Variance in cost and quality of agricultural tools and implements being provided to the farmers under Rashtriya Krishi Vikas Yojana (RKVY) and problems being faced by the farmers due to imported power tillers - a review

A parliamentary panel has pulled up the government for not taking steps to lower the prices of power tillers and check cartels in the agri-machinery sector. Most farmers in the country are small and marginal, who could hardly afford costly agri-equipment and machineries. In this scenario, power tillers with flexibility, multi-purpose nature and low cost are considered ideal to enhance the level of agri-mechanisation, it said. It noted that power tillers are imported at Rs 75,250-86,000 a unit and are being sold at Rs 1,08,500-1,95,000 in the market, whereas indigenous power tillers with much higher cost of production are sold at Rs 1,40,000-2,15,000. Therefore, the panel had recommended the Agriculture Ministry to examine the issue and take steps to lower the prices of power tillers and even refer the case to the Competition Commission if cartelisation is suspected. The report by the Parliamentary Standing Committee on Agriculture noted that the ministry rather than reducing the prices has fixed in "haste" the maximum retail price (MRP) of power tillers. "The criteria for fixing MRP of power tillers agreed upon by domestic manufacturers/importers are more than their existing price in the market," said the report placed in Parliament during Monsoon session. There is wide variation of selling prices of power tillers. The selling price of both indigenous and imported power tillers is higher than the MRP indicated by the manufacturers/supplies, it said. The panel said the agriculture ministry is "acting contrary to the spirit of its recommendation regarding the need to take steps for lowering the prices of power tillers." Further, the ministry ruling out cartelisation of makers/importers of power tillers without "proper scrutiny" shows "lethargy" on its part towards the panel's suggestions. The committee again asked the ministry to shun the process of fixing MRP of power tillers and examine the entire process of price discovery of the equipment in Indian market.