Budget 2018: In Union Budget 2018, Finance Minister Arun Jaitley has announced various agricultural reforms in a bid to double farmer income by 2022. Union Budget 2018 has key implications for agricultural sector and farmers, considered as the the backbone of the economy. Notably, agriculture sector provides employment to nearly 50 per cent of the total workforce in India and contributes around 17-18 percent to the country’s GDP. The Economic Survey 2017-18, which was released in Parliament on Monday ahead of the Union Budget 2018, noted that Agricultural R&D is the main source of innovation, which is needed to sustain agricultural productivity growth in the long-term. We take a look at four key reforms announced by Finance Minister Arun Jaitley.
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Support price for produce
In a big relief to farmers, Finance Minister Arun Jaitley announced fixing minimum support price (MSP) of Kharif crops like paddy at least 50 per cent higher than the cost of production, while raising farm credit target for the next fiscal by 10 per cent to Rs 11 lakh crore. Economic Survey 2018 says that the actual expenditure of Department of Agricultural Research and Education/Indian Council of Agricultural Research has increased from Rs 5,393 crore in 2010-11 to Rs.6800 (BE) crore during 2017-18.
Also read: India economic survey 2018: Farmers gain as agriculture mechanisation speeds up, but more R&D needed
Allied-Sectors get a boost
In a bid to give a boost to agricultural related sectors, the government will set up fisheries and aqua culture infra fund and animal husbandry infra fund with an outlay of Rs 10,000 crore, Arun Jaitley said. “Cultivation of horticulture crops in clusters bring advantages of scales of operations and can spur establishment of entire chain from production to marketing, besides giving recognition to the districts for specific crops,” Arun Jaitey said.
Livelihood creation
In a bid to to enhance livelihood creation, Finance Minister Arun Jaitley announced various measures to benefit the farmers. “Apart from employment due to farming activities and self employment, this expenditure will create employment of 321 crore person days, 3.17 lakh kilometers of rural roads, 51 lakh new rural houses, 1.88 crore toilets, and provide 1.75 crore new household electric connections besides boosting agricultural growth,” Arun Jaitley said.
Tax incentives
In the Union Budget 2018, Arun Jaitley also announced tax incentives to promote post-harvest agricultural activities. “In order to encourage professionalism in post-harvest value addition in agriculture, I propose to allow hundred per cent deduction to these companies registered as Farmer Producer Companies and having annual turnover up to Rs 100 crores in respect of their profit derived from such activities for a period of five years from financial year 2018-19,” Arun Jaitley said.
