Farmer protests: Normalcy returns in MP but decision to buy onions may backfire

After a week of violent protests that resulted in death of six farmers, the western belt of Madhya Pradesh is slowly moving towards normalcy with curfew being lifted off and internet services being resumed.

For now, farmers have responded to Chief Minister Shivraj Singh Chouhan's initiatives and given up their protests.

However, some of these pro-farmer initiatives could have serious repercussions on the state's revenue as it did last year when the Shivraj government had announced similar steps to calm down angry farmers. The decision to buy onions at Rs 8 per kg from the farmers is one such measure that could cost the government dearly

It seems the state government has not learnt its lesson from the previous years where it not only had to sell onions at a very low cost but had to even spend on transporting the stock to different places. Adding to this, a substantial amount of the onion stock perished since the government didn't have adequate storage facilities. If this wasn't enough, the government had to spend a lot in clearing out these rotting onions.

In 2016, under pressure from the farmers, the government bought 10.5 lakh quintals of onions at Rs 6 per kg. As a result, the government spent nearly Rs 60 crore in procuring onions. Thereafter, the government tried selling onions at a price of Rs 4 per kg which didn't find any buyers. It was then decided that the price should be fixed at Rs 3 and yet again there were no buyers forcing the government to try and sell it at Rs1 per kg. Still there were no buyers.

Left with no choice, the government decided to distribute the onion for free through PDS outlets and that again cost them Re 1 per kg in transportation. In addition, six lakh quintals of onion perished in godowns and the state government had to spend more than Rs 7 crore in removing these. In total, the government spent close to Rs 70 crore in buying onions.

As a result, the government announced that it will take necessary steps to ensure better storage facilities for onion it will procure from farmers. However, these assurances turned out to be a damp squib considering no such efforts have taken shape at the ground level.

Citing these losses across various states, the central government announced that 56,800 tonnes of storage capacity of onions would be added in three states including Madhya Pradesh. The state was to increase its storage capacity by 38,000 tonnes. However, nothing has happened on ground and things stand where they were a year ago.

Meanwhile, in the last few days, several areas in the state witnessed heavy rainfall and with monsoon fast approaching, there is a likelihood of onions worth crores being damaged. With government's announcement of buying onions at Rs 8 per kg could further hurt the state exchequer.

Experts estimate that this time around, government could spend nearly Rs 100 crore in procuring onions from the farmers. With no improvement in its storage capacity and facility, a repeat of 2016 is most likely on the cards. It remains to be seen that for how long would the government continue to turn a blind eye towards such losses and not move towards improving the basic infrastructure.

Along with this, the prices of other crops like potato and soyabean have also plummeted severely with farmers not expecting to make any profit. There is no denying the fact that the state government has taken efforts to improve the state's irrigation network along with a better procurement system. As a result, the state has the country's highest agricultural growth rate in the last few years.

The agricultural growth rate in the state has witnessed a jump of more than 10% in the last decade which reflects in the bumper harvests year after year. While improved infrastructure has definitely resulted in bumper crops, it has also led to drastic fall in prices which has led to farmers demanding higher price from the government for their produce.

Meanwhile, Chouhan on Sunday called off his fast and said that violent incidents in Mandsaur would be investigated thoroughly. The chief minister was on an indefinite fast at the Dussehra Maidan in Bhopal in order to restore peace in the western region of the state.

Earlier on Saturday, Chouhan met with members of four families from Mandsaur district who lost their kin after police fired upon the protestors on Tuesday. The family members asked Chouhan to take action against policemen responsible for the deaths of six people. They also asked for loan waiver and a higher MSP for their produce.

During the meeting, they asked the chief minister to release innocents lodged in jails across the state and said action should be taken only against those who are guilty. The chief minister gave them a patient hearing and said he will look into their demands. Meanwhile, the families, who were hoping to receive a cheque of Rs 1 crore, were asked to wait and Chouhan said he will soon visit the trouble area.

In other developments, social activist Medha Patkar, Swami Agnivesh and Yogendra Yadav tried to meet the kin of the victims but were not allowed to enter the state. The police informed them that the situation has not normalised and they would be allowed once normalcy is restored.