New Delhi: In the politics of agricultural reforms, the aim is to bring small farmers to the forefront as the primary ‘Labharthi’ (beneficiaries) and the central goal of agrarian reforms in India is to make market mechanisms more efficient, productive, systematic, and sustainable for small farmers, said Krishnamurthy Venkata Subramanian, the former Chief Economic Adviser to the Narendra Modi government and current Executive Director for India at the International Monetary Fund (IMF). Subramanian has made a bold claim in his new book, India@100: Envisioning Tomorrow’s Economic Powerhouse. Released on July 31, 2024, by Union Commerce and Industry Minister Piyush Goyal at a Special Session organised by ASSOCHAM in New Delhi, the book envisions India reaching a US$55 trillion economy by 2047.
Subramanian’s proposition, while ambitious, is grounded in a comprehensive analysis of India’s economic trajectory and the policies required to sustain high growth rates. His projection of a US$55 trillion economy appears optimistic, especially when juxtaposed with Ernst & Young’s prediction of US$26 trillion by 2047. However, Subramanian provides a detailed economic rationale, considering India’s historical inflation rates, currency depreciation, and recent economic policies.
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In Section III: The Second Pillar: Social and Economic Inclusion, Subramanian writes about ‘Agrarian Renaissance: Small Farmers- The ‘Labharathi’ of Agricultural Reforms and makes some strong recommendations.
According to him, the right policy mix, including structural reforms, will not only promote economic resilience in agriculture but also foster social inclusivity and sustainable development. “However, realising this vision requires concerted efforts from policymakers and stakeholders to address the systemic barriers that impede the welfare of small farmers in India,” he writes in India@100.
He emphasises the need for comprehensive agricultural reforms, crucial for enhancing productivity and reducing risks for small farmers. Subramanian advocates for improving storage infrastructure to minimise potential wastage and prevent distress sales of produce to intermediaries in local markets. Additionally, he underpins the importance of providing insurance coverage to small and marginal farmers, a critical measure to ensure their economic stability and resilience.
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Subramanian also highlights, in India@100, the need for clear political messaging to distinguish between large, rich farmers and small, poor farmers. He argues that large, rich farmers often benefit disproportionately from MSP (Minimum Support Price) policies, earning nearly risk-free profits that are also tax-free, as agricultural income is not taxed. This inequity, according to Subramanian, must be addressed to uplift the economic and societal status of small farmers.
By addressing critical issues in agriculture, such as infrastructure and insurance for small farmers, and by promoting equitable economic policies, India can create a more inclusive and sustainable growth model. The differentiation in political messaging between large and small farmers is a vital step toward achieving social and economic justice.
As India stands on the brink of a new economic era, Subramanian’s roadmap provides a clear path forward, urging policymakers, industry leaders, and citizens to embrace bold reforms and innovative solutions. His call to action is a reminder that with the right strategies and collective will, India can indeed rise as a global economic powerhouse by 2047, ensuring prosperity and equity for all its citizens.
