Abstract

Most commentators have attributed the current agrarian crisis to two successive droughts and demonetization. While droughts do have an adverse impact on agricultural sector, disaggregated data categorically demonstrates that demonetization did not lead to acceleration in the decline of the rural sector. Given that there has been a decline in the rural sector along with the failure of the price policy, there is a growing consensus regarding farm linked cash transfers as an alternative policy choice to address the current rural crisis. However, a cash transfer in the form of a targeted basic income would be a better policy as it will cost the same as an extensive farm sized cash transfer program, but it will be targeted to cover all the poor across the country.

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