Lok Sabha Question No. 5199 (UNSTARRED), answered on 2018-03-27
Subject: Profit Making Industries in Agriculture Sector
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: SEETARAM AJMEERA NAIK

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE, COOPERATION AND FARMERS WELFARE

## LOK  SABHA UNSTARRED QUESTION NO.5199

TO BE ANSWERED ON THE 27 TH  MARCH, 2018

## PROFIT MAKING INDUSTRIES IN AGRICULTURE SECTOR

5199.     PROF. A.S.R. NAIK:

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ष एवं कसान कयाण मंी be pleased to state:

- (a) whether industries engaged in agriculture sector are making huge profits every year while farmers are sinking into debt day-by-day and if so, the details thereof;
- (b) whether the reason behind accrual of huge profits to companies engaged in agriculture sector, such as tractor manufacturers, fertilizer manufacturers/ suppliers, companies supplying insecticides and seeds, is the faulty policies of the Government, which are harming the farmers and benefiting the industries engaged in agriculture and if so, the response of the Government thereto; and
- (c) whether the Government is considering for setting up a regulator for fixing prices of the said resources, so as to arrest the trend of earning huge profits on agricultural tools and if so, the details thereof?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF AGRICULTURE AND FARMERS WELFARE

कृ ष एवं कसान कयाण मंालय म राय मंी (SHRI  PARSHOTTAM  RUPALA)

(a) to (c): No  Madam.    Agriculture  is  a  State  subject;  however,  Ministry  of  Agriculture  & Farmers  Welfare  is  implementing  various  schemes/programmes  for  benefit  of  farmers.  The National  Sample  Survey  Office  (NSSO)  conducted  a  Situation  Assessment  Survey  (SAS)  of Agricultural Households during its 70 th round (January-December, 2013) in the rural areas of the country  with  reference  to  the  agricultural  year  (July,  2012-June,  2013).  As  per  the  results obtained from the survey, the average amount of outstanding loans per agricultural household was approximately Rs.47000.  The State wise amount of debt burden per agricultural household is at Annexure.  These loans included all kind of loans taken by the agricultural households.

In order to provide good quality of fertilizer at a reasonable price, the Government of India  has  declared  fertiliser  as  essential  Commodity  under  the  Essential  Commodities  Act, 1955. Under Section 3 of the Act, the Government of India promulgated the Fertiliser Control Order (FCO), 1985. The FCO, 1985 empowers the Government of India to regulate the price, distribution and quality of the fertiliser. At present the Government of India is fixing the statutory price only of the urea fertiliser. The price of other fertilisers are out of the purview of statutory price. The Government of India has fixed the price of urea of 45 kg. bag at Rs. 242/- w.e.f. 1 st March, 2018. No person shall sell any fertiliser over a statutory price fixed by the Government of India.

To promote the farm mechanization in the country, Department of Agriculture, Cooperation  &  Farmers  Welfare  has  introduced  'Sub  Mission  on  Agricultural  Mechanization' (SMAM). Under SMAM, the Government is providing subsidy to the farmers for procurement of various Agricultural machinery in the range of 25 to 50% of the cost as  agricultural equipment. The subsidy is provided to the farmers through the State Governments. The State Governments after  negotiating  the  price  with  the  agricultural  machinery  manufactures  and  empanelled  the manufacturers so that the price become affordable to the farmers. The farmers have freedom to choose any machinary from any of the empanelled manufacturers.

Mechanization  helps  in  improving  utilization  efficiency  of  inputs  like  seed,  fertilizer  & pesticides, besides safety and comfort of the agricultural worker, improvements in the quality and value addition of the produce and also enabling the farmers to raise a second crop or multi crop.

There  is  no  proposal  of  Government  to  set  up  a  regulator  for  fixing  prices  of  the agricultural  tools.  However  some  of  the  states  negotiate  the  prices  of  various  agricultural machinery  with  manufacturers  through  tender  process  before  these  are  supplied  through subsidy scheme so that the farmers can be benefited by the reduced price.

The  Central  Government  under  Section  5  of  the  Insecticides  Act,  1968  registers pesticides  after  considering  the  data  on  different  parameters  such  as  chemistry,  bio-efficacy, toxicity, packaging and processing to ensure efficacy and safety to human beings and animals. The  act  also  provides  power  to  State  Government  for  use,  manufacture,  sale,  transport  and distribution  of  insecticides.  Generic  pesticides  accounts  for  majority  of  the  Indian  pesticides market.  The  intense  competition  between  the  manufacturers  ensures  that  the  price  remains competitive.

The  Insecticides  Act,  1968  does  not  provide  for  a  regulator  for  fixing  of  the  prices. However, certain steps have been undertaken such as pesticide association have been asked to  communicate  last  three  years'  data  on  Maximum  Retail  Price  (MRP)  of  fast  moving  high consumption generic pesticide and their formulated products so as to deliberate on the ways to provide pesticide to farmers at affordable prices.

The price of seeds of various crops are governed by market forces, except the Bt.Cotton seed prices, which are fixed under Cotton Seed Price (Control) order-2015.

The Price (per packet of 450 gm and 120 gm refugia) of BG-II variety of Bt.Cotton has been reduced from Rs.800 (2017-18) to Rs.740 (2018-19).

Annexure State wise average amount of debt burden per agricultural household

| States/UTs        |   Average Amount of Debt per Cultivator Household (Rural) Rs. |
|-------------------|---------------------------------------------------------------|
| Andhra Pradesh    |                                                        130599 |
| Arunachal Pradesh |                                                          4386 |
| Assam             |                                                          7856 |
| Bihar             |                                                         48674 |
| Chhattisgarh      |                                                         16810 |
| Delhi             |                                                          8801 |
| Goa               |                                                         21959 |
| Gujarat           |                                                         53717 |
| Haryana           |                                                         99212 |
| Himachal Pradesh  |                                                         91682 |
| Jammu & Kashmir   |                                                         17176 |
| Jharkhand         |                                                          9250 |
| Karnataka         |                                                         83987 |
| Kerala            |                                                        441589 |
| Madhya Pradesh    |                                                         48723 |
| Maharashtra       |                                                         68532 |
| Manipur           |                                                          5849 |
| Meghalaya         |                                                          2872 |
| Mizoram           |                                                          6915 |
| Nagaland          |                                                          3800 |
| Odisha            |                                                         25389 |
| Punjab            |                                                        216524 |
| Rajasthan         |                                                         72453 |
| Sikkim            |                                                         78878 |
| Tamil Nadu        |                                                        100266 |
| Telangana         |                                                         84423 |
| Tripura           |                                                           386 |
| Uttarakhand       |                                                         40573 |
| Uttar Pradesh     |                                                         69794 |
| West Bengal       |                                                         10333 |
| A & N Islands     |                                                         17114 |
| Chandigarh        |                                                         43133 |
| Dadra & N. Haveli |                                                         46317 |
| Puducherry        |                                                        205675 |
| All-India         |                                                         70580 |

Source: NSSO 70 th Round, Key Indicators of Debt and Investment in India (2014)

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