7/21/2019 From 50 Years Ago

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EDITORIALS

Economic & Political Weekly  EPW   NOVEMBER 28, 2015 vol l no 48 9

From 50 Years Ago

 Vol XVII, No 48, NOVEMBER 27, 1965

WEEKLY NOTES

Getting the Farmer to Spend! ...But what level of output would be adequate?The present level plus two million tons, five million

tons, ten million tons? Who wants this additionalproduce? If it is the towns, the additional require-ments can only be marginal. For the Survey

estimates an increase of 2.5 million tons in theurban demand for food between 1951 and 1961—a period in which production increased from 55to 80 million tons. A tenth of the increase in out-put would have sufficed the towns, apparently.

Where did the additional output of food go?Partly to feed the additional population, whichincreased by over a quarter; partly to satisfy thedemand of people who became better off. TheSurvey gives twice as much weight to the influ-

ence of population growth as to that of incomerises; the effect was probably more equal in viewof the low income elasticities the Survey assumes.

What do the agriculturists do with their addi-tional incomes? The information the Survey givesis amazing. A rupee spent on agricultural goodsgenerates only 12 paise of further demand, nineof which go to agricultural goods, one to foodindustry and one to mining and manufacturing.This is so amazing as to be incredible: if it weretrue, about the only use agriculturists made ofadditional incomes was to gorge themselves.Nevertheless, there is some truth in the picture: in

particular, Indian farmers do not spend on ser- vices as Australian and Philippino farmers do oron fertilisers as the Taiwanese farmers do.