GDP growth not justifiable unless benefits reach farmers: Jaitley

Union Finance Minister Arun Jaitley on Sunday said the agriculture sector is the top priority for the Government because the country’s economic growth is not “justifiable and equitable” unless the benefits are “clear and evident” in the farm sector.

“The Government is making efforts to ensure benefits of economic growth reaches all sections of society and particularly the farmers. India is one of the fastest growing economies in the world and the growth is benefiting people in different sectors. But maximum population are dependent on agri-sector and unless the gains are clear and evident, the (economic) growth is not justifiable and equitable,” Jaitley said after launching options trading in guarseed on NCDEX (National Commodity & Derivatives Exchange).

Guarseed is the first agri-commodity options. Options are derivatives which give a buyer the right but not the obligation to buy or sell an underlying asset or instrument at a specific price on or before a certain date.

He said this unique hedging tool will allow farmers to mitigate their price risk along with taking advantage of upward price movement.

“It is first-of-its-kind hedging tool which will prove to be a game changer for the farmers,” he said.

 NCDEX is the second exchange after MCX to launch options trading in commodities. In October 2017, MCX had launched gold options.

“Therefore, the Government's priority is to ensure the gains reach the farmers and the growth is visible even in the farm sector,” he added.

Among the priority areas, agriculture sector is on the top, he said. “Ensuring the benefits reach the agri-sector and growth is visible — this is among the priority areas for us.”

Jaitley further said: “We see in some places the problem of falling prices because of higher production. Farmers are not getting the price for their produce.”

He said many steps have been taken in the last few years to take farmers out of this situation. “There has been some impact,” he said. Lauding the contribution of farmers, he said they have left no stone unturned to serve the nation. They have worked hard to turn a food shortage country to a surplus now. However, due to higher production, they are now faced with falling prices, he added.

The minister also mentioned that the launch of options trading is one of the major steps taken to help farmers.

In the beginning, options trading may look like a small step but when its awareness increases in the coming days, it will benefit farmers, he added.  “I hope this initiative will provide huge benefit to farmers in the coming days,” Jaitley said.

Speaking on the occasion, NCDEX MD and CEO Samir Shah said, “The option trading is a powerful tool to hedge price risks. We are confident that this will boost the development of the agri-commodity market.”

As per latest Central Statistics Office (CSO) data, the country's economic growth is expected to slow to a four-year low of 6.5 per cent in the 2017-18 fiscal, the lowest under the Modi-led government, mainly due to poor performance of agriculture and manufacturing sectors.

The CSO has pegged farm and allied sector growth to slow to 2.1 per cent in the current fiscal from 4.9 per cent in the preceding year.