Budget 2017: Arun Jaitley raises credit to farmers to Rs 10 lakh crore

NEW DELHI: The budget has proposed various initiatives that promise to improve farmers’ incomes and productivity. They include higher investment in irrigation, increased coverage under crop insurance, a fund to develop dairies, wider access to credit, and expansion of agri-markets by denotifying fruits and vegetables.

The move to double long-term irrigation fund to Rs 40,000 crore will help increase area under irrigation and improve efficiency of irrigation. Currently less than half of 142 million hectares of farmland in the country is irrigated. The Budget also paves way for a micro-irrigation fund to be set up by National Bank for Agriculture and Rural Development (Nabard) with an initial corpus of Rs 5,000 crore.

“Improving irrigation efficiency is critical for Indian agriculture since we have 2.4% of the world’s total geographical area, 18% of the world’s population, but only 4% of the world’s total fresh water resources,” said Harsh Kumar Bhanwala, chairman at Nabard.

The Budget has advised states to de-notify perishables from agricultural produce market committee (APMC) and expand the electronic National Agriculture Market (e-NAM) to 585 mandis from 250 now.



“The de-notification of fruits and vegetables from APMC if it happens will be a welcome announcement because farmers will get good rate for their produce and supply chain will be reduced, leading to fall in post-harvest losses,” said Atul Chaturvedi , CEO at Adani Wilmar, maker of Fortune brand of edible oils. He, however, said a lot more mandis should be brought under e-NAM considering there are 15,000 mandis in the country.

Nabard has also proposed to set up a dairy processing and infrastructure development fund with an investment of Rs 8,000 crore over three years. RS Sodhi, managing director at Amul, said this would create additional processing capacity of 5 crore litre milk per day and will give Rs 50,000 crore per annum extra income to farmers in the country in the years ahead.

The budget proposed increased farm credit of `10 lakh crore and widening coverage of Pradhan Mantri Fasal Bima Yojana ( PMFBY) to 40% of cropped area in 2017-18 and 50% in the following year, up from 30% now. Total Budget allocation for agriculture, rural and allied sector stood at Rs 1,87,280 crore.

All farmers are not pleased with the Budget though. “We hoped the Budget would bring reforms to improve farmers’ livelihood, which is not the case,” said Ajay Vir Jakhar, chairman of Bharat Krishak Samaj, an advocacy group that works with farmers.