Rural Distress, Farmer Suicides, Drought Measures

Rural Distress, Farmer Suicides, Drought Measures

Extending the Aspirational District Programme (ADP)


From UPSC perspective, the following things are important :

Prelims level : Aspirational Districts Programme (ADP)

Mains level : Not Much

The PM has hoped to extend the Aspirational District Programme (ADP) to block and city levels.

Aspirational Districts Programme (ADP)

  • Launched in January 2018, the ‘Transformation of Aspirational Districts’ initiative aims to remove this heterogeneity through a mass movement to quickly and effectively transform these districts.
  • The broad contours of the program are Convergence (of Central & State Schemes), Collaboration (of Central, State level ‘Prabhari’ Officers & District Collectors), and Competition among districts driven by a spirit of mass Movement.
  • With States as the main drivers, this program will focus on the strength of each district, identify low-hanging fruits for immediate improvement, measure progress, and rank districts.

Behind the name

  • PM then negated the idea of naming any scheme based on their backwardness.
  • Rather the name ‘Aspirational’ presents a more affirmative action-based execution of the scheme.

Selection of districts

  • A total of 117 Aspirational districts have been identified by NITI Aayog based upon composite indicators.
  • The objective of the program is to monitor the real-time progress of aspirational districts based on 49 indicators (81 data points) from the 5 identified thematic areas.

Weightage has been accorded to these districts as below:

  • Health & Nutrition (30%)
  • Education (30%)
  • Agriculture & Water Resources (20%)
  • Financial Inclusion & Skill Development (10%)
  • Basic Infrastructure (10%)

Strategy of the ADP

The core Strategy of the program may be summarized as follows.

  • Making development a mass movement in these districts
  • Identify low hanging fruits and the strength of each district, to act as a catalyst
  • for development.
  • Measure progress and rank districts to spur a sense of competition.
  • Districts shall aspire to become State’s best to Nation’s best.

Features of the ADP

  • It has transformed into a Jan Andolan.
  • The ADP is different in trying to monitor the improvement of these districts through real-time data tracking.
  • The programme seeks to develop convergence between selected existing central and state government programmes.
  • District performance in the public domain and experience building of the district bureaucracy is another notable feature.
  • The programme is targeted, not towards any single group of beneficiaries, but rather towards the population of the district as a whole.

What makes this program special?

The program reflects what has become of the development project in India under neoliberalism, especially after the end of planning.

  • Long overdue sectors have been given more emphasis.
  • It is not a tailor-made program with one-size-fit strategy. More onus has been laid on the districts. It has a district-intervention strategy.
  • It works on the principle of SWOT (strength, weakness, opportunity and threats) model and comparison with national best parameters for effective resource management.
  • It is the most reviewed programme by the Prime Minister.
  • A general idea behind the idea is that a good work never goes un-noticed. It is duly appreciated on social media as well as by the officials.

Programmatic Strengths

  • A key strength of the ADP is the collection of baseline data and follow-ups at regular intervals.
  • Sustaining this effort would create a robust compilation of statistics for use by both researchers and policy-makers.
  • In doing this, the government also brings much-needed attention to human development and a willingness to meet the Sustainable Development Goals (SDGs).
  • Incremental progress being made in the chosen districts as reflected in the rankings.
  • The programme also claims to be “non-partisan and unbiased” and geared towards all-India growth.
  • The selection of districts indeed suggests that the programme has not favored any bias either regional, political or any other.
  • The programme seeks convergence of central and state schemes anchored around specific activities.

Issues with the programme

  • Using the case of Bihar, they argue that the programmes selection of districts itself is problematic.
  • In fact, it actually excludes the most backward districts because per capita income, the most basic measure of development, has not been considered.
  • There seems to be some ambiguity around the issue of whether the programme is concerned only with improved access or also with the quality of service provided.
  • The indicators used are not defined relationally, rather they are static human development indicators that do not see people mired in dynamic social relations.
  • It is also accused that the state is not making any new or focused public investment (except for possible use of Flexi-funds) into these districts, on the other hand, it is moralizing about their inability to improve (through rankings).
  • The programme is carrying the burden of proving the government’s “developmental” work without addressing any of the fundamental issues around achieving equitable development.
  • Yet, the NITI Aayog justifies the overall approach as capitalizing on “low-hanging fruit.”

Way forward

  • The program has been able to make difference in the lives of citizens of India, in education, health, nutrition, financial inclusion, skill development and this has made a difference to some most backward and most geographically far-flung districts of the nation.
  • ADP is ‘aligned to the principle of “leave no one behind—the vital core of the SDGs. Political commitment at the highest level has resulted in the rapid success of the program the report said.
  • UNDP has recommended revising a few indicators that are slightly close to reaching their saturation or met by most districts like ‘electrification of households’ as an indicator of basic infrastructure.


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Rural Distress, Farmer Suicides, Drought Measures

Farmer suicide


From UPSC perspective, the following things are important :

Prelims level : NCRB

Mains level : Farmers suicides in India

The number of agricultural labourers who died by suicide in 2020 was 18% higher than the previous year, according to the National Crime Records Bureau (NCRB) report.

Farmers suicide in 2020

  • In 2020, 5,098 of these agricultural labourers died by suicide, an 18% rise from the 4,324 who died last year.
  • Overall, 10,677 people engaged in the farm sector died by suicide in 2020, slightly higher than the 10,281 who died in 2019.
  • They made up 7% of all suicides in the country.
  • Most of these deaths were among those whose primary work and main source of income comes from labour activities in agriculture or horticulture.
  • However, among farmers who cultivate their own land, with or without the help of other workers, the number of suicides dropped 3.7% from 5,129 to 4,940.
  • Among tenant farmers who cultivate leased land, there was a 23% drop in suicides from 828 to 639.

State-wise data

  • The worst among States continues to be Maharashtra, with 4,006 suicides in the farm sector, including a 15% increase in farm worker suicides.
  • Other States with a poor record include Karnataka (2016), Andhra Pradesh (889) and Madhya Pradesh (735).
  • Tamil Nadu also bucked the national trend; although the total number of farm suicides in the State was slightly higher.

Why more suicides despite a boom?

  • The farm sector was one of the few bright spots in the Indian economy since a year.
  • It recorded growth on the back of a healthy monsoon and the continuation of agricultural activities during a lockdown that crippled other sectors.
  • Hence, suicides among landowning farmers dropped slightly during the pandemic year.
  • Landless agricultural labourers who did not benefit from income support schemes such as PM Kisan may have faced higher levels of distress during the pandemic.

General causes of farmers suicides in India

Suicide victims are motivated by more than one cause however the primer reason is the inability to repay loans.

  • Debt trap: Major causes reportedly are bankruptcy/indebtedness, problems in the families, crop failure, illness and alcohol/substance abuse.
  • Lack of credit: Low access to credit, irrigation and technology worsens their ability to make a comfortable living.
  • Responsibility burden: In other words, debt to stress and family responsibilities as reasons were significantly higher than fertilizers and crop failure.
  • Disguised unemployment: This remains high. Fragmentation of land holdings has left far too many farmers with farms that are too small to be remunerative.
  • Mental health: One of the major causes behind suicidal intent is depression. Farmers are often subjected to fear of boycott due to societal pressures.


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Back2Basics: National Crime Records Bureau (NCRB)

  • The NCRB is an Indian government agency responsible for collecting and analysing crime data as defined by the Indian Penal Code (IPC) and Special and Local Laws (SLL).
  • It is headquartered in New Delhi and is part of the Ministry of Home Affairs (MHA).
  • It was set-up in 1986 to function as a repository of information on crime and criminals so as to assist the investigators in linking crime to the perpetrators.
  • It was set up based on the recommendation of the Task force, 1985 and National Police Commission, 197.
  • It merged the Directorate of Coordination and Police Computer (DCPC), Inter State Criminals Data Branch of CBI and Central Finger Print Bureau of CBI.

Also read:

[Burning Issue] Farmers’ suicide in India


Rural Distress, Farmer Suicides, Drought Measures

[pib] Five Star Village Scheme


From UPSC perspective, the following things are important :

Prelims level : Schemes covered under the initiaitive

Mains level : Not Much

The Department of Posts has launched a scheme called Five Star Villages, to ensure universal coverage of flagship postal schemes in rural areas of the country.

The Five Star Villages Scheme sounds typically among the most commons types say, Swachh Bharat, Financial Inclusion and Literacy or Infrastructure amenities. Here is the caution for preventing a blunder.

Five Star Villages Scheme

  • The scheme seeks to bridge the gaps in public awareness and reach of postal products and services, especially in interior villages.
  • The initiatives covered under the scheme include:
  1. Savings Bank accounts, Recurrent Deposit Accounts, NSC / KVP certificates,
  2. Sukanya Samridhi Accounts/ PPF Accounts,
  3. Funded Post Office Savings Account linked India Post Payments Bank Accounts,
  4. Postal Life Insurance Policy/Rural Postal Life Insurance Policy and
  5. Pradhan Mantri Suraksha Bima Yojana Account / Pradhan Mantri Jeevan Jyoti Bima Yojana Account.
  • If a village attains universal coverage for four schemes from the above list, then that village gets four-star status; if a village completes three schemes, then that village gets three-star status and so on.

Its implementation

  • The scheme will be implemented by a team of five Gramin Dak Sevaks who will be assigned a village for the marketing of all products, savings and insurance schemes of the Department of Posts.
  • This team will be headed by the Branch Post Master of the concerned Branch Office. Mail overseer will keep personal watch on the progress of the team on daily basis.
  • The teams will be led and monitored by concerned Divisional Head, Assistant Superintendents Posts and Inspector Posts.

Rural Distress, Farmer Suicides, Drought Measures

Using knowledge-era technology to bridge the urban-rural gap


From UPSC perspective, the following things are important :

Prelims level : Not much.

Mains level : Paper 1- Closing the the gap between urban and rural in India using knowledge-eratechnology.

This article puts forward the idea of using knowledge-era technology to minimise the difference between rural and urban areas. In the first part, it elaborates the reasons and circumstances that led to the neglect of rural areas and development in urban areas. In the next part, the idea of using knowledge-era technologies to close the gaps between rural and urban areas is explored.

Why Urbanisation is spreading and how it led to the neglect of rural areas?

  • Better opportunities: The tendency to migrate to urban areas has been a natural consequence of better opportunities that got created there — in contrast to life in rural areas becoming increasingly unsustainable.
  • Centralisation: The industrial-era dynamics that led to centralisation in support of mass production or massive scale-up was clearly a major one.
  • This, in turn, also led to the concentration of higher education/capacity building processes to urban centres where there was job growth, quite to the detriment of the much larger rural area.
  • Problems in education and training: The education and training environment became myopic, essentially meeting the manning requirements to run systems created by others.
  • Our education with its inherent problems led to little confidence in creating one’s own systems to address needs independent of others.
  • Demographic dividend: India’s importance grew primarily because of her demographic dividend and the large market that her people constituted and not because of the systems and technologies.
  • Neglect of rural India: Rural India suffered severe neglect in the process, probably as a result of poor job opportunities there and education having lost its role as an enabler of local development.
  • However, the country is learning to create systems and technologies to address her needs. The exercise is, by and large, urban-centric.

UPSC asked about the quality of urban life in 2014, and the trends of labour migration in 2015. This article touched upon both of these themes.

Using the knowledge-era technology to close the urban-rural gap

  • We are now in the knowledge era.
  • And knowledge-era technologies, in contrast to industrial-era technologies, promote democratisation (social media, for example) and facilitate decentralisation (work from home).
  • It should thus be possible for an adequately educated and trained youth residing in a rural domain to support a significant part of the manufacturing and service needs of urban areas.
  • Just as an urban youth can support a significant part of the knowledge and application needs in rural areas.
  • With technologies like additive manufacture, internet of things, and artificial intelligence, well-trained people can address needs in both urban and rural areas from wherever they are.
  • Thus, the knowledge era should, in principle, become a significant income leveller between the urban and rural domains, with a large rise in the overall national income.
  • As we focus on capacity building of rural youth, the opportunities in rural areas should, in principle, become higher than those in urban areas since the rural segment can now benefit from all three sectors of the economy- agriculture, manufacturing and services.

The idea of “cillage”

  • In the knowledge era, with emphasis on capability and capacity building of rural youth in terms of holistic education, appropriate technology and enhanced livelihood, there is a possibility for a more balanced distribution of income as well as population.
  • This would, however, need knowledge bridges to be built between cities and villages, and the creation of an ecosystem which has been conceptualised as a “cillage” — a synergistic combination of city and village.
  • Bridging the knowledge gap between a city and a village would also bridge the income gap between the two.
  • This will also lead to a faster bridging of the gap between the average individual income in India and that in industrially advanced countries.
  • Democratisation promoted by knowledge technologies, if properly leveraged, can in principle reduce disparities, which, unfortunately, are on the rise today.

How to realise the idea of cillage?

  • Integrated and holistic approach: Developing a “cillage” ecosystem would need a rooted and integrated approach to holistic education and research, technology development and management, as well as technology-enabled rural livelihood enhancement.
  • It would take a while for the rural youth to become empowered enough to convert the challenges into opportunities in rural areas.
  • The emergence of a new-age society is an inevitability.
  • How soon the rural domain can embrace it and how concurrently, comprehensively that can happen, is the real challenge.
  • That will decide whether India will gain in the knowledge era or lag as it did in the industrial era.

Look at one more question from 2015-“Smart cities in India cannot sustain without smart villages. Discuss this statement in the backdrop of rural-urban integration”.  The ideas discussed here in this article help us to deal with such questions.

Can Covid-19 speed up the realisation of cillage?

  • The process could also be seen as the migration of a set of experiences and skills to villages.
  • We can look at this as a potential two-way bridge for a new relationship between cities and villages.
  • It will be the bridge in which not all need to return to cities, but can rather meet the needs of cities as well as villages by remaining in villages.
  • Several initiatives will be needed to realise such a possibility.
  • Facilitating a number of new skills, technologies and support systems that can further leverage current capabilities of these people for starting a new enterprise would be important.
  • Immediate arrangements to facilitate their livelihood, and leveraging their present capabilities could help retain at least some of these people in villages.
  • It could trigger a faster movement towards an inevitable long-term equilibrium.
  • Going forward, we should take knowledge activities to a higher level so that the products and services created by these people become more competitive.
  • Looking at disruptive technologies for exploiting local opportunities should follow.


Given that the new normal after Covid-19 would, in any case, be quite different, the right course would be to channelise the stimulus caused by this crisis towards accelerating the shift to a new normal. This will not only help a more dispersed population, but will also reduce disparities and lead to faster growth of the economy.

Rural Distress, Farmer Suicides, Drought Measures

NCRB Report on Farmers Suicide


From UPSC perspective, the following things are important :

Prelims level : NCRB

Mains level : Strategies to combat farmer's distress in India

In 2017, 10,655 people involved in agriculture committed suicide in India, according to data released January 2, 2020 by the National Crime Record Bureau (NCRB).

NCRB had released the 2017 crime data last October 2019, but held back information on suicides.

Highlights of the report

  • NCRB highlighted that the toll was the lowest since 2013.
  • Among those who took their lives, 5,955 were farmers / cultivators and 4,700 agricultural labourers — both lower than in 2016.
  • They comprised 8.2 per cent of all suicide cases in the country in 2017.
  • In 2016, 6270 farmers killed themselves, down from 8,007 in 2015, while 5,109 farm hands committed suicide, up from 4,595.
  • The number of women farmers committing suicide, however, jumped to 480 in 2017 from 275 in ’16.

Farm suicides over half a decade

Years No. of farm sector suicides No. of farmers
2017 10,655 5,955
2016 11,379 6270
2015 12,602 8007
2014 12,360 5650

Statewise data

  • In 2017, the most number of farm suicides were reportedly in Maharashtra (34.7 per cent), followed by Karnataka (20.3 per cent), Madhya Pradesh (9 per cent), Telangana (8 per cent) and Andhra Pradesh (7.7 per cent).
  • The trend was quite similar to previous year: In 2016, Maharashtra accounted for 32.2 per cent, Karnataka 18.3 per cent, MP 11.6 per cent, Andhra 7.1 per cent and Chhattisgarh 6 per cent.
  • In 2015 too Maharashtra tops in farmers suicides followed by Karnataka, Madhya Pradesh in 2016.
  • West Bengal, Odisha, Nagaland, Manipur, Mizoram, Uttarakhand, Chandigarh, Dadra and Nagar Haveli, Daman and Diu, Delhi, Lakshadweep and Puducherry reported zero suicides by farmers or agricultural labourers.

Causes of Farmers Suicide

  • Major causes of farm suicides were reportedly bankruptcy / indebtedness, problems in the families, crop failure, illness and alcohol / substance abuse.

Assist this newscard with:

[Burning Issue] Annual Crime in India Report-2017

Rural Distress, Farmer Suicides, Drought Measures

Behavioural aspect of farmer suicides


From UPSC perspective, the following things are important :

Prelims level : Not Much

Mains level : Strategies to combat farmer's distress in India

  • Farmer suicides, which have till now been studied economically and agriculturally, are now being looked at from behavioural and psychological angles.

Study on farmer’s suicide

  • A study is being conducted under the National Agricultural Science Fund of IICAR in three states — Punjab, Telangana and Maharashtra.
  • Till now the issue of farmer suicide was being looked at only from economic and agricultural angles.
  • The study has looked at it from behavioural, psychological and cultural perspectives in addition to the earlier two.

Major causes of suicide

  • Since most discussions and parleys on suicides are overtaken by issues of crop failures, rising debts, new farming techniques, the psychological aspect is largely ignored.
  • One of the major causes behind suicidal intent is depression, found the researchers.
  • It needs to be understood that at times a farmer under a debt of Rs 2 lakh shows a tendency to end his life, while another under a debt of Rs 10 lakh does not.

Need of the hour: Psychological assistance

  • The study suggested roping in psychologists and counselors on various issues.
  • They included battling depressive ruminations, suicidal ideations, negative cognitions, hopelessness, helplessness.
  • It aimed at recognising and managing stressors like financial distress, relationship problems, and enhancing psychological resources through emotional well being, and mindfulness.

Model of 7’s

  • The researchers developed a ‘7D’ model of triggering and confounding factors and a ‘7R’ model of preventive and protecting factors to deal with the problem of farmer suicides.

‘7D’ model

It encapsulates:

  1. Drugs,
  2. Debt,
  3. Disease,
  4. Disputes,
  5. Depression,
  6. Disrepute and
  7. Death

 ‘7R’ model

It looks at prevention of suicides. It consists:

  1. Remunerative agriculture,
  2. Resilience building,
  3. Rational expenditure,
  4. Reassurance through connectivity,
  5. Righteous conduct,
  6. Religious support and
  7. Responsible reporting

Way forward

  • Farmers don’t need money only, they need motivation too.
  • Along with subsidies, increased farm profits, the focus should also be on resilience building and problem solving skills of farming families.
  • In suicide-prone states, agricultural institutes and scientists should start distributing seeds of resilience, tolerance and contentment among farmers, suggested researchers.
  • Agri universities can play a powerful role in dissipating the culture of shame associated with mental illness and depression as it is the fear of stigma that acts as a barrier to seek appropriate treatment.

Rural Distress, Farmer Suicides, Drought Measures

High rate of farmer suicides in Punjab’s Malwa


From UPSC perspective, the following things are important :

Prelims level : Malwa region (in MP and Punjab)

Mains level : Farmers suicides prone regions


  • Over the past few years, ‘farm debt’ has been one of the main reasons behind farmers and farm labourers committing suicide in Punjab.
  • Data has indicated that 97% of farmer suicides are taking place in the Malwa region only.

More suicides in Malwa region

  • According to report farmer suicides due to debt drastically increased in the late 1990s.
  • The maximum such suicides are taking place in the Malwa region (97.45 per cent), which falls south of the Sutlej, and has 14 of the state’s 22 districts.
  • Malwa has a majority of ‘small and marginal’ farmers’, who have 1-5 acres land.

Reasons for suicide

  • Of around 97 per cent suicides that has taken place in the Malwa region — 94 per cent were due to ‘farm debt’.
  • Majority of them are small and marginal farmers having 1-5 acres of land.

Total number of such suicides

  • The Punjab government’s data states that 3,330 farmers have taken their lives due to farm debt since 2000 till date, of which 698 committed suicide in the past four years, most of them in the Malwa region.
  • It also states that 97 farm labourers committed suicide since 2016, before which no records were maintained of the same.

Why Malwa region?

  • Exorbitant lease land rentals is one of the factors behind the high rate of farmer suicide in Malwa.
  • Farmers cannot get alternative employment opportunities in Malwa, hence small and marginal farmers fall in the trap of debt.
  • If the crop turns out bad, it only adds to their mounting debt.
  • In the Malwa region, a large number of farmers have to spend a chunk of their earnings on health issues including cancer, which is quite common here.
  • There is even a train that carries mostly cancer patients from here to a hospital in Rajasthan.
  • Several reasons have been attributed to high number of cancer patients here, including highly contaminated groundwater.

Why are lease land rentals high?

  • In Malwa, the number of ‘landless’ and ‘marginal farmers’ is very high against the availability of farmland.
  • Cultivation of land is the only way available to them to earn their living.
  • For taking land on rent, they are dependent on big land lords and ‘sahukaars’ who have also become owners of agricultural lands of most small and marginal farmers, who could not pay their debts.
  • Poor farmers think that even if their entire earnings go in paying rent, they will at least get grain for a whole year for their families.
  • On the other hand, in Doaba, which is the NRI belt, and Majha, a large number of farming households either have one member abroad or in government jobs or armed forces from where they get an assured regular income.
  • Even small farmers are running subsidiary occupations like dairy. Also, they prefer to plant three crops in a year including wheat, paddy and vegetables.
  • In the Doaba, large farm lands of NRIs are available to fellow farmers for cultivation due to which lease rentals are 20-30 per cent down here.


The report suggests following measures to relieve farmers in the region:

  • streamlining of ‘land lease rentals’,
  • waiving farm loans at least once,
  • providing compensation to the tune of Rs 10 lakh to each family that loses a farmer or farm labourer to suicide,
  • continuation of free power, crop diversification, insurance for crops and health of farmers and labourers, development of dairy sector etc.
  • profitable employment for one family member of farmers and labourers, rold-age pension to farmers and labourers,
  • streamlining of banking sector and curtailing unscrupulous activities of micro-finance agencies and moneylenders etc.

Rural Distress, Farmer Suicides, Drought Measures

PM Kisan Maan Dhan Yojana


From UPSC perspective, the following things are important :

Prelims level : Details of the scheme

Mains level : Nothing much

The scheme has been envisioned with an aim to improve the lives of small and marginal farmers of the country.

Features of the scheme

  1. It is voluntary and contributory for farmers in the entry age group of 18 to 40 years
  2. Monthly pension of Rs. 3000/- will be provided to them on attaining the age of 60 years
  3. Farmers will have to make a monthly contribution of Rs.55 to Rs.200, depending on their age of entry till they reach the retirement date i.e. 60 years
  4. Central Government will also make an equal contribution of the same amount in the pension fund
  5. Spouse is also eligible to get a separate pension of Rs.3000/- upon making separate contributions to the Fund
  6. Life Insurance Corporation of India (LIC) shall be the Pension Fund Manager and responsible for Pension payout
  7. In case of death of the farmer before retirement date, the spouse may continue in the scheme by paying the remaining contributions until the remaining age of the deceased farmer
  8. If the spouse does not wish to continue, the total contribution made by the farmer along with interest will be paid to the spouse
  9. If there is no spouse, then total contribution along with interest will be paid to the nominee
  10. If the farmer dies after the retirement date, the spouse will receive 50% of the pension as Family Pension
  11. After the death of both the farmer and the spouse, the accumulated corpus shall be credited back to the Pension Fund
  12. The beneficiaries may opt voluntarily to exit the Scheme after a minimum period of 5 years of regular contributions. On exit, their entire contribution shall be returned by LIC with an interest equivalent to prevailing saving bank rates
  13. The farmers who are also beneficiaries of PM-Kisan Scheme will have the option to allow their contribution debited from the benefit of that Scheme directly
  14. In case of default in making regular contributions, the beneficiaries are allowed to regularize the contributions by paying the outstanding dues along with prescribed interest
  15. The initial enrollment to the Scheme is being done through the Common Service Centres in various states
  16. The enrollment is free of cost. The Common Service Centres will charge Rs.30/- per enrolment which will be borne by the Government.
  17. Target of 10 crore beneficiaries for this year.

Rural Distress, Farmer Suicides, Drought Measures

[op-ed snap] The case for minimum basic income


Mains Paper 3: Economic Development| Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.

From UPSC perspective, the following things are important:

Prelims level: Basic knowledge of minimum basic income.

Mains level: The news-card analyses the case for minimum income support scheme to mitigate rural distress, in a brief manner.


  • The government will present its last Budget tomorrow.
  • Conventionally, the Budget presented in an election year is a vote on account, aimed at providing funds for the government to function until the formation of new government.

Vote on account convention loosely followed

  • In recent times, the vote on account convention has been followed loosely.
  • For instance, in 2014 the Manmohan Singh-led government’s interim Budget announced the One Rank, One Pension scheme and allocated ₹500 crore for its rollout.
  • This wasn’t an emergency measure that could not have waited until the completion of the election.
  • The Budget also announced cuts in excise duties on some items, including small cars and capital goods, in the hope of reviving consumption and investments.
  • Therefore, it won’t be surprising if the present government announces an income support scheme to mitigate rural distress in its interim Budget.

Encouraging results of minimum income support

  • A pilot project conducted between 2010 and 2013, covering 6,000 beneficiaries in Delhi and Madhya Pradesh have yielded encouraging results.
  • It confirmed that at high levels of impoverishment, even the smallest income supplement can improve nutrient intake, school enrolment and attendance of female students, and reduce incidence of indebtedness.
  • The study showed that consumption of pulses went up by 1,000%, fresh vegetables by 888%, and meat by 600% among the beneficiaries.
  • This evidence challenges the commonly held views that welfare payments are an affront to the dignity of the beneficiaries and that they are used for questionable purposes, such as for buying alcohol.

Why income support?

  • The reforms since 1991 have largely bypassed agriculture and other segments of the economy that engage poor and rural Indians.
  • While incomplete economic liberalisation and technological advances have led to growth in national income, all individuals have not gained equally.
  • The disproportionate share of gains from the reforms have gone to middle-class and rich Indians.
  • This unevenness in development calls for a superior economic growth model.
  • Until that happens, redistributive policy interventions such as income transfers can improve equity.

Not to be confused with unemployment benefits

  • Income transfers are not to be confused with doles or unemployment benefits.
  • They are unconditional income supplements to compensate for policy failures and ease the economic anxieties of the less advantaged.
  • Besides equity, there’s also an urgent need to address rural distress.
  •   This is largely a consequence of policy failures such as ineffective procurement and perverse trade and pricing policies that have in times of bumper harvests led to gluts, depressed market prices, and aggravated farmer losses.
  • So, it is only fair that the government pays reparations to farmers in some form.

Telangana and Odisha Income support schemes

Telangana and Odisha are already experimenting in a limited way with income support schemes, focused on the farm sector.

  1. Rythu Bandhu Scheme
  • In Telangana, the government is providing farmers income support payment under the Rythu Bandhu, at the rate of ₹10,000/ha (₹4,000/acre).
  • However, this model benefits the biggest landowners the most, including those who lease out their land.
  • Tenants, sharecroppers and landless labourers, the most vulnerable, are out of its coverage.
  • Its success depends on reliable land records.

2. KALIA Scheme

  • Odisha’s recently notified KALIA (Krushak Assistance for Livelihood and Income Assistance) irons out these creases.
  • It proposes to transfer ₹5,000 in cash per season (₹10,000 per year for double-cropped land) to the State’s 30 lakh marginal farmers, leaving out the two lakh large farmers.
  • It promises cash grants of ₹12,500 each to the State’s 10 lakh landless households.
  • The hope is that they will use this money to rear goats or poultry and farm mushrooms or honey.
  • Fisherfolk are covered too, and will receive the investment support for buying fishing nets and allied equipment.

MSP-based payments distort price signals to farmers

  • Last year, the Budget had promised compensatory payments to farmers equal to the gap between depressed market prices and the minimum support prices (MSPs) announced.
  • But MSP-based payments distort price signals to farmers on what to produce and how much in the subsequent season.
  • Rythu Bandhu and KALIA are superior policy interventions. Plus, they do not suffer from the moral hazard and limited reach of farm loan waivers.
  • Waivers penalise farmers who repay loans on time and benefit only borrowers from banks.

Minimum income guarantee vs job guarantee programmes

  • The advantage of a minimum income guarantee is that it will also cover the urban poor, who are not covered in these schemes.
  • While job guarantee programmes, such as the Mahatma Gandhi National Rural Employment Guarantee Scheme, lock up beneficiaries in low-productivity work, income supplements allow them to continue to look for better employment options.
  • Therefore, a minimum income guarantee scheme will improve equity, address rural distress and cover the urban poor.

Are these schemes feasible politically, operationally and fiscally?

  • Income supplements can be transferred into Jan Dhan or Post Office accounts.
  • Beneficiaries can be selected through the Socio-Economic Caste Census (the last round was conducted in 2011, the results of which were released in July 2015).
  • Increasing the fiscal deficit hurts the poor, for it sparks off inflation and cannot be the way to fund income transfers.

Way Forward

  • In 2017-18, the Centre and the States collected more than ₹5 lakh crore through various taxes, royalty payments and dividends from producers and consumers of petroleum products.
  • Streamlining distortionary and demerit subsidies, such as on urea (₹70,000 crore annually), can open up significant fiscal space.
  • Healthcare, education, water conservation, environment and other merit subsidies need to be preserved and improved and should not be reduced to fund income transfers.
  • If the wealth tax that the government had abolished in 2015 is reintroduced as a fair and easy-to-collect levy on the super-rich, an income support scheme for the poor will be easier.
  • Taxpayers must realise that agri-prices, and therefore farm incomes, are not free market-driven.
  • They are kept artificially low, through pricing policy instruments, so that inflation does not erode the rest of the population’s purchasing power.

Rural Distress, Farmer Suicides, Drought Measures

[OP-ED SNAP] A quota for farmers


Mains Paper 3: Social Justice| Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and Bodies constituted for the protection and betterment of these vulnerable sections.

From UPSC perspective, the following things are important:

Prelims level: Basics aspects of reservation, Indra Sawhney case .

Mains level: The news-card analyses the issues affecting the agrarian community wrt to 10 per cent reservation entitled to EWS category, in a brief manner.



  • The last few years have seen the so-called dominant farming communities — especially the Jats, Marathas, Patidars and Kapus — mount violent agitations demanding quotas in government jobs and higher educational institutions, whether under the OBC (Other Backward Class) or any specially created category.
  • In all these instances, the standard government response was that it want to grant them reservations, but doing it entails breaching the 50 per cent limit set by the Supreme Court in the 1992 Indra Sawhney judgment.
  • Further, including them within the 27 per cent OBC quota isn’t practical, since that would be at the expense of the communities already in the list.

Things have changed with EWS quota

However, this feeble narrative has undergone a sudden transformation now, with the Narendra Modi government introducing and passing in Parliament a Constitution amendment bill that creates a new economically weaker sections of citizens (EWS) category entitled to 10 per cent reservation, over and above the 15 per cent for Scheduled Castes, 7.5 per cent for Scheduled Tribes and 27 per cent for OBC.

Agrarian community, the sufferers

  • In today’s setting, where the centre of power has shifted inexorably from “Bharat” to “India”, the Jat or Maratha farmer’s son/daughter stands no chance against the urban Brahmin or Bania’s children, even of relatively poor/lower middle class background.
  • Living in big towns and cities brings certain advantages — better schooling, exposure to English and knowledge of the outside world — that those primarily brought up on farms and village communities cannot derive.
  • Rural people in India suffer from an overall social disadvantage vis-à-vis those residing in cities. This holds true even more in a globalised milieu, where agriculture isn’t as paying and nor is land the source of power it once was.
  • According to the Maharashtra State Backward Class Commission, 76.86 per cent of Maratha families are engaged in agriculture for their livelihoods, with hardly 7.5 per cent of the community — which has a roughly 30 per cent share of the state’s population — possessing undergraduate or technical/professional qualifications.
  • The quota agitations by the dominant agrarian communities have not really been as much for public sector jobs, as for admission to government educational institutions.

Challenges in EWS quota

  • In all probability, the 10 per cent EWS quota will be overwhelmingly cornered by urban upper castes.
  • The government’s reported proposal to set the “creamy layer” for reservation eligibility at below five acres of land ownership for farming families — as against a Rs 8 lakh yearly income cut-off for others — isn’t going to help either.
  • The annual profits from growing a double crop of paddy and wheat even in a state like Haryana, where there is assured irrigation and minimum support price-based procurement, would not exceed Rs 50,000-60,000 per acre.
  • It translates into a yearly income of Rs 2.5-3 lakh for five acres. This is obviously lower for farmers with similar holdings in rainfed areas. These will, at any rate, be below the Rs 8 lakh “creamy layer” cut-off applicable for the non-farming EWS category that is predominantly savarna and urban-based.

Way Forward

  • It would have made far more sense — economically, legally, politically, morally and in the spirit of the Constitution — to have limited the 10 per cent EWS reservation to only those with farming or rural backgrounds.
  • As P S Krishnan has rightly pointed out, reservations were envisaged by our Constitution makers not to deal with “inequities against individuals”, but “deprivations imposed on certain social classes as a whole”.
  • Farmers today need support not just for remaining in agriculture, but also to enable exit by some in order to make holdings viable. This is a “group/sector” and not “individual poor” need.
  • The Indra Sawhney judgement allowed the 50 per cent limit quota limit to be exceeded in “certain extraordinary situations”, where a “special case [can] be made out”. Individual cases of poverty among urban savarnas do not represent an extraordinary situation, whereas creating a 10 per cent EWS category restricted only to farming/rural families not covered under the existing reservation provisions can be made out as a prudent response to the current crisis facing Indian agriculture.
  • Extending reservations to the children of all agriculturalists cultivating, say, up to 10 acres of irrigated and 20 acres of un-irrigated land would benefit not just numerically large communities such as the Marathas or Jats. There are many farmers who are Rajputs, Brahmins and upper caste Muslims as well.
  • Also, it is easier to fudge incomes than to prove one’s farming credentials that can come only with land ownership or kisan credit card documents.
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