Govt distrust preventing formal tenancies in AP despite reassurance of 2019 Act

The 2019 Andhra Pradesh Crop Cultivator Rights Act was legislated to make input subsidies and government income support available to small holders and landless farmers cultivating leased land but very few of them have been able to take bank loans because owners would have already mortgaged the land they cultivate. Banks give one loan per survey number and a second loan is not given till the first one is repaid and that makes most cultivators ineligible for loans, MVS Nagi Reddy, Vice-Chairman of the state’s Agri Mission told The Federal in a Zoom interview.

Though Andhra has issued 4.15 lakh crop cultivator rights cards only 60,000 card holders availed of bank loans (₹324 cr) last year, as per the state’s socio-economic survey. Tenant farmers were being encouraged to form joint liability groups to reassure banks of repayment as each member of the group would be jointly and individually responsible for loans taken by the group.

The state also provides income support of ₹13,500 a year to cultivators – land owning and tenanted. Of this, ₹6,000 is the central contribution. But it is not available for tenants. The state pays them the entire amount from its own account, Reddy said. Last year 55 lakh farmer families and 1.5 lakh families of landless tenants got it. As per official estimates, about 30% of Andhra’s farmland is leased out, mostly informally. In the Godavari, Krishna and Penna river deltas about 70% of the land is leased out, Reddy said. So, there is a big mismatch between the number of farmers in need of income support and those who get it.

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Though the 2019 act limits tenancies to 11 months and does not allow them to be renewed or extended, farmland owners hesitate to affix their signatures on cultivator card rights applications. Such is the distrust of government. Land-owning farmers perhaps fear that future governments could use the information against them. Perhaps the fear of the old tenancy act still lingers. That law did not allow the eviction of tillers. If the owner wanted to sell the land, the tenants had the right of first refusal and the land had to be sold at ten times the annual rent.

Free electricity

Apart from being alive to the concerns of tenant farmers, the state is also trying to make its agriculture financially and environmentally sustainable, Reddy said. Independent observers might not see it that way. The state provides nine hours a day of free electricity. Limiting the number of hours allow borewells to be recharged. But the idea of providing income support is to do away with input subsidies (like free electricity or cheap fertilisers) as these distort the market and encourage overuse.

Reddy says farmers drawing borewell water to cultivate are encouraged to shift to maize or jowar, which is more profitable than rice. According to him, the cost of rice cultivation per quintal was about ₹2,000 while the minimum support price was ₹1,940 last year. Reddy says maize not only needs less water but there is also good export demand for it. It is also sought after by the fishmeal and animal feed industries. The market price of maize was higher than the support price, Reddy said.

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The unprofitability of rice has made Andhra discourage its cultivation, Reddy said. About 90% of rice-growing areas with at least 300 days of water and elevation of less than 17 feet above mean sea level have shifted to fish rearing. Fish is more profitable than cultivation of cereals. According to Ramesh Chand, Member, NITI Aayog, gross value addition by the fish sector has grown by 6.72% for a period of 17 years in the last two decades against 2.40% by the crop sector. The value addition in the state’s fish sector last year was ₹55,000 crore as per its socio-economic survey, against ₹29,000 crore by the crop sector.

Apart from fish, the state was persuading farmers to shift to oil palm (for which the centre offers minimum support prices) and to horticulture. For mango, orange, turmeric and chillies, the state was declaring support prices. It intervenes when market prices fall below the threshold. The procured produce is sold in Rytu Bazaars, often at a loss. Food processing was also being given a thrust. Food processing parks are intended to be set up in each of the state’s Lok Sabha constituencies, Reddy said.

Organic agriculture

Andhra does not have difficulty in selling or using its rice output unlike Telangana. Andhra’s rice production last year was 13.3 million tonnes. In Telangana, it was 21.9 million tonnes. With massive investment in lift irrigation, Telangana has expanded rice production 4.78 times in six years from 4.6 million tonnes in 2015-16 to 21.9 million tonnes last year. Because of this, Telangana was having run-ins with the centre on rice procurement, Reddy said.

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Reddy saw free electricity for borewell users as a climate risk mitigation strategy. Without free electricity, farmers affected by drought would be worse off, he said. The state would also start promoting drip and sprinkler irrigation. It could not do this because the previous government had left a debt of about ₹1,000 crore. This has been repaid to the micro irrigation companies, Reddy said.

Before he shifted to fish farming in 1992, Reddy was growing chemical-free rice on a part of his 100-acre farm in Vijayawada. But he found it unprofitable. Reddy, who is an M.Sc from Allahabad University in plant genetics and plant breeding, says organic agriculture is more expensive that chemical agriculture because the yield is low. That is why the present government did not pursue former Chief Minister Chandrababu’s initiative to make the entire state chemical free. That would have made it share the fate of Sri Lanka and Sikkim (which the PM declared as chemical-free in January 2016). In Sikkim, as per news reports, cheaper vegetables grown with chemicals in West Bengal are making local organic produce uncompetitive. Andhra has therefore chosen to encourage farmers to go organic voluntarily. It expects consumers to pay a higher price for it. When asked about marketing support, Reddy pointed to dedicated outlets for organic produce in Rytu Bazaars.

Those may not be of much help.

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