Farm income support, a silver bullet?

Let’s rewind to mid-2017, when onion farmers in Ahmednagar, Maharashtra, took to the streets. The protests spread like wildfire to Madhya Pradesh. In northern Karnataka, pulses growers were up in arms against crashing prices. Minimum support prices were not holding up. Flustered governments began to trot out loan waivers as their election promises. It was with the roll-out of Rythu Bandhu in Telangana in 2018 that the tide turned.

Says agriculture commentator Devinder Sharma: “There has been a tectonic change for the better. An emphasis on income support, as against just price support, is exactly what the farmer needs — a basic income of ₹18,000 per month, equivalent to a Class IV government employee.”

Game changer

The Centre has lost no time in implementing PM Kisan Samman Nidhi Yojana after announcing it in its Budget. As of March 7, ₹4,366 crore (at the rate of ₹2,000 per person) has been transferred to 2.18 crore beneficiaries holding less than five acres. The BJP manifesto released on Monday promises universalisation of the scheme.

West Bengal and Odisha have their own schemes in place, transferring ₹5,000 each in two instalments. While Rythu Bandhu pays ₹4,000 per acre (to be raised to ₹5,000 soon) per season to all landholders (and not tenant farmers), Odisha claims it will target tenant farmers and even the landless, although the means of identifying them is not clear.

Be that as it may, the die has been cast. Farmers in Odisha and Telangana will receive both the Central and State payouts. The question of whether some other schemes will be pared remains unanswered. The BJP’s manifesto also promises to make the PM Fasal Bima Yojana ‘voluntary’. Veteran agriculture scientist MS Swaminathan, however, says that existing support systems, including MSP, should not be neglected ( see interview ).

Sharma explains: “Direct income support should not be confused with benefit transfer. A transfer for inputs is merely for that purpose alone and does not accrue as income to the farmer.”

While income support insulates farmers from a range of uncertainties, there are implementation concerns. The first relates to the identification of tenant farmers. A paper ‘Model Agricultural Land Leasing Act 2016: Some Observations’ by Gyanendra Mani ( Economic and Political Weekly , October 15, 2016) cites NSSO 70th Round data to point out that leased land was 10.4 per cent of operational holdings all over the country in 2012-13, with significant State-level variations.

Interestingly, Andhra Pradesh records 35.7 per cent of the area under lease (this includes Telangana) and Bihar 22.67 per cent. Punjab, Haryana, Bengal and Odisha too are above the national level. The question of identifying beneficiaries here assumes importance.

Micro realities

In States where marginal and small farmers are particularly high, PM-Kisan carries potential. Be that as it may, the initial response to the Centre’s scheme has been mixed.

In Bihar, though the agriculture department has received over 3.8 million applications from small and marginal farmers in the State, according to its website, only 1.5 million farmers have been recommended for the Centrally-sponsored scheme. A large number of farmers in the State said that they were not even aware of the scheme.

In tiny Kakadhira village in Beed district, Maharashtra, Sahadev Baglane says: “ The government has done nothing. Announcement to give farmers ₹6,000 is nothing but another jumla . And what we are going to do with ₹6,000?”

Other youth around him disagree, saying, “At least we will get some support”. Sahadev is agitated. As he chops cane into small pieces to feed his cattle, he says, “Nothing happens in ₹6,000. And the majority of farmers have not received the money and we don’t know if it will come after elections”.

Elderly Baliram Baglane intervenes. “Understand the fact that nothing is going to change with loan waivers and meagre support to farmers,” he says in a rusty voice.

“ Saheb , see the input cost and see the support price and profit farmers get. Input cost has gone so high that this Samman Yojana will not help much. Farming is going to be more difficult in the future,” he says. Though Baliram has no data or documents to support what he is saying, the analysis of reports of the Commission for Agricultural Costs and Prices (CACP) matches his experience. CACP reports show that in the case of kharif crops from marketing seasons 2016-17 to 2018-19, ₹6,000 will cover only 7 of the 14 main kharif crops.

Even as input cost is multiplying, prices are crashing. For example, in 2013-14 the profit margin was 74 per cent for soyabean. This declined to 16 per cent in 2015-16. Cotton fetched 95 per cent profit in 2009-10, and just 37 per cent in 2015-16.

Profit margins have declined for other major crops too. For Jowar, the margin declined from 54 per cent to 25 per cent. Similarly margins declined for sunflower, niger seed, cotton, maize, paddy, jowar, groundnut, bajra, moong, etc.

“Majority of farmers are still waiting for the first instalment of PM-Kisan. In fact, many go to the bank every day to check if money has arrived,” says Nanasaheb Nemane, a farmer who lost his mousambi orchard to drought in Aurangabad district. He adds that he has not yet received insurance for the lost crop.

“ This Samman is nothing but insult to farmers. Daily we have to buy a drinking water can at a price of ₹50 and this scheme promises ₹17 every day, ” says Rajabhau, a farmer from Latur.

In Kerala, Joymon, a 50-year old paddy farmer in Manalur Panchayat in Thrissur, received his first instalment of ₹2,000 in just four days. For Mini, a woman paddy farmer in the same panchayat, there was a delay of more than 10 days in transferring the amount due to her account with a cooperative bank.

Joymon, with more than 30 years of experience in agriculture, earned a revenue of ₹60,000 by producing around 25 quintals of paddy.

The 42-year-old Liji Baby, who cultivates vegetables, mango and coconut, on his 50 cents of land at Mullassery Panchayat in Chavakkad has spent the first instalment to buy manure for his farming activities. He is not concerned about the continuation or discontinuation of the scheme.

In the scarcity-hit Vankaner Taluka of Morbi district in Gujarat, economic activity has come to a standstill in farming and animal husbandry. “These are challenging times. No water for irrigation nor for cattle. We have no income from our main livelihood. In such difficult times, the cash support from the government brings much relief for the family and provides a breather,” says Rahimbhai Kadiwar from Arni timba village.

Apart from the Central scheme, the Gujarat government also provides ₹6,800 per hectare up to 2 hectares. But in Saurashtra, a large section of farmers do not fall under the State government’s input subsidy scheme.

According to Pravinbhai Dudhat, a farmer from Sarambhada village in Amreli district, the money received under PM Kisan scheme is being used for domestic purposes. “It isn’t a big amount. But we still can buy our daily necessities which can last for a few days. This eases the stress situation,” he says.

It costs ₹22,000-25,000 per acre to grow paddy in Telangana, ₹30,000-35,000 per acre in the case of cotton and ₹20,000 in the case of maize. Will the farmer benefit from these schemes?

By Radheshyam Jadhav, Vishwanath Kulkarni, Rutam Vora, V Sajeev Kumar, KV Kurmanath, TV Jayan and A Srinivas

COMMENT NOW