The slogans with which Finance Minister P Chidambaram wanted to impress everyone in his speech for the Union Budget for 2007-08 were about inclusive growth, top priority for agriculture and second green revolution.
A close scrutiny of the Budget reveals that he has not put money on the issues of concern that he mouthed in these slogans; especially if we look at the Budget from the perspective of rural and agricultural sectors.
But first let us give him credit where it is due.
The Groundwater Recharge Scheme that Chidambaram has proposed is certainly an urgently needed step in the right direction.
However, the way he has described the scheme in the Budget speech raises a number of questions. Chidambaram said, "The strategy for ground water recharge is to divert rain water into 'dug wells.'" But Rs 4,000 per structure allocated for this seems rather high. In Saurashtra (Gujarat), farmers have achieved this at a cost of just a few hundred rupees.
We also need to await details on how the proposed 7 million structures over about 850 blocks in 100 districts will be implemented. It is also not clear as to for what period will the amount of Rs 1,800 crore (Rs 18 billion) be given through NABARD for this purpose.
The Indian water resource establishment is like a king who keeps trying to expand his reign over new areas without bothering to see what is happening to the acquisitions. According to a World Bank estimate, India currently needs about Rs 17,000 crore (Rs 170 billion) every year just to maintain the created infrastructure.
Two years ago in his Budget speech Chidambaram was ruing the fact that the efficiency of India's irrigation sector is one of the lowest in the world. He has done nothing to make amends on that score.
On the contrary, he did exactly the opposite when he increased the allocation for Accelerated Irrigation Benefits Programme by a whopping 55 per cent to Rs 11,000 crore (Rs 110 billion).
Similar is the story of the irrigation component of Bharat Nirman, most of which goes for big dams and long distance canals that have proved too costly and relatively unproductive over the years.
Compare that with a paltry allocation of Rs 100 crore for the National Rainfed Area Authority.
For what he described as his dream scheme two years back, namely, repair, renovation and restoration of water bodies, worse is in store. The water bodies are to depend on the World Bank and other aid agencies.
The finance minister has nothing to offer to solve the biggest problem of India's water sector: utter lack of transparency and accountability.
Moreover, he has proposed nothing credible to arrest land deprivation, to provide measures for increasing productivity of small farms and national average yields of crops. One step he could easily have taken was to enthusiastically promote a new method of rice cultivation called System of Rice Cultivation, which has the potential of increasing the yields even with a reduction in inputs like water, seeds and chemicals.
The entry of corporate bodies in the agriculture sector (corporate farming, marketing) has in fact created problems for the rural people. But the Economic Survey for 2006-07, indeed calls private entry an improvement and talks rather positively about Special Economic Zones.
On the urgent and expanding problem of farmer suicides, the Budget has nothing to offer on the one score that could really help: ensuring that farmers get remunerative prices for their produce. The only thing Chidambaram offered was, well, another, (Dr R Radhakrishna) committee.
2007-08 is the first year for the 11th Five-Year Plan and neither the Approach Paper nor the Budget has any credible steps to achieve inclusive and sustainable agricultural growth. A sector, which the finance minister noted, supports 115.5 million families.
It is doubtful if Chidambaram would get even passing marks for this performance. In fact the results of his performance were available a day before when people of Punjab and Uttarakhand ousted the UPA governments.
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