Indicative of the priorities of Modi 3.0, the first file signed by the Prime Minister authorised the release of the 17th instalment of the Pradhan Mantri Kisan Samman Nidhi of `20,000 crore to benefit 93 million small and marginal farmers. The first Union cabinet meeting took a decision to build more houses for the rural poor, exemplifying the ruling National Democratic Alliance regime’s commitment to farmers’ welfare and agriculture.
The task thus is cut out for Shivraj Singh Chouhan, the new minister for agriculture and farmers welfare and rural development. While the buzz is around the ministry’s first 100 days’ agenda, Chouhan stated that work was already going on at a fast pace, adding that the government was not new and there was continuity. All measures initiated in the last decade to boost farmers’ incomes will be expedited, he said, adding a road map for farmer welfare and rural development was already a part of the Bharatiya Janata Party’s (BJP) election manifesto.
While continuity on the policy front is to be welcomed, all eyes will be on how the former chief minister of Madhya Pradesh addresses the narrative of distress stalking the countryside. Farmer discontent stems from falling farm gate prices and lower realisations.
Cultivation is getting increasingly unviable at the margin. Small and marginal farmers continue cultivation on holdings that are diminishing in size. Cultivators in the vanguard agrarian states of Punjab and Haryana continue agitating for the legalisation of the minimum support price (MSP) regime for more crops beyond rice and wheat as the existing regime does not insulate their incomes from market failures, volatility of prices, and sudden supply gluts. The BJP’s manifesto pledges to increase MSPs but there is a deafening silence on the farmers’ demand for a price guarantee. The manifesto is also silent on the PM’s promise eight years ago to double farmer incomes.
Chouhan has the right background to address these persisting farmer demands as MP was the ground zero for an alternative to MSPs, notably deficiency price payments (DPPs). DPPs compensate farmers for the difference between the MSPs for select crops and their mandi prices if the latter rule at lower levels and do not entail physical procurement.
The Bhavantar Bhugtan Yojana was introduced in October 2017 following violent agrarian protests against falling crop prices.
But before scaling it up nationally, the new minister might want to re-examine how it actually worked in MP and why it was given up the very next season as traders had gamed the system, widening the gap between mandi prices and MSPs, thereby causing an enormous amount of expenditure by the state government. It will be interesting if Chouhan tweaks the scheme to present it as a superior option to legally guaranteed MSPs demanded by farmers.
Chouhan also has considerable experience with income support as MP ran a highly successful cash transfer scheme for women, which triggered speculation that the Centre was considering doubling income support for women farmers under PM-Kisan. But why single out only women farmers as the narrative of agrarian distress affects both male and female cultivators? While the first file signed by the PM pertained to PM-Kisan, Chouhan might consider making it more inclusive by including agricultural labourers, and construction and non-farm workers.
As the doubling of farmer incomes has proved elusive, PM-Kisan can then transform into a quasi-rural basic income scheme that will be welcomed in the countryside.
Source: Financial Express