Insta
Bridging The Market-MSP Gulf: Novel NITI Aayog Proposal To Compensate Farmers Under Consideration By Centre
Swarajya Staff
Jan 29, 2019, 05:09 PM | Updated 05:09 PM IST
Save & read from anywhere!
Bookmark stories for easy access on any device or the Swarajya app.
The NDA government is considering including NITI Aayog’s area-based income compensation (ABIC) scheme in the interim budget which pays farmers the difference between the market price and the government-mandated minimum support price (MSP), reports Business Standard (BS).
The scheme is believed to be an affordable way for the government to relieve farm distress and is also the least ‘market-distortionary’ among the alternatives.
“This method of payment will take care of productivity variations as well as price variations across the mandis and will be the least market-distortionary,” said a NITI Aayog official to BS.
The compensation to the farmer will be determined on a per acre basis by using district-level data on surplus grains and prices in the harvest season. The scheme can also be applied retrospectively on past losses using daily price data recorded on the agmarket.nic.in portal which collates information from over 3,000 mandis across the country.
“Through this model, farmers can even be compensated for the losses suffered by them in the past and it will have the lowest financial burden on the central exchequer,” said another official.
Interim Budget To Focus On Farmers
It was reported in December 2018 that the government was considering a Rs 60,000- crore package in the interim budget to provide income support to farmers. Discussions on a proposal to club all farm input subsidies including fertiliser costs and pay it as cash to farmers are also under way.
Also Read: How Replicating The Amul Model Across India Can Ease Farm Distress
Save & read from anywhere!
Bookmark stories for easy access on any device or the Swarajya app.
Support Swarajya's 50 Ground Reports Project & Sponsor A Story
Every general election Swarajya does a 50 ground reports project.
Aimed only at serious readers and those who appreciate the nuances of political undercurrents, the project provides a sense of India's electoral landscape. As you know, these reports are produced after considerable investment of travel, time and effort on the ground.
This time too we've kicked off the project in style and have covered over 30 constituencies already. If you're someone who appreciates such work and have enjoyed our coverage please consider sponsoring a ground report for just Rs 2999 to Rs 19,999 - it goes a long way in helping us produce more quality reportage.
You can also back this project by becoming a subscriber for as little as Rs 999 - so do click on this links and choose a plan that suits you and back us.
Click below to contribute.