ASSOCHAM & FAIFA urges government to support all farmers without discrimination

Gurgaon, August 4, 2016: The Associated Chamber of Commerce and Industry of India (ASSOCHAM) and Federation of All India Farmer Associations (FAIFA) a national body of farmers today made a representation to Members of Parliament at an interactive session to discuss the opportunities and challenges for India to realize Prime Minister’s target of doubling farmer incomes by 2022, at an ASSOCHAM event held in New Delhi.

Speaking on the occasion, Mr. D S Rawat, Secretary General, ASSOCHAM, said, “It is encouraging that the Prime Minister has set a target for Indian farmers to double their income by 2022, which will have a huge impact on the revival of the Indian economy. However, the Government must carry all sections of farmers together, and not discriminate against the tobacco farmers, who have made an immense contribution towards India’s cash crop farm economy.”

Mr. B V Javare Gowda, President, FAIFA, said, “Rather than addressing the Plight of tobacco farmers, India is Hosting the 7th Session of the Conference of the Parties (CoP) to the WHO Framework Convention on Tobacco Control (FCTC) in November, 2016. This conference will add further misery to the poor Indian tobacco farmer. We appeal to the Government of India that Indian farmers must be part of the official delegation of CoP7, else it would put livelihood of millions at risk without any public health benefit.”

Mr. Gadde Seshagiri Rao, Vice- President, FAIFA, said, “It is disheartening that the Indian tobacco farmer today is subjected to the worst ever discrimination by way of harsh policies and attacks on their livelihoods without providing either a scientific justification or an alternative to safeguard their interests. We appeal to all the respected Members of Parliament to withdraw 85% warning rule and adopt the recommendations made by the Parliamentary Committee on Subordinate Legislation which has recommended 50% warnings on cigarette packs”.

Mr. Murali Babu, General Secretary, FAIFA, added, “For the first time since independence, this year 22 tobacco farmers committed suicide, as tobacco crops became unrenumerative. With tobacco board cutting the crop size by 30%, the situation of tobacco farmers will get worst. Government needs to urgently provide solutions to tobacco farmers and ensure that foreign tobacco is stopped from invading the Indian markets at the present rate”.

The challenge for the Indian economy is to activate the stalled engines - agricultural growth and rural demand, trade, and private investment. To double the income of farmers by 2022, in nominal (numerical) terms — which do not take inflation into account—would require a 15% annual income growth rate (compounded), according to FAIFA estimates.

Tobacco is a Source of Livelihood for 4.6 Crore Indians. Farmers of FCV tobacco suffered huge loss in earnings of around Rs.750 crore last year leading to tragic cases of Farmer Suicides. Earnings will be further reduced this year due to Tobacco Board mandated 30% reduction in FCV tobacco crop size.

For the first time in Independent India Tobacco Farmers committed Suicide last year due to loss in earnings/livelihood. 22 tobacco farmers committed suicide last year, and almost all are distressed due to reduction in FCV crop size - 40% lower than the crop produced in 2013-14. Farmers will not be able to repay even their debts as earnings will shrink by more than Rs. 1,000 crore this year from FCV tobacco alone.

Lower crop size would mean farmers will be left with large unproductive or less productive acreage in absence of equally remunerative alternative crop.

Anti-tobacco propaganda based on inadequate and misleading information is influencing Indian policy makers and opinion leaders. As a result, in the recent past Government has adopted extreme tobacco control regulations like High Taxation, Large Pictorial Warnings etc. These policies have led to huge increase in smuggled cigarettes impacting demand for Indian tobacco. Tobacco Farmers are the ones who are facing the full brunt of these policy decisions.

Indian farmers loss is Malawi farmers’ gain. Malawi has supported its growers & followed a balanced approach to regulations and as a result, Malawi doubled its exports at the cost of other exporting countries, as overall Exports remain unchanged.

Other tobacco producing countries also continue to support their farmers. Subsidies are being provided to tobacco in countries like Malawi, Zimbabwe, Tanzania, EU & USA. EU allows duty free imports from least developed countries like Malawi etc. Tariff Rate Quota in USA allows concessional import duty rate for countries like Argentina, Brazil etc., while a rate of 350% is applied for tobacco imports from India.

Until a remunerative alternative is found Tobacco Farmers should be supported as there is global demand for tobacco. Various Studies by CTRI have failed to provide any remunerative alternative crop to tobacco thus far. In fact, during the crop holiday in Andhra Pradesh in 2000-01, farmers grew crops like red gram, bengal gram, black gram, but CTRI study showed that due to crop substitution farmers suffered loss of Rs.225 crores (56%) & they reverted to tobacco crop. Tobacco growers are cultivating tobacco as no remunerative alternative has been found yet. Anti-Farmer policies are benefiting growers in other countries at the expense of Indian farmers.