Forward gears of farm mechanization

Non-remunerative agriculture has pushed large number of farm labours in Assam to migrate to cities and towns to work in construction sectors or get employed as unskilled workers in industries. This has led to shortage of labour and rise in the cost of hiring labour in the state precipitating agricultural crisis. Farm mechanization remains an option for farmers to replace high cost manual labour to increase production and productivity. Lack of adequate capital limits the purchase of farm machineries by farmers while the cost of taking on rent from individual owners of farm machineries is also often not affordable for small and marginal farmers. Poor agricultural credit disbursement in the state is indicative of farmers not feeling confident of mobilizing finances through bank loans to fund agricultural activities, including procuring farm machineries. The State Focus Paper of the National Bank for Agriculture and Rural Development (NABARD) for Assam for the year 2023-24 brings to light that priority sector advances during 2021-22 touched an amount of Rs 60,568 crores, but only 19.6% was advanced towards agriculture while 24.8% was advanced towards MSME sectors. Against a target of Rs 10,066 crores of crop loans, only Rs 1891 crores were disbursed, but optics of individual success stories overshadows ground realities. The Sectoral Paper on Farm Mechanization published by NABARD highlights the disparity between northeast region and rest of India in farm mechanization. It points out that even though farm mechanization in states like Punjab, Haryana and Uttar Pradesh is very high, negligible farm mechanization in northeast region has kept dragging the overall farm mechanization of the country at 40-45% compared to 95% in United States, 75% in Brazil or 57% in China. The NABARD estimates the credit projections for Assam for 2023-24 under Crop Loan at Rs.12,146.94 crore including Rs.792.71 crore credit for farm mechanization. Addressing the issues identified to be coming in the way of farm mechanization will be critical to achieving the projections. Some of the issues listed by NABARD are: cumbersome credit procedure, agriculture markets remaining supply-driven and not demand driven which leads to price fluctuation and low income adding to hesitancy among farmers to take loans to increase investment, low awareness about availability of machineries which are suitable for small land holdings and can be procured by individual small farmers, etc. The document pitches for farm mechanization as the only alternative to deal the problem of increasing cost of labour and argues that it can help reduce time by approximately 15-20 percent. “Additionally, it helps in improving the harvest and reducing the post-harvest losses and improving the quality of cultivation. These benefits and the savings in inputs help in the reduction of production costs and allow farmers to earn more income,” adds the NABARD sectoral paper setting the premise for policy push for farm mechanization to boost agricultural production and augmenting income of far households. A key issue pointed out in the document which needs attention of the police makers is that subsidy provided by the central or the state government is based on budgetary allocation and not based on actual requirement of loans. Assam Agriculture Department set the target of setting up 128 village-level farm machineries bank and fixed subsidy of 95% of the total amount subject to maximum subsidy amount of Rs. 9.50 lakh for purchasing power tiller, tractor, rotovator, thresher, reaper etc. Over the past two years, altogether 321 tractors and 95 power tillers were procured at subsidy by selected group of farmers in 321 villages for establishment of Village Level Farm Machinery Bank and by selected individual farmers as single machinery under Sub-mission on Agricultural Mechanization, a central sector scheme. Distribution of 9525 tractors in 9525 villages under the Chief Minister’s Samagra Gramya Unnayan Yojana (CMSGUJ) also indicated the push by the state government for farm mechanization in the state over the past two years. The subsidy of 70% (maximum of Rs. 5.5 lakh) is provided to the selected groups of 8 to 10 members on the procurement price of the tractor, including implements. While 20% of the amount is provided by the bank as a loan, the rest 10% is required to be paid by the applicant member group. CMSGUJ scheme envisages covering all the 26,000 villages in phased manner which is a significant step forward towards accelerating the pace farm mechanization. Rental of these tractors remaining affordable for individual farmers will be crucial for deriving optimal benefits of the scheme and achieve targets of boosting production with the help of farm mechanization. Strengthening the village level common hiring centres of farm machineries through procurement of drudgery reducing technologies in addition to tractors, power tillers, threshers, etc, setting up of cold storages, marketing linkage will go a long way in realizing the benefits of farm mechanization in doubling income of farm families.