Rising consumer demand for high value food products offers an unprecedented opportunity to raise farmer incomes. Additionally, changing dynamic of global food and agriculture trade flows in the post-pandemic world offers one more pathway. In fact, agri exports are an imperative in raising farmer incomes, because the domestic market alone is unlikely to absorb the expanding production without a downward pressure on prices. To gain from both these opportunities, farmers need to diversify the crops grown, as also access new knowledge in crop management to supplement their conventional practices. While the measures announced in the Budget to support production of millets, oilseeds, shrimps, fruits and vegetables will catalyse crop diversification, the proposed PPP scheme to deliver digital and hi-tech services to farmers will serve the latter purpose.
On the other hand, higher outlay for procurement of wheat and paddy at MSP should allay the concerns of farmers growing those crops. These crops will continue to be the staple food and mainstay of the national food security programme, anyway.
Chemical-free natural farming is a good alternative, not only as a route to safe-food production, but also to reduce the cost of cultivation for farmers. However, given the reduction in farm yields during the initial years of natural farming and the resultant poor economics, farmers are naturally hesitant to adopt this method widely. For some time, this effort must be taken up in an R&D mode in select clusters, experimenting with integrated production system comprising of conservation agriculture, intercropping, integrated nutrient management etc, to evolve the best practices for improving farm economics. Therefore, focussing initially in the land corridors along the River Ganga, as envisaged in the Budget makes sense rather than giving it a wider push.
With all bets placed on FPOs as the primary mechanism that can bring the power of scale to the small farmers, as many measures as can be brought to strengthen the FPO ecosystem are valuable. Accordingly, creating a fund with blended capital that can support FPOs, hiring of farm machinery, adoption of technology, including IT-based support etc, is a step in the right direction. This will reduce the cost of operations for the FPOs appreciably.
Drones have several applications in agriculture, and will find a ready uptake from the farmers, especially when offered “As a Service”. It is good to see a reference to that aspect as well. Allocation of five per cent of annual collections under the Universal Service Obligation Fund is an important step that will enable access to affordable broadband in rural areas, putting a foundational block in place for digitalisation of agri services.
State governments have to play a lead role in catalysing the development of crop value chains by converging the spends on infrastructure and farmer capacity building in high-opportunity clusters. Hopefully, a part of the increased allocation to the ‘Scheme for Financial Assistance to States for Capital Investment’ and the ‘fifty-year interest free loans over and above the normal borrowings allowed to the States’ will be deployed in this effort.
It is estimated that India has over 80 million hectares of degraded lands. Afforestation and other nature-based solutions like biodiversity revival can support the requirement of biomass, non-timber forest products, raw material for wood-based industries as well as community pasture lands, while sequestrating carbon and contributing to a carbon neutral economy. The commitment that the required policies and legislative changes will be brought in to promote agro forestry and private forestry is a welcome step.
All in all, the budget proposals in agriculture are both futuristic and inclusive, in keeping with the vision of India@100.
The author is Group Head - Agri & IT Businesses, ITC Limited