Farming Entropy
Tags: Complexity, Politics, India, Farming, Economics

Delhi is choked. In many ways. Now, farmers are up in arms. What’s at stake & how will it pan out?

The future is always uncertain and all crystal-ball gazing is futile. But, we can consider a few possibilities.

1. What’s at stake?

The new farm policies open up agri markets further.

* Now, farmers can easily sell their produce directly to anyone, including corporates, to make more money, instead of being limited to selling only to govt regulated markets.

* When more and larger corporate entities compete to buy produce directly from farmers, farmer’s incomes are expected to double soon, though there is no guarantee this will happen.

* Contract farming is being made easier. Farmers can be assured of steady, perhaps even higher, incomes by entering into contracts with corporates who can influence farming productivity/outcomes as per local & global markets requirements.

* Corporates are expected to enter the agri business in a big way, invest more money, bring in economies of scale, newer/better technologies & practices, perhaps help reduce food prices & improve food quality, all these over time, and help improve our food security.

* The fate of govt’s minimum procurement price guarantee is not clear. Farmer’s fear they would be exposed to the vagaries of the markets and their incomes may reduce, over time. They also fear large corporates with deep pockets would push them out of agriculture and uproot their traditional farming lifestyles.

2. How will it pan out?

We seem to be doing what some other countries have done in the past and, perhaps, to some extent, we can expect similar outcomes.

After a decade or so, a few large agri-businesses may end up controlling a big chunk of our farm/food chain, as in the US. Marginal farmers may have to wind up and find other jobs. Farmer’s incomes may or may not double. Farmer’s debts may or may not reduce. Our food security may nor may not improve. No government can offer any guarantee.

Complex policies will skew incentives. Unknown unknowns will come into play. Some crops may become more lucrative to produce & sell. Exports & imports of different kinds of foods may change significantly, over time, adding to the confusion. Billions of hungry Indian consumers may alter global food chains and corporate behaviour. Critical resources like ground water may be impacted in significant ways. Climate change may speed up. We can speculate endlessly.

Farming & food chains are complex systems with many parties, relationships & interactions. When we interfere with large scale policies & regulations, despite our best intentions, outcomes will remain uncertain. They may turn out well. They may also be disastrous. We can fine-tune policies, calibrate outcomes, and hope for the best.

Meantime, all kinds of interests will wrestle it out. Poor & rich farmers, benign & wily politicians, smart businessmen, troubled social interest groups, professional protestors, paid lobbyists, enthusiastic journalists, biased economists, clueless bureaucrats, vocal scientists, bewildered public, etc. will be busy. Who is right? Who is wrong? Too many arguments. Too many factors to consider. Who can ever hope to grapple with such complexity? The powerful may prevail. The weak may win a few battles. Compromises will be negotiated. Meantime, other issues will erupt and divert our attention.

We will continue to scramble to conduct the orchestra. Will it be a symphony or cacophony?

Perhaps just transient popular music.