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Second, efficient delivery of services will be the key to higher agricultural output. Governments, especially democratic governments, are not geared for efficiency and effective delivery of services. Current food marketing and storage systems owned by the government's Food Corporation of India are a key example. Rough estimates indicate that anywhere from 20 to 30 percent of the food is spoiled before it hits the dinner table.
Thirdly, U.S. multinationals like Wal-Mart and Monsanto would prefer to deal with the private sector than with government officials.
The private sector in India is very willing to enter this profitable area. A joint venture between Bharti Telco's Milltal and E. L. Rothschild (a British investment firm) is making foray into the export of fresh fruits and vegetables. It has leased 50,000 acres of land in Punjab and will grow vegetables for export to Europe. It will also become a laboratory for new ideas. An initial US$50 million investment is expected to export $15 million worth of produce in the current year, rising rapidly in the next three years as shipping and storage issues are overcome. Reliance, which in the last 15 years has become an industrial giant, has plans to invest about $6 billion in the agricultural retail sector. Its retail outlets will be linked to farms in Punjab, Haryana, Maharashtra and West Bengal.
This has the potential to revolutionize the handling and distribution of food in the country, and deliver better returns to farmers. This is a U.S. model, where corporate giants like Cargill run distribution and manage farm output. The present government in India has to readjust its policy to let the private sector play a role, as it is most likely to succeed. Success of ventures like this will persuade governments to give up control over food distribution.
Connecting rivers to transfer surplus water to areas lacking water is no longer a pipe dream, although there are a few obstacles. East India's Brahamaputra Valley has a surplus of water, which causes havoc every year from July to October. This could be transferred to the West and South. Similarly, rainy season surplus water in the Gangetic Plains can reach southern India and help develop agriculture in areas unknown before.
But there are problems. Bangladesh would not permit the digging of a canal from Assam to Central India through its territory, even though it would benefit that country as much as it would India. Again, the Gangetic Plains are at a lower elevation and the 400-mile wide mountain ranges, rising at places from 3,000 feet to 6,000 feet in central India, prevent any easy transfer of water. Hence, although agriculture would benefit immensely with both these river-link schemes, solutions are not likely to be forthcoming in the next 20 to 30 years. The Bangladesh issue may never be resolved. The Bangladeshis would prefer to float in floodwater year after year rather than let India dig a canal through their territory. Hence the water of the Brahamaputra may never reach central India.
For the north-south linkage of rivers, technology may some day make digging a tunnel-canal link easier. A garland canal traveling the contours of the Indian peninsula is possible. It has been previously suggested but has not gone beyond the feasibility study. It would circumvent the mountains in central India but would not deliver water to the arid lands of south-central India, where it is needed most. Moreover the garland canal would be useless until it got water supplies from the Assam valley.
Without losing heart over possible future river links, India has to explore other possibilities. A scheme to transfer Gangetic basin water westwards toward Haryana, Rajasthan and Gujarat is a possibility. The latter scheme would be a great engineering achievement. This, half the size of the original scheme, would increase the land under cultivation by 15 percent, with a huge impact on the local economy.
India has about 150 million hectares of land under cultivation. This is down by about 10 percent from land under cultivation 20 years ago. Urban encroachment, unprofitable cultivation and water logging are among the key reasons for this reduction. Of the total land under cultivation, only 45 million hectares are irrigated. This delivers about 55 percent of the total food output. The rest of the 95 million hectares of land is rain-fed or groundwater-irrigated. This bulk of the land produces 45 percent of total food production, and is where food output could be boosted. Whereas progressive Indian farmers can experiment with genetically modified food in the irrigated lands, minor and major irrigation schemes have to play a major role in boosting productivity in the areas not irrigated. This is where the state and federal governments have to play a bigger role.
Whether it is interlinking of the rivers or local irrigation schemes, something more needs to be done. Government initiatives are the key to success. Funding for local schemes should be made readily available. The current budget envisages a much higher level of funding for rural schemes. This increase is partly election-year politics and partly to boost funds for the rural areas which previously were not a top priority. Whether this increased availability of funds will translate into the start of delayed irrigation initiatives or not, time will tell. Usually any government scheme requires three to four years of paperwork before the first shovel of dirt is thrown at a site, and another four years to complete. Any initiatives taken now will bear fruit in six to eight years.
This timeframe on new projects is an acceptable consequence of democracy. Projects which are already in progress, or on which progress is slow, can be expedited. Speedily appropriated funds can expedite projects already in the pipeline. This will fill in the gap before newer and bigger projects like river links become a reality.
India sorely needs a second Green Revolution to boost food grain output to 400 million tons in the next 15 years. This is not difficult to achieve, if the mindset on introducing new technology is changed. India has to wholeheartedly embrace new technology. The private sector is better suited to deliver results than government-managed schemes. Governments, on the other hand, can play a key role in expediting irrigation schemes and managing water resources.
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(Hari Sud is a retired vice president of C-I-L Inc., a former investment strategies analyst and international relations manager. A graduate of Punjab University and the University of Missouri, he has lived in Canada for the past 34 years. @Copyright Hari Sud.)
