There were high hopes from the Interim Budget 2019 for the agriculture sector and farmers. The Modi Government came up with an announcement of annual income support to farmers who owned land up to 2 hectares, of Rs. 6000. This announcement was made under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme.
The question is that is Rs. 6,000 enough for farmers. An analysis by HT says that the amount may be less than 5 percent of their annual income. On the other hand, as per the data by the National Sample Survey Office (NSSO), which talks about the income of farmers between June 2012 and 2013 of the same month, an average farmer earns Rs 6,426 in a month in India.
If a weighted average of income of all farmers owning up to 2 hectares of land is taken out, it amounts to Rs 5,240 per month.
As per the 2016 NSSO report, farmers who have been promised to be given Rs. 6,000 under the PM-KISAN scheme equals to 87% of the total number of farmers in India. If we go by that data, 87 percent of agricultural households in India will get income more than a month’s earning under the PM-KISAN scheme, which does not look like a bad move at all.
However, the data talks about income range between 2012 and 2013. Thus, if CAGR, i.e. the compound annual growth rate of 8.2% in the nominal gross value added component of agriculture and allied activities is applied, the income of a farmer under that scheme would equal to Rs. 10, 329 a month in the current scenario.
As per the Chief Economic Advisor, Krishnamurthy Subramaniam, farmers will be getting 17 percent of the annual income under the scheme. However, as per the NSSO report and HT analysis, the amount equals to only 6% of the annual income of the targeted farmers.