In February 2019, the government introduced PM Kisan Samman Nidhi Scheme where cash incentive of Rs.6000 is given to farmers. let's look at how the rise in diesel prices from February 2019 makes this financial benefit superfluous.

Diesel prices have an impact on various farming activities, including buying inputs, irrigating crops, and selling their produce. For the sake of simplicity, I have here thoughtfully considered and taken into account the amount of diesel needed for irrigation only.

Data on the Diesel Requirement for Per Acre Farming :

According to a study sponsored by the ministry of agriculture and conducted by the Institute of Economic Growth in New Delhi, the average amount of diesel used for irrigation was 68.1 litres per hectare (that is 27.5 litres/acre ) for wheat and 117.5 litres per hectare (47.5 liters/acre) for rice.

An Indian Express article referenced a Punjab Agriculture University study that found that a farmer planting paddy and wheat uses roughly 50 litres of diesel per acre.

Let's use a moderate diesel consumption of 40 litres per acre.

Calculation on the Diesel Requirement for Per farmer :

The National Statistical Office (NSO) NSS 70th round's "Situation Assessment Survey (SAS) of Agricultural Households" found that the average landholding in India is 0.86 hectares, or 2.12 acres. Therefore, on average, a paddy requires 85 litres (40 * 2.12 = 85) of diesel for a single crop cycle.

Calculation on the Price increase of Diesel and impact on farmer :

The Petroleum Planning & Analysis Cell data shows that the cost of diesel in Mumbai was Rs. 68 in February 2019. It climbed to Rs. 104 today that is increase of Rs.36 per liter since launch of PM KISAN scheme.

Calculation of how Diesel price hike make PM Kisan benefit irrelevant :

As I already stated, a farmer typically needs 85 liters of diesel to produce one paddy crop. Due to the Diesel price increase, a Farmer now has to pay Rs. 36 more per litre of Diesel than they did in February 2019, when the Scheme was first introduced. As a result, for an average farmers input costs increased by Rs. 3060 as a result of the diesel price increase that is 51% of of the PM kisan scheme benefit.

A farmer who owns 2 hectares ( That is 4.94 acres) of land is qualified for the PM Kisan Samman Nidhi cash incentive of Rs. 6000, according to the rules. On a 4.94 acre plot of land, a farmer needs 197 liters of diesel to cultivate paddy. Since February 2019, the price of diesel has increased by Rs36/liter, costing this farmer an additional Rs7092. This is more than the 6000 rupees in monetary benefits offered by PM Kissan Samman Nidhi.

Please keep in mind that these figures are for a single crop. Farmers typically harvest two or more crops every year. In that scenario, a farmer with just 2.5 acres of land needs pay more for the increase in diesel prices than they do for government assistance through PM Kisan Samman Nidhi.

There may be a counterargument to my claim that the government takes price increases in input costs into account when determining the minimum support price ( MSP). Yes, that's correct. However, the MSP only benefits 20% of farmers. I give the government the benefit of the doubt and estimate 20%; otherwise, the Shanta Kumar Committee claimed that only 6% of farmers gain from MSP.

Conclusion: Under PM Kisan Samman Nidhi, the 6,000 cash transfer benefit has been eliminated by the price increase of diesel.