What is strange about these conversations is that they took place in Akola in October 2008. Akola is in the heart of Vidarbha — the land of farmer suicides where the people are supposed to have little initiative and the institutions are known for their non-performance. And isn’t economic liberalisation supposed to push poor farmers further into poverty?

Looking at the above success stories in Vidarbha, we get a very different picture. Farmers here are becoming aware of the opportunities that globalisation has opened up, and are quite willing to take advantage of them. In the completely dryland area, Dheeraj has managed to find a solution to the paucity of water and credit by finding an international niche. All he needed to do was to be an entrepreneur intermediary between resource-less farmers and the exporting agencies. He had to be a coordinating agent who persuaded enough farmers, and create enough of a scale, to make it worthwhile for an exporting agency to make contracts. He had to be a conduit of information, and take responsibility for quality control. In the next case, Arvind Mills — a corporate entity has taken on the coordinating role. In Kothari village, the coordinating process took place naturally by emulation by fellow villagers. In fact, it requires little coordination. Oranges are a high value crop and a few acres can fill a truckload.

Economic liberalisation can benefit even the poorest of farmers. Of course, it entails some risks. For example, it can increase price volatility and cause hardship in the short run. But the policy response should be to mitigate the short run hardship through schemes such as futures market, insurance schemes and credit rather than to dump the baby with the bathwater. Instead, on the pretext of fighting globalisation, the so-called friends of farmers have little hesitation in supporting export bans on various commodities.

... contd.