Farm subsidies in cash: Telangana to give Rs 8,000/acre

New Delhi | Published: January 19, 2018 5:54:37 AM

The Telangana government has drawn up a scheme under which farmers in the state will be given Rs 4,000 per acre twice a year to cover the costs of major inputs such as fertilisers, seeds and pesticides.

Telangana government, Farm subsidies,MNREGA, Farm subsidies in cash, kharif, rabi, Uttar Pradesh, Karnataka, kharif season, K Chandrashekar Rao, RBI,Tamil Nadu, MaharashtraThe first tranche of the largesse, to be made available to all farmers irrespective of the size of their holdings or income levels, will be disbursed during May 1-15 this year, ahead of the kharif season. (PTI)

The Telangana government has drawn up a scheme under which farmers in the state will be given Rs 4,000 per acre twice a year to cover the costs of major inputs such as fertilisers, seeds and pesticides. The first tranche of the largesse, to be made available to all farmers irrespective of the size of their holdings or income levels, will be disbursed during May 1-15 this year, ahead of the kharif season.The move is being flagged as an alternative to costlier debt waivers announced by some other states. “We have found that farmers spend about Rs 4,000 per acre in buying fertiliser, seeds and pesticides each season — kharif and rabi. With free power for agriculture provided by the Telangana government, only labour and machinery costs will now be left for farmers to bear,” said a state government official. If labour under MNREGA is allowed in agriculture, the burden on the farmers could be minimised too, he added. The Economic Eurvey 2016-17, in Volume II released in August last year, has estimated that farm loan waivers could be as much as Rs 2.2-2.7 lakh crore if all states start offering the relief and could stoke short-term deflationary shock in an economy yet to gain full momentum. Even if only the five states (Uttar Pradesh, Karnataka, Maharashtra, Punjab and Tamil Nadu) that have made the announcement to implement the loan waiver, the estimated impact could be Rs 1-1.25 lakh crore, it said.

Under the input subsidy scheme to be rolled out in Telangana, the first of its kind in the country, the state government will help farmers buy in advance seeds and fertilisers for the 2018 kharif season, the sowing for which begins around first week of June depending on monsoon arrival. The government will disburse a similar amount before the start of rabi sowing in October. The package will cost the state government Rs 5,600 crore in the kharif season as an estimated 56.65 lakh hectares will be under cultivation in the period. The total outgo in rabi season may be lower as besides the area under crops to be lower, there are assured irrigation facilities. Telangana has 31.64 lakh hectares as gross irrigated area. If this entire rabi land is taken into consideration, the state will have to spend about Rs 3,130 crore in the rabi season, taking the total outgo to Rs 8,730 crore.

Asked whether this “input assistance” scheme can be an alternative to the debt-waiver, Siraj Hussain, former union agriculture secretary, said: “Yes, it can be. Not only that, it can also help the Centre to channelise its fertiliser subsidy to farmers directly.” He said it is possible to roll out the Telangana model as a Central scheme. But he did not agree to the idea of subsidising labour costs. “Everything need not be free. The farmers should also bear some costs,” said Hussain, who currently works with ICRIER as a senior fellow. VM Singh, convenor of All India Kisan Sangharsh Coordination Committee (AIKSCC), lauded the Telangana government’s scheme and sought the Centre to replicate in all other states. But he said it cannot be an alternative to ‘debt-waiver’. “Debt has been accumulated over the years as farmers did not get price and it is a matter of past while the input subsidy is forward-looking,” Singh said. The AKSCC has been spearheading a nationwide farmer movement demanding farm loan waiver and crop MSP be fixed at 50% above the cost of production.

Outstanding credit to agriculture and allied sectors touched Rs 9.88 lakh crore as of November 24, 2017, compared with Rs 9.11 lakh crore a year earlier, showed the RBI data. Chief minister K Chandrashekar Rao in April last year had announced the input assistance scheme to be implemented in FY 2018-19. The state has since updated the land revenue records and has decided to pay to about 70 lakh farmers who own land. “There will not be problem for tenancy farmers as they may deduct the input assistance from the payment to be made to the land owner for taking the agricultural field on lease,” the government official said.  The state has spent about Rs 17,000 crore in the last four years to waive off agricultural loans of 35.3 lakh farmers. Out of the total debt of each farmer, the state had waived off Rs 1 lakh maximum that includes interest also. Out of 55.54 lakh farmers in the state, nearly 86% are either marginal or small with average land size of 1.13 hectares.

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