Interim Budget 2019: Here's how Madhya Pradesh and Chhattisgarh reacted

The announcements made by the Finance Minister Piyush Goyal pertaining to agriculture and allied sectors are likely to impact Madhya Pradesh and Chhattisgarh as both states are primarily agrarian economies and societies. The announcement of the Pradhan Mantri Kisan Samman Nidhi scheme for farmers is also an acknowledgement of the importance of catering to the rural constituency post the electoral defeat of the BJP in the three central Indian states in assembly elections in November-December.

But how will the payout of Rs 6000 per acre to small and marginal farmers impact them in these states?

As per the agriculture census, there are a total of 73.60 cultivators in MP while the corresponding number for Chhattisgarh is 34 lakh. The payout to small and marginal farmers implies that it is more a political decision than a well thought out one for promoting growth in the sector. Heres why: The marginal and small farmer numbers stand at 28.38 lakh and 19.51 lakh in MP which in sheer numbers is almost twice the number of 25.71 lakh farmers that fall in the medium, semi medium and large categories or have holdings above 5 acres and would not be eligible for these payouts.

In Chhattisgarh, the marginal and small farmers numbers stand at 19 lakh and 7.6 lakh which is almost four times the number of medium, semi medium and large farmers that add up to 7.82 lakh.

In MP, the area with marginal and small farmers stands at 13.97 lakh hectares and 28.29 lakh hectares respectively while the remaining farmers hold about 121 lakh hectares of land. In Chhattisgarh, the area held by marginal and small farmers is 8.4 lakh hectares and 10.7 lakh hectares respectively while the remaining farmers hold about32.9 lakh hectares. Clearly, the bulk of the holdings and the ones that are economical are with the so-called semi medium, medium and large farmers but they aren’t being covered in the payout.

Both the BJP and Congress in MP have spoken of introducing a flat payout system in the state at some point in time. I am seriously contemplating announcing it, if I win the elections, ex-CM Shivraj Singh Chouhan had told India Today in November, before the elections. The Congress too is serious about it but with the farm loan waiver to cost the state exchequer about Rs 45,000 crores and cannot think of any other financial package right now owing to budgetary constraints.

Besides these, the budget also promises interest subvention of 2 per cent to farmers hit by natural calamities. In MP, state government cooperative banks give out loans at zero per cent interest. What remains to be seen is if this subvention would imply a reverse payout to farmers in this category. Interest on loans on dairy and fisheries has also been reduced by 2 per cent and would benefit farmers.

MP BJP Spokesperson Rahul Kothari said that the budget provides relief to all sections of society. Small farmers would get direct support through the Kisan Samman Nidhi and would be shielded from clutches of money lenders. The hiking of the income tax slab to Rs 5 lakh would provide additional savings to numerous people with modest incomes in cities.

The Congress, on the other hand, did not immediately respond to the budget. Interestingly the entire Congress machinery was busy in organizing its version of the maiden Vande Matram rendition at the Mantralaya that was attended by CM Kamal Nath.

Finally responding to the Budget, CM Kamal Nath in a statement termed it an election-year budget’ a jumla’ and a chalava’. The last hopes of ache din have also been extinguished with this budget. The BJP remembers farmers, gau mata, the poor and labourers. The amount of money to be given to farmers is a very small amount, he said in a statement.

While there are payouts for farmers, the union government should have also ensured support for farmers that contribute to the GDP, mainly the non-small and marginal cultivators. If the government was keen on giving an impetus to the sector, they should have targeted all farmers. Besides this, the budget has not really given anything for infrastructure or industrial development, said Pratap Verma of Confederation of MP for Industry, Services and Trade.

Small and marginal farmers though not fully aware of what has been done for them are happy when informed about it. Agriculture is in distress and any help from the government is welcome, said Badami Lal Nayak of Tanda village in Bhopal’s Huzur Tehsil, when told about the Kisan Samman Nidhi announced by the government. Nayak has a 5-acre holding jointly with his paternal uncles and is eligible for the payout.

I welcome the decision to increase the income tax limit. There has been massive inflation in the last few years and items of daily use are more expensive. Also, the saving in tax will help in education and marriage of kids, said a class IV employee of the state government not wishing to be identified, whose annual income was Rs 3.60 lakh and was paying tax but will now be out of the tax net", he said.