Agriculture: The promise is over

With Prime Minister Narendra Modi’s ambitious agriculture reforms hitting a dead end with the repeal of the contentious farm laws, one might have expected Finance Minister Nirmala Sitharaman’s budget presentation to open a new front in this effort. However, though her presentation was peppered with talk of improving agriculture via technology, by using drones, promoting chemical-free farming—and an emphasis on farms in a five-kilometre-wide corridor along the river Ganga—it stopped short of reitering the promise to double farmer incomes.

While the budget’s agri-proposals may have sounded good, they will impact less than 1 per cent of the 200 million farm owners in India. Secondly, even farmers already making use of organic and natural farming are still struggling as a result of a lack of institutional reforms in the government agencies supporting them. “The announcements made are well intended, but institutions must develop communications among farmers, scientists, activists and other relevant stakeholders,” says Umendra Dutt, executive director of Kheti Virasat Manch.

In her budget presentation, the finance minister allocated about 3.1 per cent of the total expenditure—Rs 1.24 lakh crore—to the Department of Agriculture and Farmers’ Welfare. Three schemes account for about Rs 1.03 lakh crore—PM Kisan (Rs 68,000 crore), interest subvention on short-term credit (Rs 19,500 crore) and crop insurance (Rs 15,500 crore). Sitharaman also encouraged state governments to revise the syllabuses of agricultural universities to meet the needs of natural, zero-budget and organic farming. The Paramparagat Krishi Vikas Yojana, which aims to provide support to organic farmers, does not have much of a budget this year, though the finance minister did allocate some Rs 198 crore toward the development of organic farming in northeast India.

All things considered, the budget does not appear to offer a roadmap for private investment. There has also been a cut in the Agriculture Infrastructure Fund, aimed at developing farm-gate infrastructure. In 2021-22, the Center had budgeted Rs 900 crore to this effort; For 2022-23, Sitharaman has allocated Rs 500 crore. There has been a 422 per cent increase in the allocation to the Rashtriya Krishi Vikas Yojana, from Rs 2,000 crore to Rs 10,433 crore. This scheme gives state governments the liberty to assign their own priorities to schemes within the larger allocation, allowing them to decide interventions based on local priorities. In recent years, the Center had been taping down this scheme, but reversed course this year. Similarly, the Krishi Unnati Yojana was reintroduced, with a budget of Rs 7,183 crore. In 2016-17, it included a cluster of 10 schemes, with a budget of Rs 7,580 crore. This time around, it incorporates a different set of 10 schemes. To encourage the domestic production and processing of vegetable oils, about 21 per cent of these funds have been allocated to palm, oilsseeds and edible oil.