CBSE Class 11-commerce Answered
‘While subsidies encourage farmers to use new technology, they are a huge burden
on government finances.’ Discuss the usefulness of subsidies in the light of this fact.
Asked by sntshtrk530 | 04 Sep, 2017, 04:52: AM
Expert Answer
It has been rightly said that subsidies encourage farmers to use new technology but they are also a huge burden on government finances.
Points for usefulness of subsidies:
- Subsidies help in encouraging farmers to use new and innovative technology.
- In India, more than 50% of the farmers are very poor and cannot afford new technology in their farming activity. In this regard, the government can help them by providing subsidies.
- The abolishment of subsidy will violate the goal of equity because it raises differences between poor and rich farmers in India.
- The application of new technology in farming will increase the total output of agricultural products in developing nations.
Points against subsidies:
- Some economists are of the view that once technology is widely accepted, the government should stop providing goods at subsidised rates.
- Subsidies are provided to benefit farmers, but it has been observed that the fertiliser industry has benefited more than farmers.
- Also, farmers from prosperous regions benefited from subsidies more than farmers from poor areas.
Answered by Tharageswari S | 04 Sep, 2017, 08:45: AM
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