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2.2.2. Indirect Subsidies

Indirect subsidies are provided through price reduction, welfare and other ways but do not include a direct cash payment. They reach the farmers along with the use of inputs. Therefore, these are highly correlated with the amount of use of inputs by farmers. Generally, those farmers who use more inputs would naturally enjoy higher subsidies. Example cheaper credit, farm loan waivers, reduced tariffs for electricity and irrigation etc.

 

Assessment of Indirect Subsidies MeritsDemerits