Hyderabad, July 22 (INN): Lok Satta Party national President Dr. Jaya Prakash Narayan on Monday termed the unusual spurt in prices of certain essential commodities like onion, tomato, pulses and edible oils as a clear indictment of short-term, knee-jerk vote bank politics pursued by successive governments and political parties.
In a media statement, Dr. JP said, “The price of any commodity is a function of demand and supply. Agriculture is subject to natural vagaries as well as farmers’ preferences and therefore gives rise to serious fluctuations in supply of commodities. Each time the onion price increases, the Government and political parties overreact and seek to ban exports, import them at any cost, impose unreasonable restrictions on trade and storage and depress the market. This in turn leads to the price collapsing and the crop acreage dwindling. This cycle repeats itself endlessly. Tomato, which now costs Rs.30 to Rs.40 a kg in the retail market, will not fetch even Rs.2 to the farmer soon. Every year, farmers destroy the crop as there is no prospect of recouping even the investment.”
Dr. JP said that “after decades of such follies, we must learn lessons.” For non-perishable commodities, adequate storage should be provided and farmers enabled to get pledge loans on the produce to meet family and crop expenses. In case of perishable commodities, aggressive food processing facilities should be put in place so that the failure of crop in one season does not result in serious shortages.
Dr. JP said that it is again India’s short-term, vote bank policies that are contributing to large-scale imports of cooking oil and pulses year after year. The Government should boost indigenous production by imposing moderate import tariffs on such commodities and plough the revenue thus realized to boost production of pulses and oilseeds. Such a policy will ensure food security and increase the income of farmers which in turn will lead to an increase in aggregate demand and economic growth. It will help the Government save more than $10 billion of precious foreign exchange in these times when the country is going through a serious current account deficit.
Dr. JP appealed to media to exercise restraint in depicting short-term fluctuations in prices because of the operation of basic economic laws but focus on policies that help the country and the farmer in the long term.