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Indian Economic Policy

Notes families of about 75 million persons below the poverty line were targeted to be beneficiaries. For each
block a uniform allocation of ` 35 lakhs was to be shared between the Centre and the States on a
50-50 basis.
The programme was based on a graded scheme of subsidies which amounted to 25 per cent of the
capital cost of small farmers, 33.3 per cent for marginal farmers, agricultural labourers and rural artisans
and 50 percent for tribal beneficiaries. Following the Antyodaya principle, the programme was intended
to reach the poorest households first and later to reach other poor people in an ascending order.
Community works were eligible for 50 per cent subsidy. Nearly 20 percent of the outlay was to be
utilised for administrative and infrastructural support and the balance of 80 percent is meant for
subsidies to beneficiaries for acquisition of assets.
The major weaknesses of the programme were as under :
(i) Selection of ineligible families, though thd Government claims to be below 8 per cent, is in fact
larger.
(ii) Training was not imparted to majority of the beneficiaries.
(iii) In about 22% cases, no incremental income was generated.
(iv) Adequate infrastructure facilities were not available to beneficiaries. The input facility was
available to barely 40% cases, marketing in 14% cases and repair facility in 5% cases.
The programme assisted a total of 108 lakh families, out of which 50% of belonged to SC/ST categories,
thus achieving the target set for the plan. But the percentage of women beneficiaries was only 34%,
which was below the target of 40%.
Besides this, the Government decided to introduce the Family Credit Plan by enlarging its magnitude.
Under the scheme, multiple assets could be given to more than one member of the family to enable
the household to cross the poverty line. The level of investment per family was targetted at ` 20,000-
25,000 under the scheme. With a view to encourage higher levels of investment per family, security
norms for IRDP were enhanced. Banks were earlier required not to obtain mortgage of land as security
for loans up to ` 2,000. This limit was raised to ` 5,000. In addition, banks were not to obtain collateral
security for moveable assets up to ` 15,000.
According to the Mid-term Appraisal of Ninth Five Year Plan (1997-2000) published in October 2000,
since the inception of the programme till 1998-99, 53.50 million fami lies have been covered under
IRDP at an expenditure of ` 13,700 crores. During the first two years of the Ninth Plan (1997-98 and
1998-99), about 3.37 million families reported to have been covered.
The average investment per family remained at subcritical levels, too inadequate to generate income
of ` 2,000 per family per month as the programme had envisaged. At the beginning of the Ninth Plan,
an investment of ` 16,753 per family was not much higher in real terms as compared with ` 7,889 at
the beginning of the Eighth Plan. Such low-level per family investment cannot finance self-employment
projects to yield adequate income on a sustained basis.

The IRDP was started in 1980-81 in all blocks of the country and continued as a
major self-employment scheme till April 1. 1999. Then, it was restructured as the
Swaranjayanti Gram Swarozgar Yojna (SGSY) which aimed at self-employment of
the rural poor.

Jawahar Rozgar Yojana

Prime Minister Rajiv Gandhi announced on 28th April, 1989 the launching of the Jawahar Rozgar
Yojana (JRY). All the existing rural wage employment programmes were merged into JRY. This implies
that National Rural Employment Programme (NREP) and Rural Landless Employment Guarantee
Programme (RLEGP) have been merged so as to be brought under this umbrella programme referred
to as Jawahar Rozgar Yojana.

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