India’s beleaguered agriculture sector gets boost in budget as government aims to double farmer income by 2022

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Finance Minister Arun Jaitley departs from North Block to Parliament House to present the General Budget 2016-17.

India’s finance minister laid out an ambitious plan to double farmer income by 2022, and said the government intended to address key issues such as utilization of water resources, new infrastructure for irrigation, soil conservation and market connectivity to improve the beleaguered farmer’s life.

Arun Jaitley told parliament his government intends to go beyond food security and give back a sense of income security to farmers. He allotted Rs. 35,984 crore for agriculture and farmers’ welfare.

Two successive droughts have impacted India’s agriculture, which makes up for 18 percent of the economy but provides livelihood to 50 percent of the population and the government had been under tremendous pressure to take quick steps to help farmers, many of whom have committed suicide due to debts arising out of poor crops.

The previous two budgets completely ignored the farmer, raising protests from other political parties. Losses in state elections and more looming polls have now forced the hand of Prime Minister Narendra Modi’s government’s. It has tried to kill two birds through this budget: deflect political criticism and raise favour with farmers who will vote in the the forthcoming

Jaitley said that out of 141 million hectares of net cultivated area only about 65 million hectares were irrigated. He said the government would work quickly to bring another 2.85 million hectares under irrigation.   Eighty nine projects will be fast tracked, which will help to irrigate another 8 million hectares. He promised to complete 23 of these projects before end of March next year, adding that 31st March, 2017.

The finance minister also announced the creation of a dedicated Long Term Irrigation Fund in NABARD with an initial corpus of Rs. 20,000 crore.  A similar progrmme for sustainable management of ground water resources, with an estimated cost of Rs.6,000 crores has been proposed for multilateral funding.  He also said that allocations under MGNREGA will be used for creating at least 5 lakh farm pond and dug wells in rain-fed areas and 10 lakh compost pits for organic manure production.

The target for Soil Health Card Scheme coverage was raised to 14 crore farm holdings by March, 2017 to help farmers make judicious use of fertilizer. Jaitley said that 2,000 model retail outlets of fertilizer companies will be provided with soil and seed testing facilities in the next thee years.

The minister also announced a scheme to 500,000 acres of rain-fed areas under organic farming.  He launched a scheme ‘Organic value chain development in North East Region’ to make their organic produce find domestic and export markets.  Number of pulses districts under National Food Security Mission has been increased to 622.

Jaitley announced three specific initiatives to ensure the minimum support price all farmers.  First, the remaining state will be encouraged to take-up decentralized procurement.  Second, an online procurement system will be undertaken through the Food Corporation of India.   Third, effective arrangements will be made for pulses procurement.

Three hundred Rurban Clusters will also be developed to incubate growth centers in rural areas by providing infrastructure amenities and market access for the farmers.

 

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