Targeting agricultural electricity subsidies in Haryana

Based on a survey of 1,600 farmers in Haryana, this report finds that agricultural electricity subsidies are not well targeted and that wealthier farmers in Haryana received 50% of the agricultural electricity subsidies while the poorest farmers only received 30%. Improving subsidy targeting can allow for subsidies to be better focused on small and marginal farmers and at the same time reduce the fiscal stress on Haryana’s distribution companies (DISCOMs) and the state government. This report reviews the government’s flagship solar irrigation scheme, the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) scheme and recommends that it be used to target small and marginal farmers. Providing low-income farmers with financial assistance to transition to solar-powered irrigation helps them reduce their irrigation costs. It will also reduce the state’s burden of agricultural electricity subsidies.