New Delhi, Feb. 4 (IANS): The government on Monday ruled out withdrawing any subsidies or other support being given to farmers in view of the basic income support scheme announced in the Interim Budget.
It also expressed confidence that there will not be any overshooting of the fiscal deficit target for the next year because of the scheme that is expected to cost INR 75,000 crore in 2019-20.
“There is no question of withdrawing any other support schemes or the subsidies for farmers that are in force as of today. All other schemes will continue,” Finance Secretary Ajay Narayan Jha told IANS in an interview.
“The INR 6,000 income support scheme is targeted at the small and marginal farmers. It should be looked at in the larger context of other farm support schemes that already exist like the minimum support price (MSP).
“All said and done, there is comprehensive agriculture insurance scheme, soil health cards, fertilizer subsidy, incentive packages of different types, PM’s farmer irrigation scheme and input subsidy,” he said.
Jha emphasised that the new scheme will not be at the cost of various assistance to farmers that are already being given.
“This will work as an additional aid to farmers to make necessary purchases he may need during crop season,” he said.
Asked whether the government would be able to stick to the fiscal consolidation path which pegs fiscal deficit target to be at 3 per cent by 2021, he said: “If you look at the numbers in the budget, and for a second de-link the farmer income support scheme, you will find that the fiscal deficit has been contained at 3.3 per cent.
“In fact, it’ll come to only 3.26 per cent or thereabout. We are giving INR 20,000 crore for the scheme this year as a special package to address a unique situation. It works out to just 0.1 per cent of the GDP,” he said.
Likewise, INR 75,000 crore allocation for the programme next year works out to 0.3 per cent and without it, the fiscal deficit would be 3.1 per cent, Jha said.
By next year, in the full Budget, normal revenue measures and additional resource mobilization would be taken up which would add to buoyancy of tax collections.
“At the moment, it is a conservative figure. In the Budget, we have kept direct tax collection growth at 15 per cent and indirect tax at 13 per cent. In reality, direct tax revenue is growing at almost 17 per cent.
“Assuming that there will be more formalisation of the economy, and the base will also grow, so the tax revenues will also go up and add to tax buoyancy,” Jha said.
He added that revenue under Goods and Services Tax had also seen stabilisation and clocked INR 1 lakh crore last month compared to annual average of around INR 97,000 crore.
“We expect this to pick up now and consistently cross the INR 1 lakh crore mark from now on.”
Jha added that this growth in GST revenue was despite giving concessions worth around INR 1 lakh crore during the year and input tax refunds to traders.
Justifying the reasons for coming out with schemes to address the concerns of farmers and unorganised labour, and tax reliefs, he said that since it was a vote-on-account, provisions had only been made for four months.
“But the government has taken some measures considering the overall situation and announced measures on the tax side.
“What has happened is nothing new and nothing which has not been done by any government in the past,” he said.
Jha, who is also the Expenditure Secretary, also dismissed any comparison between the income support scheme for farmers and the much-talked-about Universal Basic Income scheme, saying it was a scheme to address issues of some specific sections.
He also dismissed criticism of jobless growth in the economy saying: “We are a growing economy and you can’t have growth without jobs.“We have built Bhogi Beel bridge in Assam in four years. That could not have been possible without labourers, civil engineers and other workers.
“About 30-40 km of highways and 70-80 km of rural roads are built on a daily basis. These are not being done in a vacuum,” Jha said.
He said India needed to step up the growth rate to double digits to create adequate jobs. “We are all aspiring for a double-digit growth rate.”
