Farmers Gather in Delhi Demanding Assured Prices for Crops

(Bloomberg) -- Thousands of farmers protested in India’s capital, demanding debt waivers and remunerative prices for crops, underscoring challenges Prime Minister Narendra Modi faces before national elections next year.

As many as 30,000 people representing about 200 farmer organizations reached the protest ground Thursday more than 4 kilometers (2.5 miles) from India’s parliament in the heart of New Delhi. They plan to march to parliament Friday. The farmers are demanding a special session of parliament to ensure minimum crop prices and a nationwide waiver of farm loans amid rising costs of fertilizers and agricultural inputs.

Keeping a key election promise made in 2014, Modi earlier this year approved a 50 percent return over the cost of production. Still, prices of crops including rice, pulses and oil seeds in some wholesale markets are below the government-set rates. Lower prices, combined with inadequate government purchases, have triggered the protests.

“The calculation of support price that the government fixes is erratic and erroneous,” said Darshan Pal, a rice and wheat farmer from the northern state of Punjab, who is participating in the protest. “The government should include actual rent of land, interest on capital invested and skilled labor rate while calculating the cost of cultivation of various crops.”

The government’s procurement agencies, which are mandated to purchase agricultural commodities at guaranteed rates to support prices, buy only a small portion of total output, leaving millions of farmers across the country at the mercy of middlemen.

Protests May Swell

Some farmers traveled for more than 2,000 kilometers from different parts of the country to reach New Delhi to participate in the two-day protest, which is expected to swell to 100,000 people by Friday, according to Raju Shetty, a member of parliament from Maharashtra state,
who is participating in the protest. About 800 million people of India’s 1.3 billion depend directly or indirectly on farming, with agriculture accounting for about 16 percent of the economy. The country is the world’s top grower of cotton and the second-biggest producer of wheat, rice and sugar.

Indian farmers fetched about 360 billion rupees ($5.2 billion) less last crop season due to lower market prices of commodities including rice, corn, cotton, soybean and some pulses, than what they would have received by selling at government-set minimum purchase prices, said Avik Saha, a member of political party Swaraj Abhiyan, while marching with protesters in New Delhi.

“We want Modi to waive our loans because banks are attaching farmers’ properties,” said Kumar Ramaswamy, 49, a farmer from the southern state of Tamil Nadu. “We should be paid a fair price for our produce.”

--With assistance from Santosh Kumar.

To contact the reporters on this story: Archana Chaudhary in New Delhi at achaudhary2@bloomberg.net;Pratik Parija in New Delhi at pparija@bloomberg.net

To contact the editors responsible for this story: Anna Kitanaka at akitanaka@bloomberg.net, Abhay Singh, Ashutosh Joshi

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