After Budget 2023, Agriculture Sector Still Waiting for the Reforms it Needs

The allocation to several schemes of Department of Agriculture and Farmers Welfare is lower than the budget estimate of previous year.

The Union Budget for 2024 may have disappointed farmers’ organisations who were expecting an enhancement in the PM Kisan amount of Rs 6,000 per year. There was a buzz that the amount of grant may be increased to Rs 8,000. It must be remembered that it was the interim budget of 2019 in which PM Kisan was announced, that too retrospectively from December 2018. So, hope need not be lost. The interim budget on the eve of parliament elections in 2024 may still bring cheer to farmers by increasing the amount under PM Kisan.

It is not that there is no populist announcement in the budget. The expenditure budget of the Department of Agriculture and Farmers Welfare provides an amount of Rs 800 crore for distribution of pulses. The Union government will provide a subsidy or Rs 15 per kg to the state governments who decide to distribute pulses under the PDS. The reason for this is the buildup of stock of gram (chana) procured by NAFED at the minimum support price under the price support scheme. It is a good decision as the quality of stocks of pulses deteriorates if they are stored for a duration of more than 12 months. The states opting to distribute pulses under the PDS, Integrated Child Development Scheme (ICDS) and PM Poshan will be able to address to some extent the protein deficiency of their poor population. In a year before the elections, this can also give some dividend in 13 states in which the elections are due between now and June 2023.

In a welcome move, the finance minister in her budget speech mentioned that the government will launch a programme to boost availability of high quality and disease-free planting material. She mentioned that the outlay for this will be Rs 2,200 crore. However, the budget of Department of Agriculture and Farmers Welfare does not reflect any allocation for this.

India’s success story of horticulture owes its origin to attention given to the sector by successive governments in the last two decades.

In 2001-02, the government had announced Technology Mission for Integrated Development of Horticulture in North Eastern States. Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura were originally included in this mission. It was extended to Jammu and Kashmir, Himachal Pradesh and Uttarakhand during the year 2003-04.

In 2005-06, the National Horticulture Mission (NHM) was launched in the remaining states and UTs. The focus of NHM was area expansion, production of quality planting material and rejuvenation of old and senile orchards. Protected cultivation and post-harvest management, marketing and processing were also the focus areas of NHM.

The allocation to several schemes of Department of Agriculture and Farmers Welfare is lower than the budget estimate of previous year. Rashtriya Krishi Vikas Yojana was a flagship scheme of the UPA government in which the states were given the freedom to decide their own priorities. A committee headed by the chief secretary approves the projects selected by the various departments. The budget allocation in FY 2023 was Rs 10,443 crore but the allocation for next year is only Rs 7,500 crore.

The government has done well to set up an independent ministry of cooperation. The computerisation of Primary Agriculture Cooperative Societies is long overdue. It was announced in the budget of 2017 also. The access of small and marginal farmers to institutional credit can go up if the PACS are computerised and linked to the core banking system.

To sum up, the agriculture sector will have to wait for serious reforms. In any case, a consensus with the states is needed to move forward in the area of deep reforms. So far, there seems to be little dialogue to take the reforms forward.

Siraj Hussain is a former Union agriculture secretary.