PM-KISAN’s benefits are being extended to many who don’t deserve them, but they elude the needy According to a statement made by the government in Parliament, the number of farmers receiving income transfers under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) Scheme declined from 104 million during 2021-22 to 80 million during 2022-23. There has been a corresponding reduction in payments from Rs 67,032 crore during 2021-22 to Rs 57,646 crore in 2022-23. Launched by Prime Minister Narendra Modi on February 24, 2019, and made effective from December 1, 2018, PM-KISAN is a central sector scheme. Under it, the Union government gives Rs 6,000 a year to each farmer with a valid enrolment. It is paid in three instalments of...
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Category: Targeting subsidies
Fine tune PM-KISAN to be efficacious
The inclusion of ineligible persons on the beneficiaries list of PM-KISAN raises concerns and undoes the very purpose the scheme was launched for A significant decline in the number of farmers receiving income transfers under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) Scheme from 104 million during 2021-22 to 80 million during 2022-23 and a corresponding reduction in payment from Rs 67,032 crore in 2021-22 to Rs 57,646 crore in 2022-23 has caused much consternation. Launched by Prime Minister Narendra Modi on February 24, 2019, and made effective from December 1, 2018, PM-KISAN is a Central Sector Direct Benefit Transfer (DBT) Scheme under which the Union Government. It provides an income support of Rs 6,000 a year to farmers with...
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India should abandon the MSP track now
The Government should consider direct benefit transfer to farmers. It will help eliminate inefficiencies and misuse that go with current MSP regime In view of the new Coronavirus mutation Omicron rearing its head, the 12th Ministerial Conference (MC) of the World Trade Organization (WTO), scheduled to have commenced from November 30, has been deferred indefinitely. The Government should use the interregnum for formulating strategy and coordinate with other like-minded developing countries. The key areas requiring attention are (i) permanent solution to the public stockholding (PSH) program for food security; (ii) a special safeguard mechanism (SSM) for developing countries; (iii) remove the existing inequity in fishery subsidies; (iv) patent waiver for manufacture COVID-19 vaccines; (v) WTO reforms. India runs a mammoth program...
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Dealing with ‘ration mafia’
Arvind Kejriwal, Chief Minister (CM), National Capital Territory (NCT) of Delhi has justified its much trumpeted scheme for door-step delivery of ration on the ground that this will help reining in what he describes as ‘ration mafia’ while ensuring that every grain of the subsidized food actually reaches the person (read: the poor) for whom it is intended. Who is this ‘ration mafia’? How does it plunder the subsidized food? Can the scheme prevent it? To get to the bottom of it, we need to see as to how the existing system of distributing food to the beneficiaries works. Under the National Food Security Act (NFSA) (2013), the Union Government directs the Food Corporation of India (FCI) and other state...
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Legalising MSP will prove to be anti-farmer
Out of about 150 million farmers, a mere 8% of them get to sell their produce to the state agencies In the continuing stalemate over the three farm laws, the biggest sore point is the insistence of the agitating farmers that the MSP (minimum support price) should be legally guaranteed. At present, the Centre notifies MSP for 23 farm items. The Food Corporation of India (FCI) and other state agencies buy paddy and wheat, besides a few other items such as coarse cereals and pulses, at the MSP. These are meant for feeding the public distribution system (PDS) and giving food to beneficiaries at heavily subsidised prices under the National Food Security Act (NFSA). Out of about 150 million farmers,...
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Food subsidy – fudging stops, what about reining in
In the Union Budget for 2021-22, the Finance Minister, Nirmala Sitharaman has given a pleasant surprise. This has to do with the Government’s decision to discontinue with the decades old practice of so-called “off-budget liabilities”. A technique used by successive regimes in the past, this is a fancy nomenclature to denote transfer of certain expenses incurred by the Union Government to the books of its agencies tasked with the implementation of its welfare schemes. This helps the former show lower expenses on its own books thereby helping it bring down fiscal deficit to the desired level. A typical case relates to the Food Corporation of India (FCI) through which it administers its mammoth program of delivering food subsidy. Under the...
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Don’t kill the goose that lays the golden egg
In a bid to accommodate the concerns of agitating farmers over the three farm bills enacted by Modi – government in September, 2020, the Union Minister for Agriculture & Farmers Welfare, Narendra S Tomar has given positive signal on following points:- (i) require every trader transacting with the farmers to register (under the extant law, the former only needs to have PAN number); (ii) in the event of dispute, allow farmer to go to higher courts (the present law provides for dispute resolution at magistrate’s level); (iii) strengthen the APMC (Agricultural Produce Market Committee) by imposing levies at ‘uniform’ rate on purchase at APMC and non-APMC platforms – transactions at the latter are permitted following enactment of the Central law...
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Plug the leaks
The Government should stop selling food at a subsidised price through the PDS. Instead, it should limit its role to crediting subsidy directly to the accounts of beneficiaries Since 2014, the Narendra Modi Government has weeded out close to 44 million bogus ration cards by using the Information Technology (IT) infrastructure viz. digitisation, seeding of Aadhaar on ration cards, electronic point of sale machines at retail shops and so on. However, this addresses only a small aspect of the problem and that, too, is unlikely to be rooted out completely with the use of technology alone. Besides, large-scale diversion and black marketing of grain, inclusion of the privileged among beneficiaries, a ballooning subsidy bill and so on will persist so long as...
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Food distribution – stem the rot
During the past seven years or so, the government has weeded out close to 44 million bogus ration cards with 17 million junked in Uttar Pradesh (UP) alone (other states where substantial number of bogus ration cards have been weeded out include West Bengal 7 million, Maharashtra 4 million besides Karnataka, Rajasthan and Telangana where more than a million each have been eliminated). This has happened mostly under Modi – government. It successfully used the IT infrastructure (digitization, seeding of ration cards with Aadhar and installation of electronic PoS machine at retail shops). Currently, there are 230 million ration cards (815 million individual beneficiaries). The weeded out bogus cards or 44 million is about 20%. This is creditable especially when...
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Future mortgaged for food
Tax collections are far from adequate to pay for free food and the Govt is borrowing heavily to make up for the shortfall, thereby imposing an unsustainable burden on the future generation of taxpayers To shield millions of poor from the devastation caused by the Covid-19, Finance Minister Nirmala Sitharaman had announced that the Government would give five kg of rice or wheat per person per month for “free” to around 80 crore people through the Public Distribution System (PDS) for three months. It would also give for “free” one kg of pulses per household for three months. This was in addition to five kg of cereals per person per month that 80 crore beneficiaries are already getting at a heavily-subsidised price...
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