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G. Srinivasan

Meeting on May 14 to draw a roadmap for 11th Plan

New Delhi May 4 A full meeting of the Planning Commission is being convened here on May 14 to address the structural constraints and take stock of the situation on the country's agricultural sector so that a viable strategy for pepping up farm sector development during the 11th Plan (2007-12) could be devised.

Sources in the Government told Business Line here that the Planning Commission Deputy Chairman, Mr Montek Singh Ahluwalia, has made a presentation to the Prime Minister, Dr Manmohan Singh, here last week, topped by similar presentation to the Union Minister of Agriculture, Food and Civil Supplies, Mr Sharad Pawar, here on Friday. Mr Ahluwalia confirmed to Business Line that a full meeting of the Plan panel exclusively on the issue of agriculture sector would be held under the Chairmanship of the Prime Minister.

The sources said there were no dearth of counsels on evolving workable strategies for the 11th Plan as the panel itself had the advantage of sifting five reports by National Commission on Farmers headed by agricultural scientist Dr M.S. Swaminathan, as many as eight reports by NDC Sub-Committee on Agriculture, another dozen reports by various working groups on the Eleventh Plan, besides the steering committee report.

Tech fatigue

The sources said the objective of compassing 4 per cent agricultural growth would entail overcoming serious technology fatigue in productivity potential particularly efficiency of water and soil nutrients. Efforts would be towards focusing on investment, efficiency and systems support rather than subsidy as the latter has continued to mount from 295 per cent of GDP agriculture in 1976-1980 to 4.96 per cent in 1986-1990, to 5.17 in 1991-1995, to 5.67 per cent in 1996-2000 and to 7.42 per cent in 2001-03.

Prune subsidies

The sources said while subsidy reduction as an objective should be kept in view, it would be intractable to cut down subsidies in the extant context of distress and low profitability "unless quality and effectiveness of public services improves and unit costs reduced". They further said minimum support price (MSP) ought to be honoured for at least some crops in every region and repercussions of volatile global prices must be checked through more active tariff policy.

Stating that it might be easier to prune subsidies and reduce unbalanced fertiliser use if soil health awareness was subserved and made credible, the sources said the Plan panel would hence focus on soil health and soil testing as priority areas for action.

On credit outreach, which holds vital bearing on farmers, the sources said that the Plan panel deems promoting financial inclusion is greater priority than the more popular demand for lower interest rates. They said both the 11th Plan and NDC working groups have plumped for universal banking, including group lending and a rural credit information system that aims at smart KCC (Kisan Credit Card) cards for all. They said the 11th Plan working group has recommended Rs 36,000 crore mainly as charge on the Finance Ministry and the RBI with some State contribution, to set up debt relief funds.

The sources said States had equal responsibility in restructuring agriculture planning by committing a reasonable proportion of their plans for agriculture and irrigation, evolving a production plan and associate input plan and fixing annual targets at the start of the fiscal year.

The full meeting of the Plan panel would deliberate on the concerns about the tepid agricultural growth and the way ahead in revitalising this important sector through a concrete plan of action in specific areas, drawing from the suggestions of the various expert group reports, the sources added.

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