Sunday, June 11, 2006

Village for sale

The headline is not important, but what is important is to analyse the factors that led to this outcome. Farmers growing cotton in a small village in Maharashtra are so burdened by unpaid loans that they decided to sell all their land and possessions and move to the city. They were hoping that the government will pair a good price for their cotton, but that was never done. The government is also helpless in front of the laws of supply of demand. Cotton growing got lucrative in the mid-90s, and everyone started to grow cotton. The result was a flood of cheap produce into the market, which brought done the sustainability for all the farmers. To make matters worse, there was a drought in the late 90s, and cotton being very intensive on the soil, the poor farmers were forced to take loans that they haven't been able to pay back. Moving to the city is surely not a solution. Cities have always sounded lucrative to the villagers, but the reality is quite different. Squatter cities and slum areas have even worse living conditions than the villages. The government should take note and prevent this mass migration. The farmers should be supported in growing other crops and their loans should be excused or the interest should be cancelled. Most important of all, they should be educated to not just follow the herd, but analyse the factors and take consultancy from NGOs in the best crops to be grown for long term sustainability. I sometimes wonder though, if the Soviet way of a centralized planning system is the way to go!

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