Jan. 16, 2020
Citing the high inflation rates of agriculture commodities, RBI governor Shaktikanta Das has recently stated that the supply chain in agriculture needs more improvement than it is. Despite the high inflation rates of agriculture commodities, farmers are receiving very low prices for their produce.
Price for Farmers Varies from Place to Place
In his opening remarks in third Suresh Tendulkar Memorial Lecture, the governor highlighted that better communication facility, easier access to credit and connected rural roads can contribute to the farmers’ income. Further, he emphasized agriculture market reforms that shorten the difference between prices paid by the consumer and received by the farmers. Moreover, he also mentioned that the price received by farmers varies from 28% to 78% as per a survey conducted in 85 mandis across different states. The perishable commodities get a lower price as against the non-perishable ones, he added.
Inflation in Agriculture Commodities
The governor also mentioned the persisting high inflation is somehow responsible for adversely affected the economy by adding inequality in the distribution of income. Inflation rates in agriculture commodities remain as a matter of high concern. Farmers do not receive the right price for their produce therefore, the supply chain needs alteration. He further emphasized on the utilization of tax collections for social and infrastructural expenditure to maintain financial stability for economic growth.
What’s the Growth?
Tharman Shanmugaratnam, senior minister of Singapore moreover appreciates India’s growth. He praised the development in terms of electrification, sanitation and financial inclusion in the last five years. He also mentioned the importance of entering into a global chain by becoming more export-oriented. Referring to the high unemployment rate (30%), he advised focusing on increasing employment opportunities at a fast rate. Further, he spoke about rapid urbanization to decrease the pressure on the existing cities. The manufacturing sector must expand at a fast pace as it is the one accommodating bulk of the labor. Besides, it will provide alternative employment opportunities other than agriculture. He also mentioned the need to prioritize the green economy for sustainable development.