Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-Aasha) intended to shore up the prices that farmers get for their produce will unlikely to be succeed with its current set-up. Analyse (200 words)
Refer – Business Standard
Enrich the answer from other sources, if the question demands.
IAS Parliament 6 years
KEY POINTS
· The three schemes that are part of PM-AASHA are –
1. the Price Support Scheme (PSS)
2. the Price Deficiency Payment Scheme (PDPS)
3. the Pilot of Private Procurement and Stockist Scheme (PPPS)
Significance
· These different components would cover the gaps in the procurement and compensation mechanism for crops.
· It will also help revive the rural economy by assuring better income to farmers.
· With better prices across crops, the new scheme may ensure crop diversification and reduce the stress on soil and water.
Issues with PM-AASHA
· The additional budgetary allocation for the PM-Aasha is Rs. 150 billion, which is too meagre compared to the magnitude of the task.
· Notably, these schemes are meant to be operated through the existing mandis run by the APMCs which would run the risk of carrying their inherent deficiencies and trading malpractices.
· PSS – Its main bane is the limited resource availability and belated reimbursement of losses by the Centre.
· Though, it proposes to raise direct and indirect funding support to NAFED to Rs 450 billion that, too, seems inadequate to extend its coverage any further.
· PDPS – The experience of Madhya Pradesh which implemented the PDPS under the Bhavantar Bhugtan Yojana, shows that it can be easily manipulated.
· Ground level checks revealed that traders plotted with each other and depressed the prices at mandis.
· They forced farmers to sell at lower prices and pocketed the compensation from the government.
· Finally farmers face the double burden of lowered price and no compensation.
· PPSS – Under this, registered private entities are supposed to buy the selected commodities at the MSPs and undertake the post-procurement handling, storage and disposal of the stocks.
· For this, they are offered service charges, which are capped at just 15 per cent of the MSP of the particular crop.
· This commission, obviously, is too little to woo them to join this scheme.
Suggestions
· PDPS – The Centre first needs to break the trader lobbies at mandis.
· This could be done by widening the competition by inter-linking mandis.
· e-NAM promises to do so, but, States need to be proactive in undertaking regulatory reforms.
· PSS – The Centre needs to figure out how to handle procurement and disposal efficiently.
· PPPS – It looks the most promising, but for private players to show enthusiasm, the government should extend support through policy measures, which includes liberalised trade and exports.
