Pradhan Mantri Kisan Samman Nidhi (PM-KISAN)

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The first instalment of the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme for 2021-22 was released with Rs 20,667 crore being transferred to more than 9.5 crores beneficiary farmer families.

About PM-KISAN

• The Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) Scheme is a Central Sector Direct Benefit Transfer (DBT) Scheme. 
• It was launched in February 2019 (made effective from December 2018) to give income support to farmers.
• The scheme is meant to aid farmers partially to meet the expenses on fertilisers and seeds before the sowing season.

Features of PM-KISAN

• The financial assistance of Rs. 6000 per annum is provided to all landholding farmer families across the country, subject to certain exclusion criteria relating to higher income strata, e.g. all Institutional Landholders.
• The amount is transferred in three equal instalments, every four months, of Rs. 2000 each, directly into the bank accounts of the beneficiary farmers.
• The State Governments identify the beneficiaries and share the list with the Centre.
• Payment is done on the basis of the Aadhaar seeded data of beneficiaries, except for the State/UTs of Assam, Meghalaya, Jammu & Kashmir and Ladakh, which have been given exemption in this regard up to 31st March 2021.
• States first upload farmers’ data in the public finance management system, a platform that auto verifies bank accounts and authenticates Aadhaar details of beneficiaries, and then returns the data to states for physical signatures.

Benefits of PM-KISAN

• It enables farmers to take care of expenses related to agriculture and allied activities as well as domestic needs.
• The scheme covers all farmer families in the country irrespective of the size of their landholdings.
• The funds are not allocated and sanctioned Statewise.
• In this scheme, Samman Rashi of over Rs. 1.15 lakh crores have been transferred to farmer families so far.
• This is the first time that farmers in West Bengal will also receive the cash transfer as the State government has not joined PM-KISAN yet.  

Challenges 

• Inadequate financial support: The impact of PM-KISAN can only be realised through financial support that provides farmers with adequate purchasing power to meet their daily basic necessities. Due to the volatile market and price fluctuations in different regions, it is important to index the cash transfers to local inflation. Also, the cash transfer is not linked to the size of the farmer’s land.
• Not reaching all farmers: PM-KISAN is not pro-poor since recipients of the scheme seemed to be better off than the general rural population even before the lockdown. Given this uncertainty over the reach of it and its targeting, the relevance of the scheme needs to be carefully evaluated during this period.
• Exclusion of Landless farmers: The scheme excludes even poor rural households that do not own land. The exclusion from the list could be very high. There is a strong case to include landless tenants and other poor families.
• Implementation issues: PM-KISAN is an ambitious scheme that has the potential to deliver significant welfare outcomes but the top-down approach of the government ignores governance constraints.
• Structural issue: If the budgetary allocations shift decisively in favour of cash transfers, they will be a cause for great concern for other long-term budgetary commitments in agricultural markets and areas of infrastructure such as irrigation.

Way Forward

• The central government has so far exhibited a serious intention to turn around the unattractive agriculture profession, still, there is a need to address its deficiencies drawing from the experiences of various state governments.
• An alternative bottom-up strategy and well-planned implementation mechanism would allow bottlenecks to be identified and rectified at the local level.
• The pandemic has highlighted the need for the government to have robust social security mechanisms to reach the most vulnerable sections of the population, and making PM-Kisan more inclusive is an important step in that direction.

Sources: DTE