Loan Waiver Scheme: Analysis

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Current scenario of Indian Agriculture

  • Indian agriculture is characterised by low scale and low productivity.
  • About 85% of the operational landholdings in the country are below 5 acres and 67% farm households survive on an average landholding of one acre.
  • More than 50% of area under cultivation does not have access to irrigation.
  • Agriculture income generated is not adequate to meet farmers’ needs.

Vice President:

  • Free power and farm loan waivers cannot be a permanent solution to the problems in the agriculture sector : Vice-President Venkaiah Naidu
  • “We have a clamour for populism to win over people during elections. That is not going to solve the problem.”

Increasing trends of debt burden

  • The share of institutional loans disbursed to agriculture and allied sectors has risen from 9% in 2000-01 to 31.4% in 2015-16.
  • The amount of short-term institutional loans for agriculture exceeds the total cost of inputs including hired labour. This indicates that a part of crop loans is spent on non-agricultural purposes.
  • According to NSS surveys on Investment and Debt (NSS-I&D), loans taken by cultivators from non-institutional sources is rising faster than from institutional sources.
  • Much of the growth in household demand in rural India has been debt-ridden and not supported by growth in income.

 

Reasons:

  • Modern agriculture requires investment in farm machinery and inputs like seed, fertiliser, agri-chemicals, diesel and hired labour.
  • Savings generated from unremunerative crop enterprise are inadequate for such investments.
  • Rising expenses on health, education, social ceremonies and non-food items put additional financial demand on farm families.

Loan waiver scheme

  • States like Uttar Pradesh, Maharashtra, Punjab and Karnataka have rolled out farm loan waiver schemes for immediate relief to farmers.
  • The demand for such measures is spreading to other States too.
  • Ultimate goal is to lessen the debt burden of distressed and vulnerable farmers and help them qualify for fresh loans.
  • The success of the loan waiver lies on the extent to which the benefits reach the needy farmers.

Drawbacks of loan waiver scheme

  • It covers only a tiny fraction of farmers. According to 2012-13 NSS-SAS, 48% of the agricultural households did not have any outstanding loan.
  • Out of the indebted agricultural households, about 39% borrowed only from non-institutional sources.
  • The farmers investing from their own savings and borrowing from non-institutional sources are equally vulnerable, but are outside the purview of loan waiver.
  • Provides only a partial relief because half of the institutional borrowing of a cultivator is for non-farm purposes.
  • Many household has multiple loans either from different sources or in the name of different family members, which entitles it to multiple loan waiving.
  • Loan waiving excludes agricultural labourers who are weaker than cultivators in bearing the economic distress.
  • It severely erodes the credit culture, with dire long-run consequences to the banking business.
  • Scheme is prone to serious exclusion and inclusion errors, as evidenced by the Comptroller and Auditor General’s findings in the Agricultural Debt Waiver and Debt Relief Scheme, 2008.

Implementation errors

  • According to the CAG report, 13.46% of the accounts, eligible for the benefits under the scheme were not considered by the lending institutes while preparing the list of eligible farmers.
  • In 8.5% of the cases, the beneficiaries were not eligible for either debt waiver or debt relief but were granted the benefits.
  • Around 28% of the beneficiaries were not issued debt relief certificates which would have entitled them to fresh loans.

Other issues with loan waiver scheme:

  • Implications for other developmental expenditure, having a much larger multiplier effect on the economy.
  • A similar amount spent on improvement of agriculture infrastructure and other developmental activities would create a base for future growth and development of the sector.
  • Loan waiving can provide a short-term relief to a limited section of farmers;
  • It has a meagre chance of bringing farmers out of the vicious cycle of indebtedness.
  • There is no concrete evidence on reduction in agrarian distress following the first spell of all-India farm loan waiver in 2008.

Sustainable solutions

  • More inclusive alternative approach is to identify the vulnerable farmers based on certain criteria and give an equal amount as financial relief to the vulnerable and distressed families.
  • Raise income from agricultural activities and enhance access to non-farm sources of income
  • Strengthen the repayment capacity of the farmers by improving and stabilising their income.
  • Improved technology, expansion of irrigation coverage, and crop diversification towards high-value crops are appropriate measures for raising productivity and farmers’ income.
  • Another major source of increase in farmers’ income is remunerative prices for farm produce.
  • More public funding and support
  • Removal of old regulations and restrictions on agriculture to enable creation of a liberalised environment for investment, trading and marketing.
  • States must undertake and sincerely implement long-pending reforms in the agriculture sector with urgency.

Source:

http://www.thehindu.com/todays-paper/tp-opinion/think-beyond-loan-waivers/article19311079.ece

Border Area Development Programme (BADP)

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Ministry/Department : Ministry of Home Affairs

 

Aims to meet special developmental needs and well-being of people living in remote and inaccessible areas situated near international border areas.

 

Scheme:

  • Scheme plans to ameliorate the problems of people living in isolated locations.
  • The umbrella BADP scheme is being implemented by Union Home Ministry in 367 border blocks of 104 border districts in 17 states.
  • It also seeks to saturate border areas with entire essential infrastructure through convergence of Union, state, BADP, local schemes and participatory approach.
  • Sub-schemes under it include construction of primary health centres (PHCs), connectivity, schools, supply of drinking water, community centres, drainage to enable sustainable living in border areas.
  • It also covers schemes or activities relating to skill development programmes, promotion of sports activities in border areas, promotion of rural tourism, border tourism, protection of heritage sites, Swachhta Abhiyan, construction of helipads in remote and inaccessible hilly areas, which do not have road connectivity.
  • Skill development training to farmers for use of modern and scientific techniques in agriculture, organic farming is also part of BADP now.
  • As many as 61 model villages are being developed under BADP to improve the quality of life for people living near border areas.
  • A total of Rs 13,400 crore so far have been released since BADP programme was initiated in 1986-87.

 

Note:

India shares land border with seven neighbouring countries viz. Bangladesh (4,096 km), China (3,488 km), Pakistan (3,323 km), Nepal (1,751 km), Myanmar (1,643 km), Bhutan (699 km)  and Afghanistan (106km in Pakistan Occupied Kashmir).

Operation Greens

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Ministry/Department :  Ministry of Food Processing Industries

Aims to promote farmer producers organisations, processing facilities, agri-logistics and professional management.

Scheme:

  • It was announced in Union Budget 2018-19 on line of Operation Flood to promote FPOs, agri-logistics, processing facilities and professional management. 
  • It also aims to aid farmers and help control and limit erratic fluctuations in the prices of tomatoes, onions and potatoes (TOP).
  • It is essentially price fixation scheme that aims to ensure farmers are given the right price for their produce.
  • The idea behind it is to double the income of farmers by the end of 2022.
  • Its major objectives are:
    • Price stabilisation for producers and consumers by proper production planning in TOP clusters.
    • Reduction in post-harvest losses by creation of farm gate infrastructure, development of suitable agro-logistics, and creation of appropriate storage capacity linking consumption centres.
    • Enhance value realisation of TOP farmers by targeted interventions to strengthen TOP production clusters and their FPOs,
    • Increase in food processing capacities and value addition in TOP value chain.
    • Set up of market intelligence network to collect and collate real time data on demand and supply and price of TOP crops.
  • National Agricultural Cooperative Marketing Federation of India (NAFED) will be nodal agency to implement price stabilisation measures

Impactful Policy Research in Social Sciences (IMPRESS) Scheme

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Ministry/Department : Ministry of Human Resource Development

 

The objective of this scheme is to identify and fund research proposals in social sciences with maximum impact on the governance and society.

 

Scheme:

  • The government support would include a total funding of Rs.414 crore on 1500 projects for policy themes in the social sciences at the cost of Rs. 20-25 Lakh per project.
  • Thematic Areas : Under the scheme, support is to be provided for projects on 11 broad thematic areas as follows:
    1. State and Democracy
    2. Urban transformation,
    3. Media, Culture and Society
    4. Employment, Skills and Rural transformation
    5. Governance, Innovation and Public Policy
    6. Growth, Macro-trade and Economic Policy
    7. Agriculture and Rural Development
    8. Health and Environment
    9. Science and Education
    10. Social Media and Technology
    11. Politics, Law and Economics.
  • The Sub-Theme areas will be decided on the basis of Expert Groups’ advice before notifying the scheme and calling for applications.
  • To ensure selection of projects through a transparent, competitive process on online mode.
  • To provide opportunity for social science researchers in any institution in the country, including all Universities (Central and State), private institutions.
  • ICSSR funded/recognised research institutes will also be eligible to submit research proposals on the given themes and sub-themes.
  • Nodal Agency : The Indian Council of Social Science and Research (ICSSR) will be the project implementing agency.

Scheme for Promotion of Academic and Research Collaboration

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Ministry/Department : Ministry of Human Resource Development

 

Aims to improve the research ecosystem of India’s higher educational institutions by facilitating academic and research collaborations between Indian Institutions and the best institutions in the world.

 

Scheme

  • Under the scheme 600 joint research proposals will be awarded for 2 years.
  • The scheme will facilitate strong research collaboration between Indian research groups with the best in class faculty and renowned research groups in the leading universities of the world, in areas that are at the cutting edge of science or with direct social relevance to the mankind, specifically India.

  • Thrust Areas : The scheme will improve research ecosystem of India’s higher educational institutions by facilitating academic and research collaborations between Indian Institutions and the best institutions in the world to jointly solve problems of national and international relevance. Five thrust areas identified are as follows:
    1. Fundamental Research.
    2. Emergent Areas of Impact.
    3. Convergence
    4. Action-Oriented Research
    5. Innovation-Driven
  • This Scheme is expected to have a major impact in providing the best international expertise to address major national problems.
  • The scheme exposes Indian academicians to the best collaborators abroad to enable international faculty to stay in India for a longer duration.
  • The scheme provides Indian students an opportunity to work in the world class laboratories, to develop strong bilateral relationships in research, and improve the international ranking of Indian Institutes.

Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA)

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Aimed at ensuring remunerative prices to the farmers for their produce.

 

Scheme:

  • The Umbrella Scheme includes the mechanism of ensuring remunerative prices to the farmers and is comprised of:
    • Price Support Scheme (PSS),
    • Price Deficiency Payment Scheme (PDPS)
    • Pilot of Private Procurement & Stockist Scheme (PPPS).

Sustainable Alternative Towards Affordable Transportation (SATAT)

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Ministry/Department : Ministry of Petroleum and Natural Gas

 

Aims at providing sustainable alternative towards affordable transportation.

 

Initiative:

  • The SATAT initiative has potential to boost availability of more affordable transport fuels, better use of agricultural residue, cattle dung and municipal solid waste, as well as provide additional revenue source to farmers.
  • It will also benefit vehicle-users as well as farmers and entrepreneurs.
  • Under it, Expression of Interest (EoI) have been invited from potential entrepreneurs to set up Compressed Bio-Gas (CBG) production plants and make available biogas in market for use in automotive fuels.

 

ias4sure.com - Sustainable Alternative Towards Affordable Transportation (SATAT)

 

  • Benefits
    • It will pave way for efficient municipal solid waste management and help in tackling problem of polluted urban air due to farm stubble-burning and carbon emissions.
    • It will boost entrepreneurship, rural economy and employment and provide additional source of revenue to farmers.
    • It will also help achieve nation’s climate change goals and bring down dependency on natural gas and crude oil imports and act as a buffer against crude oil and gas price fluctuations.
    • It will also help to integrated CBS networks with city gas distribution (CGD) networks to boost supplies to domestic and retail users in existing and upcoming markets.
    • Besides retailing from OMC fuel stations, CBS can at later date be injected into CGD pipelines too for efficient distribution and optimised access of cleaner and more affordable fuel.

Ayushman Bharat : Analysis

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Context:

  • Universal health coverage is getting prioritised as a part of political reform with the launch of two pillars.

 

Current state of Healthcare:

  • Poor condition of healthcare in country; Lack of infrastructure;
  • Poor health services in government hospitals; Private hospitals out of reach of most people.
  • According to the Global Burden of Disease study, India is ranked low in the Healthcare index; India stands at a rank of 154.
  • But despite this, the budget allotment on healthcare services is extremely low. India spends less than 2% of her GDP on public healthcare.

 

Ayushman Bharat:

  • The National Health Protection Mission or Ayushman Bharat Yojana, launched by the Government is the first major step.
  • Ayushman Bharat Yojana is a program which aims to create a healthy, capable and content new India.
  • It will also focus on the poor and weaker sections of the society.
  • It aims to provide insurance of up to 5 lakh rupees to each family.
  • The new scheme also intends to improve secondary and tertiary healthcare services for crores of Indians.

 

There are two flagship initiatives under Ayushman Bharat:

  1. Pradhan Mantri Jan Arogya Yojana (PMJAY):
    • Under this scheme, 1.5 lakh health sub-centres are being converted into health and wellness centres.  
    • It will bring the healthcare system closer to the people.
    • The centres will provide comprehensive healthcare, including treatment for non-communicable diseases and maternal and child health services.
    • Besides this, they will also provide free essential drugs and diagnostic services;
    • Rs. 1200 crore have been allocated for this flagship programme. 
    • The scheme will cover more than 10 crore poor families, which is approximately 50 crore persons.
    • It will also setup wellness centres which will give poor people OPD facility near their homes. 
  2. National Health Protection Scheme:
    • The National Health Protection Scheme will cover over 10 crore poor and vulnerable families.
    • It will provide coverage up to 5 lakh rupees per family, per year for secondary and tertiary care hospitalization.

 

Best health care at the lowest possible cost should be:

  1. Inclusive
  2. make health-care providers accountable for cost and quality
  3. achieve a reduction in disease burden, and
  4. eliminate catastrophic health expenditures for the consumer.

 

Criticism of Ayushman Bharat:

  • Currently, the NHPM is pushing for hospitalisation at secondary,  and at tertiary-level private hospitals, while disregarding the need for eligible households to first access primary care, prior to becoming ‘a case for acute care’.
  • It is important to note that without the stepping stone of primary health care, direct hospitalisation is a high-cost solution.

 

Problem of constraints:

  • Public sector health capacities are constrained at all levels.
  • Further, forward movement is feasible only through partnerships and coalitions with private sector providers.
  • It is important to note that these partnerships are credible only if made accountable.
  • It has been suggested that Health-care providers (public/private) should be accredited without any upper limit on the number of service providers in a given district.

 

Need of a holistic approach:

It is believed that one must bring together all relevant inter-sectoral action, linking health and development, so as to universalise the availability of:

  1. clean drinking water,
  2. sanitation,
  3. garbage disposal,
  4. waste management,
  5. food security,
  6. nutrition and
  7. vector control.

Further, the Swachh Bharat programme must be incorporated in the PMJAY.  These steps put together will reduce the disease burden.

 

Way Forward

  • A public education media campaign could highlight the merits of personal hygiene and healthy living.
  • The States of Kerala and Tamil Nadu have demonstrated that high-performing, primary health-care systems do address a majority of community/individual health needs.
  • The health and wellness clinics must connect with early detection and treatment.
  • It is believed that robust delivery of preventive, clinical and diagnostic health-care services will result in early detection of cancers, diabetes and chronic conditions, mostly needing long-term treatment and home care.
  • This would further minimise the demand for hospitalisation.
  • In conclusion, investment in primary care would very quickly reduce the overall cost of health care for the state and for the consumer. Technology and innovation are further reducing costs. AI-powered mobile applications will soon provide high-quality, low-cost, patient-centric, smart wellness solutions. Currently, the scaleable and inter-operable IT platform being readied for the Ayushman Bharat is encouraging.

Pradhan Mantri Jan Arogya Yojana (PMJAY)

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Scheme:

  • PMJAY is government-sponsored health insurance scheme, that will provide free coverage of up to Rs 5 lakh per family per year in any government or empanelled private hospitals all over India.
  • It will cover beneficiaries families identified on the basis of Socio Economic Caste Survey (SECC) 2011 in 444 districts of 30 states/Union Territories.
  • National Health Agency (NHA) is the apex body for implementing this scheme.
  • States will be required to form State Health Agency (SHA) to implement scheme and at the district level also structure for its implementation will be set up.
  • Around 13000 hospitals both public and private in the country have been coordinated for implementation of the scheme.
  • PMJAY will be funded with 60% contribution from Centre and remaining from the states.
  • NITI Aayog will be working as partner for this scheme for operationalizing robust, modular and interoperable IT platform which will involve a paperless and cashless transaction.
  • PMJAY is entitlement based scheme with entitlement decided on basis of deprivation criteria in the SECC database.
  • There will be no cap on family size and age under this scheme.
  • The benefit cover under it also includes pre and post-hospitalisation expenses.
  • It also takes into consideration all pre-existing medical conditions.
  • It will provide reimbursement for bed charges and drugs and diagnostics two days before, during and 15 days after hospitalisation. Beneficiary will be also paid transport allowance for hospitalisation defined under it.
  • The payment for treatment will be done on package rate which will be defined by Government in advance basis.
  • The package rates will include all costs associated with treatment.
  • States and UTs have flexibility to modify these rates within limited bandwidth.
  • PMJAY allows national portability i.e. resident of any part of country is entitled for free hospitalization at empanelled hospital anywhere in the country.
  • It will strengthen healthcare services in India by targeting poor and vulnerable population of the country.
  • The scheme allows beneficiary to take cashless benefits from any public or private empanelled hospitals across the country.
  • ID documentation required for verifying beneficiary under this scheme may be Aadhaar card or election ID card or ration card. 
  • Aadhaar is not mandatory. 
  • Beneficiaries will QR codes having letters for verification through scanning.

 

PM

Dairy Processing & Infrastructure Development Fund (DIDF) Scheme

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Ministry/Department : Ministry of Agriculture & Farmers Welfare

 

Aim is to boost dairy sector.

 

Scheme:

  • It is managed by NDDB and will be implemented from 2017-18 to 2028-29.
  • Milk unions, multi-state milk cooperatives, state dairy federations, milk producer companies and NDDB subsidiaries can avail loan under this scheme after meeting eligibility criteria.
  • Under this scheme, eligible milk organisations will be provided financial assistance in the form of a loan at 6.5% interest for building an efficient milk procurement system and other dairy processing infrastructure.
  • This loan will be reimbursed over period of 10 years.
  • It also has provision of interest subsidy on loans.
  • The loan proceeds will be provided for putting in place efficient milk procurement system by setting up of chilling infrastructure and installation of electronic milk adulteration testing equipment.
  • It will be also used for creation, modernisation and expansion of processing infrastructure and manufacturing faculties for value-added dairy products.

 

Benefits:

  • The scheme will benefit 95,00,000 farmers in about 50,000 villages.
  • In addition to this, it will provide direct and indirect employment to many skilled, semi-skilled and unskilled workers.
  • It will also help in creating additional milk processing capacity of 126 lakh litre per day, milk drying capacity of 210 MT per day, milk chilling capacity of 140 lakh litre per day.