Agriculture needs more than just quick fixes

Agriculture needs more than just quick fixes

Context

The government’s efforts to focus on the welfare of farmers in the Union Budget is admirable but care should be taken to address the sector’s competitiveness in a global scenario.

Long term policies needed

• Long-term cure will be in the form of policies that provide a boost to credit growth, crop insurance, drip irrigation, warehousing, mechanisation and availability of skilled farm labour.

There has been no mention of these measures in the 2018 Budget

Posiitives:

• Agricultural credit: The target for agricultural credit has been increased to ₹11 lakh crore from ₹10 lakh crore last year.
  • Benefit: This will empower farmers with much-needed funds to procure agricultural inputs in a timely manner.
• Development of agriculture market infrastrucutre: The Finance Minister has announced ₹2,000 crore for development of agricultural market infrastructure to link 22,000 local rural markets to the electronic national agriculture market platform.
  • Benefit: This will definitely help prevent undue volatility that creates stress for farmers.
• MNREGA allocation:This year’s budget may increase MNREGA allocation to ₹60,000 crore.
• Benefit: This scheme would provide long-term benefit if the labour force is tied up to assist farmers overcome scarcity in farm labour, the absence of which is forcing many to give up on agriculture altogether.

Dangers around MSP

• Care should be taken not to give too drastic an increase, which will render the commodity uncompetitive in global markets and unaffordable to mill owners.
• This might affect the farmer adversely if prices have to be corrected in the future

Too small allocation for Operation Green

The Finance Minister has launched ‘Operation Green’, and allocated ₹500 Crore to promote farmer producer organisations and agri-logistics associations.

Ultimately a mixed bag

While the impetus given to agricultural credit and rural infrastructure is laudable, the Budget could have been truly progressive had it not put so much focus on the regressive policy of MSP.

Conclusion

In future Budgets, I hope the government shifts even more towards forward-looking policies that boost the competitiveness of the agro-industry, and secure long-term growth in farmers’ income and quality of life.