Montek Singh Ahluwalia Advocates for PLI Schemes for Farmers

Montek Singh Ahluwalia suggests replacing fertilizer subsidies with production-linked incentives for farmers to improve soil health and directly benefit them. He highlights the need for nuanced policies in manufacturing and services to boost India's economic potential.

Montek Singh Ahluwalia, former Deputy Chairman of the Planning Commission, has called for a transformative shift in agricultural subsidies. In an exclusive interview with ANI, Ahluwalia critiqued the current fertilizer subsidy system, arguing that it not only disproportionately benefits the fertilizer industry but also degrades soil health due to excessive use. Instead, he advocates for a production-linked incentive (PLI) scheme directly benefiting farmers.

Ahluwalia emphasized the importance of transitioning from subsidies concentrated on specific inputs towards a broader incentive structure. 'The large expenditures on fertilizer subsidies could be more effectively used if channelled as production-linked incentives,' he stated. He urged a comprehensive dialogue involving stakeholders such as farmers, economists, and industry authorities to devise optimal solutions.

In discussing the applicability of PLI schemes, Ahluwalia recognized their success in fostering growth in nascent industries like mobile manufacturing and semiconductors but criticized their extension to traditional sectors like garments. 'PLIs should prioritize areas where India lacks substantial experience, such as chip manufacturing and battery production,' he recommended. While applauding governmental efforts to attract giant manufacturers like Apple, Ahluwalia cautioned against neglecting the country's established strength in services, emphasizing that India's economic strategy should capitalize on both sectors' potentials.

(With inputs from agencies.)