Mains Q & A 19 May 2023

Q1. The National Land Monetisation Corporation will not only generate revenue from the surplus land holdings of the government but also streamline management of government held land. Analyse. (250 words)

Paper & Topic: GS II à Government Policies and Interventions

Introduction:

The Union cabinet recently approved the creation of a National Land Monetisation Corporation to monetise the surplus land holdings of Central Public Sector Enterprises (CPSEs) and other government agencies. Considering that various arms of the state have considerable land holdings across the country, monetisation of their “surplus, unused and under-used non-core assets in the nature of land and buildings” is a prudent strategy as it will lead to more efficient utilisation of these “under-utilised” assets.

Body:

Rationale behind National Land Monetisation Corporation:

Database of land surplus and investors:A detailed and comprehensive inventory of the state’s land holding will not only help it identify the surplus land, and push for monetising it, but will also help create a database for potential investors.

Clarity to potential investors:A properly marked land parcels with geographical identifiers, with their boundaries clearly demarcated, and with the legality of title well established, will provide greater clarity and certainty to private investors.

Monetising unused land:Public sector entities hold vast tracts of land that are either unused and underused land.

As per reports, the total vacant land available with Railways is estimated at around 1.25 lakh acres.

Similarly, the defence ministry also has considerable land holdings outside of the cantonment boundaries.

Thus, collating them under a single entity will lead to a more efficient monetisation drive, and better utilisation of these assets.

Additional resources:The proceeds from the monetisation of these assets will help generate additional resources, boosting government coffers. The land in and around prime areas can possibly generate substantial returns.

Reduce artificial scarcity of land:Importantly, auctioning off surplus land will increase the supply of land, which may address the issue of the “artificial” scarcity of land that exists in certain areas. This could depress prices and thus have a moderating effect on costs of projects.

Separate entity to streamline management: Considering that land monetisation is a complex process, entrusting this work to a separate agency is the right way to go about it.

As the government itself has acknowledged,it requires “specialised skills and expertise” in areas such as “market research, legal due diligence, valuation, master planning, investment banking and land management.”

A separate entity, housed with professionals with specialised skills is better suited for this task.

Issues that exist:

First,the estimation of surplus land may be a contentious issue.

Ministries, departments, and public sector entities may bereluctant to demarcate land parcels as “surplus”.

Second, the corporation will have to grapple with issues such as the absence of clear titles, ongoing litigation, and muted investor interest.

Third, there is also the issue of the encroachment of government land to contend with.

But while this monetisation drive should lead to more efficient outcomes, it does raise questions over the management of commons, and whether public purpose can be better looked after by more effective management of public land by the state.

Way forward:

The success of the infrastructure expansion plan would depend on other stakeholders playing their due role.

These include State governments and their Public Sector Enterprises and the private sector.

In this context, the Fifteenth Finance Commission has recommended the setting up of a High-Powered Intergovernmental Group to re-examine the fiscal responsibility legislation of the Centre and States.

Maintaining transparency is the key to adequate realisation of the asset value.

Q2. Despite its advantages, the potential of organic farming in scalability and profitability can be realised only after overcoming the limitations posed it. Examine. (250 words)

Paper & Topic: GS II à Agriculture related issues

Introduction:

According to FSSAI, ’Organic farming’ is a system of farm design and management to create an ecosystem of agriculture production without the use of synthetic external inputs such as chemical fertilizers, pesticides and synthetic hormones or genetically modified organisms. FAO suggested that Organic agriculture enhances agro-ecosystem health, including biodiversity, biological cycles and soil biological activity.

Body:

Advantages of Organic farming:

Compared with conventional agriculture, organic farming uses fewer pesticides, reduces soil erosion, decreases nitrate leaching into groundwater and surface water, and recycles animal wastes back into the farm.

Limitations of Organic farming:

Due to relatively small volumes, the costs of organic food products are relatively high. According to the Indian Council of Agricultural Research, productivity on an average dips by 6.7 per cent in the first year, and the government needs to have a plan in place to support farmers during the transition.

The cost of cultivation increases as it takes more time and energy to produce than its chemical-intensive counterpart.

High demand and low supply has further created an inflationary pressure on organic food products.

Pest attack on organic crops is another reason cited by the farmers for low productivity and demanded education and training to deal with it.

Specialised farmer training costs, higher processing and inventory holding costs, and increased packaging, logistics and distribution costs add to the price of end products.

The absence of organic food products across all segments in the market is a concern

There is low awareness at the producer level on the difference between conventional farming and organic farming.

At the consumer level, there is confusion between natural and organic products and limited understanding of the health benefits of organic food products

Consumers are faced with a plethora of decisions around brands —imported or domestic, product quality, authenticity of claims and certifications.

Even as farmers are struggling to find a better market, the existing certification systems for organic food are making things difficult for them. The certification systems are not only cumbersome and time-consuming, but also expensive.

Way forward:

Supply-demand mismatch can be eased fundamentally by making organic production mainstream with location-specific hybrid production strategies.

Investments in achieving operations excellence by companies will facilitate lowering the cost of organic food products

In order to sustain consumer trust, maintaining an accurate audit stream, and preventing cross-contamination with conventional goods would be crucial.

Consumers should consume responsibly and stakeholders should prevent wastage along the supply chain.

The Government must rope in agricultural scientists and international research institutions to develop organic herbicides.

It is critical for companies involved in the organic food business to increase awareness among consumers in non-metro cities.

People across all income groups should have access to organic food.

Establishing community-supported agricultural farms or with “grow your own food” programmes.

Conclusion:

Organic agriculture is the best insurance policy that India can have with better performance on productivity, environmental impact, economic viability and social well-being. Focusing only on higher yields at the expense of other sustainability pillars (economics, environment and society) is not the food production system that India needs. What India needs is an integrated system that gives equal importance to all sustainability dimensions across the value chain and thus helps establish a healthy and well-fed society.