How demonetisation and Aadhaar worsened Indian farmers' plight

Astha Kapoor
Astha KapoorJun 09, 2017 | 12:33

How demonetisation and Aadhaar worsened Indian farmers' plight

Reeling from the worst drought in decades, fluctuating prices of crops and declining output, India’s agrarian sector is a tinderbox waiting to explode. Over the past year, the government’s policies of demonetisation, pushing of Aadhaar and rapid digitalisation have further alienated the farmer.

The recent farmer protests that have gripped the country are linked to the sweeping changes that have been brought about in Mandasaur in Madhya Pradesh and the gunning down of five agricultural workers is representative of a systemic problem that needs looking into.


This is just the tip of the iceberg in the number of farmer agitations every day. The anger, dismay and restlessness in the agrarian sector is palpable. Farmers groups have stormed Delhi one after another in the past three years: the frightening Tamil farmer protests at Jantar Mantar in Delhi show the desperation in the workers to be heard and taken seriously by the ruling party at the Centre.

Farm woes, however, are not new to the country. If farmer deaths are a metric: more than 12,000 farmers have committed suicide every year since 2013. The government of India aims to double farm income by 2022, which requires a farm growth rate of 14%, the current rate is 4%. Which is also not enough. The average income per farmer in India is Rs 6,400 - double it and its Rs 12,800 which is not enough by any standard.

The journey to doubling incomes will be long and cumbersome, especially because of the unpredictability that governs the farm sector, which has suffered from poor irrigation, drought and varying prices. 

The government believes that digitisation of processes, digital payments and most importantly Aadhaar authentication for government services will help plug in leakages and reach benefits to those who need it the most, especially small and medium farmers.


Therefore, demonetisation has been used as a pivot to push digital payments and Aadhaar authentication. As of March 2017, Aadhaar has been made mandatory to access a host of farm sector schemes and programmes. A farmer cannot get a soil health card, an instrument that informs on the productivity and nutritive value of the land, without Aadhaar as of March 31 across the country.

Aadhaar is also mandatory for crop insurance, including Pradhan Mantri Fasal Bima Yojana (PMFBY). June 1 onwards, Aadhaar-enabled payments will be made available through PoS machines at all 170,000 fertiliser retailers across India, who sell subsidised agricultural inputs to farmers. So far, fertiliser has been a universal subsidy.

The push for Aadhaar authentication and PoS machines under Digital India is exciting and in fact, has been lauded as one of the government’s most popular moves in its three years. However, much like demonetisation which caused grief to farmers, digitalisation of farm based programmes and schemes is likely to result in exclusion and further discomfort for a sector that employs 50 per cent of the workforce and contributes 15 per cent to the GDP.

Making Aadhaar mandatory for receiving government subsidies and payments is hugely problematic because the unique ID is exclusionary at many levels - 72 per cent of the population is covered, those who are not covered will be unable to access government services without the Aadhaar number, and any exclusion on this basis should be unacceptable.


The protests the government is facing may just be the start to what will be a huge movement of farmers against the technologies and processes that are being enforced on them. 

Most of the people left to enrol are the poor, and live on the margins of society and are unable to get government services in the first place, and now they have another hurdle to overcome. Even for those enrolled, authentication issues are abundant, i.e. there is a mismatch of fingerprints or readers are unable to read the prints.

A report from Telangana states that there is a whopping 36 per cent verification failure. There are other errors for those who are enrolled, such as mismatch of numbers with land records, bank accounts or biometrics with Aadhaar. In Karnataka, over 40,000 farmers did not receive compensation for crop failure because Aadhaar data was entered incorrectly by banks.

Further, as seen in an experiment on Aadhaar-enabled fertiliser uptake, over 10 per cent of transactions were authenticated by one individual on behalf of another due to absence of the Aadhaar number or issues with authentication, thus defeating the purpose of using the biometric ID for verification.

Connectivity also remains a cause of concern while pushing for Aadhaar all around. In Andhra Pradesh, a study showed that authentication could take anywhere between 5-10 minutes per person, because of lack of signal. This is hardly surprising in a country where an MLA had to climb a tree to make a phone call!

Finally, awareness is always a big issue as the government changes rules in short timelines and expects people to come onboard. In the fertiliser experiment in Andhra Pradesh, despite outreach and advertisements, a shocking 88 per cent of farmers did not know that they would require Aadhaar for fertilisers and as a result a very small percentage of fertilisers was taken up off the PoS machine, despite the huge investment in infrastructure.

Beyond issues of access, and convenience, there are also a myriad of concerns around privacy and Aadhaar that have been discussed ad nauseam in the light of all data leaks that have happened through government portals in the last few months. The government seems to incorrectly believe that Aadhaar is safe and that the poor do not value privacy if receiving services.

However, a conversation with farmers would prove otherwise – just the linking of land records with Aadhaar numbers received a lot of resistance as there is a constant fear of land-grabbing.  

To the government of India, the solution lies in the technological platform it has constructed anchored in Aadhaar. However, Aadhaar is flawed in design, and serves to be exclusionary to the people who need government services the most.

Exclusion is an inexcusable crime at the hands of the government - and its impact will compound over the next couple of sowing seasons as the full effect of the introduction of Aadhaar starts to take roots.

The protests the government is facing may just be a start to what will be a huge movement of farmers against the technologies and processes that are being enforced on them without logic or benefit.

Last updated: June 12, 2017 | 12:05
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