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LATEST NEWS UPDATES | The PM-KISAN challenge -Aparna Roy

The PM-KISAN challenge -Aparna Roy

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published Published on Feb 14, 2019   modified Modified on Feb 14, 2019
-The Hindu

The top-down, rushed approach of the government in reaching out to farmers is likely to end in failure

This year’s Interim Budget is being regarded as a big spread for farmers. The government announced its decision to transfer Rs.6,000 every year directly to 12 crore farmers holding cultivable land up to 2 hectares through the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme. While this is a progressive step, is it enough to mitigate India’s severe agrarian distress?

The agriculture sector employs over 50% of the workforce either directly or indirectly, and remains the main source of livelihood for over 70% of rural households. However, the droughts of 2014 and 2015, ad-hoc export and import policies, lack of infrastructure, and uncertainty in agricultural markets have adversely affected agricultural productivity and stability of farm incomes. Consequently, agriculture growth rates have been inconsistent in the last five years — 5.6% in 2013-14, (-) 0.2% in 2014-15, 0.7% in 2015-16, 4.9% in 2016-17 and 2.1% in 2017-18. This is a major concern. PM-KISAN is aimed at boosting rural consumption and helping poor farmers recover from distress. Although the scheme is valuable in principle, without adequate focus on proper strategy and implementation, it is unlikely to make any meaningful impact.

Inadequate financial support


The merit of cash transfers over loan waivers and subsidies lies in their potential greater efficiency in enabling poor households to directly purchase the required goods and services as well as enhance their market choices. Therefore, the impact of a welfare measure such as PM-KISAN can only be realised through financial support that provides farmers with adequate purchasing power to meet their daily basic necessities. Given that India’s poverty line is Rs.32 per person per day in rural areas and Rs.47 in urban areas, according to the Rangarajan Committee, the income support of Rs.17 a day for a household, which is the amount offered by PM-KISAN, is largely insufficient for even bare minimum sustenance of vulnerable farmers. Therefore, to be effective, any cash transfer scheme should first ensure that there is enough cash provided to help bring an affected community out of poverty. For instance, the Rythu Bandhu in Telangana, that the Centre is said to have replicated, provides Rs.4,000 per acre to each farmer in each season, and the Krushak Assistance for Livelihood and Income Augmentation scheme in Odisha offers a direct cash transfer of Rs.5,000 for a farm family over five seasons, among other benefits.

Moreover, given the volatile market and price fluctuations in different regions, it is important to index the cash transfers to local inflation. The failure of an ambitious plan of Direct Benefit Transfer in kerosene in Rajasthan is a case in point, where the cash transferred to families has been insufficient to purchase kerosene, as the market price increased substantially.

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The Hindu, 14 February, 2019, https://www.thehindu.com/opinion/op-ed/the-pm-kisan-challenge/article26261487.ece?homepage=true


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