pm-kisan-first-installment-late

Context- Amid the surge in COVID-19 cases, the wait of over 9 crore farmer families for the first installment of their PM Kisan payout for the financial year 2021- 22 is getting longer.

Background

  • As for the Ministry of Agriculture it may take some more days to transfer the installment of rupees 2000 for the period April to July to eligible farmer families under the Pradhan Mantri Kisan Samman Nidhi or the PM Kisan.
  • Under the scheme, the government provides Rupees 6000 to eligible farmers’ families in three equal installments during the course of the financial year.
  • The first installment is due between April 1 and July 31.
  • Last year, most of the beneficiaries received the money in their bank accounts between March 24 and April 20. However, this year even with the end of April no farm household has received any money.
  • The stated reason by the Agriculture Ministry’s official is the wait for the states to complete the process of closure of lots and signing of RFTs or Request for Transfers.
  • According to the guidelines of PM Kisan, State Nodal Officers (SNOs) authenticate the data of eligible farmers and upload them in batches from time to time on the portal.
  • Based on the verified data, the SNOs sign the RFTs that contain the total number of beneficiaries under the scheme.
  • The public finance management system (PFMS) then issues a fund transfer order (FTO), based on which the Department of Agriculture, Cooperation and Farmers’ Welfare shows the transaction order for the mentioned amount, and then the installment is credited into the account of the beneficiary.
  • The agricultural ministry also noted that due to covid 19 crisis, field teams are taking longer time to complete the verification process.

About PM- Kisan

  • The pradhan mantri Kisan samman Nidhi or PM Kisan is the first universal basic income type of scheme targeted towards farmers.
  • It is implemented as a central sector scheme by the Government of India.
  • The scheme was initially targeted at the small and medium farmers but with the declining growth in the gross value added (GVA) in the agriculture sector, it was extended to all the farmers in May 2019.
  • The aim of the scheme is to provide income support to the farmers in order to ease their liquidity needs to facilitate timely access to inputs.
  • Under the scheme, an amount of rupees 6000 but here is transferred directly into the bank accounts of the farmers, subject to certain exclusion criteria related to higher income status.
  • Government ministry- Ministry of Agriculture and Farmers Welfare

Objectives of the scheme

  • To provide income support to all the eligible landholding farmers and their families.
  • It aims to supplement the financial needs of the farmers to procure various inputs in order to ensure proper crop health and appropriate yields, an immense rate with the anticipated farm income.

Eligibility under the Scheme

Any small or marginal farmer should not fall under the following criteria to be eligible under the Pradhan Mantri Kisan Samman Nidhi Yojana. Some of the categories of beneficiaries who are not eligible for benefit under this scheme are:

  • Any institutional land-holders.
  • The farmer as well as any member of the family belonging to the following categories:
    • Former and present holders of constitutional posts
    • Former and present Ministers/ State Ministers
    • Former or present members of Lok Sabha/ Rajya Sabha/ State Legislative Assemblies/ State Legislative Councils 
    • Former and present Mayors of Municipal Corporations
    • Former and present Chairpersons of District Panchayats.
    • Any serving or retired officers as well as employees under the Central/ State Government Ministries /Offices/Departments.
    • All retired pensioners who get a monthly pension of Rs.10,000/-or more and belonging to the above category.
    • Any individual who paid their income tax in the last assessment year is not eligible under this scheme.
    • Professionals like Doctors, Engineers, Lawyers, Chartered Accountants, and Architects registered with Professional bodies and carrying out profession by undertaking practices.

Advantages of the Scheme

  1. It eases the liquidity constraints for the farmers for procuring inputs especially when more than half of the Indian farming households do not have access to formal credit.
    • This is extremely pertinent in India, as more than 50% of the farmers here rely on informal credit and 1/5 of the farmers purchase inputs on credit.
    • Also, the producer support in India is very low when compared to the other countries and the scheme helps in supplementing that.
  2. It aids modernization as it has significantly stimulated the Krishi Vigyan Kendra’s impact on the adoption of modern cultivation techniques.
  3. Since it has the potential to increase the net income of the farmers, it may enhance the farmers’ risk-taking capacity, thus leading to undertaking riskier but comparatively productive investments.
  4. There is no selection bias in choosing the beneficiaries under the scheme based on attributes like caste and land size.

Challenges in the Implementation of the Scheme

  • Ad hoc export and import policies, lack of infrastructure and uncertainty in the agricultural markets has led to an adverse effect on agricultural productivity and stability of farm incomes.
  • Given that India's poverty line is Rs.32 per person per day in the rural areas and Rs. 47 in the urban areas as per the Rangrajan Committee, the income support of Rs. 17 per day for a household which is the amount offered under the scheme, is largely insufficient for even bare minimum sustenance of the vulnerable farmers.
  • Due to the volatile market and price fluctuations in the different regions across the country, it is important to index the cash transfers to local inflation.
  • The scheme does not provide a clear design of transfers and a framework for effective grievance redressal.
  • The delay in the payment of installments often undermines the actual objective of the scheme I.e., to provide credit to the vulnerable farmers to procure agricultural inputs.

Way Forward

  • Any welfare measure especially those related to direct financial support should provide the farmers with adequate purchasing power to meet their daily basic requirements.
  • Apart from financial support to the farmers, there are some basic issues on the structural level that need to be addressed in the agricultural sector like modern agricultural techniques, better infrastructure, better prices, etc.
  • For the scheme to be implemented efficiently there is a need for back-end infrastructure and institutions.

Source- IE