Lessons in Direct Income Support from Odisha’s Kalia Scheme

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Context: 

  • The Odisha government’s KALIA scheme aims to provide Direct Income Support (DIS) to farmers. 

Relevance:

  • G.S Paper 2> Welfare Schemes for Vulnerable Sections.
Kalia Scheme
  • KALIA or “Krushak Assistance for Livelihood and Income Augmentation” scheme was launched by the Odisha Government for farmer’s welfare.
  • The aim of the scheme is to accelerate agricultural prosperity and reduce poverty in the State payments to encourage cultivation and associated activities.
  • The scheme is being seen as a viable alternative to farm loan waivers.
  • Under the scheme, around Rs, 10,180 crores will be spent over three years until 2020- 21 in providing financial assistance to cultivators and landless agricultural labourers.

Eligibility

  • Small and marginal farmers, landless agricultural household, vulnerable agricultural household, landless agricultural labourers and sharecroppers (actual cultivators) are eligible under different components of the scheme.

Provision of the Scheme

  • For Cultivators: All farmers will be provided Rs 10,000 per family as assistance for cultivation. Each family will get Rs 5,000 separately in the Kharif and Rabi, seasons, for five cropping seasons between 2018-19 and 2021-22. Crop loans up to Rs 50,000 are interest-free.
  • For Landless Agricultural Households: Financial Assistance of Rs.12500will be provided to each landless Agricultural Household for Agricultural allied activities like for small goat rearing unit, mini-layer unit, duckery units, fishery kits for fisherman, mushroom cultivation and bee-keeping, etc.
  • For Elderly: The elderly, sick and differently-abled population who are unable to take up cultivation, will be provided Rs 10,000 per household per year.
  • Insurance for cultivators and landless agricultural household: The KALIA scheme also includes a life insurance cover of Rs 2 lakh and additional personal accident coverage of the same amount for 57 lakh households. 

Some unique steps under KALIA Scheme:

  • Odisha used a three-step framework for KALIA Scheme. This is called the “Unification-Verification-Exclusion” framework. This framework is used to identify the beneficiaries of the scheme. The important points of the framework are,
  • Unification: This is the first step. It involves creating a unified database with “green forms”. These green forms are essential for farmers who wanted to avail benefits under the KALIA Scheme. This has led to the creation of 1.2 crore applicants.
  • Verification: In this step, the unified data get verified. The databases like the Socio-Economic Caste Census, National Food Security Act and other databases are used in the verification process. Similarly, Aadhaar and bank account also got verified to avoid duplication.
  • Exclusion: In this step, the focus is on the exclusion of ineligible applicants. This includes applicants like government employees, taxpayers, large farmers, and those who voluntarily opted out.

Advantages of the KALIA scheme:

  • KALIA targets a whole bunch of rural activities.
  • KALIA scheme support farmers farming on a small scale, sharecropping, fishing, animal herding, which are not covered under bank loans, but are caught in debt traps set up by local moneylenders.
  • KALIA is considered as a better alternative to farming loan waiver as loan waivers penalize honest farmers who repay on time and can discourage them from doing so.

How does the scheme differ from the loan waiver?

  • Unlike a loan waiver, through which banks appease a few farmers, KALIA’s main targets are rural activities as a whole.
  • The scheme will support farming on a small scale like sharecropping, fishing, animal herding, which are not covered under bank loans but are caught in debt traps set up by local moneylenders.
  • Also, a farm loan waiver will reduce the credit available to farmers in the long term.
  • On the other hand, income support can be used to make a repayment or at least activate a bank account which can then receive a loan.

How is it going?

  • Better leverage of data: Any government targeted scheme can use the reliable data collected under the KALIA scheme for service delivery. So the other DIS schemes should aim towards forming such reliable data.
  • Proof of Data Security: Odisha government obtained the consent for use of citizen data under the KALIA scheme. The data was also kept under a secure firewall. Further, access to data was only available to relevant officials on a need-to-know basis. Other GovTech platforms must use these “privacy by design” principles in data handling.
  • Effective grievance redressal: The KALIA scheme established an online grievance redressal mechanism (GRM). This online platform is accessible to farmers “offline” at the Common Service Centres closest to them.
  • Using this, nearly 10 lakh grievances were received and resolved. The GovTech platforms should establish such an effective redressal mechanism.
  • The KALIA scheme has more lessons for the governments on the way of constructing a social welfare system for farmers.



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