[Burning Issue] Income support model (Telengana)

 

How Telangana supports farmers with Rs 4,000 for every acre they own

 

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Why in News

  1. An income support scheme for farmers in Telangana has earned the appreciation of outgoing Chief Economic Advisor Arvind Subramanian.
  2. It formally gives scope for the feasible framework at pan-India level.

What Rythu Bandhu provides?

  1. Under Rythu Bandhu, the Telangana government gives every beneficiary farmer Rs 4,000 per acre as investment support before every crop season.
  2. The objective is to help the farmer meet a major part of his expenses on seed, fertiliser, pesticide, and field preparation.
  3. The scheme covers 1.42 crore acres in the 31 districts of the state, and every farmer owning land is eligible.
  4. Officials said 92% of the beneficiaries own less than 5 acres, 5% own 5-10 acres and the remaining 3% own more than 10 acres.

Payment

  1. The government plans to extend the flat Rs 4,000-per-acre subsidy to the rabi season as well, with the distribution of cheques from November 18.
  2. The government has allocated Rs 12,000 crore for Rythu Bandhu in 2018-19; the 24×7 free power supply to farmers is estimated to cost another Rs 1,000 crore.
  3. The government will issue cheques rather than make direct benefit transfer (DBT) because banks might use the DBT money to adjust against farmers’ previous dues.
  4. The cheques have been distributed along with free Pattadar Dharani passbooks with updated information including ownership and land purchase and sale.

Beneficiaries

  1. The government had initially drawn up a list of 72 lakh beneficiaries based on a revenue department survey last year.
  2. Lack of proper land records resulted in the total being shortlisted at 57.33 lakh.
  3. But the records are still under rectification and more farmers will be added to the list later.

Relief from Indebtedness – the major impact

  1. Rythu Bandhu money provides that cushion to the farmer because with that money the farmer can purchase seeds and fertiliser and start sowing.
  2. If a bank approves his loan later then it is of additional help to hire farm labour etc but at least he is not going to moneylenders.

Criticisms of the scheme

  1. The foremost issue is that it does not exclude rich farmers and wealthy landlords. The scheme does, however, have a provision under which cheques can be returned to the local authorities.
  2. The scheme leaves out tenant cultivators — an estimated 40% of Telangana’s farming population and mostly coming from the poorest and most disadvantaged backgrounds. Tenant farmers cannot be included in the scheme as they cannot submit any proof of cultivation of land, which is done mostly based on informal and oral lease arrangements. Their frequent movement makes it very difficult to identify them. If they are included in the scheme, it will lead to unnecessary litigation.

Way forward

  1. Acute agri distress is a grim reality that needs to be tackled on a war footing. Schemes like Rythu Bandhu show promise.
  2. Filter out the rich farmers (on the basis of factors like income, land and asset ownership etc) so as to make the model more cost-effective and impactful.
  3. The model will have to be customised to suit the agro-climatic and socio-economic variations across India. A blanket approach will not work.

By Explains

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