Income transfers are hottest trend in agricultural policy. But how do states identify beneficiaries?

Early on January 25, Saroj Kumar Sahu and Manu Patel, two farmers from a western Odisha village, boarded a bus with around 10 others from their village to travel across the state to Puri. They were among thousands of farmers from the state’s 147 Assembly constituencies who were chosen to attend a rally where Chief Minister Naveen Patnaik would launch Kalia, the Krushak Assistance for Livelihood Income Augmentation, an income transfer scheme that aims to give 30 lakh small and marginal farmers Rs 10,000 per year.

Neither Sahu nor Patel saw the launch. Worried they might get lost in the packed rally ground, the agricultural officer accompanying them asked them to skip the rally, eat something nearby and return.

What riles the two farmers more is that despite the fanfare, a month after the first income transfers were rolled out on January 26, neither had received any money. This, even as businessmen and the families of ministers made it to initial drafts of the scheme’s beneficiary list.

Like others, the two farmers from Talab village in Sambalpur district, heard of the new Kalia scheme early in January, soon after it was announced in December. The scheme will give small and marginal farmers Rs 5,000 per season for five agricultural seasons, until the state reviews it again. It also includes assistance for sharecroppers and landless cultivators.

It is one of several cash transfer schemes that state governments have rolled out for farmers in the last two years after persistent negative margins in agricultural markets sparked widespread protests.

States such as Madhya Pradesh and Haryana have toyed with market-level intervention schemes, where they paid farmers the difference between the market price and the centrally-declared minimum support prices. However, traders have taken advantage of these schemes to artificially drop market prices at the expense of the government.

Telangana took another approach, launching the Rythu Bandhu scheme, also called the Farmers’ Investment Support Scheme, in September 2017. It gives farmers financial support to buy agricultural inputs at the start of the sowing season. Each agricultural landholder gets a fixed amount of money per acre per agricultural season, regardless of what they cultivate or whether they are personally involved in cultivation.

The first cheques under the scheme were released in May, and the second round of payments began in October. In the Assembly elections held in December, the K Chandrashekhar Rao-led Telangana Rashtra Samithi government returned to power. This was attributed partly to the Rythu Bandhu scheme.

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The idea spreads

Telangana inspired other states to swiftly follow suit. On December 21, Jharkhand Chief Minister Raghubar Das announced the Mukhya Mantri Krishi Yojana, which will give 22.76 lakh small and marginal farmers Rs 5,000 per acre in the 2019-’20 financial year. Odisha notified its Kalia scheme on December 22. On December 31, West Bengal Chief Minister Mamata Banerjee announced the Krishak Bandhu scheme, which will give farmers Rs 5,000 per year for growing one crop on a single acre.

On February 1, the Narendra Modi government at the Centre joined in, announcing the PM-Kisan, or the Pradhan Mantri Kisan Samman Nidhi Yojana, in its interim budget. This scheme will give Rs 6,000 annually to farmers with land holdings of up to five acres. Andhra Pradesh announced the Annadata Sukhibhava scheme on February 12. Under it, the state will give PM-Kisan beneficiaries an additional Rs 4,000, and also Rs 5,000 to farmers with more than five acres.

But the rapid spread of the idea has not taken into account one major hurdle: to work efficiently, these schemes must address the knotty question of how to identify beneficiaries, especially when the administration has no comprehensive data on them.

Most schemes have followed Telangana’s lead in using land records to determine who qualifies for agricultural benefits. The only outlier is Odisha, which has nominally included sharecroppers in its list of beneficiaries, and also has a separate component for training landless people in small-scale livelihoods.

Scroll.in travelled to Telangana and Odisha to see how these schemes are working on the ground. In Telangana, large landholders were benefiting disproportionately from the scheme, while in Odisha, businessmen and the families of ministers found their way onto initial beneficiary lists, even as sharecroppers remain largely excluded.

How Telangana is identifying beneficiaries

Digitised and updated land records are crucial to the success of the Rythu Bandhu scheme as it targets only those people who own agricultural land.

To identify even landholding farmers, Telangana first needed to update its records of land ownership. Land records in India are notoriously complicated. Different regions have inherited land ownership records from different administrations before Independence, leading to variations in the classification of land, the measurements used for it, and even the languages they have been written in.

Telangana, which was part of Andhra Pradesh until it was bifurcated in 2014, was ruled by the Nizam of Hyderabad before Independence. Its land records were written in multiple scripts, including Telugu, Urdu, Devanagari and the now-obsolete Modi script. Unlike Andhra Pradesh, which was administered by the British, the Nizam’s bureaucracy was not as meticulous, said a government official familiar with the process of digitisation. Telangana still has large portions of uncultivable land, where the ownership is not clear.

Even before Rythu Bandhu was announced, however, Telangana had a head start in computerising land records. The Centre had been pushing for computerisation of land records since 1989, when it began the process in eight districts. One of those was in Andhra Pradesh.

By 2013, around 95% of the land records in undivided Andhra Pradesh had been digitised. For the launch of Rythu Bandhu, however, Telangana needed to make sure that these records were up to date. In September 2017, it launched what it called a “land purification” exercise where revenue officials visited all villages and posted land ownership details of all landowners to update records and ownership. By April 2018, this process had largely been completed.

“Political leadership for this came from the top,” said V Karuna, Director of Land Administration in Telangana. “The chief minister led this from the front.”

Land records have been divided into Part A (without disputes), and Part B (disputed). Around 7% of land records were in Part B at the beginning of March, Karuna said.

The Rythu Bandhu scheme began by giving landholders Rs 4,000 per acre per season, which has been raised to Rs 5,000 per acre per season for the coming financial year.

The scheme does not filter out those who pay income tax, do not live on the land or in the country, or are government employees. A report in The New Indian Express said IAS officers were “pleasantly surprised” on receiving cheques under Rythu Bandhu for the agricultural land they owned. Telangana Gazetted Officers reportedly told the chief minister that they would all return the money they had received.

Large farmers benefit

The scheme benefits large farmers more because there is no cap on the amount of land a beneficiary can own. A farmer with 20 acres can get Rs 1 lakh per season.

Bendur Krishna, a farmer in Umri village in Adilabad district, owns and cultivates 15 acres of land. In May, the Mandal Revenue Officer came to his house to hand him a cheque of Rs 60,000. This offset more than half of his average investment of Rs 1 lakh for sowing cotton across his land, Krishna said.

According to state data, 90% of all landholdings in the state are small and marginal – under five acres. Only 10% are large farmers. But thanks to the incremental increase in benefits, this subset can command a disproportionate amount of the scheme’s funds. In Adilabad district alone, 313 farmers with holdings larger than 20 acres had received Rs 3.19 crore or 1.7% of the total Rs 185 crore disbursed to 1.18 lakh farmers for the 2018 kharif season, Scroll.in found through a Right to Information Act application.

While marginal farmers with 2.5 acres or less were 36.7% of the beneficiaries, they received only 16.1% of the funds disbursed. Among Scheduled Castes, 75% of operational landholdings are marginal, according to Telangana’s Social Development Report of 2017.

Complicating this further is the Andhra Pradesh Land Reforms (Ceiling on Agricultural Holdings) Act, 1973, which capped the amount of land that an individual can hold in the range of 10 acres to 54 acres, depending on irrigation facilities and cropping pattern. To avoid giving up their land, large landowners divided their holdings within their family, which means that a single family can hold several hundred acres of land. For now, the state has no mechanism to filter out the concentration of benefits within a few families.

In a detailed note Telangana had prepared on the Rythu Bandhu scheme, which was accessed by Scroll.in, the state says there is no need to place caps on the land that beneficiaries can hold since farmers who are “economically self-sufficient” will give up the financial assistance on their own. This amount will be transferred to the Telangana Rashtra Samanvaya Samiti, a state-level federation of farmers.

In the 2018 kharif season, the government transferred Rs 5,257 crore to 51 lakh farmers. The amount returned was only Rs 66.7 lakh. In all, around Rs 3 crore has been returned to the federation, said its chairman G Sukender Reddy.

“As this is a trust-based system, we want people to return it only voluntarily,” Reddy said. “We do not decide who does or does not cultivate. Our job is to promote agriculture. The rest is up to the landowners.”

Another downside of the Rythu Bandhu scheme is that by making land records the basis of identifying farmers, it ends up excluding tenant farmers who cultivate the land but do not own it. They are often the most vulnerable.

“After Rythu Bandhu was implemented, instead of going down, my land rent went up from Rs 1 lakh to Rs 1.1 lakh,” said Sakerla Narayana, a landless tenant farmer from Talamadugu village in Adilabad district. Narayana did not believe that Rythu Bandhu was the cause for the increased rent – but he also did not see the promised reduction in rent either.

What Odisha is offering

Unlike Rythu Bandhu, which is limited to landowners, Odisha’s Kalia aims to provide financial assistance to all small and marginal cultivators (those owning less than five acres of land), regardless of whether they own the land.

In advertisements, the Odisha government has claimed farmers will get Rs 25,000 as assistance under the scheme. In reality, this will be disbursed in instalments of Rs 5,000 per household per season over five seasons.

All farming households will receive this fixed amount, regardless of how much land they cultivate and whether the land they hold is irrigated or unirrigated – factors which impact the cost of cultivation and returns at the market.

“With this approach, the cost of cultivation gets normalised,” said M Muthukumar, director of agriculture in Odisha. If the scheme began to differentiate how much it would pay people based on parameters such as whether their land was irrigated or rainfed, or on what crops they sowed, the scheme would no longer be feasible to implement, he added.

A second component of the scheme provides livelihood support to landless agricultural workers. The government aims to give financial assistance of Rs 12,500 in three instalments to 10 lakh people as they attend training in seven different livelihoods: fisheries, eggs, the rearing of goats, ducks and poultry under the Veterinary and Animal Husbandry Department, and beekeeping and mushroom farms under the Horticulture Department.

How Odisha is identifying beneficiaries

In all, Odisha has identified around 40 lakh farmers as beneficiaries for the first component of the scheme, and another 5.5 lakh for the second component.

The state identified an initial list of beneficiaries from its Paddy Procurement Automation System through which registered farmers get text messages that inform them when and where their paddy will be procured. Another source for the first list was the state’s database of direct benefit transfers for agricultural input subsidies, said Saurabh Garg, principal secretary for agriculture.

Landless sharecroppers are also allowed to register with the procurement system if they get consent letters from their landlords. In practice, few landlords agreed to do this, which is why in July, Odisha announced that sarpanches could certify sharecroppers and after the response remained lukewarm, in September, allowed district agricultural officers to verify these claims. Months on, this explains the low number of sharecroppers identified in this system. Only 57,000 people across Odisha have been identified as sharecroppers through the procurement database, said Muthukumar.

“A sharecropper would in any case be a small and marginal farmer,” said Garg. “They might have one acre of their own and take five acres on lease.”

Odisha published the first draft beneficiary list in all its villages. Those not on the list were allowed to submit green forms to the Agriculture Department to be included, while those who were ineligible but still on the list were encouraged to submit red forms to be excluded.

The state received 55 lakh green forms and 5 lakh red forms in this phase. But the proportion of green forms to red forms varies. In Sambalpur district, for instance, against 1.33 lakh green forms submitted, there were only 3,848 red forms.

Names from the green forms were displayed in the second draft list of beneficiaries in all villages. There was a fresh call for green forms at this point. The third draft list of beneficiaries included all those who had been left out from the previous lists. A final list is yet to be prepared, Garg said.

Landless agricultural workers had to apply with their own green forms after the first draft list was published. Their applications were checked with land records and other field records to ensure that they were actually landless.

Identification troubles

Problems in identifying beneficiaries have begun to crop up early in the execution of Kalia. The scheme has a long list of exclusions. Families owning more than five acres of land, those who pay income tax, and government employees are not eligible for this scheme. In a notification on January 5, the state clarified that gram panchayats are supposed to vet the names to ensure that multiple members of the same family, farmers who have died, and duplicated names do not appear on the beneficiaries list.

However, businessmen and party functionaries with land parcels were listed on the first draft list of beneficiaries, said Subhash Mohapatra, a human rights activist who filed a public interest litigation appeal against the scheme in the Odisha High Court, in January.

According to documents with Mohapatra, which Scroll.in has independently verified, a minister and family members of ministers were included in Kalia’s first draft list of beneficiaries. After reports in Odia media, several of these names were withdrawn, with some saying they had already applied for exclusion before the outcry.

Niranjan Pujari, Odisha’s minister for water resources and the Biju Janata Dal MLA from Sonepur, featured in the first draft beneficiary list. According to the assets he declared during his nomination for the seat, Pujari has 7.6 acres of land. This should have rendered him ineligible even had he not been a government employee paying income tax.

“I am not a Kalia beneficiary and I have not received any money in my account,” Pujari told Scroll.in. He said he found his name on the first list when it was put up at the panchayat office. “When I found my name on the list I submitted the [red] form saying Kalia was not applicable to me because I pay income tax.”

Pradeep Maharathy, who resigned as agriculture minister on January 6, is the MLA from Pipli in Puri district. His brother Prasidha Maharathy and sister-in-law Himanshubala Maharathy were on the first draft list of beneficiaries in two different villages in Pipli block.

Bikram Arukha is the minister of information and public relations. His brother Birendra Arukha and sister-in-law Sangita Arukha were also on the first draft beneficiary list. This is despite a rule restricting the scheme to a single household, not individuals.

This reporter called Maharathy to seek his response, but his phone was switched off. Bikram Arukha cut the call when this reporter introduced herself as a journalist. Arukha did not respond to a subsequent message asking about this.

Omprakash Mishra, a businessman listed as director of five companies and who contested as an independent candidate from Puri, was on the first draft list. His wife Debanita Acharya, a director in one of his companies, was on the list too.

“The scheme had no proper process to see who should be excluded,” said Mishra, who owns 12 acres jointly with his two brothers. Though they have caretakers who tend to the cashews grown there, Mishra and his brothers are technically the landowners.

Mishra said both he and his wife have registered identification numbers with the state government and were therefore included in the Kalia scheme. When they found their names on the list, they submitted the red form to be excluded, he said, adding that they have not received any money. “Some local vindictive political people made this an issue,” said Mishra.

According to Garg, some politicians had submitted red forms for exclusion, while those who had not were being excluded using government databases.

“As our scheme is universal for all small and marginal farmers, even political representatives can technically be included,” he said. “For instance, if they are poor and do not pay income tax, they should qualify.”

Garg acknowledged that instances remain of multiple family members from the same household finding themselves on the lists.

This might explain why Sambalpur district has received around 2 lakh applications for the scheme, when according to the 2011 Census, there were only 1.07 lakh small and marginal farmers in the district.

One reason for this is that there has been fragmentation in landholdings since 2011, Garg said, with sons and daughters applying as separate families. “In many instances we have found that a husband and wife have applied for the scheme,” he said. “Or there are large farmers who have applied, hoping our databases will not pick them out….In the landless component…we had instances of one person having submitted 10 forms just to be certain that their form did not get lost. That is why the actual number is much less than the number of forms.”

This is the first part of a three-part series.

Part II: Most vulnerable farmers are left out as states across India start money transfers to farmland owners

Part III: Can Telangana and Odisha afford the money they want to give their farmers?

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