In the Union Budget 2018 that was announced yesterday, the Government has laid emphasis on the agricultural industry. Termed as ‘Farmer’s budget’, this year’s budget allocated a total of Rs. 2000 crore for the development of the agricultural sector, to solely generate productive employment for farmers. The Union Budget 2018 is very encouraging for the agriculture sector with several measures to ensure better post-harvest prices to farmers. The laudable intent of the Union Government in doubling farmers’ income in the medium term is expressed through key measures in this budget.
The finance minister announced that Rs. 500 crore will be allocated for ‘Operation Green’, a programme that aims to promote farmer producers’ organisations agri-logistics, processing facilities and professional management that will ensure a fair pricing system. Removing uncertainty in prices of agricultural produce is critical to give impetus to Indian agriculture. Government’s proposal of 1.5x Minimum Support Price (MSP) for all Kharif crops has the potential to provide 50% gross margin to farmers and this will send positive signal to market. Government also shared its plan to fix a structure to ensure that farmers receive MSP when market prices are lower than MSP in consultation with Niti Aayog and state governments. This in our opinion is the most important step. Better price realization will fuel improved investment by farming community in quality inputs and practices to increase crop yield. With these measures, the entire ecosystem will be encouraged to invest in infrastructure and research & development initiatives to bring the best of innovations to Indian farmers.
The budget also proposes to ensure the reduction of middlemen in the agricultural chain. Some of the initiatives for the same are the upgradation of rural haats into grameen agriculture markets. These markets will enable farmers to sell their produce at profitable rates. Agricultural Produce Market Committees (APMCs) will now be linked to ENAMs, giving a boost to agricultural digitalisation as well as providing the farmers with a speedy channel for sale of produce. A proposal to liberalise the export of agricultural products has also been made.
The finance minister also proposed to extend kisaan credit cards to livestock farmers along with a Fishery and Aquaculture Infrastructure Development Fund and Animal Husbandry Infrastructure Fund with a total corpus of Rs 10,000 crore to be set -up. With an outlook for agriculture holistically, the year certainly looks promising for the entire sector.
The Union Budget 2018 has addressed many areas of distress for the agriculture sector and we hope that this will prove to be a stride taken towards the development of the agricultural industry and that it will widen the horizons for the sector.