What's happening to about Indian agriculture?

While so much attention is being lavished on how well the Indian economy is doing on growth, inflation, exports, foreign exchange reserves, software and BPO, manufacturing and stock prices (and you can add to the list), people have also been celebrating this year's bumper harvest -- on which many of the other successes are built.

In fact, though, we should be worrying very seriously about what is happening to Indian agriculture.

This is a bumper year on account of a near-perfect monsoon, but the foodgrain harvest is no bigger than it was two years ago.

As for other crops (oilseeds, pulses and most of the cash crops  -- tobacco, cotton, jute, etc) and the plantation sector, the output this year is smaller than it was between five and eight years ago.

In other words, we are not moving forward at all, and in much of rainfed agriculture, there has been prolonged stagnation. If this isn't a crisis, what is?

Indian agriculture was clipping along at about 4 per cent annual growth in the 1980s. By the end of that decade, economists pointed out that the money going into the agriculture sector was increasingly in the form of subsidies, not as investment, and this would affect production at some point.

No one paid attention, and since we can't escape the laws of economics, that is precisely what happened. Agricultural growth roughly halved in the decade of the 1990s. Now it is in danger of halving again, and falling well below the rate of growth of population.

The danger is not that we will have to import food once again; the country has the trade strength and accumulated reserves to be able to do that and not worry about it.

The problem goes deeper, because nearly 70 per cent of the population still lives off the land, and if output is not growing, income isn't either -- while the population expands in number.

If there is no money in the countryside, there is going to be serious unrest, which can manifest itself in a rash of protests by farmers, suicides, Naxalism, criminality and a breakdown of law and order. . . all the known aberrations.

The problem won't stay confined to the villages, because large numbers will migrate to the cities, which can barely cope with the existing numbers. In short, if we don't do something about agricultural policies, so that output and incomes rise, we are asking for trouble for the system as a whole.

The trouble is that there has been no progress on most fronts. Crop yields are stagnant, partly because we don't have new, higher-yielding seeds despite the plethora of agricultural research institutions; and partly because the government machinery that used to work with farmers to improve yields has become decrepit.

The irrigation potential remains hugely untapped, because of massive time and cost over-runs on projects, because of poor planning that results in waterlogging of vast tracts, and because protesters like Medha Patkar have made new dams virtually impossible to build. So there won't be any more Bhakra-Nangals that turned Punjab and Haryana green.

Policies on cropping patterns, pricing, trade and movement restrictions and many other issues are stuck in a groove, and have failed to respond to changing reality, so that Indian agriculture has to hide behind high tariff walls.

Inputs for agriculture are mispriced, creating needless distortions. Pesticide and fertiliser adulteration is rampant.

If India exports wheat and rice, it is at a huge loss that the exchequer bears -- while Thailand (to take one example) makes money on its massive rice exports.

And the diversification of output that would take place with the development of a cold chain, post-harvest technology and the development of a strong food processing industry, remains a distant hope. Whether it is sugar, tea or coffee, the operative reality is grower dissatisfaction and industry crisis.

The optimists will point to change on the margin: the clearly visible progress in growing fruits and vegetables, the birth of a nascent wine industry, the growth of floriculture.

But the much larger reality is a grim story of stagnation and discontent -- and none of it has to do with the weather, it is all man-made.

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