Agriculture and the Union Budget 2011-12 Positive Points
The Rashtriya Krishi Vikas Yojana (RKVY) mantra seems to be working. As state after state ensures higher allocations to the agriculture sector to ensure that its eligibility to access funds is not affected, the Union government is opening newer windows within the RKVY to address issues which need immediate attention and redressal. Thus in addition to continuing with the Rs 400 crore grant for bringing Green Revolution in the eastern region, a special sanction of Rs 300 crore each has been given for the integrated development of sixty thousand pulse villages in the rain-fed areas, promotion of palm oil cultivation, initiative on vegetable clusters, nutria-cereals, protein supplements and fodder development. Thus the overall budget of RKVY has shot up from 6755 crore in the previous year to 7,860 crore in the current year.
I will discuss these special initiatives briefly before touching upon the other highlights of the agricultural budget. As regard the Green Revolution for eastern region, suffice it is to say that the programme targets the improvement of water-intensive rice-based cropping system in Assam, West Bengal, Odisha, Bihar, Jharkhand, Chhattisgarh and districts of eastern Uttar Pradesh.
THE PULSES MISSION
The objective of the pulses mission is to ensure that the country becomes self-sufficient in pulses production. Thanks to the support under the National Food Security Mission and the Accelerated Pulse Production Programme (A 3P), this year’s production was an all-time record of 16.5 million tones, which is quite close to the country’s requirement of 18 million tonnes. The fact that the focus is on the rain-fed areas means greater consideration to both equity and ecology.
PROMOTION OF PALM OIL
Even more than the gap in the domestic requirement and production of pulses is the mismatch in the edible oil sector. Here the gap is as high as fifty per cent, and the dependence on imports is critical. As palm oil is an efficient crop, the special allocation of Rs 300 crore has been made to bring an additional 60,000 hectares under oil plantation, and by integrating farmers with markets. Over the next five years, this initiative is expected to yield at least three lakh tones of palm oil annually.
THE INITIATIVE ON VEGETABLE CLUSTERS
As per the Union Budget, the growing demand for vegetables—both on account of rising incomes and increasing urbanisation—will have to be met by a robust increase in production, productivity and market linkages. An efficient supply chain to provide quality vegetables at competitive prices will come up near urban clusters to address both supply side and demand-related aspects.
The Finance Minister’s speech also referred to the imperative of ensuring not just food security, but also balanced nutrition. Bajra, jowar, ragi and other millets are highly nutritious, and are known to possess several medicinal properties . However, the availability and consumption of these cereals have been declining over the years. The efforts of the research system in this direction have also been sparse. The inclusion of nutria cereals within the RKVY window means that states will have to make specific plans for the development of nutri-cereals. This fund is not limited to production aspects alone: it will also support processing technologies, and create awareness about their health. The initiative will provide market linked production support to ten lakh millet farmers in the arid and semi-arid regions of the country. The programme would cover a thousand compact blocks in over twenty-five thousand villages. This will not only enhance nutritional security – it will also increase the feed and fodder supply for livestock.
PROTEIN SUPPLEMENTS & FODDER DEVELOPMENT
As the demand for foods rich in animal protein is rising faster than the production, the National Mission on Protein Supplements is being launched to take up activities related to animal-based protein production through livestock development, dairy farming, piggery, goat rearing and fisheries in selected blocks. Likewise, another rupees three hundred crore are being earmarked for ensuring adequate fodder for cattle engaged in milk production. This programme is also expected to extend over twenty-five thousand villages—and it shows the intrinsic links between the agriculture and the animal husbandry sectors.
The other major highlight of this year’s budget was the substantial rise in the provision for rural credit. As against the credit flow of Rs 3,75,000 in the current year, the target for the next year has been raised substantially to Rs 4,75,000 crore, with special instructions that the marginal and small farmers should be given the first priority for approvals and disbursements. The icing on the cake is that the existing interest subvention scheme of providing short-term crop loans to the farmers at seven per cent interest will be continued during the current fiscal as well. The additional subvention of two per cent for farmers’ repaying their loans on time has been further enhanced to three per cent, thereby making the effective rate of interest to framers at four per cent, which has been the long-standing demand of farmers organisations, and was first raised by Subhas Chandra Bose during his presidential address to the Indian National Congress a few years before India won its freedom. From a perspective of history, it shows how long the farmers have waited to get their demands accepted. This would be possible only if the lead refinancing agency, viz NABARD is strengthened. The budget has some positive news for NABARD as well. The equity base is to be strengthened by a fresh injection of Rs 3000 crore in a phased manner as government equity, thereby raisin g it to Rs 5000 crore.
There are other positive strokes as well, including the establishment of 15 new mega food parks and viability gap funding for capital investment in the cold chain sector. It also calls upon the state governments to amend the APMC Act. When such a request is made as an integral part of the budget speech, it shows both the concern and commitment of the government in this direction.
By Sanjeev Chopra
The author is Joint Secretary, Ministry of Agriculture, Government of India