Extracts from Simple Alternate Development Strategy -1997′
“The alternate strategy involves printing of currency notes and this is under the purview of the central government, A question will therefore arise as to how a state government can adopt this strategy without the central government’s involvement. This is not difficult. The state government can sanction loans to a farmer for digging wells and pay the amount by tokens which can be made legal tender. The farmer can pay the workers employed by him with these tokens and the workers can buy their requirements from the shops with tokens and the shopkeepers can pay taxes, electricity bills, water bills etc to the government with these tokens. At other level, the, the state government can sanction loans to the farmers for digging wells and credit the loan amounts to accounts of the farmers in a state financial institution. The farmers can pay the workers with a slip/chit/cheque and these amounts could be credited to the workers’ accounts in the institution. The workers can pay the shopkeepers for their requirements like food grains, clothing, footwear etc by slips/cheques. There can be settlement of accounts in the financial institutions once in a week or two weeks or a month. ”
The above extract, though about improving agriculture and overall economy, describes the possible operation of cashless economy
Life Expectancy at birth in India increased from 58.5 years in 1990 to 64.19years in 2010 but it is still below the world average of 67.88 years, according to UN POPULATION PROSPECTS 2010. India ranks 146th among 198 years.All the neighbouring countries have higher life expectancy than India as seen below.
Sri Lanka 74.25
Japan with life expectancy of 82.73 years ranks no.1.Life expectancy depends on diet, medical facilities, accidents, climatic conditions etc. The fact that some people in India live upto 100 years shows that climatic conditions are alright in India.
India’s per capita production/ availability of food grains is only around 200 kg per year (260 million MT for 1270 million people) while the world average producion is over 350 kg/per head/per year. India should stop thinking that it is surplus in food grain production.
Though India has excellent medical facilities in several cities,the overall expenditure on health in India is only around 4% of GDP while Sri Lanka and Maldives spend around 8% of their GDP on health. Japan and other developed countries spend around 10% of their GDP on health.It is to be noted that per capita GDP in India being lower than than in Sri Lanka and Maldives(less than half), in absolute terms expenditure on health per person in India is very very low.
If life expectancy at birth in India is to go up substantially, food grain production should increase and per capita expenditure on health should increase significantly.
According to FAO, India has arable land of 157 million hectares(ha). It has a population of about 1250 million people. The density of population per ha of arable land is about 8 persons.
Bangladesh has arable land of 7.7.million ha and a population of about 155 million. The density of population per ha of arable land is about 20 persons i.e. about 2.5times that of India.
Bangladesh annually produces about 51 million MT of food grains, mostly paddy(not rice).i.e. about 330kg per head per year while India annually produces about 280 million MT(paddy taken into account- not rice)i.e. only about 225kg per head per year. It is strange that even with low per capita production India occasionally exports food grains while Bangladesh imports food grains.
Bangladesh receives rainfall of about 265 cm annually while India receives only about 110 cm of rainfall. But low production of grains in India is not due to shortage of water,It is due to under utilization of water as can be seen from the very large quantity of river water joining the sea in various parts of India.There shold be more lakes and dams in India and river and rain water should be drained in these lakes and dams .
Bangladesh takes two/three crops in a years on larger proportion of land than India. Average paddy yield in Bangladesh is also high at around 4.3 MT/ha while in India it is about 3.5 MT/ha. Thus while on an ha of arable land Bangladesh produces about 6.5 MT of food grains, India produces only about 1.8 MT(India produces coarse grains on rain fed areas where the yield is very low and this brings down annual production on an ha of land.
India needs to spend more time and energy on finding ways for better utilization of rain/river water -by linking rivers with rivers, rivers with lakes, recharging ground water etc.
Food Security is wrongly understood by planners. Food security means keeping adequate stock of food grains in the market. While countries where climatic and other conditions are not favourable for agriculture, the governments should ensure adequate stock in the market by facilitating or directly importing food grains. In countries like India food security means facilitating production of adequate food grains by making farming a profitable profession i.e. by ensuring fair prices for agricultural produce. At the same time government should ensure work with fair wages for all adult people. Even the disabled should do jobs according to their ability. The only fields where government should provide services free of cost or at subsidized rates are health and education. This is because, these services at times can become unaffordable for people.Food grains need not be supplied at subsidised rates.
Economy can grow only when the production of goods and services grow. This can happen only when all adults work.
Bihar state had/has able, efficient and illustrious Chief Ministers like S.K.Sinha, Bhola Paswan Shastri, Dr.Jagannath Mishra, Laloo Prasad Yadav and Nitish Kumar. Some of them had very successful Cabinet Ministers at the Central Government holding important portfolios. The state also had/has brilliant bureaucrats. Some of the successful bureaucrats at the Central government are from Bihar cadre. But none of them was able to lift the state out of poverty. The state was under President’s rule several times though for short periods. Among the states, Bihar still has the lowest per capita income of just Rs12000/-per year. The production of food grains is only 10 million tonnes in 2010-11, less than the production of 10.6 million tonnes in 1991-92. The yield per hectare of land instead of increasing over the years has come down from 1450 kg/hectare(ha) in 1991-92 to 1090 kg per ha in 2010-11. The national average yield in 2010-11 is 2240kg/ha. The people of Bihar do not produce even 100 kg of food grains per head per year while other states on an average produce more than 200kg per head per year.
One of the major reasons for the backwardness of the state is the very high density of population (1100 per sq.km) and a very high population growth rate(25% during 2001-11) and the inability of the successive governments to launch huge developmental projects which would have increased the per capita income and reduced population growth rate. Among the major states, Bihar has the highest population growth rate.
Law and order situation is also not satisfactory.
Experiments like postponing elections for two-three years, forming non-party government, imposing President’s rule, emergency etc could be debated
There was a time when India had acute shortage of sugar. Then the government increased the procurement price of sugarcane and continues to increase the procurement price periodically. This has led to India becoming not only self sufficiet but also surplus in sugar.Not only this, sugarcane is one of the only 2 or 3 crops in which India’s yield is higher than world and Asian average yield.
If countries which are deficit in cereals increase procurement prices substantially,the farmers will find ways to increase the yield and production. These countries should also impose import duties on cereals to such an extent that the local produce becomes cheaper. The deficit in food grains can easily be wiped out in most of the deficit countries.
The question will arise as to how poor people who are malnourished for want of money to buy food gains shall buy at higher prices. The people do not have buying power because they do not have enough work. The govenments there should undertake massive works like digging lakes, canals, wells,laying roads, railway lines, power transmitters and lines solar power stations, hydro-electric power stations etc. Most of the west and east African countries receive over 1000 mm rainfall every year and hence increasing food grain production may not be a big problem at all.
The top priority for any state government in India, particularly those in the south, should be construction of lakes on a large scale, not only to dam rivulets but also to drain rainwater from ditches and pits into the lakes. Tamilnadu receives around 100 cm of rainfall per year on an average. If the rainwater is harvested to the maximum extent possible, two- three crops can be raised in most of the places. Tamilnadu will become surplus in food grains.
During rainy season in October-December, one finds water everywhere(i.e.on very large area), stagnating in shallow ditches. This water evaporates in 15-20 days once the rainy season ends, without being of any use for cultivation as the water is not deep enough to recharge ground water. If this water is drained into deep lakes to be constructed, the evaporation will be less and the ground water will be recharged. Around the lakes, one can get water in the wells at a depth of 20-25ft. While rains will be more or less enough to raise one crop, well water will help raise 1-2 crops.
Lake water can also be a reliable source of drinking water for people of villages around the lakes. While supplying water to people from reservoirs/rivers hundreds of kilometres away is welcome, this is not as reliable a source as local lake water.
Each district should have a senior water resources development officer with technical staff and with adequate powers to sanction construction of a lake and related work
The per capita production of food grains (rice, wheat, coarse grains and pulses) in India is less than 200kg per year while in the world it is over300 kg. This means that India’s performance in agriculture needs to be improved vastly. In India among the various states, Tamilnadu’s performance is very poor. During 2009-10, India produced 218 million tonnes for a population of around 1180 million. The per capita production is about 185 kg per year. Tamilnadu state produced about 8.0 million tonnes for a population of about 67 million people, which works out to a per capita production of only 120kg per year.
India’s production went up from 176 million tonnes in 1990-91 to 218 million tonnes in 2009-10 which works out to about 24%increase in 20 years. This increase itself is low. But increase in Tamilnadu is very much lower at 8% from 7.4 million tonnes in 1990-91 to only 8.0 million tonnes in 2009-10.
The reasons for the slow growth in production in Tamilnadu are:
• unremunerative prices for agricultural products resulting from high cost of agricultural labour.
• insufficient water for irrigation. During rainy season, large quantity of water flows into the sea without irrigating fields, as water is released from reservoirs even though not required, for want of storage space. So the urgent need is to construct more reservoirs which could be even underground reservoirs if necessary.
• During rainy season, large quantity of water stagnates in shallow ditches. This water evaporates in 15-20 days after the rainy season. The period of stagnation is short and the depth of ditches is low and these do not permit recharge of underground water. What is required is to drain this water into nearby lakes where lakes exist nearby or to construct lakes in suitable area.
• Fertilizer use is satisfactory. In addition, there is enough manure by way of cow dung, chicken refuse, dry and green leaves etc.
There is a lot of scope in developing countries for creation of employment avenues. In developed countries, the scope for laying new roads is limited as they already have sufficient roads. Similarly, there is very limited scope for laying railway lines, drawing electricity and telecommunication lines, in building houses, in building lakes and digging canals, laying sewerage, expanding supply of piped gas etc., as saturation point has already reached. But in developing countries, the scope is unlimited. In other words, while it is difficult to generate employment in advanced countries, it is very easy to do so in developing countries.
All the works mentioned above, will not only eliminate unemployment, but would lead to labour shortage. However, priority should be established for undertaking the different works. Irrigation and agriculture should get the top priority. After digging lakes and irrigation wells around the lakes, it takes only about 4-5 months to get additional production of food grains. The second priority should be to set up cotton ginning, spinning and weaving mills and ready made garment units.
Funds should not be a problem as currency notes can be printed. This will not lead to long term inflation as with the digging of lakes, wells and canals, the production of food grains and other agricultural produce will increase which will lead to decrease in prices. Inflation would be there only for a short time, between the start of the work for digging lakes etc and the harvesting of the agricultural produce.