But will the New Budget Measures Make it Happen?
Aamir Shaik Khalid
In her eighth consecutive budget and the tenth budget under the Modi government, Finance Minister, Nirmala Sitharaman presented a financial blueprint to sustain economic growth in the world’s most populous country. She outlined four engines of growth that will propel the economy-agriculture, small and medium enterprises, investments and exports.
Agriculture continues to be the backbone of the Indian economy. It accounts for 15% of GDP, but nearly 42% of the population still finds employment in the sector, according to data from the Ministry of Statistics and Programme Implementation (MoSPI).
The budget introduced a new scheme, the Prime Minister Dhan-Dhaanya Krishi Yojana, which aims to help 1.7 crore farmers, covering 100 districts with low crop productivity. However, it fails to address the key issues confronting the agricultural sector and the challenges of climate change in India. Farmers continue to be mired in debt, and not much has been done to help them on this front. The increase in the threshold limit for them to access the subsidised Kisan Credit Card was raised from Rs.3 lakh to Rs.5 lakh, does not go far enough. Crop productivity is negatively impacted by poor quality of soil, water and air owing to the impact of a global rise in temperatures, which has also influenced India. But the budget barely took note of these challenges.
The farm sector has primarily been driven by productivity and yield ever since the Green Revolution in the 1960s. But even today, Indian farmers struggle to secure optimum results from their land. The rampant use of fertilisers and herbicides has over time degraded soil quality. There has not been adequate attention to the need for research on soil and air quality, and the effects they have on the working conditions of farmers.
The creation of a Makhana Board in Bihar to improve makhana or fox nuts’ production, processing, value addition, and marketing is a welcome step. Roughly 90% of India’s makhana production comes from Bihar, mostly from districts like Madhubani, Supaul, Kishanganj, Darbhanga, Katihar, Araria, Purnea, Sitamarhi, and Saharsa. With the creation of a Makhana Board, those engaged in makhana production will be organised into Farmer Producer Organizations (FPOs), which will enhance their bargaining power, financial stability and access to credit. But by focusing almost exclusively on generating employment and sustainability for farmers in Bihar, the government is open to criticism for having prepared a ‘Budget for Bihar’, overlooking the major concerns of farmers’ livelihood across the country.
The Budget’s sharpened focus on cereal crops, vegetables and fruits highlights a strategic shift towards balancing urban demand while ensuring stable rural consumption. The move comes amid concerns over food inflation and supply shortages. But for this to succeed, the trend will need to be sustained over five years. That is in doubt, given the concerns over climate resilience, infrastructure investment, and global commodity trends. The challenge lies in translating these policy priorities into outcomes that stabilize prices and enhance farmers’ incomes.
The budget has its upsides, with a strong push for cereals, fruits and vegetables. The global implications are crucial, as India is a major player in rice, wheat and spice exports. With food inflation concerns rising worldwide, India’s efforts to boost production could help stabilize global food supply chains. Any shift in its agricultural policies could affect South Asian, Middle Eastern and African markets.
India can become a model for climate-smart agriculture in developing countries if it invests in climate-resilient agriculture and sustainable farming methods, which are in line with the objectives of global food security. India may be able to stabilize the world’s food markets, reducing supply chain interruptions and guaranteeing sustained trade dependability, if these budgetary measures are carried out effectively.