Agriculture Expectations from Union Budget 2019: There is expectation from the Modi government to step up its focus on rural economy and charting a course for doubling farmers’ income in the upcoming Budget on 1 February 2019.
Union Budget 2019 Expectations for Agriculture Sector: The disconcerting condition of farmers due to falling prices and adverse weather conditions has led to many farmers’ protests such as Delhi Kisan Protest and Maharashtra Farmers Long March, and suicides in the recent past. Thus, there is expectation from the Modi government to step up its focus on rural economy and charting a course for doubling farmers’ income in the upcoming Budget on 1 February 2019. It would also give a push to consumption and help attract private investments.
Finance Minister, Arun Jaitley, in his previous budget accorded priority to agriculture and the rural economy, with increase in MSP and launch of Operation Green, National Health Protection Scheme and thrust on rural infrastructure. Further, the government allocated a total of Rs 2 lakh crore to agriculture and rural ministries.
The trend is likely to continue in the upcoming budget, Sameer Narang, Chief Economist, Bank of Baroda, said to Financial Express Online. Adding to it, he said, there is possibility of 20-25 per cent increase on rural economy, which would help boost consumption.
The fiscal deficit target of 3.3 per cent, set in the previous budget for 2018-19 is likely to be breached, due to shortfall in GST collections, rising expenditure and declining manufacturing output. Further, policy experts also expect announcements on some populist policies ahead of the general elections, which are less than 100 days away.
Sujan Hajra, Chief Economist, Anand Rathi, told Financial Express Online that he is expecting the government to launch policies such as Rythu Bandhu Scheme based on Telangana model or KALIA scheme from Odisha on a pan-India basis. However, the government should focus on better targeting the small and marginal farmers and vulnerable section along with the rationalisation of subsidies, he said. But for this, unavailability of land records and leakages may pose a challenge in identification, he added.
Similarly, Madan Sabnavis, Chief Economist, CARE Ratings, also pointed out the possibility of farm loan waivers, hike in food subsidy, spending on e-nam scheme and a replication of Rythu Bandhu Scheme on a pan-India scale by replacing schemes such as NREGA in part. Considering all this, it will be interesting to see how the government sticks to its fiscal consolidation path in its upcoming Budget 2019.