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Resource centre on India's rural distress
 
 

Why Cash Transfers Cannot Replace Structural Reforms In Agriculture -Padmini Ramesh

-IndiaSpend.com

New Delhi: With the launch of the Rajiv Gandhi Kisan Nyay Yojana (RGKNY) on May 21, 2020, Chhattisgarh became the sixth Indian state in two years to initiate a direct cash transfer scheme for farmers. The scheme aims to supplement the income of the state’s 1.9 million farmers by Rs 10,000-Rs 13,000 per acre of land owned.

Cash transfers for COVID-19 relief and stimulus are also gaining salience, with the Centre announcing frontloading of PM Kisan payments. How effective is this increasingly popular direct transfers approach? One way to assess this is to analyse the impact of India’s first cash transfer scheme for farmers, Telangana’s Rythu Bandhu Scheme (RBS), launched in May 2018. Both RBS and the Rs 5,700-crore RGKNY are alike in that both define cultivators in terms of land ownership.

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