Enthusiasm is excitement with inspiration, motivation, and a pinch of creativity. The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails. Optimism is the faith that leads to achievement. Nothing can be done without hope and confidence.

If you don't create change, change will create you. Change starts when someone sees the next step and the first step toward change is awareness. The second step is acceptance. Many fine things can be done in a day if you don't always make that day tomorrow. You see, in life, lots of people know what to do, but few people actually do what they know. Knowing is not enough! You must take action.

Sometimes it's the smallest decisions with larger aims that can change the lives of many. If our attempts can at least become a spark. We are really grateful and the TEAM can proudly proclaim ‘MISSION ACCOMPLISHED’.

If you can LEND A HELPING HAND for the advancement of our country and its people be part of our ENDEAVOR.

Thursday, December 16, 2010

Why no price rise?

"When tillage begins, other arts follow. The farmers, therefore, are the founders of human civilization".

Why no price rise?

by Jacob Oommen Arikupuram

It’s high time and we are getting more and more conscious about the food price rise and other price rise. All of us at least the wage earner of almost every family must have at least once cursed the rise in price of our necessary commodities.

It’s the basic human instinct, at least of a common Indian to take what ever we get at a low price as our right .and curse if there is any increase in price. at the same time if we do a job and get paid less the same we start to grumble and it would finally bloom into a strike , agitation or some sort of anti social movements. Why is this so? Why do we still tend to enjoy in others ill fate?

Why no food price rises when everything includes that salary of almost every employee rise? The salary of civil servant is base at 40’000 that of a IT sector employee is between 20,000 and can go onto seven digit numbers, college lecturers based on 45,000 a lower division clerk bags 7,000 a peon gets 5000 and a sweeper get the same and a manual agricultural labour obtains about 300-400 per day in Kerala and there is of course a large number of jobs available at least in the primary unskilled sector and the condition of every other sectors have changed a lot from the ‘80s. Let alone voluntary unemployed persons who are ready to go only for executive jobs. Then if the situation in our job market is like this, why can’t they let the price of the most important thing of their life rise? When the work of everyone should be given equal importance, I don’t find why a common farmer who cultivates in his own farm is never entitled to get an equivalent what a sweeper let alone a white collar job get in a service sector firm. Is it because of that farmer is doing less important job in cultivating food for others out of his food and blood? No it shouldn’t be, value of food products which keeps us alive should be high when we compare it to the price of some other goods or price of some commodities are yet to go up at least from the present rates, least because it’s one of the basic need for life to survive.

Food is one thing which is ought to have more value in real terms considering its significance.

Apart from the entire statistics if the price of food commodities is so large why are we not yet ready to cultivate some in our backyards? At least for our consumption? Why are we not cultivating some thing in the large tracts of lands that are remaining uncultivated for many years now in a row? I think one of the main reasons for it is that we still don’t find it worth waste of time even the current rate of price. We people who say that the price is very high yet not find cultivating these products at least those we can grow in our climatic conditions not profitable enough. We think that even at the current price its better to but from market, that means price are bound to rise, at least till a point just below where we are ourselves forced to cultivate for our own use at least to a point where we will start to think about that. It’s only at that point a farmer who is wasting his time in farm is getting what he is worthy of in real terms.

When about how the common man is going to overcome the current price rise. We should understand that what we mean by common man. It is estimated that about 60 percent of Indian population is dependent on agriculture as a livelihood. It is estimated that about a 2/3 of our population live below the earlier indicator of poverty, the poverty line. Every kid in the country know its largely a exaggerated number and that many very much above the poverty line are still counted as under the poverty line mainly due to the follies of a system controlled by people and politicians who have nothing above self interest and electoral politics. So in fact the actual number below the so called line must be around 50 percent. On cross checking these two facts we can get into one simple conclusion that most people who are inside the former 60 percent are there in the latter 50 percent. Thus it would be by every means mean that farmers are going to be benefitted by the price rise if the role of middleman is controlled by the govt. through its agencies. Government should take steps to ensure the role of such merchants. In fact it could bring a large section of the population who are under poverty line for decades and the attempt to bring whom various measures of the govt have failed continuously through the 60 years after it got independence and in case of those who are under poverty and are not able to produce for their own its for them that the government had started various policies like noon meal scheme and the public distribution system. The government through PDS is giving rice for 2 rupee a kg and wheat at 5 per kg. This is more than necessary to ensure the situation of the poor who cannot cope with the price rise. If one is saying he don’t want to make use of the PDS he is not poor and his is voluntary poverty and we can do very little to help them no one can help them, there is no need to be sympathetic about them.

But on the other hand, take into consideration the life of a common agriculturalist say a rice farmer.(with special reference to Kerala). He is given away with the duty of cultivating paddy sell it at a price dictated by various vested interests (which includes me and you) and price prepared by them. He is doing it as much as he can. Then he is forced to find some other job or when he is not allowed to do it by some of us like the left which contribute much by issuing orders that prohibit construction on paddy lands, he is forced to commit suicide to escape the arid poverty, he is left with no other way out we are responsible for that its not a suicide it’s a murder a homicide. It’s because it’s too hard for him to stay in the hunt in life through agriculture his family never get over poverty though he does the job which should be admired by the rest of the mankind as he does something greater than what is done by a doctor who saves a sick man to life. But a farmer is helping a man to escape from starvation. He is the one who feeds us all. Case can be considered the same in Vidharbha where the farmers brave the weather and other forces of nature and market ,cultivate cotton which get the lowest price in market ,here those who work to cloth others are in a condition which wont allow them to buy at least one cloth for their son and daughters, here the problem is with the middlemen who get more than what they deserve. Here is where we are forced to think against trade, think that it is an evil as did in the ancient world where acquisition of wealth through trade is considered far inferior to wealth obtained through agriculture or military exploits. The same theory prevailed through the period of Xenophon, Plato (who gave little role for market in his ideal state), Aristotle (considered acquisition of wealth a sin and money through trade was considered unnatural for it involved making money at somebody else’s expense) Marcus Aurelius, Judaism and early Christianity. This was a period of golden age of agriculture, isn’t not that the age of agriculture is over but the coming of trade meant that the protection the traders get where never given to farmers. That means the tertiary sector developed at the expense of workers and farmers in primary sector the result of whose work on which traders capitalized upon.

The same man who is happy to buy a luxury cosmetic or a bag costing 5000 when it actually cost around 1/10th of the price. Only because of its brand value one is ready to spend that much. Here the question is that does the brand value of a particular cosmetic is as much costlier for you that it cost much higher than your food without which you can't live? The answer would be certainly no in most cases and there may be some exceptions as a possibility. But for the time being we are forced to avoid taking any such exceptions into account.

I remember teacher taught me in my second standard during my schooling that Food, shelter and clothing are the basic necessities of life. I am here going on with the same line of thought, that food and thus food grains are the basic necessities of life. Among these basic necessities clothing and shelter may even occupy the lower rug giving better grading points to food. (Considering their importance in the subcontinent at least. these just mean that food according to me is the most important necessity of life and is never aimed at belittling the importance of any of the other factors)

PUNJAB--- a case study

Now take into the account of Punjab the so called best state in India for food production.The state that has the reputation of feeding those even out of their state by their agricultural produce imagine a situation when the farmers in the state decide to quit the sector well this is not quite a rhetoric, the experts already now pointing at the expiry date of the state.

Punjab has 1.5 of India’s area producing almost 25 percent of India’s wheat and close to 15 percent rice; almost all of Punjab is cultivable. They plant rice and wheat and wheat and rice, the moment they are done with one the shift to other. But now as time pass this creates a monoculture eroding the soil quality. The excess use of chemicals is also said to be problem for this. It’s polluting the land air and water of the area. The result is that now many have sold their land for the high price they get usually from industrial heavy weights who have better techniques and are ready to adopt better techniques for cultivation this has caused the coming of large scale investment into the farming sector about which we will discuss in detail later. Here, the coming of large sum of money into their hands have resulted that the Punjabis who have till now worked whole day and enjoyed what they got out of their hard work have whole lot of money and they know very little to spent it in a productive way as the industry sector is also collapsing in the state. So they have decided to enjoy life the other way. The way they were not familiar till some time before. ‘Sitting and Enjoying’. They lazy man way of enjoying, the way the prodigal son enjoyed his life. Spending money on partying, gambling on liquor drugs and ‘Luxury Punjab’ is going the same way. Here are some facts which prove the theory…

It is said that in 1997 there were 12 drug offenders and now in 2010 there are 65 and there are about 1000 peddlers in Punjab today, today experts on study of Punjab have given an expiry date on Punjab, once the sentinel state of India. Yield from farming is dropping; there are now concerns that industries are moving out of state. And there are even concerns that khalistan demand might be revived. It’s principally because ‘everything Punjab does it overdoes’ .in 2009-2010 they drank 29 crores bottles of Punjab made liquor, Indian made foreign liquor and beer. This apart from illicit brew, liquor bought by foreigners, defence sales and stuff brought from other states, this is in state that has only 2.5 crores people and then it equates to 10 bottles of 750 ml per person a year, and from this we take away the children the old the ailing and those sects who are required to be teetotallers the consumption rises dramatically for the drinking population. And the account on narcotics and psychotropic substances are even loose. In 2010 police operations had seized about80 kilo of heroin and smack 14 kilos of opium two quintal of poppy husk and 15 kilo of methamphetamine.

Drug addicts in the state varies from 13 years of age to old age, forty percent are below 50. Fifteen percent are above 50 and half of them are women and in fact 75 percent are drug addicts and if the story continues the story of Punjab would end by 2030 says ravinder Singh sandhu, professor of sociology in Guru Nanak university, he has for his name the only official study on addiction in Punjab, ‘drug addiction in Punjab sociological study’. Today Punjab makes one of the busiest drug transport points on earth.

Apart from this the excessive use of chemical fertilizer which had been prominent in the state from the period of green revolution had been a major cause of worry for the state in as time passed today the burning about 7 kilo of nitrogen a kilo of phosphorus and about 11 kilo of potash for a kilo of paddy. This cause for asthma and other pollution related health problems. Organic farming which is touted as an alternative to chemical farming is still in its infancy in the state and the case is similar in almost every other parts of the country. Yield is also dropping the yield which was 45 quintals in 2000-2001 was down to 40 quintals in 2004-2005.

Long Run Prospects of this issue.

Now consider the other part of the story, consider if the government control the price rise through various measures available in its reserves. The result would mean that the returns for a farmer would remain to stay low. That means a continuation of inter sector mobility against the agricultural sector or the continuation of farmer suicides. That in the long run would mean that number of small farmers who remain in the business would be minimal or even less. That means cultivation needs to be done by some one else who can afford to do it say the multinationals like Reliance or Birla group who have many farms across the country invest more in the sector and the government itself helping them with land and other factors of production free of cost, like done in some north Indian states by the corresponding states. The hidden danger in this is that it would finally even, make food a monopoly of these industrial heavyweights and then we the people would be at the receiving end. Then we would be out of choices and we would be forced to give what ever they ask for. They may use this as a bargaining chip that if they form a cartel it could influence any governmental decision. It is necessary for the long term interest of the country to make sure that food doesn’t become a bargaining chip for anyone. If at all to make sure of this government has to understand the need to make agriculture a profitable business. For those who argue that the industrial heavyweights should be given their due for their hard work they have put onto achieve the stature they have got at present I must make it clear that these peoples have of course made their home works but it not only that which had helped them to be what they are now but also the various subsides and various land acquisitions leave alone the Marxist theory of exploitation of the bourgeoisie of the proletariat. What I meant is that government shouldn’t try to slow the single farmers on one hand and promote the steps taken by heavyweights on the other hand. The government should have same stance towards the single farmer and towards a heavyweight (in agriculture, of course government aid is necessary in secondary and tertiary sectors. ) what we should understand is that food is always important than anything and we cannot afford it to be concentrated in a few pockets.

Positive Economic interpretation of the phenomenon

The basic causes of the above phenomenon should be understood before speaking about the price rise. The main reasons of the above mentioned phenomena is a simple economic theory , the basic of all economic theory that when supply decrease amid increasing demand the prices are bound to shoot upwards to a point where there supply is equated with the demand. If the demand is still not decreasing as food is the commodity here the supply should be increased to control the price. There is no alternative way out of this, whatever we shout whatever we do. Or else the government should pay the price that has gone up. By large this is not at all a feasible solution that it can control the problem for a short term and there is no way escaping this except by increasing the production or by decreasing the demand that is by decreasing the population and considering the fact that our economy has a rapidly increasing population its also by large impossible in a democratic country like ours and even in a dictatorial rule decreasing the population is impossible except by some disasters like war or large scale massacres during the time of Hitler and in other countries natural calamities or some epidemics can only don the job in a short period of time. Thus other than speaking of such impossible and unfair cases why can’t we just allow the farmers to get what they are worthy of? Why are we saying that even if I die I will not let him live? Have these people done anything bad to you in their previous births if there was one? So thus we have to do something to increase the production for that the best way would be to make farming a profitable business, else the economy will crumble down to it feet.

N.B-- what is said here only means that the farmers who are producers of food should get more for their work when every other work and worker is given their due for their work. Anything else said in due course of the article should be considered a point used to substantiate the above mentioned point.


  1. Well researched, excellent cover-up of a staring issue. Kudos to you, Jacob. Arguably the the best post of the blog till date. Finally Shankerji meeting up with his high expectations and doing justification to his literary panache.
    I'd like to share some thoughts on this part. issue.

    1. Forgive me if my economics is bad, but isn't there some theory to link this price rise phenomenon and unemployment and explains it?

    2. 'Cultivation in our own backyards'. Striking. A long lost culture in the contemporary Kerala. Remember those days when we used have our own backyard vegetable garden. Self sufficiency has been balled up critically.

    3. Agriculture is one sector which is the least affected by globalization. We need to discuss how we can being about a positive change into it.

    4. The question posed by the writer regarding the branded items with reference to basic necessities is something which is unavoidable. Economic equality is an Utopian concept. Even the most successful communist countries cannot claim to be a champion of such equality. The question is not to protest against the evils of globalization and privatization but how to make sure that agriculture is not left out in the race.

    5. ‘everything Punjab does it overdoes’ - Sure it does.

    Keep up the good work.
    Good luck.

  2. @goutam: really true...one of the best articles of d blog till date...
    jacob has done a gr8 job as well as a lot of research. this is was actually his topic for presentation in MIEF(MAR IVANIOS ECONOMICS FORUM).
    got a standing ovation...
    kudos2 him..

  3. Jacob,I've opposed you, when you presented this in the forum and what to say? I still oppose it. Just leave kerala, look at India. Some gets paid as low as Rs.10, he can't even buy 250g of onions.

    What happens in this country is; The middleman loots away the profit, leaving the farmers in poverty. India must do something to stop this game.

    The 'Common Man' is not paid well(India).. moreover people have to consume many things, like clothing, transportation etc... Are these farm produced?

    Just take the example of wheat bread, the raw materials come from the farm, but how much share does he get? (I'm not saying, 'Firms should not be profit motived' - rather it should be, and it should be under check).

    About the poverty, "Is not exaggerated". Indians have a funny way of hiding their evils. We change the 'base' of poverty line bringing it lower, to show, those below the line are low.

    And you just can’t let the prices rise. It will lead to hyper-inflation.

    And in the case of Punjab, I go with @goutamjay.


  4. The person who denies the necessities of life to the poor are indeed the higher income groups like you and me who don't bother paying a little extra to secure our comforts.
    Most of the problems are caused due to our hypocritical culture that has least respect for nature that prevents educated persons from entering farming. The lust for gold makes the unfortunate brides of Kerala mere objects to be bought and sold.
    The focus should be on basics like food and clothing. No amount of development can cover up the handicaps of our country in food production.
    I appreciate the measures suggested that include
    backyard cultivation. Just imagine the situation where each household is able to grow some of it's necessities? That would be like Gandhism come alive. That is what I call true development.
    Considering the present situation, only Gandhi can save India. He was a force that urged the nation to be self dependent. remember the khadi movement.
    Bush was right when he said that the Indian middle class is the reason for food shortage. new trends in income has made the upper middle class crazy and wasteful. It is us who go to fancy restaurants and pay thousands for food that are valued much lesser. We waste food and take resources like petrol for granted, just because we can afford.
    I believe it is a crime against the poor. The bottle of coke we drink is costlier than milk. yet we are ready to pay more for something nonsensical as that.