publishing of poems is an act of desperate attempt by WorldBank to sensitize the world  towards the deprived?

Well, diverting from the emotional to the rational side, the inevitable question that arise in my mind is whether there exists a Holy grail solution to poverty. If so, is it the philanthropy or the much-in-vogue enterprise solutions the call-to-action? It seems like the quest and the debate takes a new shape with the just published book "The Bottom Billion" authored by the Oxford Economist Paul Collier.

Click here to read more.

~ Santosh

 

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