Budget 2019: Eye On 2022 - Rs 75,000 cr seed fund for parched lives

The Interim Budget is not heavy on the farm sector but delivers on the widely-debated farmer income support scheme with the Pradhan Mantri Kisan Samman Nidhi.

The Centre will directly transfer Rs 6,000 per year in cash into the bank accounts of 12 crore small and marginal farmer families with an annual spend of Rs 75,000 crore. Effective from December 1, 2018, it will cover "vulnerable landholding farmer families, having cultivable land up to 2 hectares".

Finance Minister Piyush Goyal said the farm income will be given in three instalments of Rs 2,000. The first one, for the period up to March 31, will be disbursed this fiscal. The expenses for the current fiscal (December to March) is estimated at Rs 20,000 crore. The scheme will be wholly funded by the central government.

The government has also increased the Minimum Support Price (MSP) to achieve its promise of doubling farm income by 2022.

Steering clear of loan waiver or rescheduling, there is a provision for 2% interest subvention to farmers affected by natural calamities. Additionally, there is 3% interest subvention upon timely loan repayment. Two per cent interest subvention is set for farmers pursuing animal husbandry and fisheries.

Agricultural expert Devinder Sharma welcomed the farmer income assistance, but said the amount was meagre. "It is on the lower side," he said. "It comes to Rs 500 per month. How can we augment a farmer's income with so little?" He cities NABARD (National Bank for Agriculture and Rural Development) figures, saying an average farmer's income is Rs 8,931 per month. Of this, more than 50% is non-agricultural.

"Having said that, it is a good thing that the government has accepted that direct income support to farmers is required," he added. "Five states have already taken up direct income support and now the central government has also launched it. Which means that henceforth, we will have this provision in every Budget." Sharma also said that the subsequent government could further raise the amount.

However, he is disappointed that tenant farmers have been kept out of the scheme — "You have left out at least 50% of the farmer population," he said. One of the reasons for this could be that there are no proper records of them, he offered.

Murali Babu, general secretary of the Federation of All India Farmers Association (FAIFA) said the government needs to devise a way to include farmers working on leased land in Direct Income Transfer programme. "These farmers are not able to get bank loans too, because of land title issues," he said.

Babu also urged the government to ensure that prices of fertilisers and other inputs do not shoot up due to the income support. "That will negate any benefit," he said.