Agrarian distress, farmers' suicide, drought and the fluctuating market were all definitely expected to be addressed when Finance Minister Nirmala Sitharaman tabled her first budget and that of Modi 2.0 government. And she has not disappointed the Indian kisan.
Budget 2019-20 expects to spend Rs 1,51,518 crore on agriculture and allied activities. This is almost twice the Rs 86,602 crore that was spent in 2018-19, which in turn exceeded the original estimate of Rs 63,836 crore.
Strangely, the finance minister did not make any announcement to thumping treasury benches in her speech of this quantum leap for a sector crying for help.
The single largest chunk of this spending will go towards Pradhan Mantri Kisan Samman Nidhi, the PM-Kisan for short. A sum of Rs 75,000 crore has been allocated for this central government scheme, up from Rs 20,000 crore in 2018-19 when the scheme was rolled out. It intends “to provide income support to all farmer families across the country, to enable them to take care of expenses related to agriculture and allied activities as well as domestic needs.”
Farmers are provided Rs 6,000 annually in three instalments of Rs 2,000, and the programme was rolled out with the first lot of Direct Benefits Transfer made sometime in February. About 14.5 crore farmers are expected to be covered under the scheme, which the government hopes will protect them from the clutches of the money lenders.
A first-time entry in the agriculture and farmers' welfare expenditure budget is the Pradhan Mantri Kisan Pension Yojana, for which a sum of Rs 900 crore has been allocated. The scheme aims to provide social security net for small and marginal farmers. A minimum fixed pension of Rs 3,000 per month will be provided to eligible small and marginal farmers when they turn 60, subject to some exclusion clauses. A voluntary and contributory scheme with an entry age of 18 to 40, around 5 crore farmers are expected to be covered in the first three years under the Pradhan Mantri Kisan Pension Yojana.
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The allocation for interest subsidy for short-term credit has been enhanced from Rs 14,987 crore to Rs 18,000 crore, while that for the Market Intervention and Price Support scheme have gone up from Rs 2,000 crore to Rs 3,000 crore. The enhancement of fertiliser subsidy by around Rs 10,000 crore will also ultimately benefit the farmer.
The Finance Minister counted the Minimum Support Price (MSP) for agricultural crops for 2018-19 among the steps on account of which the medium-term growth prospects of the economy are bright. The moderation in GDP growth momentum was attributed to the lower growth in “agriculture and allied” sector where the growth was 2.9 per cent.
The budget also addresses those who are not in the business of growing wheat, paddy and pulses. The minister announced bamboo, honey and khadi as the chosen focus-sectors for which 100 new clusters will be set up in 2019-20, under the Scheme of Fund for Upgradation and Regeneration of Traditional Industries (SFURTI). It aims at setting up more Common Facility Centres to facilitate cluster-based development, leading to more productive, profitable industries capable of providing sustained employment opportunities. Ajay Kakra, Leader, Food and Agriculture at PwC India says, “SFURTI is also an excellent initiative to organsie farmers under bamboo and honey farmers and artisans who have been working in an unorganised sector. Also beneficial step for the North East, where bamboo is a major source.”
The farmer was possibly more wooed than any other voter in Lok Sabha 2019. In fact, the PM Kisan Yojana, conceived recently and kickstarted just ahead of the polls, saw many farmers receive the first instalment of Rs 2,000 each of a promised Rs 6,000 a year.
“Ease of doing business and ease of living, both should apply to farmers, too” Sitharaman said as she proposed the idea of going back to basics, and Zero Budget Farming. Also on her anvil are 10,000 new farmer producers' organisations, which would help them achieve economies of scale.