India’s union budget gives thrust to agriculture sector

India’s union budget gives thrust to agriculture sector

Our bureau
New Delhi, Mar 3:

Indian finance minister Arun Jaitley last  week gave major boost to the agriculture sector by announcing series of measures including augmenting farm credit by Rs 50,000 crore, allocating Rs 5,300 crore for micro-irrigation and watershed development and allocation of Rs 25,000 crore to the corpus of Rural Infrastructure Development Fund (RIDF).

For helping farmers realising fair prices, Jaitley mooted creation of unified national agricultural market, for which he would held consultation with states.

While presenting maiden full-fledged Budget for 2015-16, Jaitley said, “farm credit underpins the efforts of our hard- working farmers. I have, therefore, set up an ambitious target of Rs 8.5 lakh crore of credit during the year 2015-16 which, I am sure, the banks will surpass.”

Farmers are at present availing crop loans up to Rs 3 lakh at 7% interest rate. However, the effective rate of interest for farmers who repay on time is 4%. Ajay Jakhar, Chairman, Bharat Krishak Samaj  said “the finance minister’s statement lacks transparency in terms of explaining as to who actually benefits from this largesse,”.

The finance minister announced allocation of Rs 5,300 crore for the next fiscal towards the Pradhan Mantri Krishi Sinchai Yojana (PMKSY) to boost micro irrigation as at present  close to  60% of agricultural land is rainfed. Jaitley also urged states to ‘chip in substantially’ for  micro irrigation and watershed development initiatives.

Besides an allocation of of Rs 25,000 crore to the corpus of RIDF set up NABARD, Jaitley also  announced an allocation of Rs 15,000 crore for long term rural credit fund, Rs 45,000 crore for short term cooperative rural credit refinance fund and Rs 15,000 crore for short term Regional Rural Banks (RRB) refinance fund.

The finance minister also committed financial support for ‘soil health card scheme’ and yet to be launched agriculture ministry’s organic farming scheme – Paramparagat Krishi Vikas Yojana. The allocation for Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has been fixed at Rs 34, 699 crore.

Besides, the government has combined 10 major schemes, including National Food Security Mission, under the umbrella scheme ‘Krishionnati Yojana’ to be implemented by states with central assistance of Rs 9,000 crore during next fiscal.

Last year, Prime Minister Narendra Modi had asked agricultural scientists to disseminate technologies to farmers in simple and acceptable manner and make ‘per drop, more crop’ a mantra to promote farming through optimum utilization of water.

“The proposals on agriculture is consistent with the government’s focus on addressing the keys challenges of irrigation and soil to boost productivity,”  KC Ravi, Vice President, Commercial Acceptance & Public Policy, Syngenta South Asia, a global agri major, said.

While mooting creation of national agricultural market, Jaitley said “while the farmer is no longer in the clutches of local trader, his produce still does not command the best national price. To increase the incomes of farmers, it is imperative that we create a National agricultural market, which will have incidental benefit of moderating price rises,”.

Meanwhile, terming the agriculture sector as ‘fragmented’, industry association FICCI has said that moving towards a single national market for agri-produce will help rein in the inflationary pressure in case of food commodities as well as provide better prices to farmers for their produce.

The economic survey 2014-15 on Friday suggested some bold measures including asking states to delete fruits and vegetables from Agricultural Produce Marketing Committee (APMC) purview, support creation of private market and explore possibility of constitutional amendments

Noting that increase in productivity and realisation of reasonable price of agri-production is essential for the welfare of rural people, Jaitley said, “we should commit to increase irrigation area, improve efficiency of distinct irrigation scheme, promoting agro-based industries, value addition, increasing farm income and reasonable prices for farmers produce,”.

(copy ends)