Context: While the agri-exports have risen in the recent times, it’s time to look at commodities like rice and sugar from a sustainability perspective.
Agri-exports at new heights:
Agri-exports touched $41.8 billion in FY 2020-21, registering a growth of 18% over the previous year.
However, even these exports fall much short of the target of $60 billion that the Narendra Modi government set out to achieve by 2022.
Issues of sustainability in agri-exports of India:
Water guzzling:
Amongst the various agri-commodity exports, rice ranks first with 17.7 million tonnes valued at $8.8 billion, roughly 21% of the total value of agri-exports.
Rice and sugar are well-known water guzzlers – 1kg of sugar has a virtual water intake of about 2,000 litres.
In 2020-21, India exported 7.5 million tonnes of sugar, implying that at least 15 billion cubic metres of water were exported through sugar.
India is a water-stressed country with per capita water availability of 1,544 cubic metres in 2011, down from 5,178 cubic metres in 1951.
Provisions of heavy subsidies:
They are heavily subsidised through cheap/free power for irrigation as well as fertilisers, especially urea - power and fertiliser subsidies account for about 15 % of its value in states like Punjab and Haryana.
Sugar-exporting countries like Australia, Brazil and Thailand have registered a case against India at the WTO.
Greenhouse Gas Emissions (GHGs): Rice cultivation contributes to more than 18 % of the GHG emission generated from agriculture.
Declined exports in broader terms: Agri-exports have remained lower than the level reached in FY2013-14 ($43.3 billion)
It has slid to 13.5% by FY2020-21, indicating India is becoming less globally competitive in exports and more protectionist in imports, presumably in the name of Atmanirbhar Bharat.
Price distortions: Non- basmati exports are actually sourced not only below- MSP but also below the average domestic mandi prices prevailing in the country.
One possibility is that a substantial part of supplies through the PDS and the PM Garib Kalyan Yojana are leaking out and swelling rice exports.
Way forward:
Adopt water-efficient farming practices:
Farming practices such as alternate wetting drying (AWD), direct-seeded rice (DSR) and micro-irrigation will have to be taken up on a war footing.
Farmers may be incentivised and rewarded to save water, switch from paddy and sugar to other less water guzzler crops, and reduce the carbon footprint.
It is high time to introduce direct cash transfers in PDS for rice.
Diversification of agricultural systems to save up on costs of burgeoning buffer stocks and diverting those savings towards research and development.
Better logistics and infrastructure: An export-led strategy also needs to minimise logistics costs by investing in better infrastructure and logistics.