By Geena Paul
NEW DELHI: What is common between India and Argentina? Both the countries are ruled by governments which need not think twice before goofing up a very favourable situation and make it a mess for farmers!

If you have any doubt, just check these facts. This year wheat prices soared to record highs in the global market and India was struggling to feed its population as the public distribution system failed to buy enough stocks. The government then decided to import wheat at unprecedented prices. Remember, India was a wheat exporting country once. Nobody knows why farmers dumped wheat and stopped producing enough food for the country. The reason is explained when the government imported wheat from foreign shores at huge prices and still refused to pay that money to Indian farmers. After the crisis was over, when farmers demanded increased wheat minimum support price, the government again dilly-dallied. Later, very reluctantly, it hiked the MSP a bit. But, when it had to import wheat from foreign countries, the government had no doubt in quoting big prices for the import.

You can compare the scene to Argentina. The situation is almost same in that country also. Worried over the wave of inflation rippling around the world, the government of president Cristina Fernández de Kirchner of Argentina increased export taxes on some crops, a move meant to keep down domestic food prices by encouraging farmers flush from global profits to sell more at home.

Same thing happened in India also. When the inflation figures moved up, India banned export of several food items like wheat and rice. It never allowed its farmers to make money form the opportunity. Because, the India government wanted to please the urban population and ensure that in the elections the ruling party gets more votes.

In Argentina, the government is trying to get money from farmers to subsidize other sectors of the economy. Same is the case with India. Even though it announced a debt waiver scheme for the farmers, India is yet to take a farmer-friendly decision which will force the farmers to cultivate more and produce more so that the world gets enough food.

India even imposed huge taxes on export of certain goods so that the farmers sell it in the domestic market just to keep inflation under control.

But, take the case of Brazil. Brazil’s government of president Luiz Inácio Lula da Silva is helping farmers finance the purchase of new machinery and other facilities. The government reduced the interest rates farmers pay and gave more time to pay off the loans.

For Brazil, rising food prices mean many farmers will reap record profits. And South America’s agricultural powerhouse Brazil does not want to miss that opportunity.

Da Silva’s government recently announced record farm credits, a form of indirect subsidy, to encourage Brazil’s farmers to produce more while the price of their exports are high on world markets, a move that should improve Brazil’s economy. But Argentina, Brazil’s economic and political rival, decided to share the agricultural windfall at home.

In the race to take advantage of the tight global food market, Brazil has a number of advantages over Argentina and India. Brazil is the world’s first or second largest exporter of beef, soybeans, orange juice, chicken, sugar and coffee.

The government in Brazil wants it to stay that way. Last month, it announced a $49 billion credit line for farmers, up 12 per cent from last year’s total. Officials said farmers needed the credit to buy tractors and other machinery, pay for seed and fertilizer — which have also risen in price — and to increase productivity.

India also announced a debt waiver of Rs 70,000 crore for farmers. But, people are yet to find out what happened to that waiver scheme.

Brazil says that it needs to give incentives to producers because people are buying and eating more. This is Brazil’s opportunity to produce and export more, and help to reduce hunger in the world.

Most of the credit line comes in the form of reduced interest rates and longer payoff periods for loans. More than $40 billion is earmarked for larger agri-business concerns, and the rest is to help small farmers.

The government’s main goals are to help producers expand onto available land and increase productivity on their current land. It estimates there are up to 220 million unused acres available for planting. Brazil knows that its productivity can’t remain the same if people are going to eat more.

In Argentina, the Kirchner administration tried to raise taxes on grain and soybean exports in line with rising world prices. The decision was intended to force Argentine farmers into selling their wares at home, thus creating a domestic glut that would keep prices down and inflation in check.

But instead of reaping the windfall, the government reaped a whirlwind of protest. The sliding tariffs pushed the tax on soybeans, Argentina’s most important export, to almost 50 per cent. It also infuriated farmers, who resorted to violent demonstrations.

While that wave of turmoil has subsided, farmers in Argentina feel that the government will do the same thing again and so it is difficult to plan their short- and medium-term future.

India is also facing the same problem. Indian farmers can never think of producing good crop and sell it outside to gain more money. Because, the government will come in between and seize the crop from him for a price determined by the government.

Farmers feel that it is time India change its policies on farmers and agri products. According to experts, India should learn to adapt to the changing global scenario and allow farmers to produce more and find market for that produce. Instead, of squeezing them ,the government should help them produce more for a hungry world.