Marine subsidies are a mess, say small scale fishers of southern Karnataka

Fish being dried in a harbour. Photo by Supriya Vohra.

  • Subsidies in marine fisheries in southern Karnataka, introduced after modernisation of fishing practices in the 1950s and 1960s, mainly focus around fuel and modernising gear.
  • Government welfare schemes such as housing welfare and distress relief fund have not been active since 2017, claim locals, although they are advertised on the government websites.
  • At the WTO, India seeks special and differential treatment because it says it needs to provide a secure livelihood to small scale fishers. Critics say the internal distribution of subsidies is a mess that needs to be sorted out first.
  • A focus on the welfare of small scale fishers and incentivisation of subsidies to encourage compliance to regulation are both critical to improving the situation, say experts.

Till the 1950s, fishing operations in Karnataka were mostly of traditional, non-mechanised, small scale and subsistence nature. The Indo-Norwegian project in 1966 introduced the mechanisation of fishing crafts with a view of increasing fish harvest to increase export earnings. Trawlers were introduced. Purse seiners followed suit, and Karnataka became the first state to introduce purse seining in India.

The introduction of modern marine fisheries brought with it several government-sponsored schemes and subsidies. These were meant to enhance the capacity of fishing by reducing fuel costs and offering modern fishing gear at low rates. The schemes trained fishers to improve post-harvest efficiency for preserving, marketing and exporting the fish catch, and eventually improve their socio-economic livelihood. They are applicable to both small scale and large scale industries.

In India, subsidies are given by the central government and the state government. Every year, an annual budget is allotted to the department of fisheries, out of which a certain chunk is reserved for subsidies. These subsidies are broadly around fuel, modern fishing gear, fishing nets, ice plants, and marketing infrastructure. Currently, the focus is shifting to the promotion of inland fisheries and aquaculture. The welfare schemes include providing monetary support to the fishermen during the monsoon season (when there is a fishing ban), housing welfare, security and insurance.

Crates for ice and fish at Mangalore harbor. Photo by Supriya Vohra.

Coastal Karnataka has three districts– Uttara Kannada, Udupi, and Dakshina Kannada. It has one state fisheries department, and three deputy departments in the three districts. The state fisheries budget filters through to the three districts for subsidies. The state subsidies, combined with the central government subsidies, are announced at a particular time each year. The district panchayat also has a budget for certain subsidies.

The question is, how much of these subsidies are going to the small and artisanal fishers?

Not all fisherfolk are beneficiaries

“If 80 people from a village apply for a welfare subsidy, perhaps ten people will get it. The rest are told that they will get it the following year, but they never do,” said Shobendra Sasihithlu. Sasihithlu is a fisherman and chairman of the Sasihithlu Fishing Cooperative Society at Sasihithlu, a fishing village in south Karnataka.

“We have budgets and targets for each subsidy,” said Manjula ShriShenoy, assistant deputy director at the department of fisheries, Mangalore. “For example, in 2018-19, we gave a subsidy of INR 10,000 each for nets and coracle for traditional fisherfolk. Our budget was five lakh, and our target was 50 beneficiaries.”

The total fisher population of South Karnataka is approximately 35000. Why aren’t they all considered for a subsidy?

“It doesn’t work like that,” said ShriShenoy. “The targets are clear.”

Further explaining the process, she said that once the subsidies are decided, notifications are put out in newspapers with a cut-off date. The fisherfolk are required to provide appropriate documents, which include a ration card, boat license, proof of membership of a cooperative fishing society, all to be sent within the cut-off date. The documents are taken in on a first-come-first-served basis and scrutinised. Those who apply well in advance, and have their documents in place, are approved.

But the notifications come only via newspapers. If you miss it somehow, you miss your chance. A 2014 research paper by conservation research non-profit Dakshin Foundation reveals that most of the time, the fishers are not even aware of the welfare schemes available to them. Also, the entire Dakshina Kannada, which earlier had five taluks, now has nine taluks. There is only one office where subsidies can be availed. “This means that people who live far are often left out,” said ShriShenoy.

Current subsidies have greater focus on marketing, aquaculture

“Since independence, India’s capture fisheries-related policymaking has been focussed around increasing production,” said Siddharth Chakravarty of The Research Collective, a non-profit facilitating research around development, sustainable alternatives and people’s rights.

“The bulk of subsidies, therefore, are focussed upon the ability to keep the fishing boats at sea. This typically involves fuel and fishing gear, but increasingly are allocated towards fishing harbours and the development of a cold-supply chain to enhance the value of these landings.”

Out of the 18 subsidies listed by the Karnataka State government for the year 2018-19, seven focussed on inland fisheries development and aquaculture, six on fish marketing and cold chain supply, three for enhancing marine fisheries capture, and two on welfare.

The notification inviting applications for the schemes to be implemented by the department of fisheries, Government of Karnataka. Image courtesy Government of Karnataka.

The central government-sponsored Blue Revolution scheme also has a heavy focus on aquaculture and training young people in methods of fish farming.

In the latest Union Budget announcement, the finance minister allocated a budget of 570 crores for the Department of Fisheries (which was formed in 2019), proposing to raise fish production to 20 million tonnes by 2022-23. Mentioning that cage culture, seaweed and algae will be promoted, Nirmala Sitharaman laid emphasis on Blue Economy. “Our government proposes to put in place a framework for development, management and conservation of marine fishery resources,” said the budget.

Read more: Budget 2020 is an opportunity for navigating Indian fisheries sector out of the blues.

“The capture marine fisheries production has been steady at 3.5 to 5 million tonne for the last few years,” said Dr. Sunil Mohamed of CMFRI. “And I don’t see that changing. The rest will probably come from inland and aquaculture,” he said in a telephone conversation.

“The Government’s focus is more towards the development of intensive culture fisheries rather than the capture fisheries, which also means that the emphasis will be more towards building additional income for the farmers who engage in fishing rather than creating opportunities for the traditional and small scale fishworkers,” said a statement by National Fishworkers Forum.

No sign of savings and relief for the last three years in Dakshina Kannada 

Under the central government-sponsored “National Scheme of Welfare of Fishermen,” the savings-cum-relief scheme, fisherfolk are meant to receive monetary support from the central and state governments during the lean fishing season, which has traditionally been the three months of monsoon. The 35-year-old scheme requires the beneficiary, the state government and the central government to add INR 1500 each per month into the savings account of the beneficiary.

However, since 2017, the fisherfolk say that no one in south Karnataka has received this compensation.

Officials of the department of state fisheries confirm this, saying that the money has not been released by the central government yet. “The state has the money ready, but it all needs to be given together. We are waiting for the central government to release the money,” said ShriShenoy.

In addition, the declining catch is creating distress amongst the small scale fishers. “We need some kind of support from the government,” said Chandrasekhar Shriyan of South Karnataka Coastal Original Fishermen Union. “The peak fishing season has failed us.”

Housing welfare is only on paper

Under the state-sponsored scheme called “Matsya Ashraya Yojane,” fisherfolk living below the poverty line with the prerequisite documents are eligible to apply for housing facilities.

But despite it being advertised every year, the officials say the scheme has been scrapped since 2017. “One needs to prove some form of ownership of the land to avail the house,” one official told me. “And that’s tricky here. Most of it comes under CRZ, and there are several hurdles to cross. So no targets have been released for this scheme.”

Safety at sea: still a question for small scale fishers 

Shortly after a boat went missing in late 2018, the Karnataka state government made it mandatory for trawlers to attach an AIS (Automatic Identification System) transponder in the fishing vessels. “This year, we had a target of 100 transponders,” said ShriShenoy. “And we have already distributed 69.” Transponders are devices that receive and transmit radio signals. They are becoming extremely relevant when going out in unpredictable conditions. Each transponder costs approximately INR 60,000, and the state government provides a one-third subsidy on the device.

However, another type of device called the Distress Alert Transmitters (DAT) were meant to be distributed to trawlers and purse seiners. The scheme was to be introduced last year, in collaboration with ISRO. According to this report by Bangalore Mirror, a budget of 3 crores was allotted in 2019-20 for “assistance of 50 percent of subsidy for installation of ISRO authorised Distress Alert Transmitter (DAT) equipment on equipment on fishing boats.”

“We have not received a budget or a target for it yet,” said ShriShenoy. “It should have arrived by November 2019 at the latest, but nothing so far. It may be introduced in the upcoming state budget,” she said.

The small scale fishers on the other hand, do not receive transponders or DATs. “They don’t go too far out in the sea,” said Shri Shenoy.

However, with the increasing frequency of cyclones hitting the west coast, things may change. “Distress Alert Transmitters will be useful for us,” said Sasihithlu.

Fuel subsidy – the rich get richer, the poor stay poor

The big boat owners fill diesel into their boats at the diesel pumps stationed at the harbour. They pay the full amount at the station. The station counter sends an online bill to the state department, and the subsidised amount reaches the bank accounts of the boat owners directly.

Diesel pumps at Mangalore harbour. Photo by Supriya Vohra.

According to government records, the diesel fuel subsidy has nearly doubled from Rs 221.7 million in 2015-16 to nearly Rs 440 million in 2019-20. The number of beneficiaries rose marginally 757 in 2015-16 to 1022 in 2019-20.

So why has the diesel subsidy risen?

“Part of the reason for this is the rise in sales tax,” explained Shri Shenoy. “Earlier the tax was at INR 7 -7.5 per litre, but is now INR 9-10 per litre.”

“The number of boats is also increasing, so more diesel is being allocated under the subsidy scheme,” she added.

If one does a rough calculation, the individual beneficiary receives almost 50 percent more the diesel fuel subsidy in 2019-20 as compared to four years ago.

“Such an increase of subsidies are causing maintenance of over-capacity which are not financially viable and ecologically sustainable, says Dr. Ramachandra Bhatta, fisheries economist and senior scientific consultant at ICAR-NAARM, Hyderabad.

“In the long run, with declining fish production, the demand for increased diesel allocation could increase further, leading to an increased share of fuel subsidy in the total budget. The total impact is that the overall subsidy expenditure by the State Fisheries Dept has increased substantially, leading to less funds available for other social schemes and also for infrastructure development,” he said.

On the other hand, the small scale fisherfolk receive a fixed amount of kerosene for their small boats every month. They receive approximately 200 litres of kerosene at a subsidised rate of Rs 35/litre from the nearest cooperative bank. The small boat owners feel this is too less.

“We tend to use more because we stay out longer because we are waiting to find the fish,” said Shriyan.

In the year 2019-20, a total of 1313 beneficiaries received approximately 1.9 million litres of kerosene. If one is to calculate the amount of kerosene entitled per beneficiary in a year, keeping in mind they are supposed to receive approximately 200 litres per month, it goes up to 2,400 litres per year per beneficiary. The total amount for 1313 beneficiaries comes to nearly 3.1 million litres of kerosene. So what the fishers actually got is lesser than what they are entitled to, according to the data given by the department.

Outboard engine for motorised crafts. Photo by Supriya Vohra.

The global debate 

Globally, there are intense discussions at the World Trade Organisation over marine fisheries subsidies. The United Nations Sustainable Development Goals 14.6 calls for the prohibition of subsidies that contribute to IUU (Illegal, Unreported, Unregulated), overcapacity and overfishing by 2020. These negotiations were launched under the WTO Doha Round in 2001. In December 2017, members of the WTO issued a ministerial declaration indicating that they planned to negotiate and adopt an agreement on fisheries subsidies by the end of 2019.

Due to the complex nature of the issue, the discussions are still ongoing. India’s trade envoy has told the WTO it cannot do without subsidies as “it has to keep in view the livelihood and food security concerns of around four million marine fishermen as well as to retain its policy space to grow.” India, along with several developing countries, including China is therefore seeking Special and Differential Treatment (S&DT).

The discussions are not without their challenges.

“China is the largest producer of marine catch,” said one of the experts representing India at the discussions, who requested anonymity. “It also provides a large amount of subsidies. In the wake of the ongoing scenario of trade war between the USA and China, the US is apprehensive of developing country status to China and thus to get S&DT in fisheries subsidies. This also impacts India as S&DT is supposed to be horizontal, available to all developing countries – big or small,” he explained in an email.

However, the internal situation in India is not as homogenous – as we observe in this story.

“Small scale fisherfolk everywhere (despite WTO) are increasingly seeing economic distress due to drop in catch, loss of access, use and control of land-based resources to private interest or large govt projects,” said Savita Vijayakumar, a political ecologist with The Research Collective.

When asked about this, the WTO negotiator wrote, “The internal conflicts between the interests of large scale fishers and small scale and artisanal fishers is a matter of national policy governance of fisheries. When it comes to WTO, India has to keep in view the livelihood and food security concerns of around four million marine fishers as well as to retain its policy space to grow. Simultaneously India will be embracing the obligations to fish in a sustainable manner.”

Plausible solutions for India

So given the complexity of the issue, are there any plausible solutions?

“We need subsidies to survive,” said T. Peter, general secretary, National Fishworkers Forum. “But we need subsidies that benefit us. We need the government to listen to us. Our situation is getting very dire, our fishing grounds are getting reduced to nothing thanks to the Blue Economy projects of the government, there is no fish in the oceans. They need to talk to us when they represent us at global discussions,” he says.

“Its fine to have subsidies, but it would be good to incentivise it, give it to only those who follow the rules,” said CMFRI’s Mohamed. “In that sense, we can drive more compliance towards regulation.”

Bhatta calls for a progressive system of subsidy. In his report on SDG Goal 14, submitted to the Department of Planning and Program Implementation, Government of Karnataka, he has suggested for a progressive reduction in the percentage of subsidy paid to the bigger and high fishing intensity vessels.

A multi-day trawler under construction at a boatyard in Bengre. Photo by Supriya Vohra.

According to him, in the present system, the more intense fishing activity is getting a higher subsidy: bigger the boat, higher the horsepower, more fuel used, therefore more subsidy given.

“In the present system, we end up with providing higher input subsidy to highly capital and fishing intensive fishing firms and indirectly subsidizing richer and also destructive fishing methods. The small scale fishers who constitute a larger part of employment and more directly dependent on fisheries for their livelihoods receive less subsidy since their fishing intensity and fuel consumption is far less than the big boats,” he said.

He calls for a progressive system of subsidy, which is actually negative taxation.

“Why do you subsidize the rich fishermen?,” he asked. “Instead of giving 100% rebate, give 50% to the rich. Give 100% to the small scale fisherfolk. If the government is following progressive taxation in the case of direct taxation, it should adopt the opposite of the same policy for a subsidy, which should lead to giving out more subsidy to poor and less to rich.”

This story was produced with the support of Internews’ Earth Journalism Network.

Read more: Declining catch worries fishers in southern Karnataka.

Banner image: Fish being dried in a harbour. Photo by Supriya Vohra.

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