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MGNREGA to employ at least 52 million Indians in the next 20 years

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Image source: nregs-mp.org/

New Delhi: There is a 14-percent rise in the programme run under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in the 2016-17 Budget, the world’s largest state-run jobs plan, after a decade of operation continues to be India’s top poverty mitigation programme.

MGNREGA, which guarantees 100 days of work to unskilled people in villages of India, will employ at least 52 million people and provide livelihoods to their families. That means about 260 million (considering an average family of five) will depend on it over the next 20 years, according to an analysis.

In three years MGNREGA funding has raised up to 18%. Unlike last year, though, when the programme exhausted its money by December, it is unclear what might happen this year when — which is more likely than if — the money runs out.

In 2015-16, there was a cushion of Rs5,000 crore in case the ministry over its money, but New Delhi released only Rs.2,000 crore of that money, according to Aruna Nikhil Roy of the People’s Action for Employment Guarantee, a Delhi-based NGO.

More Indians are still poor than the population of Indonesia. The unqualified number of poor as well as the proportion of poor below the poverty line (according to the Tendulkar poverty line) has been declining over two decades, as we reported.

But about 270 million are still below the poverty line, more than the population of Indonesia (255 million), the world’s fifth-most populated country. The poverty line is the ability to spend Rs.47 per day per person in urban areas and Rs 32 in rural areas.

MGNREGA is being lauded for its achievements in the past decade. Around 277.9 million people are registered under the scheme, and 98.3 million of them are active workers. The programme covers all adults from rural households who seek employment.

The “work” under MGNREGA covers “unskilled manual labour”, providing an opportunity to every person who needs employment. Without skills, young Indians in rural areas will need MGNREGA.

To know exactly how many Indians will need employment in the coming years, the illiterate rural population was scrutinised, according to the 2011 census. There are 51.7 million illiterate people aged 16 to 30.

Since they will not benefit from the Right to Education, which guarantees free and compulsory elementary education till age 14, this population will not be a part of India’s skilled labour force.

According to this International Labour Organisation definition, skills require at least five years of schooling. So, for at least 20 years, MGNREGA will likely need to support this group of Indians.

A word of caution: This 52 million (rounded-off) population includes only illiterates from the Census 2011 data. There are many among the literate population who have basic reading and writing skills but are not skilled enough to work in industry.

MGNREGA critics contend that the scheme does not help pare poverty because of corruption and poor implementation. “From a policy point of view, we should be interested in the efficiency of transferring incomes to the poor,” economist Surjit Bhalla wrote in a column recently.

With no cost-benefit valuation of MGNREGA work and no technical support, the programme struggles to create assets or infrastructure in rural areas, which it should, Indian Institute of Technology (Delhi) economics professor Reetika Khera, wrote in a recent column.

MGNREGA is short of funds- 17 percent of its budget went into paying wages and material from the previous financial year, according to a letter from Ministry of Rural Development to the Ministry of Finance.

The actual allocation for MGNREGA this year is around Rs.29,000 crore ($4.6 billion).

This fund squeeze for MGNREGA is not new and has been evident under both the United Progressive Alliance II and the National Democratic Alliance regimes. Ending the year with pending obligations, which effectively means workers’ wages are unpaid, has been a consistent trend.

As much as 95 percent of the budgetary allocation for the current financial year (2015-16) was exhausted by December 30, 2015. Further, as per the Ministry of Rural Development and Ministry of Finance calculations, state governments require at least an additional Rs.6,300 crore to pay wages and other expenses.

The drought-affected states of Odisha, Madhya Pradesh, Karnataka, Andhra Pradesh, Telangana and Uttar Pradesh will provide 150 days of employment against the normal 100-but there is no extra money evident, from Delhi or in their budgets.

Finance Minister Arun Jaitley’s budget for MGNREGA may not be enough. Under the devolution recommendations of the 14th Finance Commission, India’s states have been given more money, and hence more powers, to decide how they want to finance social welfare.

The one-time Planning Commission had 66 centrally sponsored schemes, reduced to 30 under the NITI Aayog, the body that has replaced the Planning Commission. MGNREGA is one of these 30.

Even though the central government has transferred social welfare to the states through “devolution” (transfer of powers-fiscal or administrative-from higher level of government to lower level of government), it will pay for important programmes, such as NREGA and rural roads.

Jaitley said in his budget speech: “In spite of the consequential reduced fiscal space for the Centre, the government has decided to continue supporting important national priorities such as agriculture, education, health, MGNREGA, and rural infrastructure including roads.” (IANS)

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Food processing will be a main industry in future: Jaitley

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Food
Food processing will be a main industry in future: Jaitley

New Delhi: The entire Indian agriculture value chain is set to change drastically and food processing is going to be one of the main industries of the country in the future, Finance Minister Arun Jaitley said on Friday.

“The farm to kitchen chain is going to change in India, like elsewhere, with increased agricultural production, better storage facilities, more food processing and changing consumer food preference,” Jaitley said at the inaugural session of the World Food India 2017 here.

 “Food processing is going to be one of the principal industries of India in future, and an entrepreneur in 2017 should think of the industry from the perspective of where it will be in 2040, 2050,” he said.

In terms of market size, the Indian food market was worth $193 billion in 2016 and is expected to cross $540 billion in 2020, officials said here. The sector has been growing at the rate of 12 per cent annually.

“There is a silent revolution ongoing in India. There is an expanding middle class and below that there is a growing aspirational class, which is building up reasonable purchasing power,” the Finance Minister said, noting that this provided an enormous potential market for food products in the country.

About the potential, Food Processing Minister Harsimrat Kaur Badal said that only about 10 per cent of agricultural produce is processed in the country, leading to a lot of wastage.

The industry enjoys many fiscal incentives, including preferential credit under priority sector lending, she said.

“There is 100 per cent FDI (foreign direct investment) allowed into the sector through the automatic route and we have seen inflows increase 40 per cent over the last year,” she said.

“The proposal for a Food Processing Bank is also under active consideration.”

In the presence of delegates from many countries, the event was inaugurated earlier by Prime Minister Narendra Modi, who pointed out that India is the biggest producer of milk in the world and the second in rice, wheat, fish and vegetable output.(IANS)

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Decoding the Indian Agrarian Crisis and Fake Farmers Facade

Gaurav Tyagi believes half baked measures like loan waivers just make people lazy parasites.

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farmers
An increasing number of farmers in India are committing suicide due to debt pressure. To tackle the issue, the government has come up with farm loan waivers. (VOA)

– By Gaurav Tyagi


New Delhi, September 18, 2017 : 
Indian and International media is full of articles regarding large number of farmers in India committing suicide due to debt pressure.

Instead of going to the root of the problem and analyzing the reasons for this phenomenon, Indian politicians have come up with an absurd idea of farm loan waivers.

Majority of Indian farmers under debt trap own very little land. Farming on such small piece of land is not economically feasible. This sector is highly unorganized. Most of the time, no planning is involved in cultivation, irrigation and harvesting.

Middlemen exploit farmers by buying their produce at a very low price and then selling it at a premium to the end consumers.

The irony is that a large number of Indian politicians claim huge incomes from agriculture while farmers starve.

In the province of Madhya Pradesh 24 farmers committed suicide this year over crop loss and failure to repay loans but 18 of the 20 cabinet ministers of the state have shown ‘agriculture’ as their main source of huge incomes.

How come politicians are earning in Billions through farming while the real farmers are struggling to make both ends meet?

Let’s examine the issue in-depth.

The income earned from agricultural land is exempt from income tax under section 10 (1) of the Income Tax Act 1961. Politicians, bureaucrats and businessmen in India launder their money misusing the above income tax clause.

Normally, one cannot own agricultural land in India unless their forefathers have been agriculturists. Rich and influential people in the country obtain agriculturist certificates by ‘greasing the palms’ of the local land officials.

Farmers are not required to maintain detailed records in India. This provides an excellent loophole to pass off unaccounted and undeclared cash as agricultural income. It is done by showing fake sales cash receipts of agricultural produce, which like other certificates can be purchased in India through bribes.

Approximately 800,000 tax declarants in India state exorbitant amounts as agricultural incomes while filing their annual income tax returns.

This income, a whopping INR. 874 Lakh Crores was eight times more than the cumulative GDP of India for the financial years 2011 and 2012.

The average annual income declared by these assesses comes out to be anywhere between Rs. 30-80 Crores, on which they don’t pay any taxes.

It’s obvious that the aforesaid is not agricultural earning instead it’s declared as agricultural income by these assesses just to avoid paying taxes.

According to National Bank of Agriculture and Rural Development (NABARD) Delhi, with hardly any farming land has more farmers indulging in agriculture than Madhya Pradesh, Uttar Pradesh, Karnataka and West Bengal provinces.

Delhi’s so called ‘farmers’ received Rs. 22,077 Crores in agricultural loans during 2009. In reality, these ‘self proclaimed farmers’ are the owners of big farm houses on the outskirts of the capital.

The authorities are well aware of this malpractice. The Tax Administration Reform Committee in its report in November 2014 said, “Agricultural income of non-agriculturists is being increasingly used as a conduit to avoid tax and for laundering funds, resulting in leakage to the tune of Crores in revenue annually”

The Finance Minister of India, Arun Jaitley on 26th April said that the government of India does not plan to tax the farm income.

farmers
Finance Minister of India, Arun Jaitley, wikimedia

It reveals that Indian politicians cutting across party lines indulge in this malpractice, 27% of the winning Lok Sabha M.P’s in 2014 elections have declared wealth of over Rs. 1 Crore, majority of which has been mentioned as agricultural income.

Indian opposition politicians blackmail the political party in power by indulging in spurious farmer agitations.

If there is a bumper crop then the opposition parties start shouting that prices have crashed due to over-supply in the market. When farming cultivation fails due to the vagaries of nature, then they start throwing statistics about farmers suicide.

A group of ‘self proclaimed’ farmers from Tamil Nadu province camped at Jantar Mantar in Delhi, the Indian capital city during March this year and indulged in cheap theatrics to draw attention to their protests.

The leader of this group, P. Ayyakannu is demanding that all farmers should be given loan waivers from banks and quoted highly inflated figures of farmers suicides in Tamil Nadu.

The Tamil Nadu government on 28th April, 2017 conveyed to the Supreme Court of India that no famers committed suicide in the state and clarified that a few, who took this extreme measure did it due to personal reasons.

Many farmers died due to old age and other medical issues. Ayyakannu clubbed all of them together to gather national as well as international attention.

ALSO READ Farmers welfare: What Indian agricultural sector needs to learn from Denmark?

Ayyakannu called off this whole play in Delhi on 23rd April after 40 days, when the Chief Minister of Tamil Nadu came to meet these protestors.
He said that their group is giving a one month’s time-frame to the government in order to fulfill their demands otherwise, they would resume their protests in the national capital from May 25 on a bigger scale.

This impostor farmer leader Ayyakannu again came back to Delhi again on 16th July with his gang of ruffians to continue their drama.

Ayakannu as per media reports is not even a farmer, but a lawyer, who makes huge amounts of money through out of court settlements and personally owns hundreds of acres of land.

He and his bunch of hooligans all look quite healthy and well-fed. They don’t appear like destitute farmers as claimed by them.

Fake farmers like the aforementioned Ayyakannu are just the front faces of this façade in the name of farmers.

The remote controls of such characters remain in the hands of politicians, who use them for their narrow, selfish, corrupt agendas depending on the political situation at the state and national level.

The governments of Punjab, Maharashtra, Karnataka, Rajasthan & U.P. provinces have waived off agricultural loans worth Billions. This has set up a very bad precedent for the rest of the country.

ALSO READ Exclusive: Angry Farmers and Distressed Leaders

There are no ‘free lunches’ in this world. These half baked measures like loan waivers just make people lazy parasites.

The following steps would go a long way in helping the real distressed farmers;

  • Scientific soil and climate testing should be done across all farming regions in India. Farmers can then be educated about which crops to grow profitably, in how many cycles; depending on the soil conditions and climate of the region.
  • Implement agricultural reforms like farming co-operatives, where farmers having small agricultural land holdings can be encouraged to come together and pool their land plus resources together.
  • Crop storage infrastructure should be built and maintained in every village so, that farmer can store their surplus produce rather than sell it desperately at a low price.
  • Crop insurance must be compulsorily introduced all over the country wherein, farmers by paying a nominal amount need not bother about their crops getting destroyed through excessive rain or drought.
  • Organic farming needs to be encouraged instead of over-reliance on chemical fertilizers. The food waste produced by an entire village can be easily turned into biodegradable compost, through innovative schemes like Vermicomposting.
  • Vermicast can replace fertilizers in the agriculture fields. This would save money for the farmer and provide high quality chemical free crops.
  • The APMC’s (Agriculture Produce Marketing Committees) have created a coterie of middlemen, who along with the complicity of these committees, form a virtual barrier between the farmer and the consumer, paying the former a pittance for his produce and charging the latter exorbitant amounts for fruits and vegetables.
    Vegetables are purchased at Rs. 2 or 3 a kg from farmers and then sold at 30 to 40 rupees per kg to urban consumers.
    This setup has been going on for decades in every town and city of India. Millions of urban Indians pay artificially higher prices and majority of farmers are underpaid due to this flawed system.
    The profits are made by middlemen, who do not pay taxes on these huge earnings. It is a common practice for them to store money in cash and not in banks.

These APMC’s must therefore be abolished immediately. Farmers should get direct access to the end consumer through the elimination of middlemen. This would ensure a better monetary return for farmers.

  • Private moneylenders in and around the villages charge a very high rate of interest from farmers. This unscrupulous sector should be bought under government regulation by bringing down the rate of interest to a rational level.
  • Government schools in villages are in shambles. They need to be upgraded so, that quality education at an affordable price is available to every child in the village.
    This would uplift farmers children through educational empowerment. It will enable them to make a transition to non-agricultural professions in future and enhance their family earnings considerably.

The aforementioned steps would cost the government far less than what it is losing in the absurd loan waiver schemes, which anyways don’t help the poor marginal farmer at all.
As regard dealing with the fake farmers of India.

The solution entails; no farm loan waivers and bringing the agricultural income above a certain threshold under the tax bracket.

The aforesaid measures would prevent the fake farmers façade spreading rapidly all over the country, while resolving the agrarian crisis of India by assisting needy farmers of the country.

The author is a Master Degree holder in International Tourism & Leisure Studies from Netherlands and is based in China. 


 

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Listening for Well-being : Arun Maira Talks About a Democracy in Crisis, Unsafe Social Media and More in his Latest Book

Maira asserts that we must learn to listen more deeply to 'people who are not like us' in our country because of their history, their culture, their religion, or their race.

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Arun Maira
Arun Maira (extreme left), during a public event in 2009. Wikimedia
  • Former Planning Commission member Arun Maira’s latest book is titled ‘Listening for Well-Being’
  • Maira observes that physical and verbal violence in the world and on social media is continuously growing
  • He also highlights the importance of ‘hearing each other’ in order to create truly inclusive and democratic societies

New Delhi, September 5, 2017 : Former Planning Commission member Arun Maira contends that “physical violence” in the real world and “verbal violence” on social media against people whom “we do not approve of” are increasing today. With such trends on the rise, the very idea of democracy finds itself in a crisis.

The solution?

“We need to listen more deeply to people who are not like us,” said the much-respected management consultant, talking of his latest book, “Listening for Well-Being”, and sharing his perspective on a wide range of issues that he deals with.

“Violence by people against those they dislike, for whatever reason, is increasing. It has become dangerous to post a personal view on any matter on social media. Responses are abusive. There is no respect for another’s dignity. People are also repeatedly threatened with physical violence.”

He said that gangs of trolls go after their victims viciously. “Social media has become a very violent space. Like the streets of a run-down city at night… not a safe space to roam around in.”

At the same time, streets in the physical world are becoming less safe too. “Any car or truck on the road can suddenly become a weapon of mass destruction in a ‘civilised’ country: in London, Berlin, Nice, or Barcelona,” Maira told IANS in an interview.

Maira said that with the rise of right-wing parties that are racist and anti-immigrant, there is great concern in the Western democratic world — in the US, the UK and Europe — that democracy is in a crisis.

In the US, for example, supporters of Donald Trump, Maira said, believe only what Trump says and watch only the news channels that share a similar ideology. On the other side are large numbers of US citizens who don’t believe what Trump says but they too have their own preferred news sources.

“They should listen to each other, and understand each other’s concerns. Only then can the country be inclusive. And also truly democratic — which means that everyone has an equal stake and an equal voice,” he noted.

In “Listening for Well-Being” (Rupa/Rs 500/182 Pages), Arun Maira shows his readers ways to use the power of listening. He analyses the causes for the decline in listening and proposes solutions to increase its depth in private and public discourse.

Drawing from his extensive experience as a leading strategist, he emphasises that by listening deeply, especially to people who are not like us, we can create a more inclusive, just, harmonious and sustainable world for everyone.

But it would be wrong to say that the decline in listening is only restricted to the Western world.

“We have the same issues in India too. We are a country with many diverse people. We are proud of our diversity. However, for our country to be truly democratic, all people must feel they are equal citizens.

“The need for citizens to listen to each other is much greater in India than in any other country because we are the most diverse country, and we want to be democratic. So, we must learn to listen more deeply to ‘people who are not like us’ in our country because of their history, their culture, their religion, or their race,” he maintained.

Maira also said that India is a country with a very long and rich history. And within the present boundaries of India are diverse people, with different cultures, different religions, and of different races.

“So, we cannot put too sharp a definition on who is an ‘Indian’ — the language they must speak, the religion they must follow, or the customs they must adopt. Because, then we will exclude many who do not have the same profiles, and say they are not Indians. Thus we can falsely, and dangerously, divide the country into ‘real Indians’ and those who are supposedly non-Indians. Indeed, such forces are rising in India,” he added.

Maira, 74, hoped that all his readers will appreciate that listening is essential to improve the world for everyone. He also maintained that it is not a complete solution to any of the world’s complex problems but by listening to other points of view, we can prevent conflict and also devise better solutions.

Born in Lahore, Arun Maira received his M.Sc. and B.Sc. in Physics from Delhi University’s St Stephen’s College. He has also authored two bestselling books previously, “Aeroplane While Flying: Reforming Institutions” and “Upstart in Government: Journeys of Change and Learning”. (IANS)