Interim FM Goyal announces assured income for farmers

In a major sop in the election year, small and marginal farmers having less than 2 hectares of land in the country would get an assured income support of ₹6,000 a year to “help them avoid indebtedness”, interim Finance Minister Piyush Goyal announced on Friday.

Goyal while presenting the interim budget of the NDA government said the newly-announced scheme – PM Kisan Samman Nidhi (PM Kisan) – would benefit over 12 crore Indian farmers and the scheme would be implemented from December last year. The farmers would be paid be the dole in three equal instalments of ₹2,000 each, he said.

“The programme would be made effective from December 1, 2018 and the first instalment for the period up to March 31, 2019 would be paid during this year itself. It will entail an annual expenditure of ₹75,000 crore,” Goyal said. “This will pave way for farmers to earn and live a life of respect and is towards our goal of doubling farmers’ income by 2022,” he said.

In the current fiscal, the government has allocated a sum of ₹20,000 crore for the PM Kisan scheme.

Though it is modelled on Raithu Bandhu launched by Telengana last year and Kalia scheme recently announced by Odisha, the scheme seemed to be smaller in scope. While Telangana farmers are paid ₹5000 per acre twice a year, Odisha government has promised to pay a lumpsum of ₹10,000 (in two instalments for kharif and rabi seasons).

“This will pave way for farmers to earn and live a life of respect and is towards our goal of doubling farmers’ income by 2022,” the Minister said.

Later in the day, Goyal ruled out extending benefits under PM Kisan to tenant farmers.

Experts’ views

“This is nothing but an election stunt. It’s too little and too late The sum promised through the PM Kisan scheme just covers 3 to 5 per cent of the cost, depending on the crop chosen by farmers,” said Vikas Rawal, professor of economics at the Jawaharlal Nehru University.

“No way the government can implement the scheme in such a short notice and distribute even the first instalment of ₹2,000 to all the beneficiaries, if they want to do it a genuine manner. When most States are not yet digitised their land records and the records are not yet linked to Aadhaar, how are you going to identify them and make the payment,” he asked.

Global consultancy firm, PwC, on other hand, said the structural income support providing direct benefit to small and marginal farmers, who would constitute 90 per cent of Indian farmers, is the right direction.

The Finance Minister also promised to give a 2 per cent interest subvention to farmers pursuing animal husbandry and fisheries, which will be further increased by another 3 per cent on timely repayment. According to him, as many as 1.5 crore farmers benefit from this.

Besides, all farmers affected by severe natural calamities will get 2 per cent interest subvention and an additional 3 per cent interest subsidy on timely repayment of crop loans, he said.

Bharatiya Kisan Union leader Rakesh Tikait called the interim budget “anti-farmer” and people would respond appropriately when the elections come.

The PM Kisan scheme is a desperate measure to buy the farmers’ votes, said Yogendra Yadav, president of Swaraj India. “It is a double insult to the farmers that the government expects to get the farmers’ votes so cheap. Farmers will surely reject this dishonourable bargain,” he said.

This announcement suffers from additional infirmities, since the scheme excludes farmers above 5 acre even in rain-fed areas, the landless cultivators, tenant farmers, and the millions of farmers who do not have land pattas, including adivasi farmers. It is also not clear how this scheme will be implemented in such a short time period in the absence of any data base of all the farmers.

“The announcement on interest subvention is of minor significance because it applies only to loans which are rescheduled during calamities. With most natural calamities not even being declared by the government and poor implementation of loan rescheduling, this benefit would hardly go to 1 per cent of the farmers, said Avik Saha of Jai Kisan Andolan.

Yogesh Pandey of Swabhiani Shetkari Sangathana expressed deep disappointment that the problem of mounting dues of sugarcane farmers, in excess of ₹11,000 crores, did not merit even a mention in the FM’s speech. He said that the government is divorced from the reality of the farmers.