Jan Dhan has to be a financially viable proposition to alleviate poverty. Banks should be mandated to take up the cost of universal financial access as part of their business obligation or contribute a percentage of their net profit to a Universal Financial Services Obligation Fund (UFSOF), which has to be managed by the Jan Dhan mission. The contribution towards UFSOF should be treated in lieu of banks’ 2 per cent contribution for CSR.
Department of Posts needs to be converted into a full-fledged bank—not just a payments bank, which it is already—that can offer all banking products including credit.
RSBY should be universalised and hence should be part of Jan Dhan scheme. This will ensure that all Indians have a minimum health insurance cover. The 12th Plan’s target was to cover 70 million households by the end of 2016-17. The target should be revised to cover all households. It will have a multiplier impact on healthcare and insurance industry.
SHGs must be incentivised to form institutions that can tie up with industry to cater to their needs. This will make them financially viable, generate jobs in the hinterland and stop the rural urban migration.
Make in India campaign must incorporate the need to involve SHGs and MSMEs in the overall industrial expansion.
Industry and banks must help SHGs in adopting modern technology and processes at the least possible cost.
In farm sector the focus should be on investment credits. Incentives are given for short-term loan. There is interest subvention scheme of the central government and subsidies from states. In some states the effective interest rate on short-term farm loan is zero percent. However, no such incentive is available for long-term investment in agriculture sector. There should be special focus for investment credit in agriculture sector.
National Mission for Sustainable Agriculture
Given that this is a new initiative being driven by rather limited resources, it would be better if the funds are released by the central government directly to the implementation agencies instead of routing it through the state government.
There has to be a programme management unit (PMU) approach and one of the key functions of the PMU would be to identify and enlist possible implementation partners and vendors.
The scheme funds only a government prescribed process and method of organic farming. In our field experience, we found that there are wide variations in the processes and methods followed and therefore one-size-fits-all approach may not be optimum.
It would be better to fund outcomes and cover producer risk rather than using the money towards inputs. This essentially means using the money for end-product certification, a minimum support price, an agriculture insurance to cover all exigencies, setting up of cold chains as well as local food processing, marketing & advertising to create organic food culture and consumption, setting up of web portal and physical store fronts, farmers markets etc.
The MSP model may not be practical in the short-term and one out-of-the-box idea could be to procure locally grown organic food only for the mid-day meal scheme wherever available.
On the input side, the only area that requires extensive support and capacity building is the job of creating producer organisations (companies/cooperatives/SHGs). The scheme provides zero support for this.
There is no support towards management and other expenses for producer organisations. NABARD provides Rs 9.8 lakh per producer organisation over a period of 3 years towards this. Something similar should be incorporated in this scheme as well.
Once the producer organisation is formed, the experience is that the credit linkage is difficult and thus specific guidelines have to be given to the banks for making credit available expeditiously.
Attention should also be focused on introducing concepts like Urban Farming, Urban Producer Organisations and Grow Your Own Food.
National Centre of Organic Farming (NCOF)
It’s a large campus and building with a staff of only 20. The staff strength needs to be increased and need to set up more laboratories.
They are doing a lot of things by observation and not through a scientific testing facility that they do not have. They have to have all laboratory facilities for all stages of organic farming, ability to prove data-based efficacy of organic insecticide, fertiliser, soil etc.
A lot of work is being done with fungus and bacteria etc. to be used as inputs. No tests are being done on side effects or long-term effects. This could pose a danger of bio-hazards replacing chemical hazards introduced during the Green Revolution.
The centre should have a knowledge repository of various organic practices being followed in India, besides creating their own practices.
It also makes sense to create a traditional seed bank at the centre as more and more indigenous crops are becoming rare.
Elements of usage of organic food, health benefits, increasing shelf-life and local processing options should be integrated in the NCOF. It should be conceptualised as a centre covering the entire chain from farm to the table.
Participatory Guarantee System for India
While this is a good system, from a producer perspective, it is not likely to inspire consumer confidence without an independent third party certification including end-product testing.
Such a participatory system can also lead to cartelisation and non-organic products being certified as organic through mutual consent.
Organic producers can buy non-organic produce and show it as their own organic produce.
There is a need to identify and appoint such third party certification agencies perhaps at a district level. This is proposed, in addition to the Participatory Guarantee System.
For Digital India to be successful factors such as tech neutrality, net neutrality, General Financial Rules (GFR), procurement and payment processes, inverted duty structures and level playing field need urgent attention.
Government should not make technology choices nor specify technology, rather specify services. Choice of technology should be left to the market forces.
Solutions need to be interoperable based on open architecture and open standards to allow innovation to flourish.
Digital India is about service delivery and not about technology. The government should set priorities, frameworks of what is to be achieved, rest should be left to the people. The neutrality tone has to be set right at the top.
The government has to shift from the concept of L1 to the best value for money—the scope of which goes beyond technology. It has to be a Total Cost of Ownership (TCO) and the value that it brings to the citizen as well as to the government.
Procurement process needs alignment in terms of the needs of IT. The process today is rigid and inflexible. This requires revision in GFRs. There are gaps in thinking: people responsible for different domains are not fully aware of what technology does, what technologies are available or can be deployed or what services to expect.
The government or regulator should not distort level-playing field by directly or indirectly indicating technology or vendor preferences—open source or RuPay. This is particularly true in case of payments. Whether it is MasterCard or any other card, let the competition happen and customer decide the usage of services rather than government stating its preferences.