November 12, 2009 / 1:29 AM / 10 years ago

SPECIAL REPORT-India's food dilemma: high prices or shortages

* Growing calls for a different sort of Green Revolution

* Looming scarcity opens door to genetically modified crops

By Himangshu Watts

NEW DELHI, Nov 12 (Reuters) - For a man who will inherit vast tracts of fertile farmland in Punjab, India’s grain bowl, Jaswinder Singh made what seemed to him a logical career move — he took a job with a telecoms company in New Delhi.

"I can’t go back to the village after an M.B.A. Delhi has more money, better quality of life. The job is more satisfying, and you don’t depend on the weather or prices set by the government," said Singh, who earns rent from his farm, while a tenant tills the land.

Singh’s choice reflects a growing and worrisome trend in the nation’s agriculture sector: Indian farms are failing to attract capital or talent, either from rich landlords like Singh, or the 21,000 students who graduate from India’s 50 agricultural and veterinary universities.

"At present, most of the farm graduates are either taking jobs in the government, or financial institutions, or in private sector industry. They are seldom taking to farming as a profession," a report by the M.S. Swaminathan Research Foundation said.

The views of the foundation — set up by M.S. Swaminathan, who led India’s Green Revolution in the 1960s that helped make this vast nation self-sufficient in food — were echoed in a poll by the National Sample Survey Organisation, a government body. The survey showed 40 percent of Indian farmers would quit farming, if they had a choice — an alarming revelation for a country where two-thirds of the billion-plus people live in villages.

SLOW GROWTH

India’s farm sector has changed remarkably little since the advent of the Green Revolution, while other industries have been transformed over the past two decades. As a result, agriculture’s share of the Indian economy shrank to 17.5 percent last year, from nearly 30 percent in the early 1990s.

"We are not realising that farming is becoming an increasingly less profitable profession. There was a time when farmers had very little choice. Things have changed. Farmers would like to make a shift," said T.K. Bhaumik, a leading economist.

This has raised concerns that India’s farm output could lag demand and the country — which ranks among the world’s top three consumers of rice, wheat, sugar, tea, coarse grains and cotton — will become a large food importer unless yields jump.

"The increase in yields in the past decades have been insignificant. India sorely needs another Green Revolution," says Kushagra Nayan Bajaj, joint managing director of Bajaj Hinduthan (BJHN.BO), India’s top sugar producer, which is importing raw sugar after a drought ravaged the domestic cane crop.

But the next revolution faces a tougher challenge — in part because of the environmental damage done by the previous one. Back then, abundant groundwater was available and the soil was not degraded by pesticides and fertilisers, which initially helped boost productivity.

P.C. Kesavan, distinguished fellow at the M.S. Swaminathan Research Foundation, said chemicals used in agriculture had destroyed the sustainability of productivity in the long run.

"Yes, a second Green Revolution is indeed very essential — the very need of the hour. But, it should not be the same kind of Green Revolution that the first was," he said.

In India’s Punjab state, the flagship of India’s Green Revolution, groundwater is declining rapidly.

"The water table of Punjab is falling at an alarming rate, especially in the central districts, due to excess drawing of groundwater," said Karam Singh, an agricultural economist at the Punjab State Farmers Commission.

Sardara Singh Johl, an economist and former chairman of India’s Commission for Agricultural Costs and Prices, said there would be very little water available for farming in the state. "This could severely compromise the food security of India. Government should realise the gravity of the situation and allocate funds for research to conserve groundwater," he said.

To prevent food shortages, economists and scientists are calling for a range of policy initiatives, such as allowing genetically modified crops, greater investment in irrigation, better economics in farming and greater government attention to agriculture.

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