Centre allocates Rs 75,000 cr for PM-KISAN to cover 145 million farmers

Nirmala Sitharaman has allocated Rs 12,000 crore less in the Budget for financial year 2019-20 towards the government's flagship income support scheme, PM-Kisan, which has been extended to cover all farmers now.

The Budget has provided Rs 75,000 crore for the scheme, where as the Cabinet had approved the expansion of the scheme with an estimated expenditure of Rs 87,000 crore for 2019-20 on May 1, 2019.   Rs 75,000 crore was the estimated expenditure if only small and marginal farmers (who owned less than two hectares of land) were to be covered, as was proposed in the interim Budget presented by Piyush Goyal.  After that the Cabinet had extended the scheme to all farmers in line with what was promised by the BJP in its election manifesto. 

In fact, a footnote in the full Budget for 2019-20 also says that the sum is meant to  provide income support to ‘all’ farmer families across the country. It also says about 145 million farmer families are expected to be covered under the scheme in 2019-20, which is the total number of farmer households in the country.

Another document – The Output-Outcome framework (started from 2017-18), shows that the government aims to target 100 million farmer families through PM-KISAN in 2019-20.

Most experts said that government can always provide the extra Rs 12,000 crore needed to cover all farmers under PM-KISAN through supplementary demand for grants later in the year.

The lower allocation and the mismatch between figures mentioned in the footnotes and Output-Outcome Budget presents a rather confusing scenario as far as the government’s expenditure on the expanded PM-KISAN is concerned.

A clearer picture could emerge in the supplementary demand for grants for the agriculture ministry and also the roll-out numbers. Nonetheless, despite making an allocation which should be adequate to cover just small and marginal farmers and not all farmers, PM-KISAN seems to have gobbled up a lot of funds meant for the agriculture ministry and going forward could be the main marquee scheme of the government for the farm sector in its second term.

The allocation for the ministry as compared to the interim Budget tabled in Parliament in February 2019 shows a miniscule increase of just Rs 900 crore. Though, when compared to the revised estimate of 2018-19, the allocation for the ministry of agriculture is up by 92.45 per cent, but when the extra amount granted for PM-KISAN estimated at Rs 55,000 crore is removed, the hike comes at a moderate 11.33 per cent in comparison to the revised estimate of 2018-19.

For the Department of Agriculture, Research and Education (DARE), allocations in the 2019-20 Budget estimates are exactly the same as provided in the interim Budget at Rs 8,078.76 crore, but just 1.53 per cent more than the revised estimate of 2018-19 which was pegged at 7,952.73 crore.

For the Ministry of Fisheries, Animal Husbandry and Dairying, which has been carved as a separate ministry for the first time this Budget, an allocation of Rs 3,426.25 crore was made, which is 10.84 per cent more than that in the Interim Budget tabled in February and 10.27 per cent more than the revised estimate of 2018-19.

A significant part of this increase is due to creation of department of fisheries for which a sum of Rs 804 crore has been allocated. For rural development, the 2019-20 Budget allocated Rs 117,647.19 crore which is same as the interim Budget, but 4.66 per cent more than the revised estimate of 2018-19.

Flagship MGNREGA got an allocation of Rs 60,000 crore, which is same as the interim budget, but Rs 1084.09 crore lower than the revised estimate of 2018-19.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel