In Budget 2023-24, Finance Minister Nirmala Sitharaman highlighted seven priorities, including inclusive development, green growth and youth power. As agriculture and allied sectors are considered efficient vehicles for inclusive development, the Budget has accorded importance to: (a) animal husbandry, dairy and fisheries; (b) setting up digital infrastructure for agriculture that will function as an open source public good; and (c) production of millets.

The focus on the allied sectors is reflected not only in allocations but also in commitment to increase credit disbursement. The prioritisation is in line with the findings in the latest Economic Survey, which showed that the contribution of the allied and forestry sectors to the total agricultural gross value added increased from 34.5 per cent in 2011-12 to 44.9 per cent in 2020-21.

The creation of digital infrastructure has been adopted as a public policy measure for the first time. Though how the infrastructure will be created, and what the allocation will be, is unclear, it will promote and support the growth of the agri-tech industry and start-ups, generate credible market intelligence, and provide improved access to farm inputs.

The Budget’s emphasis on millet production aims to make India a global hub for millets, and provide not only affordable and nutritious alternatives to consumers but also opportunities for resilient income to farmers.

Another significant step is promoting farmer producer organisations with higher allocation, to ₹955 crore from ₹500 crore in 2022-23. In the previous two Budgets, the allocation was revised downwards from the Budget Estimates.

The exports of marine products recorded one of the highest growth rates in recent years, and the duty on key inputs for the domestic manufacture of shrimp feed has been reduced to promote exports further.

Agriculture credit

The target for agriculture credit has been raised to ₹20-lakh crore, with greater emphasis on animal husbandry and fisheries. The Finance Minister also highlighted the importance of primary agricultural credit societies and increased the allocation for digitisation from ₹350 crore in 2022-23 to ₹968 crore in 2023-24. The allocation for the Department of Agricultural Research, which was constant (in terms of current prices) for the last two years, has been hiked by 11.6 per cent to ₹9,504 crore.

But the other proposals and announcements are a cause for concern. The allocation proposed for the Department of Agriculture and Farmers’ Welfare for 2023-24 is ₹1.15-lakh crore, 6.8 per cent lower than the Budget Estimate of 2022-23. The reduction is symbolic of the consistent withdrawal of the Centre from the agriculture sector.

The allocation for the flagship Rashtriya Krishi Vikas Yojana (RKVY renewed) has been reduced by 31.5 per cent to ₹7,150 crore and for Pradhan Mantri Kisan Samman Nidhi (PM-Kisan) by 11.7 per cent to ₹60,000 crore (over BE). The National Beekeeping Honey Mission, introduced in last year’s Budget and allocated ₹100 crore, has not got any allocation this year.

In the previous Budget, the flagship Green Revolution scheme, which included more than 15 missions and schemes, and the Pradhan Mantri Krishi Sinchai Yojana were discontinued and replaced with RKVY renewed and the Krishionnati Yojana. The latter was disaggregated into oilseeds, digital agriculture, agriculture extension, agriculture marketing, etc. But this disaggregation is not provided in the agriculture budget of 2023-24, and the aggregate allocation has been reduced by 1.6 per cent. The absence of disaggregation hinders the tracking of relative resource allocation among non-cereal crops — oilseeds, pulses and horticultural crops.

While the Budget has made several proposals that can propel agriculture growth, t does not provide the structural shift that can move the sector on to a path of long-term, sustainable growth.

Kumar is Senior Research Fellow, and Pathak is Program Manager, at International Food Policy Research Institute, New Delhi