Budget focus on raising farmers’ incomes

By Gargi Parsai

Union Fince Minister Arun Jaitley med agriculture as one of the 10 important sectors that were the focus of his budget for 2017-18. He backed it up with announcements of crucial measures towards raising farmers’ incomes including enhancing credit availability, formulation of a Model Law on Contract Farming to reduce post-harvest losses and setting up of Dairy Processing and Infrastructure Development Fund for additiol source of income to farmers in dairy sector.

In a major boost to the sector, the Fince Minister raised the availability of credit for farmers to a record Rs 10 lakh crore. “For a good crop, adequate credit should be available to farmers in time. The target for agricultural credit in 2017-18 has been fixed at a record level of  Rs 10 lakh crores. We will take special efforts to ensure adequate flow of credit to the under serviced areas, the Eastern States and Jammu and Kashmir,” he said.

A new Dairy Processing and Infrastructure Fund will be set up to encourage dairying as an additiol source of income for farmers. The fund will be under BARD with a corpus of Rs 8,000 crores over three years. Initially, the fund will start with a corpus of Rs 2,000 crores.

Availability of milk processing facility and other infrastructure will benefit the farmers through value addition. A large number of milk processing units set up under the Operation Flood programme have since become old and obsolete, the Minister observed.

Looking to the vagaries of monsoon when 60 per cent of Indian farming is under rain-fed conditions, Mr Jaitley set aside Rs 9000 crore under the newly-launched Prime Minister’s Fasal Bima Yoj. The coverage of this demand-driven scheme will be increased from 30 per cent of cropped area in 2016-17 to 40 per cent in 2017-18 and 50 per cent in 2018-19. The budget provision of  Rs 5,500 crores for this scheme in Budget Estimates for 2016-17 was increased to Rs 13,240 crores in Revised Estimates 2016-17 to settle the arrear claims.

“For 2017-18, I have provided a sum of  Rs 9,000 crores. The sum insured under this scheme has more than doubled from  Rs 69,000 crores in Kharif 2015 to Rs 1,41,625 crores in Kharif 2016,” Mr.Jaitley said. The scheme was launched from April 1, 2016 and is a shift from claim-based insurance scheme to upfront subsidy for premium-based system with minimal burden on farmers.

In addition, farmers will benefit from the 60 days’ interest waiver on loans availed by farmers from the cooperative credit structure as announced by Prime Minister rendra Modi earlier.

“The Primary Agriculture Credit Societies (PACS) act as the front end for loan disbursements. We will support BARD for computerisation and integration of all 63,000 functiol PACS with the core banking system of District Central Cooperative Banks. This will be done in three years at an estimated cost of  Rs1,900 crores, with fincial participation from State governments. This will ensure seamless flow of credit to small and margil farmers.”

Referring to the Soil Health Card programme of the Ministry of Agriculture and Farmers Welfare, Mr. Jaitley said the programme had gathered momentum but the real benefit will accrue to the farmers only when soil samples are tested quickly and the nutrient level of the soil is known. For this the government will set up new mini labs in the 648 Krishi Vigyan Kendras and ensure 100 per cent coverage. In addition, 1000 mini labs will be set up by qualified local entrepreneurs. The government will provide credit linked subsidy to these entrepreneurs.

Mr. Jaitley said the total corpus for the Long Term Irrigation Fund under BARD will be Rs 40,000 crore with the addition of Rs 20,000 crore announced earlier. A dedicated Micro Irrigation Fund will be set up in BARD to achieve the ‘per drop more crop’ goal with an initial corpus of Rs 5,000 crore; 99 irrigation projects are targeted to be completed by 2019 under the programme.

Over 250 markets have been connected through an electronic platform (e-M) under the tiol Agriculture Market programme launched last year. This will eble farmers to get better prices, in a transparent manner, for their produce in the post-harvest phase. The coverage of e-M will be expanded to 585 APMCs. For this, the government will provide assistance up to a ceiling of Rs 75 lakhs will to every e-M market for establishment of cleaning, grading and packaging facilities for value addition to the farmers’ produce. Towards this end, states will be urged to undertake market reforms and de-notify perishables from the Agriculture Produce Marketing Committee Act (APMC). This will give opportunity to farmers to sell their produce and get better prices.

Mr. Jaitley said that to integrate farmers who grow fruits and vegetables with agro-processing units for better price realization, the government proposes to bring a Model Law on Contract Farming. The model law will circulated to States for adoption. Saluting the resilience and commitment of Indian farmers, the Minister observed that the farm sector was set to grow by 4.1 per cent this year. He, however, underscored the need to enhance production and productivity and meet post-harvest challenges.

The budget allocation to the Ministry of Agriculture and Farmers Welfare was more than doubled in 2016-17 to Rs 35,983.69 crore from Rs 15,296.04 in 2015-16. The allocation in the Revised Estimates was Rs 39,840.50 crore. In the 2017-18 Budget, the Ministry has an outlay of Rs 41,855 crore. (PIB)

(The author is an award-winning, senior jourlist. She is based in New Delhi.)