• Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-AASHA) is a scheme that guarantees Minimum support price (MSP) to the farmers.
  • The scheme is an effort of the government’s commitment to ensure remunerative prices to farmers for their produce.

Salient features of PM-AASHA

The scheme comprises three sub-schemes viz.

  • Price Support Scheme (PSS): Under this physical procurement of pulses, oilseeds, and Copra is to be done by Central Nodal Agencies in collaboration with state governments.
  • Both the National Agricultural Cooperative Marketing Federation of India (NAFED) and Food Corporation of India (FCI) to take up PSS operations in states.
  • As per norms, the central government will bear the procurement expenditure and losses due to procurement.
  • Price Deficiency Payment Scheme (PDPS): This is based on the recommendations of NITI Aayog which suggested “Price Deficiency Payment” for implementation of MSP in crops where procurement is poor.
  • Direct payment of the difference between the MSP and the selling price will be made to pre-registered farmers selling their produce in the notified market yard and thus it does not involve any physical procurement.
  • The scheme aims to provide compensation to farmers for agriculture products whenever their price falls below the announced Minimum support price (MSP) thereby protecting them from losses suffered on account of distressed sales.
  • All payments will be made directly into the registered bank accounts of the farmers.
  • Pilot of Private Procurement & Stockist Scheme (PPPS): Under this scheme, participation of the private sector in procurement operations will be piloted. States have the option to roll out the scheme on a pilot basis in selected districts/APMCs involving private stockists.

Issues and Challenges

  • Procurement Infrastructure: The NITI Aayog in its 2016 evaluation report highlighted that the procurement infrastructure in India is inadequate. However, recent initiatives under PM-AASHA have not focused on improving the procurement infrastructure.
  • Distribution System: Another important concern is the lack of an efficient distribution system. For example, NAFED has a stock of 4 million tonnes of pulses and oil seeds because of the previous 2 years’ procurement. However, their distribution policy is still non-existent.
  • Undue benefit to traders: Critics has also raised concerns over price manipulation by traders. The rural trader has great clout in the present political set-up and can manipulate prices.
  • Procurement by Private Players: Previously, FCI and state agencies have engaged private companies for procurement of wheat and paddy from farmers at MSP. However, the process has not been smooth and the companies have taken years to get their expenses reimbursed by the government.
  • Funding: Due to depressed prices in the open market, NAFED incurred losses since 2012 which amounted to about Rs. 1,083 crores. The funding and financial condition of NAFED is a major concern over the successful implementation of the Price support scheme.

Way Forward

  • Efficient implementation will be the key to the success of PM-AASHA Scheme. The government should ensure hassle-free and easy registration of farmers.
  • The scheme should target small and marginal farmers to improve their economic condition.
  • The government should effectively check price manipulation by traders. The Centre first needs to break the trader lobbies at mandis. This could be done by widening the competition by interlinking mandis.
  • Further, it is of paramount importance to improve procurement infrastructural facilities.
  • Income support measures should be taken for farmers to alleviate farm distress.

Related Links:

Pradhan Mantri Ujjwala Yojana (PMUY)PM Gati Shakti
PM Gram Sadak YojanaPM Kisan Samman Nidhi Yojana