20
S
tate
of
I
ndia
’
s
L
ivelihoods
R
eport
2015
to these products and services (Annexure
2.1 contains an analysis of the poor’s share
in some subsidy schemes). In order to
meet the goal of serving the excluded poor,
these schemes need to be restructured in a
manner that the benefits actually reach the
poorer people. When existing subsidies are
withdrawn, the resulting gaps should be
dealt with in a manner that the poor do not
suffer. This is an aspect which requires to
be worked upon.
As regards financial outlays, the Finance
Minister has tried to compensate for the
reduced budget spending with loans from
financial institutions for rural infrastruc-
ture, agriculture, microenterprises and
microfinance (Table 2.3). A slew of alloca-
tions (not from the Government Budget
but mostly out of priority sector lending
shortfall related contributions from bank-
ing system) have been announced as has
been the practice since the last decade. The
legitimacy of including finances that are not
a part of the Budget and create an illusion
of funding development programmes has
to be questioned.
The RIDF, Long TermRural Credit Fund
and the PMMY are likely to have a positive
impact on the ground by addressing gaps as
well as coverage of underserved people. On
agricultural credit flows, there are issues of
concentration in some states and unequal
access where small farmers lose out. While
nominally, agricultural loans should fully
support livelihoods through either produc-
tion or investments, the subsidy element in
crop loans has increased the demand for
credit in some quarters and the loans are
not always applied for cropping. The Credit
Guarantee Fund of
`
30 billion announced
for the MUDRA bank will be welcomed in
the microenterprise space. While the details
are to be known, availability of a dedicated
fund of
`
200 billion for small enterprises
with a guarantee facility is bound to kick-
start a number of enterprises. For the pur-
pose of the Scheme, banks have been asked
to provide loans named MUDRA loans to
customers who fall under the definition of
small customers. At the end of August 2015,
banks reported a disbursement of
`
220
billion. The target for the year 2015–16 is
`
122 trillion.
Legislative initiatives
Land acquisition bill
Pending passage of the Bill on land acquisi-
tion, an ordinance on land acquisition was
promulgated twice. But in the absence of
parliamentary support for the Bill (both from
the opposition as also some of the allies) the
ordinance was allowed to lapse recently.
While before the Parliament the Bill sought
to ease the processes of acquisition and
reduce the time taken for acquiring land for
a variety of purposes, there was trenchant
criticism on two key aspects. The apparent
neglect of social impact concerns and a sum-
mary manner of acquisition—waiving off
informed consent from the owners of the
land—were thought of as draconian. There
have been debates in which the inefficient
processes in the current acquisition lawdelay
the project start-up that depends on the land
and attendant cost-overruns have also been
highlighted (Box 2.3). The need for a quick
and efficient legal framework thatmakes land
available within a reasonable price for devel-
opment purposes—where people including
owners of the land benefit—has been under-
lined time and again. Objections have been
Table 2.3:
Allocations made outside the budget
Purpose
Amount
(
`
billion)
Rural Infrastructure Development
Fund (NABARD)
250
Long Term Rural Credit Fund
(NABARD)
150
Short Term Cooperative Rural
Credit Refinance Fund (NABARD)
450
Short Term RRB Refinance Fund
(NABARD)
150
Pradhan Mantri Mudra Yojana
(PMMY) corpus (MUDRA Bank)
200
Target for agricultural credit
8,500
Source:
Union Budget 2015–16.
