Budget 2020: Can Nirmala Sitharaman help the government double farmers’ income by 2022?

From an increase in R&D investment to the many reforms needed for better access to credit, here are the top concerns of the agriculture sector—a key player in boosting India’s GDP—before Union Budget 2020.
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Covering an area of over 160 million hectares, agriculture is undoubtedly the largest source of income for the rural Indian sector. But the largest employer in the country has, for decades, been in a dire situation, and is in need of a jumpstart.

The Modi government has set a target of making India a $5 trillion economy by 2024. The government had also announced that it is aiming to double farmers’ income by 2022. But this would require concerted efforts to give the agriculture sector a fillip.

SocialStory speaks to a few experts in the agriculture sector to understand how this target can be achieved and what more they expect from Nirmala Sitharaman in the Budget to be announced tomorrow.

Mallikarjun Kukunuri, CEO of Niruthi Climate and Ecosystem Services, which provides field-level information needed by farmers to better manage their crops, stresses upon the fact that doubling farmers’ income by 2022 can be achieved only by moving from a reactionary approach to a more proactive one.

“Incentivising alternative agri practices and adaptation of technology will lead to improved efficiency and performance of marginal farmers who dominate the Indian agricultural space,” he says. 

Mallikarjun explains that knowledge gaps need to be plugged for effective implementation of policies in the agriculture sector.

“Even though India is a nation largely driven by agriculture, there are still large knowledge gaps that keep farm yields low. Apart from providing agricultural policies, the government should also focus on increasing productivity, efficiency, and output across the agriculture business value chain by trying to boost the agritech sector,” he adds.


The credit crisis

One of the biggest issues plaguing the agriculture sector in India is the lack of credit for farmers, who are unable to access money in time. Due to their low earning power and high rates of interest charged by non-institutionalised local lenders, farmers often find themselves in deep debt.

This lack of access to a good credit system leaves farmers in the lurch as they are unable to afford quality seeds, fertilisers, irrigation facilities, farm equipment, and other things needed to bring better yield.

Last year’s Budget had an announcement to create 10,000 Farmer Producer Organisations (FPO) to pool together small and marginal farmers to help them get better bargaining power plus access to credit. It remains to be seen what Budget 2020 will bring in this regard.

The need of the hour is also the revision of the Minimum Support Price for crops and bring quality seeds and other critical resources under subsidy.

Some farmers are taking an alternative approach with the concept of zero budget farming. Coming into the limelight last year, the practice entails farmers using organic inputs rather than chemicals and pesticides. This reduces the dependence on purchased inputs such as seeds and fertilisers, and farmers can drastically cut down on costs.



Focus on price regulation

In the upcoming Budget, farmers are hoping for on-ground support from the government.

Lalita Mukati, a woman agripreneur leading the way for organic farming in her village, Borlai, Madhya Pradesh, says farmers should be able to decide a price for their produce.

She explains, “There isn’t much support in terms of trading. We need a provision where the government can eliminate the middleman who tends to take away our hard-earned money. Also, the MNREGA scheme needs to be revised, as labourers get a kilo of rice for just Re 1. This isn’t helping us, and affects the sector.”

Price regulation also needs attention, especially in recent times when vegetable prices are shooting up.

"For instance, if there is a surge in onion prices, the government imports them at a lower cost to tackle inflation. But this means farmers face the risk of their onions losing market value and getting spoiled in storage,” Lalita says.

She adds that farmers are looking forward to announcements on price regulation in Budget 2020, so that there is a provision for farmers to tackle the deficit in cases where the government imports crops and vegetables.



Tech and innovation

Experts also call for a boost to certain activities in the sector like reliable storage of agricultural production and better logistics. A solution, they all agree, is more tieups with the private sector.

A collaboration with the private sector and startups can bring technological innovation to the agri sector, in terms of farming methods, irrigation, crop growth, and weather forecasts for better crop production.

Digitisation of land records is another way in which the sector can embrace efficiency. But Shubhanshu Shekhar Shukla, Founder, DRISTI, an organisation working towards to transform villages through technology, believes there should be enough investment by the government to create awareness for all these measures to take off.

“The upcoming Budget should allocate a certain fund for technology and awareness initiatives. With integration of technological innovation, farmers can access various schemes and portals to enhance farming practices,” Shubhanshu says.

(Edited by Evelyn Ratnakumar)