More money for states in budget to boost to rural economy

The Indian states can take a lot from finance minister Arun Jaitley’s budget aiming to transform rural economy by better road connectivity, improving irrigation and empowering Panchayats by pumping around Rs 3 lakh crore.

Updated on: Feb 29, 2016, 20:41:12 IST

Hindustan Times | By Chetan Chauhan, New Delhi

Prefer HTon Google

Share via

Copy link

The Indian states can take a lot from finance minister Arun Jaitley’s budget aiming to transform rural economy by better road connectivity, improving irrigation and empowering Panchayats by pumping around Rs 3 lakh crore.

By the time irrigation network and better roads would be in place, Jaitley proposed electricity for every village by May 2018, crucial to boost rural economy. (Vipin Kumar/HT Photo)

All this has a target --- doubling the farmer’s income by 2022.

Rajasthan, which has already announced Jal Swabhiman scheme to improve watershed management, can hope to increase its irrigation network as 28.5 lakh hectares of farm land will be brought under the ‘Pradhan Mantri Krishi Sinchai Yojana’ in the next two years.

Most of it would be in the traditionally ‘Bimaru’ states of Uttar Pradesh, Rajasthan, Madhya Pradesh, Jharkhand, Bihar and Odisha, where agriculture is largely dependent on rain water. In addition, states can also borrow money Nabard, where an irrigation fund of Rs 20,000 crore will be set up.

These states can now rely more on rural employment guarantee scheme to create durable watershed management assets as the scheme has got higher allocation of Rs 38,500 crore for next fiscal. Just 46% of India’s farm land has irrigation facility.

The increased focus on rural roads under Pradhan Mantri Gramin Sadak Yojana for which Rs 19,000 crore has been proposed as against Rs 9,805 crore in 2013-14 will also improve rural connectivity in states, especially hilly states like Uttarakhand.

“The pace of construction which is currently 100 km per day, as compared to the average of 73.5 kms during 2011-14, will be substantially stepped up,” the minister said. It will mean additional 65,000 hamlets getting roads, half to be in these Bimaru states.

By the time irrigation network and better roads would be in place, Jaitley proposed electricity for every village by May 2018, crucial to boost rural economy. Around 30% of villages did not have power till 2015 end.

That’s not all as Jaitley will increase direct funding to states by Rs 64,144 crore in next fiscal as compared to 2015-16, resulting in states getting Rs 5,70,337 crore, a 50% jump from actual funding in 2014-15.

The engines of rural growth and governance --- panchayat and urban local bodies --- will get a grant of Rs 2,87,000 crore as recommended by 14th Finance Commission, a jump of 228% compared to the previous five year period. Panchayats will get Rs 655 crore from next financial year to develop capacity to implement Sustainable Development Goals.

All this raise a poignant issue --- whether local bodies have capacity to absorb so much money. Analysis by Delhi based advocacy group Accountability Initiative showed states spent 10% less funds by December 2015 compared to their spends in the five-year period preceding 2014.

Chhattisgarh, Maharashtra and Jharkhand were, however, exceptions. This year Rajasthan and Madhya Pradesh could be added to the list as they already have prepared plans to absorb additional Central aid.

ABOUT THE AUTHOR
Chetan Chauhan
Chetan Chauhan is the National Affairs Editor looking into all aspects of news and features from across India. A Chevening scholar with over three decades of experience in reporting and news management, Chetan has extensively covered all important aspects of the social sector, political economy, environment and climate change nationally and internationally. He did a journalism course at the Reuters Institute of Journalism in Oxford and Digital Media training at Nanyang Technological University in Singapore. He started as a reporter with The Statesman in 1996 and joined the Hindustan Times in 2000 in the metro bureau covering environment, crime and Delhi politics. He covered hot local news, from the Jessica Lal murder case to the rebellion of Delhi Congress MLAs against then Chief Minister Sheila Dikshit, to the replacement of toxic vehicle fuel with cleaner compressed natural gas (CNG) in the national capital. Some of his stories on air pollution became part of the Supreme Court’s landmark MC Mehta versus Government of India case in the National Capital Region (NCR), forcing the government to take corrective measures. As part of the national political bureau since 2004, he covered important central sectors such as environment, education, social justice, labour, rural development, water resources, renewable energy, agriculture, broadcasting and the Planning Commission for more than a decade producing several exclusive and investigative breaking stories. His specialisation is the environment, having covered at least a dozen United Nations global conferences on climate change, biodiversity and wildlife including climate summits in Paris, Copenhagen and Bali. He also covered India’s two five-year plans ---11th and 12th and reported on drafting and execution of right based laws such as Right to Education, Right to Information and rural job guarantee law, MG-NREGA, now being introduced in new format as VG-RAM-G Act. He has in-depth knowledge of social sector issues. He was one of the first to report on tigers vanishing from Sariska and Panna wildlife reserves in 2004 and 2008, respectively, leading to the setting up of the National Tiger Conservation Authority (NTCA) and the introduction of stringent penal provisions for poaching. He has written extensively on the rising human-animal conflict in India and the degradation of India’s biodiversity hotspots because of mining and other activities. Since 2004, Chetan has covered Parliament comprehensively and participated in training on the nuanced coverage of Parliament proceedings. He has travelled extensively across India to cover national and provincial elections since 1998, especially in the Hindi heartland states, considered India’s road to power. He writes a regular column for Hindustan Times, Ecostani, on important national politics, economy, Himalayan ecology and environmental issues. His other responsibilities include providing inputs for edits and edit page articles for the publication, apart from managing news flow from across India.Read More