Skip to main content

Event report: Rural realities and Union Budget 2022-23


By IMPRI Team
According to the Population Census of 2011, the percentage of people residing in rural areas is close to 69% of the Indian population. As per another report by the Government of India, the percentage of the Indian population that was situated Below the Poverty Line (BPL) in 2011-2012 amounted to 21.9%. Needless to say, people affected by rural poverty contribute to a large chunk of the percentage. Therefore, the development of rural areas in terms of economy and viability of professional options is much needed. Hence, to have a look at the Rural budget separately becomes of utmost importance.
To discuss the story of the rural realities, a panel discussion on Rural Realities and the Union Budget 2022-23 was organised by IMPRI Impact and Policy Research Institute, New Delhi under the series The State of Villages – #RuralRealities in the presence of Dr J. Dennis Rajakumar as the chair, Prof. C.S.C Sekhar, Himanshu Shekhar Mishra and Dr Jyotsna Jha as panelists.

Background

Dr J. Dennis Rajakumar initiated the discussion by explaining the importance of the rural economy, which in some way represents the Indian economy and hence, has always been a central subject in Budgets of the Government. He drew attention to how the Budget 2022-23 will impact the rural realities. He stated that the GDP has risen by 9.2% in 2021-22 against a 6% fall in 2020 due to massive lockdown and in 2022-23 is expected to grow by 8 to 8.5%. Discussing the reasons behind this increase, he spoke about the rise in the private final consumption level, which was drastically affected during the pandemic, and gross capital expenditure.
In rural India, almost 69% of the total population resides and 67% of the households are located in rural areas. So, the drop in private final consumption was a rural or urban phenomenon and remains a question. The dependence of almost 90% of the rural population on the informal sector with 80% on cash on employment led to an increase in the hardships for the poor due to the pandemic- induced lockdown and thus, there is a need to discuss of how this ‘booster budget’ would help in improving the present plight of the rural economy.

Employment Creation and Capacity Building

Dr Jyotsna Jha talked about the problem of unemployment rates, which are expected to be much higher than what was shown in the data. She also highlighted the fact that during the pandemic, women’s unemployment has grown much higher than men’s unemployment. She also expressed concern about the reduction in the allocation for MGNREGA, which has always been a source of rural unemployment for unskilled workers and has the ultimate aim of building infrastructure and maintaining the rural economy in line.
One of the main reasons behind the declining GDP during the pandemic is a fall in the consumption expenditure. Hence, as compared to the need for capital expenditure, which will help to increase employment in the long run, we need direct benefit transfers into the hands of those who will spend the complete amount and MGNREGA is a major scheme for the same.
She also drew attention towards education and nutrition which are of immense importance with the objective of increasing employment in the country. Programmes like E-Vidya announced in the financial blueprint would not benefit the students in the rural areas and there are many bottlenecks with the same, like inadequate number of teachers staffing and recruitment and hence low income in rural areas. Expanding her conversation to nutrition, she spoke about Aanganwadi which have always been a major employer of rural women but in the Budget, there hasn’t been any change or improvements in the same. The only sector which maintained steady growth during the pandemic is the agriculture sector and given the money and technology in their hands, it could help them to perform more efficiently. Hence, the rural sector shouldn’t be looked like a place for passive investment but a highly potential space of inclusive growth.

Status of Agricultural and its Potential

Prof. CSC Sekhar talked about two parts in the agriculture growth which are:
  • What led to growth in agriculture and
  • Growth in the subsections of agriculture
It is expected that agriculture would see a growth of 3.9% but disappointingly, there hasn’t been any specific allocation for the same. Along with agriculture, livestock and fisheries are also extremely important for the rural economy which wasn’t given the requisite attention. Additionally, stating the major sectors of income for rural India, he told that with a 55% increase in the income from livestock there has been a decline in income from the crop sector by 40%.
He also seemed to praise the government’s step towards increasing capital investment in agriculture through doubling the allocation for Rashtriya Krishi Vikas Yojana, increasing agriculture infrastructure fund by 150%, clubbing various projects under Krishi Unnati Yojana and ample allocation for Animal Disease programmes which is of utmost importance for the animal husbandry sector playing a major role in India’s rural economy. He also welcomed National Livestock Mission, Production Linked Incentive schemes that are immensely helping food processing industries and small scale industries.
Furthermore, the government’s concern towards food storage and warehousing is also appreciable and it could be evidenced from the Budget itself. However, the reduction in the allocation for the MGNREGA programme is premature. Talking about reforms and improvements for the agricultural growth, sir suggests increasing the use of the latest technology as the Government already seems to work for the same but at the same time, there is a need for the young population to build interest in farming and encouraging them to accept this sector with innovation.

Key Takeaways from the Budget 2022-23

Mr Himanshu Shekhar Mishra shared his experience with the farmers of western Uttar Pradesh and how, for the first time, Indian farmers have been at the forefront of Indian economical debate with the Agriculture Acts of 2020.
On the basis of such interactions, he put forth the expectations of the farmers from the Union Budget, 2022-23; some of them for increasing the fertilizer subsidy, having a strict rule for MSP allocation as the cost of production exceeds the income they are getting and containment of inflation, especially in rural areas, to ensure sustenance.
Moving on, he highlighted pointers from the latest Budget concerning agriculture: increase in the Ministry of Agriculture’s budget from 1,23,000 crores in 2021-22 to 1,32,000 crores in 2022-23; 2,37,000 crores of MSP payment to 1,63,000 crore farmers; 1,400 crores for the Ken Betwa Link project with more than 9,00,000 hectares of land being irrigated; chemical free natural farming; NABARD facilitating supply of more funds; use of Kisan Drones while spraying insecticides and pesticides; a rationalized scheme to increase oil seeds production inthe country; declaration of the year 2023 as the international year of millets, enhancing consumption of millet products; and finally, reducing the budget for MGNERGA.
Although the farmers were expecting more subsidies with respect to the fertilizers and pesticides, there was a cut for the same this year. Mr Mishra also explained how the demand of MGNREGA-related incentives went up during the first wave of COVID-19 as the country witnessed reverse migration and 1.14 crores migrant workers returned their homes, as per the February 2021 data by Mr Santosh Gangwar. Thus, on one hand, unemployment was shooting skies during the pandemic and on the other hand, there was an increase in allocation of 40,000 crores under the COVID-relief package announced by the Finance Minister.
He also mentioned about the lack of official real-time unemployment data which hampers the assessment and way forward. The Economic Survey for this year presented right before the Budget, also shows increased targeted cash-flow, Rs 16,50,000 crores, from agriculure due to the increased focus on infrastructure developments in agriculture.

Way forward

Post the panel discussion, questions were raised regarding the flexible nature of budget allocation under MGNERA. To which, Mr Mishra replied how MGNREGA is a demand driven scheme and inversely proportional to many variables, such as the state of monsoon. While answering another question, Mr Mishra explained the complex situation of MSP. Throughout the negotiation talks between the farmers’ unions and the government, one of the major demands was implementation of a rational law for MSP. Although the government promised formulating a new committee solely devoted to the issue, there has been no formal updates.
Extending this further, Prof SCS Sekhar suspended that MGNERGA, being a legal initiative confirms some incentive to those registered with it, be it in the form of an employment or as an unemployment allowance. However, if MSP is legalized, the failure in not getting satisfactory revenue or there are lack of deficiency payments, the farmers will incur huge losses as the cost of production in agriculture is much higher, making it a risky bet.
Answering the questions raised by out Chair, Dr Jyotsna Jha explained that how the gap between the wages from MGNREGA and wages from other work has deteriorated over the years. She also elaborated on the implications of health insurance schemes for the rural population due to the lack of infrastructure and awareness. The event was concluded with closing remarks by each panellist on whether the Union Budget 2022-23 heed to the revival of rural employment scenario and rual demand.

Comments

TRENDING

Loktantra Bachao Abhiyan raises concerns over Jharkhand Adivasis' plight in Assam, BJP policies

By Our Representative  The Loktantra Bachao Abhiyan (Save Democracy Campaign) has issued a pressing call to protect Adivasi rights in Jharkhand, highlighting serious concerns over the treatment of Jharkhandi Adivasis in Assam. During a press conference in Ranchi on November 9, representatives from Assam, Chhattisgarh, and Madhya Pradesh criticized the current approach of BJP-led governments in these states, arguing it has exacerbated Adivasi struggles for rights, land, and cultural preservation.

Promoting love or instilling hate and fear: Why is RSS seeking a meeting with Rahul Gandhi?

By Ram Puniyani*  India's anti-colonial struggle was marked by a diverse range of social movements, one of the most significant being Hindu-Muslim unity and the emergence of a unified Indian identity among people of all religions. The nationalist, anti-colonial movement championed this unity, best embodied by Mahatma Gandhi, who ultimately gave his life for this cause. Gandhi once wrote, “The union that we want is not a patched-up thing but a union of hearts... Swaraj (self-rule) for India must be an impossible dream without an indissoluble union between the Hindus and Muslims of India. It must not be a mere truce... It must be a partnership between equals, each respecting the religion of the other.”

Right-arm fast bowler who helped West Indies shape arguably greatest Test team in cricket history

By Harsh Thakor*  Malcolm Marshall redefined what it meant to be a right-arm fast bowler, challenging the traditional laws of biomechanics with his unique skill. As we remember his 25th death anniversary on November 4th, we reflect on the legacy he left behind after his untimely death from colon cancer. For a significant part of his career, Marshall was considered one of the fastest and most formidable bowlers in the world, helping to shape the West Indies into arguably the greatest Test team in cricket history.

Andhra team joins Gandhians to protest against 'bulldozer action' in Varanasi

By Rosamma Thomas*  November 1 marked the 52nd day of the 100-day relay fast at the satyagraha site of Rajghat in Varanasi, seeking the restoration of the 12 acres of land to the Sarva Seva Sangh, the Gandhian organization that was evicted from the banks of the river. Twelve buildings were demolished as the site was abruptly taken over by the government after “bulldozer” action in August 2023, even as the matter was pending in court.  

Swami Vivekananda's views on caste and sexuality were 'painfully' regressive

By Bhaskar Sur* Swami Vivekananda now belongs more to the modern Hindu mythology than reality. It makes a daunting job to discover the real human being who knew unemployment, humiliation of losing a teaching job for 'incompetence', longed in vain for the bliss of a happy conjugal life only to suffer the consequent frustration.

A Hindu alternative to Valentine's Day? 'Shiv-Parvati was first love marriage in Universe'

By Rajiv Shah  The other day, I was searching on Google a quote on Maha Shivratri which I wanted to send to someone, a confirmed Shiv Bhakt, quite close to me -- with an underlying message to act positively instead of being negative. On top of the search, I chanced upon an article in, imagine!, a Nashik Corporation site which offered me something very unusual. 

Will Left victory in Sri Lanka deliver economic sovereignty plan, go beyond 'tired' IMF agenda?

By Atul Chandra, Vijay Prashad*  On September 22, 2024, the Sri Lankan election authority announced that Anura Kumara Dissanayake of the Janatha Vimukthi Peramuna (JVP)-led National People’s Power (NPP) alliance won the presidential election. Dissanayake, who has been the leader of the left-wing JVP since 2014, defeated 37 other candidates, including the incumbent president Ranil Wickremesinghe of the United National Party (UNP) and his closest challenger Sajith Premadasa of the Samagi Jana Balawegaya. 

Will Bangladesh go Egypt way, where military ruler is in power for a decade?

By Vijay Prashad*  The day after former Bangladeshi Prime Minister Sheikh Hasina left Dhaka, I was on the phone with a friend who had spent some time on the streets that day. He told me about the atmosphere in Dhaka, how people with little previous political experience had joined in the large protests alongside the students—who seemed to be leading the agitation. I asked him about the political infrastructure of the students and about their political orientation. He said that the protests seemed well-organized and that the students had escalated their demands from an end to certain quotas for government jobs to an end to the government of Sheikh Hasina. Even hours before she left the country, it did not seem that this would be the outcome.

A Marxist intellectual who dwelt into complex areas of the Indian socio-political landscape

By Harsh Thakor*  Professor Manoranjan Mohanty has been a dedicated advocate for human rights over five decades. His work as a scholar and activist has supported revolutionary democratic movements, navigating complex areas of the Indian socio-political landscape. His balanced, non-partisan approach to human rights and social justice has made his books essential resources for advocates of democracy.

Tributes paid to pioneer of Naxalism in Punjab, who 'dodged' police for 60 yrs

By Harsh Thakor*  Jagjit Singh Sohal, known as Comrade Sharma, a pioneer of Naxalism in Punjab, passed away on October 20 at the age of 96. Committed to the Naxalite cause and a prominent Maoist leader, Sohal, who succeeded Charu Majumdar, played hide and seek with the police for almost six decades. He was cremated in Patiala.