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Odisha's farm income support trumps that of Telangana; which model will PM Modi choose?

Joe C Mathew     January 30, 2019

A month before Narendra Modi government announced its flagship national health insurance programme Ayushmann Bharat in September 2018, Odisha Chief Minister Naveen Patnaik launched Biju Swasthya Kalyan Yojana, a health assurance scheme claimed to cover more persons than what would have been covered under the Central scheme. Earlier this month, Odisha said it is rolling out yet another welfare measure, to ensure inclusive and flexible income support system to the small and marginal farmers, landless labourers and sharecroppers of the state. The timing of the implementation of Krushak Assistance for Livelihood and Income Augmentation (KALIA) Scheme is also interesting as in every likelihood, it may just be preceding Modi government's plans to announce its own version of direct income support to farmers.

To be fair, Odisha was not the first state to have thought of these schemes. In the case of health insurance, both Odisha and the Centre had looked at an existing model of health assurance that was being successfully run by the Telangana state government. In the case of farm income support too there is a successful example - at least it helped Telangana Rashtra Samiti romp back home for a second term with a higher peoples' mandate. Telangana was the first state to announce Rs 4000 per acre for every farmer in the state as income support for the purchase of seeds, fertilisers and other investments in the field during every crop season (i.e. twice a year). The biggest criticism against the scheme was that the income support was available to the land owning farmer and not persons farming on leased land or landless labourers. The Odisha model of farm income support builds on the Telangana experiment to minimise such criticisms. It provides financial assistance of Rs 25,000  per farm family over five seasons to small and marginal farmers, Rs 12,500 to each landless agricultural household for agricultural allied activities like for small goat rearing unit, mini-layer unit, bee-keeping, etc and a sustenance assistance of Rs 10,000 per family each to landless agricultural labourers. The state government has estimated that the total cost of the programme, intended to benefit 92 percent of Odisha cultivators, will be over Rs 10,000 crore till 2020-21.

What will be Modi government's response?

The Telangana model will have its own challenges as the government will have to face the ire of a much weaker and vulnerable section of Indian farming community. Even the landowning farmers will have a problem as India's land records are hardly updated in terms of ownership on a countrywide basis. The Odisha model may look more inclusive, but will be an implementation nightmare as the government may not be able to commit massive payouts without tinkering with existing subsidies it provides as minimum support price for crops, fertiliser subsidies or near free electricity for irrigation in many states.

The announcement, however, will not wait.

Firstly because, Modi government can get away with a lofty plan that needs to be implemented by the next government that takes charge after the general election is due in a couple of months from now. Second, as in the case of Ayushmann Bharat, the income support scheme for farmers will also be something where the cost is shared between the Centre and the States. In the case of health, it is in a 60:40 ratio for every large state. The income support too cannot be much different. The states too can play smart by making such announcements well before the Central announcement, as any eventual merger of the two schemes would mean burden sharing with the Centre.

For now, optics is important, and no political party will shy away from it.

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