Posted by Sandeep Shelke on November 30th, 2011
Agricultural economy grew from INR 3,71,378.4 Crores to INR 14,62,181.2 Crores almost by 393.717% between 1992 and 2010. That is it grew nearly 4 times since the economic liberalization and globalization. But the share of agriculture in the GDP is consistently decreasing from 28.99% in 1992 to 16.21% in 2010. Though it has grown in size but it is losing the its position amidst all MNCs and agriculture related research. Being a developing nation we have an advantage that labour availability is very high at low salaries/wages but capital availability is strained.
Multi National Corporations are companies with their operations in at least 2 countries. Foreign MNCs are the MNCs whose foundation is from outside Bharat. And that means these companies take the profits back to their native nation. Initially MNCs do bring in FDIs but later it becomes cause of the reimbursement to their parent countries.
Impact of MNCs on Agriculture:
MNCs like Monsanto, Myheco brought in technology, modern equipment, developed seeds, fertilizers through their entry. They encourage research in the agriculture segment. Also increased the farm production.
But for our economy they are turning to be a bane than a boon. We are a 1.2 Billion population and have huge demand for food forcing government to concentrate on agriculture at heart of economy and food security at heart of policy making. MNCs want cheap raw material so they may force commercial farming through various means like corporate farming. Small and marginal farmers (SMF) constitute more than 70% of the farmers. So the costly mechanization is not possible for SMFs which is impacting their productivity leading to widened gap between rich and poor farmers. MNCs make farmers dependent on HYV (High Yield Variety) seeds, which are not suitable in all conditions and also kill the biodiversity. MNCs press for commercial crops leading to soil exploitation and loss in soil fertility gradually.
With the rising pressure on farmers to take commercial crops the food security takes beating. Propagation of excessive use of chemical fertilizers through government machinery is rampant and killing our environment and local taste. Culture is up for grab in the hands of these MNC giants.
MNCs mostly gain the economic power and through that they may seek political power by helping politicians at time of elections. This may lead to strong pressure on politicians while making laws related to agriculture. Also they are not fair in their conduct since they use sub-standard quality in Bharat e.g. Coca-Cola.
Ironically WTO trade rules are dictating the terms for our internal policy with recommendations from WB/IMF policies. They first eliminated the local seed varieties and now are patenting seed varieties. The seeds produced by these companies are not re-sow able, leaving farmers continuously dependent on them for seeds in each season. This is a huge cost seeing the current scenario. How, on earth any country can be food secure if its seeds are not secured.
US and EU based MNCs get huge subsidies on milk products too. So these companies can flood our markets with milk products cheaper than locals.
New farmer’s freedom movement will be started sooner or later if such circumstances prevail.