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Difficulty: MediumEconomic Developments, Union & State Budgets, and Economic Surveys

Consider the following statements regarding the 'PM-PRANAM' (Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth) scheme launched as part of recent Union Budget initiatives:

1. It aims to incentivise States and Union Territories to promote alternative fertilizers and the balanced use of chemical fertilizers.
2. The scheme operates with a separate dedicated budgetary allocation created through fresh revenue expenditure.
3. Fifty percent of the fertilizer subsidy savings passed on to States can be used for asset creation and village-level green initiatives.

Which of the statements given above is/are correct?

  1. A
    1 only
  2. 1 and 3 onlyAnswer
  3. C
    2 and 3 only
  4. D
    1, 2 and 3

Answer

The correct combination is '1 and 3 only'.
Statements 1 and 3 are correct. The PM-PRANAM initiative focuses on promoting alternative fertilizers and balanced soil nutrition. It operates without a separate budget line item, using savings from chemical fertilizer subsidies to grant funds to States, half of which must go toward asset creation and village-level development.

Step-by-Step Solution

1
Analyze Statement 1 regarding the objective of PM-PRANAM.
Statement 1 is correct.
PM-PRANAM was introduced to promote organic and alternative fertilizers while encouraging balanced application of chemical fertilizers across agricultural sectors.
2
Analyze Statement 2 regarding the budgetary financing mechanism.
Statement 2 is incorrect.
The scheme has no separate budgetary allocation from the Union Budget. Instead, it is funded through the savings generated by reducing chemical fertilizer consumption under existing subsidy mechanisms.
3
Analyze Statement 3 regarding the utilization of subsidy savings.
Statement 3 is correct.
Fifty percent of the subsidy savings passed to the State/UT as a grant can be used for asset creation, technological innovation, and incentivising panchayats/farmers.

Key Concept

Financing structure and objectives of the PM-PRANAM scheme in Union Budget announcements.
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Topics

Economic Developments, Union & State Budgets, and Economic Surveys

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