Cash crunch delays rabi planting

19 Nov 2016


The severe cash crunch over the past week following Prime Minister Narendra Modi's announcement of demonetisation of high-denomination notes has hampered the sowing of rabi crops and threatens to thwart an increase in crop acreage this rabi season.

In fact, the area under rabi crop has declined marginally from last year, with the last one week witnessing major retardation, in the case of wheat, the principal rabi crop.

As per data released by the ministry of agriculture, the sowing of wheat, which was 38 per cent higher than the year-ago period until 11 November, has since lost momentum.

The sowing of rabi crops has declined marginally from last year, with the last one week witnessing major retardation in the case of wheat, the principal rabi crop. This is attributed mainly to farmers' cash crunch, according to sources.

As per data released by the agriculture ministry, about 24.1 million hectares were sown with various winter crops until Friday, which is 1.65 per cent lower compared to the sown area this time last year.

Sowing of rice was down 2.3 per cent while that of coarse cereals declined by 11 per cent.

The area under pulses, of which a record output was predicted, grew just 4.6 per cent, while oilseeds did comparatively better with an increase in area of 7.4 per cent.

Wheat sowing in Punjab, one of the largest producer, would ideally have completed by the end of November while in Uttar Pradesh, the country's top wheat producing state, sowing has covered 1.5 million hectares so far against a target of 9.9 million hectares.

Till now, wheat has been sown in 2.4 million hectares in Punjab while the target for the season is 3.5 million hectares. In Haryana, wheat has been sown in only 850,000 hectares so far while the target for 2016-17 session is 2.5 million hectares.
Agriculture ministry sources, however, sought to allay fears that the currency crunch would take a toll on rabi output. According to officials the easing of cash norms and the availability of credit facilities would give the expected boost to rabi sowing in the next couple of weeks.

The agriculture ministry has a foodgrain production target of a record 270.10 million tonnes for the 2016-17 crop year (July-June), up 6.7 per cent from the output of 253.23 million tonnes in 2015-16.

The sowing of rabi crops usually begins at the end of October and harvesting starts from April onwards.

Meanwhile, the government has announced substantial increases in the minimum support price (MSP) for rabi crops, including wheat, barley, gram masur, mustard and safflower, for the 2016-17 season. This could act as an incentive even in times of a severe cash crunch.

Over the long term, finance minister Arun Jaitley said, to ensure future increases in agriculture output and farmers' income by 2022, the government will focus on higher agriculture productivity especially in view of the limitation on expanding crop area.

To increase the price benefits to the farmers, it is necessary that the farmers are provided timely market information and developing software applications, both computer and mobile based, that link farmers to consumers.

The finance minister said it is possible by leveraging technology-especially for high yielding and resistant variety seeds and efficient utilization of water for irrigation, adapt latest IT to increase resilience to nature by phasing sowing, watering and harvesting among others.

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