Wednesday 23 May 2007

Inflation, Rural Distress, Milking the Dry Cow Therapy

Dry Cow Therapy, Rural Distress, Indian Economists : New Agriculture Strategy
From Second Green Revolution to Milking the Cow Dry :

The concerned Indian Prime Minister, has been left searching for the right answers from all the agricultural experts, while his own Agriculture Minister ignores the suicides from his home state and manages the strings of the Indian cricket team, a job no doubt he loves more than finding answers to the task entrusted to him as Indian Agriculture Minister - saving farmers from rural distress.
Another case of Humpty Dumpty on the rural front, as Indians get busy with cricket season.
Even the Indian Sensex Minister is now feeling short changed, by the massive imports bills, deposited on his doorsteps, on the food front, which threaten to blow a hole through his economic strategy of industrial development and growth in Services sectors.
Soon after suggesting budgetary support and subsidies for sugar exporters, the Agriculture Minister has gone ahead on a global buying spree for wheat. He just does not seem to like Punjabi and Haryanvi wheat. It is not tasty enough for him or maybe a trifle too full of pesticides for even his liking.
In a bid to wash off the spots on the UPA governments Three Year Achievements, and what even the lacklustre opposition performance by the NDA could not accomplish, is being accomplished in the rural fields of Vidarbha and West Bengal.
Understandably, genuine Congress election strategists are worried.
Let us examine the content of the Prime Minister's concern about Indian rural distress, worded as it is in very general terms and coming on the heels of the three years of crowning achievements of the Central ruling UPA coalition and the electoral losses in Punjab and Uttar Pradesh.
In his directions to Planning Commission, Finance Minister and Cricket Minister he has pointed out :
1. Poor growth in farm output, at approximately 2%, is the main cause of agrarian and rural distress
2. There is need for focussing on short and medium term strategies for raising farm output
3. Burden of blame must be strategically be shared with states, as according to his understanding, the Central UPa government is having to face too much unnecessary criticism as being the most responsible player in the rural distress drama of Indian politicians and urban economists. The solution to this is seen as rewarding those states which come out with agrarian focussed programmes, agro climatic and local rural growth strategies, with possible budgetary support.

Surprisingly, the music of the old song of ushering in a Second Green Revolution, futures trading in commodities markets, contract farming, agro processing Special Export Zones, seems to have been lost in the wake of Vidarbha and Uttar Pradesh debacles.

He has stated "I would only like to emphasise that whatever strategies we choose to adopt must deliver some results in the short and medium term, so that tangible benefits are visible - to farmers, consumers and the rural economy as a whole.
This is important if we have to avert any crisis in the agrarian sector and fulfil the needs of a growing economy."
All the king's horses and all the kings men, couldn't put Humpty together again ... He directed the Planning Commission to come up with a major programme to enhance central support to those states that prepare localised plans.

This obviously means he is still not prepared to ask his heavy weight Cricket Minister to choose between Cricket, Food Imports or solving Agrarian Distress in his home state of Maharashtra.

The poor Finance Minister is keeping his cards close to his chest and will surely resist tooth and nail, attempts at further central aid to states because he himself knows the dubious record of states in preparing sensitive rural programmes of integrated development, as also knowing that further expansion of agricultural land exploitation is not feasible. Also known as the milking the dry cow therapy.
But the problem is who will be brave enougfh to bell the cat ?

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