NK SINGH
This week, Chief Minister Shivraj Singh Chouhan flew to Mandsaur, the epicentre of last year’s farmers’ agitation in MP, in a desperate attempt to convince the agriculturists why they should not be joining the 10-day strike called by a rainbow coalition of farm unions.
Flanked by giant LCD screens publicising his government’s largesse to agriculture sector, he disclosed that MP government had distributed Rs 20,000 crore to farmers under various schemes.
Rs 20,000 crore is a staggering amount. The last year’s total agriculture budget was Rs 30,000 crore. But something must be amiss if farmers are not happy despite getting so much money.
Every five hours a farmer commits suicide in MP, say official figures. Half the farmers in MP are debt ridden, according to a NSSO survey.
So, where has this Rs 20,000 crore – that has come out of tax-payers’ pockets – gone?
Cheating in mandi
For a clue to this puzzle, one has to go back, again, to the man at the top. During a video conferencing with district collectors this week, Chouhan instructed them to file FIR against middlemen who were cheating the state exchequer by siphoning off the subsidies and benefits meant for farmers in grain procurement under minimum support price.
“Those who are cheating in the name of farmers should be sent to jail,” Chouhan told the collectors.
The racketeers are plundering the public exchequer not only in the field of grain procurement, where MP government offers better prices, triggering smuggling from neighbouring states and it re-sale in MP under MSP.
A study of MP government's flagship schemes shows how unscrupulous traders in collusion with corrupt government employees have cornered benefits of farm subsidies.
Get-rich-quick
Take the much-touted Bhavantar Bhugtan Yojna of MP government. It has turned out to be a get-rich-quick scheme for traders, most of them supporters of the ruling party. They form cartels that manipulate prices, buying cheap and selling dear.
Concludes a study by agriculture economist Ashok Gulati, a former chairman of commission for agricultural costs and prices: “MP experiment in BBY shows that market prices are prone to manipulation by traders, and end up helping traders more than farmers.”
The study revealed that Soybean prices shot up by Rs 1,000 per quintal a month after BBY scheme, fetching 40 per cent profit within a month. Prices of other farm produce too shot up by Rs 150 to Rs 500 per quintal, just a week after government stopped its BBY intervention.
“Those not registered under BBY have to suffer bigger losses because traders are suppressing the market,” reported the study. In one season alone, MP farmers suffered losses to the tune of Rs 6,534 crore for five crops covered under BBY.
Hairbrained ideas
The MP government’s decision to bail out distressed onion farmers, on which it has lost an estimated Rs 1,000 crore till now, has turned out to be another get-rich-quick scheme for traders.
It was a harebrained idea from the beginning: purchasing something for Rs eight a kg and then selling it at one-third of the price or, in some cases, allowing it to rot and then pay money for throwing it away!
It had all the ingredients of a classic scam. Step one: Government buys at the rate of Rs eight a kg. Step two: Government sells at the rate of Rs 2.50 a kg. Step three: Traders sell it back to farmers for Rs 5 a kg. Step four: Farmers recycle the sold-purchased-sold onions to government at Rs 8 a kg.
No wonder, when the government had announced the scheme initially, the official estimate of total onion production in the state stood at 32 lakh quintals. It ended up buying 80 lakh quintals that year!
The same story was repeated in Moong purchase. Last year the government purchased 2.42 lakh metric tons of Moong ---- which was more than five years’ total production in the state!
Benefit to middlemen
Farm insurance seems to have benefited insurance companies more than the farmers. In MP, thousands of farmers received amounts in double digits, ranging between Rs 17 and Rs 70.
On the other hand, the companies engaged in crop insurance business earned a profit of nearly Rs 1,200 crore in a single season.
A sizeable chunk of funds meant for farmers’ welfare finds its way to the pockets of fat cat traders and corrupt government employees.
The day that Chouhan was boasting that he had distributed Rs 20,000 crore to farmers, the Lokayukt officials arrested an agriculture department officer in Dewas for demanding a bribe from a farmer for sanctioning subsidy on agricultural implements purchased by him.
Apparently, unless the delivery improves, the benefits of welfare schemes for farmers will continue to be scooped up by middlemen.
Powers That Be, my column in DB Post of 2 June 2018
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