FUTURE OF INDIA LIES IN BHARAT

Narayan used to work at a construction site in Mumbai. He is now safe, back in his home at Telangana. A ‘migrant,’ he says that he finally knows where he belongs and who really looks out for him.

He is happier; he might not have enough money or the best broadband connection or the occasional outing with his friends to cinema’s and malls but he feels secure and content. His home is in a small village and there is no Covid, yet. He is super busy, sowing in his farm land, enjoying the pleasures of being a farmer which he had denied himself for so long. He feels all this is a signal from God, urging people like him to revert to farming, especially with monsoon also expected to be bountiful this year.

And that is exactly what is happening with many of the migrants who left cities and made the arduous and treacherous journey back home. Majority of them are there at the right time – its kharif sowing season and this is probably after a really long , long time that farms in India would be seeing so many heads bobbing in the fields!

We have data to back this - Centre for Monitoring Indian Economy (CMIE) stated that  rural unemployment rate continued to drop, falling to 7.26% in the week ended 21 June from 10.96% in the previous week. The job loss rate has now dropped to the lowest level in three months, even lower than the week preceding 25 March, when India first went into a stringent lockdown.

But for corona, the fact that the IMD has estimated India to have a good monsoon would have been such great news for the market - out of 683 districts in the country, rainfall has been normal in almost 74% of these. According to data from the department of agriculture, until 19^th June, the kharif crops sowing was 39% higher than last year. Aren’t these the silver lining’s which we should look at – this is what will help us stay ahead in H2FY21.

We are mainly an agrarian country and more so this year. What the industry will not be able to give today, the farms will give; the GDP might not be what it needs to be but at least we all will have food and be self-reliant. Imagine having to import rice, wheat and pulses from China – that kind of dependency would have most certainly been fatal.

It is going to be rural India which will once again drive India ahead. The ‘Bharat’ as we refer to rural India has received the biggest chunk of the so-called Rs.2 lakh crore stimulus.  What will really be a game changer will be the freedom to sell and buy their farm produce outside the mandis – this means farmers can now sell directly to whomsoever they want – exporters, wholesalers, retailers, even food processors – not just within their state but outside too and also by using e-commerce. 

Another booster will be the lifting of curbs on Essential Commodities Act (ECA) stockholding. Under ECA, production, supply and distribution of, and trade and commerce in, certain goods such as vegetables, pulses, edible oils, sugar, etc., which are treated as essential commodities gave the power to the Govt to implement provisions. Like when onion prices shoot up, the Govt could impose stockholding limits to prevent hoarding but instead of keeping the prices in check, ECA limits made its expensive. Thus removing this imposition of ECA stockholding limits will work wonders.

So the three M’s – Modi, migrants and monsoon make rural India the best bet. A bountiful harvest will put cash into the hands of the farmers and that could lead to some demand coming back. Rural India growth rate will be much higher than urban and that is good news for us, for now.

Today Gandhiji’s words ring all the more true – the future of India lies in its villages.