Agrarian Subsidy Cut In US Through Indian Prism
Much like India, United States (US) farmers are also facing frequent fall in income. This has been happening for the fourth consecutive year in US and most affected farmers belong to the states that helped Trump to win elections.
While there are no descanting voices in India for various farm subsidies by government and putting burden on state exchequer, the US President is surrounded by many questionable decisions in his first presidential tenure. The US president Donald Trump in his budget, proposed major cuts in agrarian subsidies, a nightmarish thought for any Indian politician.
Few congress members in US from farm states like Kansas, Iowa and Nebraska along with farm groups are criticising the proposed cuts to crop insurance in US, the same way Shetkari’s started in Maharashtra and Kisan Sangh in Madhya Pradesh both states facing ongoing farmers’ agitation in India.
Trump’s budget has also got some proposed cuts in safety net programs for farmers in US. Speaking to media American Farm Bureau Federation President Zippy Duvall said, “This budget clearly fails agriculture and rural US”. Though the Indian version of agitation had claimed lives of several farmers’, leaving US behind.
While India had constituted its first farmers’ commission in 2006, it took 59 long years for India to understand that farmers’ are also human. US on the other hand has a long history of agrarian subsidies.
US had started it way back, with 1922’s grain’s future act followed by agricultural marketing act of 1929 and agricultural adjustment act of 1933. Economic Research Services of United States Department of Agriculture (USDA), presents materials on all farm and commodity programs under 2008’s Farm bill of US government.
The farm bill covers commodity programs, trade, nutrition, rural development, research, horticulture-organic matter and the most important crop insurance and disaster assistance programs. India is still struggling to implement recommendations that are now decades old (National Commission for Farmers’ recommendations).
India, which is witnessing its successful PM crop insurance scheme has more chances to promote crop insurance in coming years but US had proposed a budget, which will reduce expenses to $28 billion over 10 years.
It would cap the expense of US government, which it pays to help farmers in insurance premiums and also eliminates insurance coverage for lost revenue, when there is low yield or crop prices falls.
India has witnessed a different aspect while Kharif crops had covered 56.52 per cent more insured farmers in Modi government’s tenure and Rabi crop had also covered 34.73 per cent more coverage of farmers (both with and without loans). While Indian states are taking measures like Market Intervention Scheme (MIS) to control fall in prices of agricultural commodities.
Moving a step forward, Donald Trump had proposed to reduce subsidies to farmers’, in a typical Trump way by cutting those programs to $9 billion and resizing the maximum income level from $9 lakh to $5 lakh for eligible farmer.
Proposed budget will also cut 5.5 per cent jobs in agriculture department of US government by cutting around 5263 jobs. Meanwhile the Income Tax department of India is still in dilemma to find those people who evade taxes in the name of agricultural income.
Agrarian experts speak in similar tune across the globe, and Indian agriculture economists and experts are no exception. US agriculture economists, agriculture experts and farmers say, it is important to support the agriculture sector, which makes up about 11 per cent of US employment, or about 21 million jobs, and contributes nearly $ 1 trillion to the US national domestic productivity.
"The strength of the agricultural economy has implications for rural America, but also for the larger US economy," Robert Johansson, the USDA’s chief economist from university of Mississippi, told senators after Trump’s budget. It sounds similar to the Madhya Pradesh CM’s statement where he said “India can’t progress without farmers”.
Speaking to US Media, Michigan Senator Debbie Stabenow, the leading Democrat on the Senate Agriculture Committee, warned that “the proposed cuts would have a disproportionate impact on small towns across our country and leave those communities in crisis", reminding the tune of Bhartiya Kisan Sangh from India.
It is more like a similar political drama in India and US as some people there in US, say there's no need for farmers to worry as yet.
"What I've been telling farmers is let's just relax a bit before we panic. It's going to be hard for Trump to get anything done. That's become really obvious," said B Gloy, a former Purdue University agriculture economist who now works full-time on his family's corn, soybean and wheat farm in southwest Nebraska, where Trump had strong support. Picture is contrasting in India with Patidar’s of MP and Gujarat using the protests for their political mileage.
(With inputs from Economic Research Service USDA, Indian Society of Agriculture Economics and US media reports)
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