For paddy farmers in Odisha, it is tears all the way. The State’s farmers have incurred the second highest loss in the country on paddy cultivation. Shockingly, farmers here realise a negative net return to the tune of a whopping 16 per cent over their actual cumulative spending on paddy cultivation per hectare.
And the shocker for State’s paddy farmers this Kharif is when to produce a quintal of paddy the cost was estimated at Rs 1,656, the Minimum Support Price (MSP) they would be getting is only Rs 1,550/quintal in 2017-18.
A simple arithmetic shows a substantial loss of over Rs 100/quintal, and this is the only business model where a produce is to be sold at such a high loss.
Significantly, when such is the scenario, the moot question is how can a debt-ridden farmer ensure repayment of his loanIJ
According to Commission for Agriculture Cost and Prices (CACP) which recommends MSP to the Centre, when the cumulative cost (C2) of paddy cultivation per hectare in Odisha is Rs 49,038 for the triennium ending 2014-15, the Gross Value Output (GVO), meaning value of paddy plus sale of other crop residues, of farmers has been only Rs 41,379/hectare.
The result: Farmers incur a loss of Rs 7,658/ha or 16 per cent over C2 cost, which is the second highest after Assam in the country.
Moreover, the estimated Cost of Production (CoP) of a quintal of paddy in Odisha by the CACP for 2017-18 is Rs 1,656, but the MSP of Rs 1,550/quintal CACP has been fixed basing on the usual convention followed of giving at least a 10-per cent hike over the all-India weighted average CoP of Rs 1,484.
The effect: Paddy farmers in Odisha, Assam, Jharkhand, Maharashtra, Kerala and West Bengal would bear a net loss of over Rs 100 even when they sell at the MSP.
Notably, when farmers are burdened with an albatross around their neck, the Odisha Government would be gaining around Rs 140 per quintal procured in 2017-18.
Of the Rs 80-increase in the MSP in 2017-18, the State Government would be reaping at least Rs 8/quintal more courtesy the taxes/levies collected on the MSP in the garb of enabling a necessary mandi infrastructure.
Significantly, when the State Government is flagging the cause of high fiscal burden to waive farm loans of Rs 17,000-Rs 19,000 crore, the CACP data show how the Government is raising a whopping over Rs 2,200 crore annually for the period of 2010-16 via taxes/levies on the MSP at mandis during procurement from millers.
Odisha farmers are seemingly at the crossroads. While the Central Governments (UPA or NDA) are reluctant to hike the paddy MSP by 50 per cent over the cumulative cost of production per hectare as suggested by MS Swaminathan, which in Odisha’s case would be estimated at around Rs 2,400 in 2017-18, for the fear of a cost push to inflation, the State Government sits in dharnas only leaving the farmer to fend for themselves.
The result: The State is witnessing serial suicides by debt-ridden farmers in the post-paddy harvesting season.