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Why DBT schemes need to fix the problem of farmers?

Posted on November 29, 2022 by admin1  1548

In News

  • Recently, some of the economists have suggested the conversion of all agricultural subsidies (Inputs or Output) into direct income support to farmers. 
    • The IMF too recently lauded India’s Direct Benefit Transfer (DBT) Scheme as a “logistical marvel” that has reached hundreds of millions of people and specifically benefited women, the elderly and farmers. 

What is Direct Benefits Transfer (DBT)? 

  • The scheme facilitates the transfer of subsidies to beneficiary’s bank accounts. 
  • Verification is done through multiple databases like the Agricultural Census, Socio-Economic Caste Census, National Food Security Act, National Population Registry, and HRMS database of State government employees, bank account validation through bank databases and de-duplication through Aadhaar. 
  • Agricultural land leasing rights are restricted by Indian law. Kerala is the only State to completely prohibit leasing.
  • It is also estimated that 36 per cent of India’s tenant farmers were completely landless and 56 per cent owned less than one hectare. 

Who are Tenant farmers? / Data on tenant Farmers 

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  • Who is a tenant farmer?
    • He is a farmer or farm worker who resides on land owned by a landlord.
    • It is an agricultural production system in which landowners contribute their land and often a measure of operating capital and management, while tenant farmers contribute their labour along with at times varying amounts of capital and management. 
    • Depending on the contract, tenants can make payments to the owner either of a fixed portion of the product, in cash or in a combination. 
    • Farm tenancy agreements are largely oral, unwritten contracts and seldom recorded leases.
  • Trend: There is a steady increase in tenant farmers. 
  • NSO survey: According to the National Statistical Office’s (NSO) ‘Situation Assessment of Agricultural Households’ survey for 2018-19, 17.3 percent out of the total estimated 101.98 million operational holdings in rural India were on leased lands. 
    • The share of such leased-in lands in the total area used for agricultural production was 13 per cent.
    • The NSO’s previous surveys for 2012-13 and 2002-03 revealed the shares of leased-in holdings at only 13.7 per cent (11.3 percent of area) and 9.9 per cent (6.5 per cent), respectively.  
  • State-wise tenancy data
    • Highest tenant farmers are in Andhra Pradesh (42.4 per cent) and Odisha (39 per cent).
    • Haryana and Punjab: the share of leased-in area is higher than the percentage of tenant holdings.
      • It means that the tenant farmers in these 2 states operate relatively large holdings, even though they don’t own these lands. 

Related Schemes

  • Pradhan Mantri Kisan Samman Nidhi (PM-Kisan)
    • It is a central government scheme.
    • The scheme provides an annual income support of Rs 6,000 to all landholding farmer families in India. 
  • Rythu Bandhu scheme 
    • This scheme was started by Telangana.
    • It extends financial assistance of Rs 10,000 per acre to all farmers owning land and without any size limit. 
  • Rythu Bharosa scheme
    • This scheme was started by Andhra Pradesh.
    • Here, farmer families are paid Rs 13,500 per year, which includes Rs 6,000 through PM-Kisan and the AP government’s top-up of Rs 7,500. 
  • KALIA Scheme
    • This scheme was started by Odisha.
    • The scheme brings under its umbrella 92% of cultivators of the state and almost all needy landless cultivators, who can avail the benefits of this scheme through Direct Benefit Transfer Mode. 

Limitations of DBT Schemes and Tenancy 

  • Limited reach: Schemes such as PM-Kisan, Rythu Bandhu and YSR Rythu Bharosa do not reach tenant farmers (those who undertake cultivation on leased land).
  • Left-out beneficiaries: The exclusion of tenant farmers from income support and also zero/low-interest loans, crop insurance, disaster compensation and other agri-related schemes is significant because of the rising trend of owners no longer directly cultivating their lands.
  • Crop cultivator rights cards: The CCRC requires the landowner’s signature and cannot be issued without his consent. Most owners are hesitant to sign any document confirming they have given their lands on lease. 
    • They fear that any written agreement makes them vulnerable to lawsuits by tenants claiming rights over the land. 

Significance of DBT and Tenancy 

  • Transparency: Direct benefit transfers (DBT) on a per-acre or per-farmer basis is seen as transparent and simple to administer.
  • DBT is crop-neutral: only rice, wheat and sugarcane farmers effectively get minimum support prices now and does not cause distortions in input/output markets.
  • Eliminate delays in transfers: DBT will avoid time delays in transferring of benefits to the beneficiaries.
  • No middlemen: Middlemen will be eliminated to reduce the leakage of funds.
  • Biometric identification: Fake and duplicate beneficiaries will be eliminated through biometric identification (Aadhaar). Since intermediaries are removed, this will help the government reduce the structural cost in the end.

Way forward

  • Agriculture in India is increasingly seeing both tenancy: 
    • Landless/marginal farmers leasing land to cultivate.
    • Reverse tenancy where small landowners leasing out to better-off farmers keen to reap economies of scale.
  • Leasing can help both tenant and reverse-tenant farmers operate consolidated holdings, while allowing owners to take up non-agricultural employment without risking loss of their lands. 
  • DBT by leveraging the JAM (Jan Dhan, Aadhaar and Mobiles) trinity and the technological prowess offers to drastically improve the benefit delivery system in the country. 
  • States have to come forward to adopt the Model (Agricultural) Land Leasing Act proposed by NITI Aayog in 2016. 
    • This Act would allow for the profitable use of fallow land and provide tenant farmers with access to credit and insurance services. 
  • The government should try to subsume all existing input and output subsidies under a single DBT Scheme and should find an answer to the tenant problem. 

Source: IE

 
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