Thursday 4 October 2018

How a financial squeeze on farmers poses a challenge for PM Modi in 2019

farmer protest at Delhi-UP border

The financial squeeze on India's farmers is set to worsen because of record high fuel prices and surging costs of fertilisers, posing a challenge to Indian Prime Minister Narendra Modi in an election that must be held by May.

The rise in input prices could not have come at worse time for farmers, already grappling with falling domestic product prices due to rising yields and abundant harvests.

Yet, the government has few easy options to respond. Rival global producers have complained about Indian state support and falling global farm product prices undermine export prospects.

Indian farmers voted overwhelmingly for Modi in 2014. But a fall in rural incomes risks damaging that support next year.

Thousands of farmers marched on New Delhi on Tuesday to demand better prices for their produce. Police responded with teargas and water cannon. Farmers suspended their protests after talks with officials that ran into early Wednesday morning.

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