#Agri Sector during and after the #pandemic –COVID 19
The #Indian #agriculture and its #allied #sectors still remain the highest contributor
to the country’s #GDP at 18%. It is also the highest employer, employing more
than 50% of the total workforce of the country.
Impact of #COVID-19 on Agriculture
Sector
When
countrywide #lockdown was imposed in India due to the COVID-19 pandemic,
agriculture sector was one of the badly hit sectors. Field #laborers facing a
livelihood #crisis started rushing to their #hometowns in large numbers. April
and June crops were badly hit in the absence of man power. Exports plummeted
and a reign of crisis engulfed the sector including the farm equipment
manufacturing industry.
#Impact of COVID-19 on #Farm #Equipment #Manufacturers
#Factories
manufacturing agriculture equipment were also hit and even the big players
were functioning only on 20-30% of their full capacity.
#M&M, the largest domestic manufacturer of agricultural equipment
registered an 80.4% dip in net profit due to the pandemic. The sale of #tractors, one of the largest selling equipment of M&M, went down by 24%.
Further,
the concept of ‘Globalization to Localization’ is going to present a challenge
for the farm equipment industry. Experts predict that a rise in graph can’t be
expected till the third quarter of 2021; however, things will begin changing
for good in 2022-23 due to globalization.
COVID-19 Impact on Agriculture Allied
Sectors
The
allied sectors of agriculture – #horticulture, #animal #husbandry and #fisheries
are also hit in COVID 19 due to a dip in demand and resources. Unavailability
of labors and transportation were the main factors behind their losses.
#Livestock
has been a major source of supplementary income for around 70% of agricultural
households in India. Also, the livestock products account for around 33% of the
total food expenditure in India. Lock down has adversely affected the families
depending on their livestock produces for a stable income. Due to the lock down
they couldn’t sell their produces, mainly #milk to the #dairies; which in turn
faced a dip in demand.
According
to an estimate by the #Ministry of animal husbandry dairying and fisheries, the #industry was losing around Rs 1500 crore everyday when the lock down was first
imposed.
The Revival – Moving ahead of the
Pandemic
During
the pandemic the #government of India announced many farmer centrist schemes
including crop #insurance, #loan, etc are intended to revive the farmers from
COVID 19 impact and losses.
In
an attempt to boost back the agriculture and allied sectors from the adverse
impacts of COVID 19, the government in May 20 had announced a package of Rs
1.63 Lakh crore.
The
package is linked to the core agriculture sector as well as other allied
sectors like – poultry, fisheries, bee farming, animal husbandry, herbal
plantation, food enterprises, etc. The impact of the package will be visible
only in long run and it doesn’t seek to provide immediate relief in wake of the
pandemic.
There
are also some good news coming in from the farm equipment manufacturers as they
have started seeing some demand after relaxations in the lock down. For tractor
industry it was an up-down-up sale from March to May. Total sale of tractors
(including exports) in the months of March, April and May stood at 35216 units,
12256 units and 64860 units respectively. Around 55% jump in sale than in March
is a testimony that the industry is back on its foot and thriving.
Government’s Vision and Agriculture
Reforms Post Corona virus
On
the 2nd May the #Prime_Minister of India held a high level meeting attended by
the Agriculture Minister, Finance Minister and the Home Minister. The meeting
was specifically held to review the impacts of COVID 19 on agriculture sector
and taking steps for its revival.
The
Prime Minister also expressed his willingness to change old fashioned rules and #regulations governing the industry and increase the farm gate price for the
farmers. Farm gate price is the price at which the farmers can sell their
commodities directly from the farm without transporting them to the designated #Mandi.
The
Prime Minister also stressed on the unification of domestic agriculture market,
which will allow traders and farmers to sell their produces countrywide.
Current ‘Mandi’ system restricts the farmers to sell their goods to only
specific Mandis in a particular area, thereby putting time bound and revenue
bound barriers. Moreover, the farmers have to sell through registered middlemen,
further marginalizing their profits.
The
Prime Minister also instructed to scale up the use of #e-NAM (Electronic
National Agricultural Market) platform countrywide.
The
platform allows farmers and traders to trade their commodities in any of the
listed Mandi for a profit through e-NAM mobile application. Presently, the
platform has 1000 Mandi across 18 states and 3 Union Territories of India.
The
government also seeks to exchange interstate Mandi tax with a single Mandi tax
for the whole country same as the Goods and Services Tax (GST).
Changes
in the tenancy laws, without impacting land ownership are also expected in the
future. In present scenario a tenant farmer isn’t able to avail loan and other
benefits as he didn’t own the land.
With
a government that favors digitization and unification of the Indian
agriculture market, the sector is destined to undergo some favorable changes in
next 5 to 10 years. The focus would be on making the agriculture and allied
sectors less vulnerable to looses by removing middlemen and strengthening
farmers.
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