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Promises To Keep

The Pradhan Mantri Krishi Sinchai Yojana in Modi-I did provide a fillip to 99 long-pending projects

Photo Credit : Himanshu Kumar


Even though the governments are in no haste to implement the promises made in their manifestoes, they do have to consult it from time to time especially when they have to face elections. So, by the time Maharashtra and Haryana are in election mode later this year, the government will have to show some progress.

One of the most watched promises would be a commitment to invest Rs 100 lakh crore in infrastructure out of which Rs 25 lakh crore was promised for the agri-rural sector. In Modi I period from 2014 to 2019, the total budgetary allocation for infrastructure was Rs 19.36 lakh crore out of which Rs 10.91 crore was allocated only in the last two years. If Rs 5 lakh crore a year are prudently invested in agriculture and rural infrastructure, India would not have to largely overcome distress in the farm sector and farmer’s suicides may become history.

Under PM-Kisan, the interim budget allocated Rs 75,000 crore for grant of Rs 6000 per year to farmers holding up to 2 hectares of land. The manifesto promises to expand the coverage to all farmers, irrespective of land-holding. At the most, coverage of farmers holding more than 2 hectare land may be considered in rain-fed areas as the government has failed to provide irrigation to them. Being most critical, Pradhan Mantri Krishi Sinchai Yojana in Modi I did provide a fillip to completion of 99 long pending projects but the implementation did not achieve the desired pace. The Central Water Commission has not released the data of Irrigation Potential Utilised after 2011-12, so it is not known if 31 irrigation projects claimed to be completed have actually resulted in higher irrigation potential utilised.   

A national warehousing grid could be very helpful in providing storage facility to farmers and traders. Except for some big farmers growing commercial crops, most cultivators end up selling their crop immediately after harvest. Warehousing Development and Regulatory Authority (WRDA) has not really taken off and many states in east India have just a handful of warehouses registered with WRDA. Banks continue to provide loans against stock kept in grossly unscientific conditions as they draw comfort from the collateral managers. Government has no way of knowing the quantum of stock of agriculture commodities kept in such godowns. So, an estimate of private stock of any commodity is only an intelligent guess. If banks start insisting on scientific storage of stock for their pledge loans, the warehousing sector can see a spurt in private investment as we saw under Private Entrepreneurs Guarantee Scheme, 2008 which resulted in the creation of 15 million tonnes of storage capacity for government stocks.

Similarly, insistence on the use of electronic warehousing receipts (e-NWRs) can formalise the storage ecosystem, make inter-state trading seamless and help the farmers to realise better price. If demonetisation was a real step towards formalising the rural economy, WDRA should have made it mandatory to issue eNWR in WDRA registered godowns. One can only hope that investment in rural infrastructure will be preceded with policy reforms which are necessary for formalisation of agri-economy.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

Siraj Hussain

The author retired as Union Agriculture Secretary. He is Visiting Senior Fellow, ICRIER

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