‘16 Lakh Kisans Will Benefit From Bhavantar Bhugtan Yojana’

By Times Of India on 08 Feb 2018 | read
He is the one credited with implementation of Bhavantar Bhugtan Yojana in Madhya Pradesh. Agriculture department principal secretary Rajesh Rajora explains to TOI how MP took the lead in the price deficit payment scheme and just why the Centre is considering making it a nationwide scheme. Excerpts from an exclusive interview with TOI.
What is Bhavantar Bhugtan Yojana?

It's a scheme, unlike any other in the country, to cushion farmers from price crashes. If prices fall, the government will pay farmers the deficit, hence 'bhavantar'. It has provided great security to oilseed and pulses farmers. What's unique is that farmers get compensated for fair average quality (FAQ) and near-FAQ crop as well. It's a massive incentive for farmers to go for oilseed production in which our country lags. We import 15 million tonnes of edible oil a year.

How is it different from minimum support price?

In MSP, there are a lot of overhead costs that the government has to bear. In most crops, it ranges from 30-40% because of storage and handling costs, and waste. In paddy, the cost is in fact 120% because it has to be prepped for the market. All this goes from the state coffers. In Bhavantar, on the other hand, the state's cost has come down to just 18% — and it goes straight to the farmer, not to transporters and chowkidars as in MSP. Such a scheme does not exist anywhere else in the country. The Government of India usually intervenes through three schemes in the market to support the farmers — price support, price stabilization fund and market intervention scheme. Bhavantar ensures profit to farmers, without the need to stock their produce and incur maintenance and transportation costs.

So, how did it begin?

A long time ago, Niti Aayog member Dr Ramesh Chand had written about it. In 2015, MP tried out a pilot project in Chhatarpur and Damoh, but it could not take off as the rates were on the higher side countrywide that year. We implemented it last year. Registration of farmers started in September 2017 and continued till mid-October.

How many farmers have benefited and what will it cost the government?

As many as 21.88 lakh farmers have registered for Bhavantar. The bulk of them — around 50% — grow soybean. Over 16 lakh farmers will benefit from the scheme and it will cost us Rs 2,000 crore, which will the state and Centre will share equally.

Why are only oilseeds and pulses covered under the scheme and not paddy or wheat?

MP is the largest producer of pulses and oilseeds — 28% of the total production in the country. India is not self-reliant in this. On an average, the Union government imports pulses and oilseeds worth Rs 90,000 crore every year while in paddy and wheat, the country is more than self-reliant.

How do you arrive at modal price under the Yojana?

Modal prices are average market prices for a commodity over a two-month period in MP and two other states where the crop is grown and traded. Under the scheme, farmers get compensated when notified crops are sold at less than the MSP, but the payout are capped at modal price.

How was the Centre convinced to implement it nationally?

I went to New Delhi on January 11 and gave a presentation on Bhavantar Bhugtan Yojana to the Union MoS agriculture and principal secretaries of all states. I told them how we have successfully implemented it in MP. GOI is starting a market assurance scheme for oilseeds and pulses from this Rabi season, in which it will probably give the option of price deficit payment to farmers.

Which states have shown an interest in it?

A lot of big states have — Uttar Pradesh, Haryana, Chhattisgarh, Maharashtra, Karnataka, Odisha and Telangana.

There have been reports of farmers and traders taking advantage of the scheme...

We have tried to make a foolproof system so that no one can misuse it. We are learning as we go. Checks and balances have been put in place. Registration of farmer is mandatory before selling. It is integrated with e-procurement portal. Aadhaar is mandatory for registration and the farmer has to bring a copy of Aadhar during the transaction. The revenue department certifies the sowing area. We keep samples of crop if purchased at a higher price. Mandis are now under CCTV surveillance and there has to be a minimum digital transaction of Rs 10,000 between the farmer and trader. The risk of cartelisation is being negated.

What are the changes being made in the scheme?

Onion will come under Bhavantar from this Rabi season. We have done a midterm analysis, and there isn't anything much that needs to be changed.