Considering the Budget’s priority to promote productivity and resilience in agriculture, the outlays for the ministry of agriculture and farmers’ welfare at `1.32 trillion or 2.7% of total expenditures represent a shrinking share from 5% in the Budget for FY 20. The budgeted outlays for FY25 are also lower after adjusting for inflation when compared to the revised estimates last fiscal.
This has upset farmers, farmer unions, and agricultural experts. Since the National Democratic Alliance (NDA) regime first came to power in 2014, agricultural growth has averaged 3.7% per annum while growth in overall gross value added was 5.8%. This far-from-buoyant performance has been strongly influenced by the southwest monsoon, which has become highly wayward due to climate change.
The policy imperative must be to prioritise investments in infrastructure like irrigation and water management facilities and develop heat-resistant crops by investing more in research and development (R&D) for a more climate-resilient agriculture.
The Budget speech mentioned that 109 new high-yielding and climate-resilient varieties of 32 field and horticulture crops will be released for cultivation by farmers; that the government will undertake a comprehensive review of the agriculture research set-up to bring the focus on raising productivity and developing climate-resilient varieties.
The government is in fact targeting to cover 25% of this year’s kharif paddy area with climate-resistant seeds, building on their success in the just-concluded rabi season for the wheat crop. These interventions need to be scaled up but the outlays do not reflect these imperatives.
The ministry has two departments of agriculture and farmers’ welfare and agricultural research and education (DARE). DARE’s outlays at around `10,000 crore are only 0.6% higher than the revised estimates last fiscal. Every rupee spent on agri R&D yields better returns than a rupee spent on subsidies and contributes to sustainable agriculture. Agricultural economists like Ashok Gulati have forcefully underscored the need to double the budgeted spend on the DARE.
The allocation for the department of agriculture and farmers’ welfare at `1.22 trillion, too, is up by only 5% from the revised estimates last fiscal, representing a decline in real terms. The major chunk of this is for flagship schemes like the Pradhan Mantri Kisan Samman Nidhi (PM-Kisan), Modified Interest Subvention Scheme, Pradhan Mantri Fasal Bima Yojana, and Pradhan Mantri Annadata Aay Sankrakshan Yojana, which is an umbrella scheme to ensure minimum support prices to farmers and comprises the erstwhile price support scheme and price deficiency payment scheme and has seen a three-fold increase in outlays.
But for the other flagship schemes like PM-Kisan, the budgeted expenditure is at the same level as the revised estimates last fiscal. The Budget speech announced that 10 million farmers will be initiated into natural farming but the allocations for the national mission for natural farming exhibit sharp swings from the budgeted level of `459 crore to `100 crore in the revised estimates last fiscal to `366 crore.
The other measures announced in the Budget like the digital public infrastructure for agriculture are to be welcomed as they build on ongoing initiatives like the AgriStack being put in place by the NDA government with the data it has been gathering from millions of farmers since 2014. However, considering the shrinking share of this sector and limited spending on R&D, there are no prizes for guessing why those who live off the land are disappointed.