The 2018-19 Budget has apparently been guided by the mission to strengthen agriculture, rural development, health, education, employment, the micro, small and medium enterprises (MSME) and infrastructure sectors. The finance minister quoted Vivekananda: “Let new India arise out of peasants’ cottage, grasping the plough, out of huts, cobbler and sweeper.”
The finance minister reiterated the government’s determination to double farmers’ income and to increase production from same land parcels. The budget promised much relief to farmers.
The minimum support price (MSP) for all unannounced upcoming Kharif crops has been raised to 1.5 times the cost of production as in the case of a majority of rabi crops. In case the market prices are lower than MSP, the government would procure the produce or ensure farmers get right prices.
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Comment However, linking MSP to the cost of cultivation is a bit surprising as the cost of cultivation of crops is bound to vary from place to place in the country. It is not clear how this linkage will be executed.
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The finance minister announced that 22,000 rural haats are to be upgraded into gramin agricultural markets to take care of the interests of some 86 per cent of small and marginal farmers.
An Agri-Market Infrastructure Fund with a corpus of Rs 2,000 crore is to be set up to develop and upgrade marketing infrastructure in the gramin agricultural markets (GrAMs) and 585 agricultural produce marketing committees (APMCs). The GrAMs would be linked to the e-NAM and exempted from APMC regulations, thus providing the facility of making direct sales to consumers and bulk purchasers. It was also announced that 470 APMC-promoted markets had been connected to the e-nam market platform, the rest would be so connected by March 2018.
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Comment There is little data available for the e-nam markets, and as far as is known, most farmers still sell their products in the old way through commission agents.
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The budget proposed Rs 200 crore for the organised cultivation of specialised medicinal and aromatic plants.
Organic farming by farmer producer organisations and village producers’ organisations in large clusters, preferably of 1000 hectares each, will be encouraged.
Operation Green was announced on the lines of Operation Flood to address price fluctuations in potato, tomato and onion for the benefit of farmers and consumers. There is to be a farmer-producer organisation, logistics, warehousing, etc., the allocation for the operation being Rs 500 crore.
A restructured national bamboo mission is to be set up with a corpus of Rs 1,290 crore.
Kisan credit cards would be extended to fisheries and animal husbandry sector.
Also announced was the proposal to set up a Fisheries and Aquaculture Infrastructure Development Fund (FAIDF) for fisheries sector and an Animal Husbandry Infrastructure Development Fund (AHIDF) for financing infrastructure requirement of animal husbandry sector with a total corpus of Rs.10,000 crore for the two new funds.
Under the Prime Minister’s KrishiSinchaiYojna-HarKhetkoPani, Rs 2,600 crore is allocated for focusing on 96 deprived irrigation districts. The Centre and the state governments will work together to help farmers install solar water pumps to irrigate their fields.
The allocation to the food processing ministry has been doubled from Rs 715 crore.
He also proposed to set up state-of-the-art testing facilities in all the forty two Mega Food Parks.
Export of agricultural-commodities has been liberalised in order to meet India’s agricultural exports potential of $100 billion.
A favourable taxation treatment for farmer producers organisations is to be encouraged.
Agricultural products will now be in futures markets.
The volume of institutional credit for agriculture sector increased from Rs.8.5 lakh crore in 2014-15 to Rs.10 lakh crore in 2017-18. For 2018-19, a credit for 11 lakh crore for the farm sector has been proposed.
A special scheme to manage crop residue was also announced to support the efforts of the governments of Haryana, Punjab, Uttar Pradesh and the NCT of Delhi to address air pollution in the Delhi-NCR region by subsidising machinery required for in-situ management of crop residue.
For the rural sector on the whole, in terms of social protection and security, the finance minister announced that gas connections will now be provided to 8 crore poor women.
Rs 16,000 crore was allocated for the Prime Minister’s SaubhagyaYojana for connecting 4 crore households with free electricity.
A target of constructing at least 2 crore toilets has been set under the Swachh Bharat Mission.
Under the schemes of Housing for All by 2022 and the Prime Minister’s AwasYojana (rural), 51 lakh affordable housing units constructed in rural and 50 lakh in urban areas are to be constructed. A dedicated affordable housing fund to meet the targets has been proposed.
The target for loans for self-help groups has been increased to Rs 75,000 crore, the aim being to boost livelihood opportunities and private enterprise.
The National Livelihood Mission has been allocated Rs 5,750 crore.
The total estimated allocation from extra and non-budgetary resources for housing, infrastructure and livelihood in rural areas is Rs 14.34 lakh crore.