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'Make agricultural exports ban an exception': Economic Survey.


Date: 24-07-2024
Subject: 'Make agricultural exports ban an exception': Economic Survey
Recommending a farmer-friendly policy framework, the Economic Survey 2023-2024 on Monday said the government should consider export bans on agricultural products only in specific situations and avoid banning futures or options markets at the first sign of any price surge to let markets function in the interest of farmers. India either banned or imposed curbs on exports of major agricultural items such as wheat, rice, sugar and onions as erratic weather hurt output, inflating prices in the domest ..

The survey noted that price stabilisation measures such as open market sales, trade controls, and steps to check hoarding, aimed at giving comfort to consumers, often conflict with income-support policies for farmers.

It said in case of non-essential items, the government can allow "substitution effects to play out before responding to domestic supply concerns". For instance, if sugar prices rise, consumer ..

"In general, it is far easier for consumers to substitute or pare back consumption than for farmers to endure big losses because of ad hoc export bans or huge imports," it noted. The survey also said India's inflation targeting framework should consider targeting inflation, excluding food. When the central bank appeals to the government to control the increase in prices of food products, it prevents farmers from benefiting from the rise in terms of trade in their favour.

Enhancing private sector investment in agriculture and improving market infrastructure by incentivising states is also vital to give impetus to the agriculture sector, according to the survey.


It also highlighted that incomes of farmers with small landholdings cannot be increased by growing wheat and paddy alone, adding that farmers need to move to high-value agriculture such as fruits and vegetables, fisheries, poultry, dairy and buffalo meat. The survey suggested that promoting farmer producer organisations, e-National Agriculture Market (e-NAM) and allowing cooperatives to participate in agri-marketing could lead to better price discovery. e-NAM refers to a pan-India electronic tra ..

Source Name : Economic Times

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