Speaking at a seminar on managing fiscal deficits organised by Assocham, Sompal said that taxing agriculture was a welcome idea, but could only become feasible when the farmers get equal benefits as the rest.

The minister pointed out that even in the 1999-2000 budget, allocation to agriculture has been wrongly ordered. "The watershed management, most important sector today, has not been given due importance," he said.Major portion of the budget goes to wasteful expenditure, said Sompal. "The need is to create durable resources so that tax payment can be enhanced," he added.

Mentioning that the terms of trade have hovered between 82 per cent and 94per cent (in comparison to industry) during 1960 to 1996 for agriculture and were unfavourable to farmers, Sompal said that the farmers should not be asked topay for keeping alive unmindful administration.

Justifying the subsidies on agriculture inputs, Sompal said "Subsidies had not been more than 10 per cent of GDP which was much lower than other countries".

"According to a national council for applied economic research study on fertilisers subsidy, about 58 per cent benefit went to industry, and only one third of subsidy reached the farmers," he added.

Considering the fact that share of rural areas in the developed infrastructure is minimal, Sompal said there is no logic behind taxing farmers before improving their share. "The farmers should be equitably placed first," he said.