[Budget 2022] Centre bats for digitisation of agriculture sector, launches agritech fund

The Finance Minister, in the Union Budget 2022, announced a fund with blended capital under the co-investment model through NABARD. The minister reiterated the used of technology with the participation of different players.
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From Kisaan drones to chemical-free natural farming and a new fund, Finance Minister Nirmala Sitharaman announced several plans for the agritech sector while presenting the Union Budget for the financial year (FY) 2022-23.

Sustainability and public-private partnerships (PPP) for the delivery of digital and high-tech services to farmers emerged as key themes for the sector in this year's budget.

The central government will facilitate a fund with blended capital under the co-investment model through the NABARD, the minister said. The National Bank for Agriculture and Rural Development–NABARD– is an apex regulatory body under the Ministry of Finance to regulate regional rural banks and apex cooperative banks in India.

The fund will be used to finance startups for agriculture and rural enterprises, relevant to the farm produce value chain. This will include startups involved in supporting Farmers Producers Organisation, providing them with machinery and technology on a rental basis.

“It will attract capital in the rural sector and ensure scientific upgrades in the farm produce value chain,” said Amith Agarwal, Co-Founder & CEO, AgriBazaar, an agritech marketplace.

The Finance Minister, in her speech, also called for technology involvement in rural India.

“Use of Kisaan drones will be promoted for crop assessment, digitisation of land records, spraying of insecticides, and nutrients,” the minister said.

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Players in the agritech sector cheered the Centre's move. "This decision will give a fillip to increasing the yield of the small and marginal farmers and will bring about scientific thinking towards Indian agriculture,” Amith said.

In addition, the finance minister announced the laying of optical fibre lines in villages under BharatNet project under PPP in 2022-23, which is expected to have a ripple effect.

“Digitisation of rural India and making high-speed internet available to every villager will result in higher incomes and a better quality of living,” said Amith.

Agriculture is the primary source of livelihood for about 58% of India’s population, according to India Brand Equity Foundation (IBEF).

To support the sector, the Modi government has allocated Rs. 1.51 lakh crore to the agriculture and allied activities sector in FY 23, up 2.5 percent from the revised estimates the previous year.

The government will procure about 1,208 lakh metric tonnes (Estimated) of wheat and paddy from 163 lakh farmers in the country and will pay them Rs 2.37 lakh crore of Minimum support price (MSP) value.

“To reduce our dependence on import of oil seeds, a rationalised and comprehensive scheme to increase domestic production of oil seeds will be implemented,” the finance minister said.

In line with the UN General Assembly’s announcement to celebrate 2023 as the International Year of Millets, the government will provide support to millet farmers for post-harvest value addition, enhancing domestic consumption, and for branding millet products nationally and internationally.

In addition, the Finance Minister said that chemical-free, natural farming will be promoted throughout the country with a focus on farmers' lands in five-kilometer-wide corridors along the river Ganga.

Edited by Affirunisa Kankudti

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