Mirjapur/Indore (Madhya Pradesh): As the sun rose, piles of white chrysanthemums awaited Keshu Singh Patel at his 2.5-acre farm in Mirjapur, a village in western Madhya Pradesh. Every day in the winter, the 55-year-old takes about 70 kg of flowers, tied to his bike, to sell in the flower market 15 km away.
Over the harvesting season from October to January, Patel’s income has fallen by 70 per cent. “Four days before and even after notebandi (demonetisation), I was selling sevanti (chrysanthemums) flowers between Rs 30 and Rs 40 a kg; now they sell between Rs 4 and Rs 6 a kg,” he said.
Patel is one of India’s 118.6 million farmers — equivalent to the population of the Philippines. Patel is a “small farmer”, as he has about 2.5 acres of land, less than the average land held by an Indian farmer (2.84 acres).
The largest impact of the demonetisation of Rs 500 and Rs 1,000 notes appears to be on the informal economy, which employs 82 per cent of India’s 500-million-strong workforce and generates half of its gross domestic product (GDP).
To grow chrysanthemums on one bigha — about 0.4 acres of land — cost Patel Rs 3,000 in seeds, Rs 15,000 in fertiliser and pesticides, and Rs 7,800 for labour, over three months. About 0.4 acres of land should produce 10-12 quintals of flowers. Patel’s family — his wife, son, daughter and daughter-in-law — work from 9 am to 6 pm on the farm.
If the crop is good, and flowers sell well during the wedding season — November 15 to December 15 — Patel could have made about 2,600 a day. On December 7, when IndiaSpend followed Patel, he earned Rs 543. The plant is sowed before the monsoon and flowers between October and January.
Over the season, the Patel family would have earned Rs 100,000, a profit of more than Rs 74,000. This year, they have earned about Rs 30,000, a profit of Rs 4,000 or 94.5 per cent lower. In the month after notes were banned, he earned only Rs 7,000.
Patel is forced to sell at a lower rate because flowers wither fast, and their rate reduces with time. “I had to throw 35 kg of flowers because there were no buyers yesterday,” he said.
Patel reached the bustling flower market in Indore — considered Madhya Pradesh’s commercial capital — by 7 am. He entered the flower-strewn arena — there are 51 licensed shops in this government market — on his motorcycle laden with flowers tied in makeshift bags of bright yellow, green and red cloth.
Around 12:30 pm, Patel returned to the farm, as three labourers were cutting down the stalks of the chrysanthemums planted on about 0.2 acres of his farm. His family spent the day plucking flowers off the other plants so Patel would have enough to sell the next day.
Of his 2.5 acres, about a fourth of an acre lies fallow, as their isn’t enough water for the crops.
After selling one crop of flowers, Patel would have waited for the plants to regrow and sold another batch. “But because prices are low, it is more expensive to maintain the plants,” Patel explained. In a regular year, the plants would have been cut in the end of January or February.
When IndiaSpend spoke to Patel’s son, Kantilal, on December 13, he said the market had picked up a little, with chrysanthemums selling between Rs 10 and Rs 20 a kg. “But we’ve already cut down the stalks,” he said, adding that the recovery of prices would not benefit them.
Patel and his family moved above the rural poverty line of Rs 816 per person per month some years ago, and so can’t access the lower-priced wheat, rice, sugar and oil that families below the poverty line receive from the government’s public distribution system.
Fortunately for Patel, he is well known in the village and the flower market. The local village shop is willing to give him oil, sugar and even seeds on credit, and the shop owner in the flower market is willing to give an advance payment for the flowers that he will sell, Patel said.
Since demonetisation, the government has been pushing digital payments but most transactions still take place in cash.
Most farmers and traders had bank accounts, but used cash. They said they either had too little money to put in an account or did not use debit or credit cards regularly. All transactions Patel made during the day were in cash: He filled petrol worth Rs 50 in his motorcycle in the morning, and bought a dozen bananas for Rs 40 in the afternoon.
“Before depositing Rs 500 and Rs 1,000 notes after notebandi, I had used my bank account about two years ago,” Patel said. Kantilal has an ATM card, but used it only once in 5-6 months to withdraw cash, as he had little money in his bank account. The nearest ATM and bank branch is a 15-minute ride from their village.
The family has one basic cell phone they use to call relatives. Though Kantilal has used the Internet in the past, neither father nor son currently has access to the Internet as a smartphone was too expensive to afford.
For four months last year, the family used a Samsung smartphone, which they bought for Rs 8,000. “But someone stole the phone,” Kantilal said. He had used Internet on the phone to access Facebook, he said, adding that they wouldn’t buy a new phone because it was too expensive — equivalent to almost all of their profit this season.
Patel’s family spends about Rs 1,500 to Rs 2,000 on household items every month.
For Patel, low flower prices mean he has to dip into his savings to pay Rs 130 a day to two labourers who help his family pluck flowers.
“We always face problems of water and electricity shortage,” said Patel. “This year notebandi has spoiled the year for us.”
(In arrangement with IndiaSpend.org. The views expressed are those of IndiaSpend. Feedback at firstname.lastname@example.org)