Bibek Debroy pitches for liberalising farm sector

NEW DELHI: Expressing concerns over distortions and interventions in agriculture, NITI Aayog member Bibek Debroy today called for liberalising the sector before the next spike in food inflation.

"If we are going to liberalise it (agriculture), let's do it before next spike (surge) in prices," Debroy said in his address at the launch of a book 'Food Price Policy in an Era of market stability - A Political Economy Analysis' here.

He said, "Indian agriculture is riddled with distortion and interventions. It is not being touched by liberalisation on output, input and decentralisation...consequently we did not have commercialisation (of the sector) despite government policy (in place)."

Debroy further said, "It is presumed that Indian farmer is stupid. That is why he must be controlled by the government on production (of crops)."

According to him, if the government liberalise the agriculture sector, it will provide cushion against volatility as price would be in tandem with domestic and international fluctuation.

Elaborating further, he said, "Food means rice and wheat only. But the spike in food prices was in vegetables and fruits. Indian policy is a knee jerk one."

The editor of the book and Professor at Cornell University, Per Pinstrup-Anderson, also recommended liberalisation of the agriculture sector.

While making a presentation on the recommendations in the book, he said that government should protect price signals and seek high live of price transmission (of international prices to domestic prices).

He also stressed on the improvement of cereal stocks and public-private collaboration in the agriculture sector.