ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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The Thorny Road to Evaluating Direct Benefit Transfers for Agricultural Households

Insights from KALIA in Odisha

With the introduction of the Pradhan Mantri-Kisan Samman Nidhi scheme by the union government, and more comprehensive schemes such as Krushak Assistance for Livelihood and Income Augmentation of the Government of Odisha, there is an emergence of various direct benefit transfer schemes for agricultural households. Political expediency aside, these schemes offer an opportunity to think about challenges and opportunities in evaluating causal impacts of large-scale public programmes. Using the case of the KALIA scheme in Odisha, the challenges arising out of multiple objectives, unintended consequences, and lack of appropriate counterfactuals in evaluating DBTs are demonstrated. The insights are applicable to DBT programmes in general.

The author has benefited from discussions with Srijit Mishra, Thiagu Ranganathan, Asis Kumar Senapati, and Saurabh Garg. This paper has also benefited from comments from participants at the “National Seminar on Green Revolution and Agricultural Sustainability in India: Issues and Challenges,” held at Ravenshaw University. The author has also benefited from comments on an older version of the paper that appeared as Odisha Economy Discussion Series 2, Nabakrushna Choudhury Centre for Development Studies, Bhubaneswar in April 2019. Rahul Kumar Singh provided excellent research assistance.

Over the past few years, state governments as well as the union government have come up with several policies and schemes to address agrarian distress, including policy emphasis on doubling farmers’ income (Singh 2018). Of prominence among these schemes are direct benefit transfers (DBTs) to farmers’ bank accounts such as the union government’s Pradhan Mantri-Kisan Samman Nidhi (PM-KISAN) scheme, Government of Telangana’s Rythu Bandhu scheme, and Government of Odisha’s Krushak Assistance for Livelihood and Income Augmentation (KALIA) scheme.1

DBTs started in a phased manner since 2013 to reform the delivery system of welfare schemes and transfer of subsidies by improved targeting of beneficiaries, timely transfers, and stemming leakages in particular. Over the past decade, seeding of Jan Dhan accounts with Aadhaar, and mobile numbers, the so-called JAM (Jan Dhan–Aadhaar–Mobile) trinity for plugging leakages of government subsidies, has fostered implementation of DBTs for several schemes. Telangana’s Rythu Bandhu scheme of direct transfer to eligible landowning farmers (excluding tenant cultivators) also influenced the union government’s decision to roll out the PM-KISAN scheme. Surprisingly, despite the scale and scope of these large-scale public interventions, there seems to be an absence of deliberation on ex ante analyses as well as ex post facto designs on how the DBTs, both cash and in-kind transfers to individual beneficiaries, may cause its intended impact. How such benefit transfer programmes influence labour supply decisions, farm and non-farm wages, cropping patterns, agricultural input usage, crop production, technology adoption, consumption, and investment patterns have implications on households’ welfare that go beyond the objectives of the schemes is yet to analysed thoroughly. In this context, the ex ante reasoning behind the implementation of such schemes demands a holistic assessment of behavioural implications and a theory of change. Ex post facto evaluations have to grapple with the choice of methodology for estimating potential causal impacts (Neyman 1923; Rubin 1974; Holland 1986).

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Updated On : 7th Jul, 2023
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