Calcutta Notebook

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Consecutive suicides of potato farmers in West Bengal have shaken the conscience of the people. What is particularly cruel is the attempt on the part of Trinamul Congress (TMC) politicians and ministers to attribute the suicides to reasons other than economic losses due to the failure to obtain the minimum remunerative price. An unimpassioned examination of the issue is hence essential.

An acre of good potato land usually yields 100 to 120 quintals of potato, and the cost of cultivation, including the labour cost, is at least Rs 50,000. Hence a farmer should get at least Rs 500-600 per quintal if he is to avoid losses, if not to make profits. Right now, in the mofussil areas of West Bengal, potato is being sold at Rs 5 per kilogram at retailers’ shops, clearly implying that farmers get not more than Rs 3 or Rs 4 per kilogram, if the profits of the wholesaler and the retailer are taken into account. Hence a farmer, who spends so much time and energy on the cultivation of potato, finds that even the costs incurred are not recovered. What is now his option? Many farmers take loans from local money lenders or traders for cultivation, and in order to repay them, they have to resort to distress sales. Of course, repayment of loans is not the only compulsion behind distress sales. Like all other people, potato farmers too have to maintain their families, and have to sell their crops in order to meet their daily expenses. If prices are frightfully unremunerative, they suffer from capital losses and are finally led into a debt trap.

One solution is government purchase through agents. If the farmers are offered a minimum support price of Rs 7-8 and the government purchases their produce, they can avoid this fate of suicide. But how should the government purchases be disposed of? One way is to release this stock in the summer or the rainy season or the autumn when the price of potatoes goes up significantly. In situations of overproduction, this may not be a happy solution. The other way is to export this stock to regions that do not have enough supplies of potato compared with the demand. But how far that is feasible is another question.

A third point concerns the size of the market. The market must be expanded in order to deal with the problem of overproduction. This expansion requires the increase of the purchasing power of the masses, particularly of these marginalised sections for which potato is an important food item. These sections cannot generally spend more than Rs 25 or 30 per capita per day. Right now, potato is virtually their only vegetable, because its price is much lower than even pumpkin or brinjal. If the spending ability of these classes can be raised to Rs 40-50 per capita per day at current prices, which is still much lower than the all-India per capita expenditure, they can afford to purchase enough potatoes at Rs 7-8. The quantities they can afford at Rs 5 per kg at their existing level of income will also be affordable, at the higher price if their real income is raised. In that case, the question of 'excess supply' loses its significance, because the excess supply at Rs 5 per kg evaporates at Rs 7 or 8 per kg. Hence the permanent solution lies in broadening the internal market by raising the income of the people, not through doles or charities, but through productive employment.

While writing this note, this correspondent has incidentally sighted an editorial of one of the leading English dailies of the country. The editorial suggests that the solution to the problem of potato farmers should be left to the market. 'The experience of the market is neither smooth nor comforting, but for the best results and for long-term prosperity and development, it is best to let the market correct itself and develop its own defense mechanisms. This will take time and patience, but there is just no magic short-cut'. (The Telegraph, 17 March) This comment has been made in the context of a PIL filed at the Calcutta High Court. The columnist is clearly indifferent to the reality that before such an adjustment takes place—in case of potato farmers, the period of adjustment is by no means less than one year—many cases of suicide and pauperisation inevitably occur if the farmers do not get a price enough to cover the cost. The price of market-based adjustment is thus suicide and pauperisation. Hence it is not an exaggeration to say that this editorial which is ostensibly against judicial activism in this regard, is a glaring example of the dehumanizing impact of market obsession on the minds of the ellite bhadrolok. It is, however, more comforting to hold forth on the virtues of the market than to come forward to protect distressed farmers. Meanwhile, Calcutta High Court has broken its silence. "The government cannot shut its eyes to the situation". Thus observed the Division Bench of Chief Justice Manjula Chellur of Calcutta High Court, while hearing a Public Interest Litigation (PIL) seeking the fixing of a minimum support price of potatoes.    

20-03-2015

Frontier
Vol. 47, No. 38, Mar 29 - Apr 4, 2015