Subject: Economy

India's agricultural landscape is significantly shaped by the interplay of subsidies, support prices, and risk mitigation measures. The Green Revolution, while increasing productivity, has led to various distortions in cropping patterns due to subsidy-driven farming practices.

Impact of Subsidies on Agriculture

Effects on Cropping Pattern

• Input Subsidies have encouraged water-intensive crops like paddy and sugarcane in water-stressed regions.
• The skewed fertilizer subsidy has resulted in an imbalanced NPK ratio of 7.7:3.1:1 against the ideal 4:2:1, leading to soil degradation.
• Power Subsidies have promoted unsustainable groundwater extraction, affecting long-term agricultural sustainability.

Impact on Crop Diversity

• Subsidies have led to monoculture farming, reducing traditional crop diversity.
• Farmers are incentivized to grow subsidized crops, neglecting climate-appropriate and nutritious alternatives.
• This has resulted in the decline of indigenous varieties and traditional farming practices.

Significance of Support Mechanisms

Crop Insurance

• Pradhan Mantri Fasal Bima Yojana (PMFBY) provides risk coverage for crop failure.
• Helps small farmers recover from climate-related losses and market uncertainties.
• Promotes adoption of new technologies and farming methods.

Minimum Support Price (MSP)

• Acts as a price guarantee mechanism, protecting farmers from market volatility.
• Announced pre-sowing season based on production costs and market trends.
• Ensures income security for 86% of India's small and marginal farmers.

Food Processing

• Reduces post-harvest losses through value addition.
• Creates employment opportunities through PM Formalisation of Micro Food Processing Enterprises Scheme.
• Enhances farmers' income by extending the shelf life of produce.

The integration of these support mechanisms with sustainable agricultural practices is crucial for achieving the goal of doubling farmers' income. A balanced approach between subsidies and market-oriented reforms, along with focus on climate-smart agriculture and crop diversification, will ensure long-term agricultural sustainability and food security.