Agriculture Reference
In-Depth Information
Turning to RIT from TPDS rice consumption, we observe that mean RIT for partici-
pating households is highest in Andhra Pradesh (Rs 142), followed by Maharashtra (Rs
54), and then Rajasthan (Rs 25). In Rajasthan, about 63% of the participating households
have no RIT, and about 32% have mean RIT of Rs 100 or less. In Andhra Pradesh, about
80% of participating households got mean RIT of more than Rs 100. In Maharashtra, only
16% households obtained mean RIT of more than Rs 100 from rice consumption; 33%
obtained no real-income transfer and 50% had real-income transfers less than Rs 100.
Our analysis points to several factors determining real-income transfers through
subsidized wheat and rice, and variation in these transfers across the three states. Land
as a proximate indicator of economic status has mixed effects varying by commodity
and state. Specifically, among households with owned land, real-income transfers are
lower for rice in Andhra Pradesh, and higher for wheat and rice in Maharashtra, and
for wheat in Rajasthan, suggesting that those better endowed benefited more in some
cases. Inequality in land distribution takes different forms (concentrations of landless
and near landless or of the well-endowed) and influences real incomes in complex ways
(leakages and larger supply or just leakages). As a result, the effects vary by commodity
and state (negative for rice in Andhra Pradesh, positive for wheat in Rajasthan, and rice
in Maharashtra). The extent of price subsidy, in most cases, results in larger real income
transfers. There is some evidence of transaction cost (e.g., distance to FPS) limiting
income gains (wheat in Rajasthan and Maharashtra). There is overwhelming support
for supply inadequacy limiting income gains, given proximate indicators.
(b) Nutritional Deprivation
In November 2005, the Indian government embarked on an ambitious workfare scheme,
the National Rural Employment Guarantee Scheme (NREGS), which guarantees a hun-
dred days of employment in unskilled manual labor at a minimum wage to every rural
household each year.46 Some of its features include a time-bound employment guaran-
tee and wage payment within 15 days (otherwise the government is penalized), prohibi-
tion of the use of contractors and machinery (to enhance direct benefits of the program
to the participants), a 60:40 wage and materials cost ratio, and a mandatory 33% partici-
pation for women. The scheme devolves considerable powers in planning and allocating
resources to the local village councils ( panchayats ) and through social audits allows the
community to monitor the progress.47
Do real income transfers through TPDS and NREGS mitigate undernutrition? Our
analysis using IHDS48 produces some relevant findings. NREG and TPDS significantly
increase the intake of protein, carbohydrates, calories, phosphorous, iron, thiamine, and
niacin in Andhra Pradesh, Maharashtra, and Rajasthan. In Andhra Pradesh, in most
cases, TPDS had a larger effect than NREG. By contrast, in Maharashtra, NREG had
larger effects in most cases. Rajasthan presents a more complex picture. For some nutri-
ents (e.g., calories, iron and niacin) TPDS has larger effects than NREG, whereas for oth-
ers (e.g., protein, riboflavin) the latter has larger effects. So a general inference about the
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