Economics unmasked: The farmer and the bank officer – I
by Rahul Goswami on 20 Aug 2017 6 Comments
A development assistant junior officer of a district cooperative bank in western Maharashtra, Kolhapur district, meets a kisan. The officer makes his way to the block of Gadhinglaj, in which three-quarters of the 38,000 hectares under cultivation are tended by households classified as small (holdings of 1 to 2 hectares) and marginal (less than a hectare).


The junior officer has been asked to meet the neighbours of an account holder, for the district cooperative bank wants to increase the number of customers from the block for its agricultural loans. The junior officer has been supplied with some tables which he studies while in the state transport bus, and has had his ears filled with the reasoning that such banks have scripted for likely farming customers.


As neither the bank nor the junior officer can proceed without a ‘cultivation costs’ table being filled, he asks the prospect the first question: “Value of hired human labour?”


“What do you mean ‘value’? Myself, my wife, my son and daughters and occasionally my mother when she is feeling well and sometimes my brother’s wife, work in our field. Our field, our labour.”


“Yes but what is paid for this labour?”


“Family labour is better than paid labour.”


The junior officer moves on to the next question: “Value of bullock labour whether owned or hired?”


“Five we have, Sanju and Manju the elder ones, Hira, Rama and Doli the younger. The older ones are a bit slow but strong. The younger three are playful and have yet to learn.”


“Yes but what do they cost you?”


“We feed them with the rice stalks, or jowar stalks. My brother and his wife give us some oil cake which they like. Behind my neighbour’s fields are the village pasture lands where we take them for grass.”


“Cost please.”


“Manju can eat the most when she feels like it, otherwise Rama does. What is ‘cost’ to either of them or to the field with the grass they like?”


“But I can’t put that in my form! Cost in rupees please.”


“If I have to buy fodder it may be 2 to 4 rupees a kilo when fodder is scarce.”


“When do you buy?”


“When they need it, obviously.”


Another non-answer, thinks the junior officer, who has a B. Tech. degree in civil engineering and who took a job at the bank because his father, also a kisan in the neighbouring district of Sangli, had decided that his children should not have to till fields.


Having looked around him at the kisan’s home, shed, stable and yard, the junior officer decides to omit the question about machinery and moves on to the next: “What do you pay for seed?”


“That is always an interesting subject, ‘beej’. But which do you mean? Jowar, alsande, avare, tandul?”


“All that you plant, please.”


“You see that house there,” says the kisan, pointing to a small cottage at the foot of the slope. “That is where Urmila-tai keeps the seeds I like. She gives them to my daughters for our fields.”


The junior officer, for all his inexperience and despite the very inadequate and misleading instructions about his work, realises that the script he has been told to follow is proving useless. Surely, he thinks to himself, all the 46,600 households in 93 villages of Gadhinglaj block could not be like this one.


“You do not buy seed every season, do you?”


The farmer spits, laughs and gives him a sharp look. “Money for seed and seed for money? Do you think Lakshmi comes this way?”


“But better and certified seed is available with the extension shops.”


“We have our seed and we have had it for many generations. Seed is not to be sold nor bought. You bank people are ignorant and the younger bank officers more so.”


Half an hour later, the development assistant junior officer left the kisan’s home, chastened and frustrated. His costs of cultivation form had only four of the 14 items in the ‘A1’ category filled, and the young man knew that his supervisor would not be able to calculate the remaining costs - A2, B1, B2, C1, C2 and C3, which dealt with rent, leased land, interest, depreciation, imputed labour values, and several others - from the results of his disastrous interview.


It occurred to the junior officer on his return journey in the bus to Kolhapur that the agronomists who had designed this method of collection of farming information may not have understood how kisans in fact cultivate crops, husband cattle and buffalos, and gather what they need. But they are supposed to be economists, or so we’ve been told, and economics is about connections such as these. What else could it be about?


This encounter in Gadhinglaj block, Kolhapur district, is an illustration of what happens when an economic equation meets reality. Either the equation must learn, or if its makers refuse to allow it to, it must invent a tale that has nothing to do with the reality for which it is supposed to have been designed.


The cost of cultivation table exists, and has existed for several decades, and has during these decades been modified several times. None of these modifications, nor the cost ideas themselves, have ever included what I have described in this small fictional scenario between the Gadhinglaj kisan and the bank officer. And yet this cost of cultivation table and all its replies for many crops in many growing regions of India forms the basis of a price directive which is very important indeed: the minimum support price.


Whose economics is the hapless development assistant junior bank officer following? That of his supervisor and his supervisor’s boss, the bank’s branch manager. What about the manager? His economics is derived from the cooperative’s bank’s idea of lending, loan securing, setting of interest rates, rating of farmer’s assets, marketability of their produce, willingness of traders to buy such produce, financing the traders and so on.


That idea has nothing whatsoever to do with the views, methods, knowledge, values and family life of the Gadhinglaj farmer. It has instead to do with how much profit can be had at each financialised step of the tortuous journey that an agricultural crop undertakes from the time it is seed to the time it becomes cooked (or processed) food ready to be consumed.


This is what the district cooperative bank and others like it, and what the large scheduled nationalised banks and their more glamorous private counterparts, and what the Reserve Bank of India, all imagine is a kind of economics which, since a field and farmer are actors, is called agricultural economics.


If he gave himself the time and had the inclination to dwell upon this, the Gadhinglaj kisan would be amused by such a chain of self-deception. Yet it is this quality of modern macro-economics – the farther away it is from field truths, the more authority it invents for itself – that has been kept carefully obscured.


(To be concluded...)

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