More than Rs. 70,000 crore economic loss in Q3 FY 2020-21 due to farm agitation: PHD Chamber

While appreciating the constructive talks between the farmers’ unions and Government, Sanjay Aggarwal, President, PHD Chamber of Commerce and Industry said in a press statement issued here today that the 36 days farm agitation so far will have more than Rs. 70,000 crore economic loss in the Q3 FY 2020-21 due to farm agitation through disruption in supply chains and day to day economic activities particularly in the progressive States of Punjab and Haryana and border areas of National capital Delhi.

The consensus on the 2 issues of  farmers including penalties on stubble burning and Electricity Amendment Bill 2020 is highly appreciable and we look forward to an early resolution of the remaining 2 issues soon, said Sanjay Aggarwal.

Farmers’ agitation has severely impacted the business of MSMEs in Punjab, Haryana and border areas of Delhi as raw materials of such units are procured  frequently to execute production processes and to meet up demand, said Aggarwal.

MSMEs are already severely hit by the daunting impact of Covid-19 with the hardships of migrated workers, increased costs of raw materials, transportation along with squeezed working capital, he said.

Some of the  businesses in the region have reported that their workers are shifting from their respective  factories to join the agitation, said Aggarwal.

Various reforms announced by the government during the last 9 months have created a ray of hope among the MSMEs to rejuvenate and move forward, however, the farm agitation has severely impacted the production processes of MSMEs, said Sanjay Aggarwal.

There are around 25 lac MSMEs in Punjab and Haryana which employ more than 45lac workers in their respective factories contributing more than Rs. 4 lakh crore in the total Rs. 14 lac crore GSDP (current prices) of Punjab and Haryana. The GSDP (Gross State Domestic Product) of Punjab and Haryana was estimated at Rs. 5.75 lakh crore and Rs. 8.31 lakh crore respectively in 2019-20  at current prices, said Sanjay Aggarwal.

The economic activities such as the food processing, cotton textiles, garments, automobile, farm machinery, Information technology, trading, tourism, hospitality and transport have been severely impacted by the continuous farm agitation with the disrupted supplies of many raw materials to the  industry, said Aggarwal.

GDP of agriculture, forestry &fishing grew 3.4% H1 2020-21 which has significantly helped to pull economic growth from its lows of (-) 23.9% in Q1 FY21  to  (-) 7.5% in Q2 FY21. The re-emerging demand in the rural areas at the back of resilience of agriculture sector is supporting manufacturing and services sector activities, said Aggarwal.

Going ahead, share of agriculture sector is expected to increase from 14.6%  (2019-20) to 16% in the current year (2020-21), said Sanjay Aggarwal.

The consistent and concerted efforts of the Government to boost agricultural exports are bearing fruit. During the April-September 2020, exports of essential Agriculture commodities increased to Rs 53,626 crore as against Rs 37,397 crore during the corresponding period of last year, registering a growth rate of 43% year on year, said Aggarwal.

The plethora of schemes and initiatives announced by the Government with the aim of growth and development of agriculture sector including Soil Health Card Scheme, National Agriculture Market (e-NAM), Pradhan Mantri Fasal Bima Yojana, Pradhan Mantri Krishi Sinchai Yojana (PMKSY), Micro Irrigation Fund (MIF), schemes for livestock & fishermen and an outlay of Rs 2.83 lakh crore in Union Budget 2020-21, among others are highly appreciable.

Further, the string of recent reform measures for agriculture and rural sector including removing the norm for farmers to sell agriculture produce only to licensees in APMCs, amendment of Essential Commodities Act, implementation of agriculture marketing reforms, promotion of Herbal Cultivation, will help to achieve the vision of our Prime Minister to double the farmers income, going forward, said Aggarwal.