Enhancing the Capacity for Growth

Today, India can sustain a GDP growth of 8 percent a year. Increasing this to 9 or 10 percent will need more mobilization of investment resources; better allocation of these resources through more efficient capital markets; higher investment in infrastructure through both public and PPP routes; and more efficient use of public resources.

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Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby balaram.ch@gmail.com » Tue Sep 13, 2011 7:09 am

We are in a stage of importing food grains from other countries like china. This is not good for us. Why people are buying food grain from other countries, when we are having so much of man power and so much of resources. We are having subsidies for a long time, which is not reaching the right people. Educate farmers for more productive farming and increase the price of buying from them so that they will be profitable.
Even though we are the one in the emerging countries, we are nothing when our agri sector fails.Please save our agri sectro
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby rishabhgupta12@yahoo.co.in » Tue Sep 13, 2011 9:11 am

We should reduce subsidies as these subsidies do not reach the people for who they are meant for. Hence we should reduce food and fertiliser subsidies to provide more resources for rural infracstructure. wherein the panchayat funds needs to increased and the better infrastructure and information on agriculture and guidance should be provided tof farmers through Public private partnership based on the models like e-chaupal and m-krishi.. and like the one in the Soda village of Rajasthan
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby rajarshi25may@gmail.com » Mon Nov 14, 2011 9:36 am

I think we should first try to rein in the leakages that goes into subsidies be it fertilizer or kerosene or PDS or public goods like law and order.Subsidies are needed,but with so much leakage it all goes waste.We need to create motivation for officials to see to it that leakages are stopped(by giving a % of money saved thus to the officials).That way we will save a lot of money which can be moved to infrastructure.Also moral corruption of society would be reduced.Increased salary would get us better brains too in government sector
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby gupta_tejas@yahoo.com » Tue Nov 22, 2011 5:58 am

In my opinion the government should definitely spend on enhancing the infrastructure of the rural areas, the reasoning behind it being that it would allow the corporates to enter into the agriculture sector. What the rural farmers are currently lacking are the adequate opportunities, and they are never going to acquire the clout that is required to extract the right price for their produce. Further the entering of corporates into the agriculture sector in a organized manner will only enhance the growth and sustenance of this sector. I also believe that when a huge organization would enter such a sector the whole villages shall benefit from such development activities.
The Income Tax Act also provides some substantial tax benefits to corporates who venture into rural areas thereby increasing its allure. Hence in totality not only the agriculture sector is directly developing but all the other aspects also show positive indicators.
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby urvish.munshi@gmail.com » Fri Dec 02, 2011 1:51 am

Yes, the subsidies given to the farmers is not used in a productive way. That is they tend to use more fertilizers thinking that there will be more production but it has not increased the crops rather it has reduced the fertility...

Food subsidy has also increased wastage. So rather it is imperative that we should reduce the subsidies on food and fertilizers and provide more resources for rural infrastructure for achieving inclusive growth....
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby vicky_trailblazer@yahoo.com » Fri Dec 02, 2011 12:31 pm

Government is feeding large population of India through PDS. Instead of reducing food subsidies wholly,Government should focus on Anti-Hoarding system & regulate the way of PDS. Because hoarding leads to artificial prize rise on food articles & the beneficial of PDS is not reaching Aam aadmi.It may cut food subsidies depends upon annual income of a family.

Instead of cutting fertilizer subsidy, government should encourage the farmers by the usage of natural fertilizer. Because artificial fertilizer will reduce the fertility of soil. It may give subsidy for using natural fertilizer & provide the needed infrastructure.
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby chetankempegowda@gmail.com » Fri Jan 06, 2012 5:47 pm

Considering India's poverty and undernourishment particularly in rural areas, food subsidy has to be continued. Together with this, we need to revamp the pds. Should adopt better technology to see that the subsidy reaches to the intended beneficiaries. We need to check the pilferage and better and efficient management of the storage and distribution system. Our goal should not be restricted to food security, but also we need to concentrate on nutrition security.We need to empower the people so that they are aware of their rights.
Regarding fertilizer subsidy, the government should have a serious consideration to overhaul the whole fertilizer subsidy regime.Only the fertilizer companies are benefiting from the subsidy rather than the farmers. Giving subsidy on a longer run reduces the competitiveness and innovation. It tends to breed inefficiency in the longer run. In this context, the government's move to nutrition based subsidy is a welcome move. Over subsidising the urea and other fertilizer has led to the injudicious use and have also caused various ecological and health problems. Instead the government should curtail the subsidy in a phased manner and induce competitiveness.
And it is very important and needs immediate attention in increasing the rural infrastructure spending.
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby rakesh.rnbdj@gmail.com » Tue Jan 10, 2012 7:59 am

In my view, food and fertilizer subsidies must be looked at separately.

As far as fertilizer subsidies are concerned, it is dangerous for human lives to consume fertilizers on a regular basis, so fertilizer subsidies must be reduced and we should resort to solutions which are natural, such as use of local methods to prevent attacks by pests and weeds and promotion of organic farming. Having said that, removal of all fertilizer subsidies in one go will create chaos. Hence, we should adopt a 5 to 7 year time frame within which we must remove all fertilizer subsidies and ensure that all farmers are using local methods (including organic farming if required) to grow crops. This has to be accompanied with land reforms (which must include three steps: distribution of land equally to all people, encouraging the formation of cooperatives for having better bargaining power and also allowing them to have their own sales in cities if required to get better price for crops, with the floor level set by the government as Minimum Support Price or MSPs), declaring agriculture as a public service if possible with pension and other facilities available, ensuring that farmers pay taxes (if they earn beyond a certain limit) and also encouraging use of energy efficient technology for lower consumption of electricity and diesel. Subsidies would actually shift from being on fertilizers to promoting organic farming and those incurred in such moves. They would not go away really.

Food subsidies are required because we need to ensure that the basic minimum nutritional needs of all citizens of this country are met. We do need a universalized PDS therefore. What is required is its effective implementation combined with better procurement from farmers and construction of storage facilities. All this must be done simultaneously and on a large scale, with decentralization of grain transportation and local grain consumption patterns deciding the production and other things to be done.

Rural infrastructure must be partly met through proper implementation of NREGA (such as for water bodies and afforestation) and partly though public resources (which can be generated by a variety of measures ranging from somewhat higher personal income tax rates and encouraging the purchase of infrastructure bonds to finance these to better implementation of these schemes). Rural infrastructural needs must also be based on targets other than the amount of money spent, such as the number of tanks constructed. And the CAG and other institutions need to have their capacities adapted, modified or built as required to ensure that each and every rupee of public money is properly spent.
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby nebunathan@gmail.com » Thu Jan 12, 2012 8:43 pm

Yes we should reduce fertilizer subsidies.

1. Fertilizers and Pesticides are harmful to the food chain and, It only serves short-term goals (5-10 years) after that the land becomes less productive or unproductive.

2. Usage of fertilizers and pesticides are increased exponentially each time in-order to keep the land productive and to negate the effects of resistance in pests.

3. Private Corporations artificially increase the price of Pesticides and Fertilizers.


China have done extensive research in advantages of fertilizers and proved that crop rotation and organic farming practices were more productive and less costly in long run.


Actions taken by smart govt are:

1. Incentives for Organic Farming (as productive as fertilizer based, sustainable for long term,less cost)

2. Create Institutions to provide natural enemies to the pests. (Farm having more frogs,ladybird,wasps,bees,earthworm tend to have less pests. And most of these friends are less in number or perish because of pesticides and chemicals).

3. Create Agricultural Co-operative Society in every village.Their tasks as following
    a. Provide all latest technological advanced equipments for rent/ subsidized sale
    b. Provide agricultural advanced information and guidance to the farmers
    c. Plan the farming timing of crops for each farmers
    d. Source the produce and sell to merchants and at a good price and share the proportional revenue
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Re: Should we reduce food and fertilizer subsidies to provide more resources for rural infrastructure? If so, how?

Postby goyal0707@gmail.com » Tue Jan 24, 2012 12:00 am

Subsidy on food

It is given to poor so that it can have a standard amount of calories per day.
-Reducing food subsidy, an action could only be taken if pocket of poor gets heavy. As the families of poor people are large, subsidies cannot be torn down but will increase in future(as inflation and population will only grow). But the burden on the exchequer can be reduced by strict vigil over the pipeline of funds from the exchequer to the poor's pocket.
Food coupons doesn't seem like a good idea. because they can easily be produced in any part of the country and corrupt practices will easily creep in. But the idea of ADHAAR is good . As linking bank accounts of BPL families to ADHAAR, govt can directly fund the necessary subsidy into the bank accounts. This will lead to eliminations of all evil practices in the welfare effort. But the pressure on banks will definately increase. So More branches and ATMs will be required.
Other idea of fair price shops seems viable.

Subsidy on fertilizers

It is given to the farmers so that they could grow their crops and earn a reasonable profit which will sustain them over a season or so.
Basically it's adding money to the net profit of farmer.
- Reducing fertilizers subsidy without other various efforts will lead in fall in agricultural output.
Other efforts : Over time -
All the factors that put pressure on the govt to give subsidy like
- Shortage of food due storage (this may be tackled by FDI in retail sector now by storage companies setting up infrastructure but due to private ownership of these, these could take advantage of the situation by offering the little incentive to farmer and earning more profits.. govt intervention is sought)
- More penetration of commercial banks , micro finance institutions and encouraging self help groups.
- Financial management in agricultural sector or say rural sector has yet to see light. It may be present but not aggressively pursued.
- Creating awareness of demerits of using fertilizers and chemicals extensively both for land and human beings.
- Alternative & traditional ways like biofertilizers, frogs, worms etc.
-Use of genetic crops
- Farm page of newspapers like ' The Hindu' and other easy innovative practices to compiled and distributed to farmers in local language monthly, this help them preserve their soil, land and water in better way.
- Asking for the soil samples from the farmers and recommending the type of fertilizers they need for the crop.
- Giving direct recommendations from the research reports to the farmers about the crops and their problems.
- Setting up regional centres for the tests of the soil of the farmers land free of cost and recommending the type of fertilizers needed, coupling this with the advice to use bio fertilizers. But biofertilizers has to get more cheap and abundantly available so Biofertilizers as an enterprenureal product should be encourage and waste management programs should be advocated in every region esp in the state like punjab .This is the era of large consumption across the country and large amount of waste both bio and non bio degradable is generated. This will eventuallly help in other sectors also.
-Setting up of govt transport infrastructure from the farms to food storage facilities and markets at No profit no loss costs, or making mandatory deploying mobile processing units at farm gate.

All these steps if implemented may uplift the poor and farmers and agricultural sector can boom without second green revolution. And this will also result in providing govt. with lifting of a part of subsidy which may use in rural infrastructural projects esp. water management systems as farmers are largely depend on ground water which causing shortage and is not in conformity with the objective of sustainable development.
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