India's agricultural sector faces immense challenges, from low productivity and profitability for farmers to environmental degradation. Transforming this critical sector requires strategic budget allocations and policy reforms. The central goals should be enhancing farmer livelihoods, ensuring national food security, promoting sustainability, and facilitating the evolution towards more efficient large-scale and corporate farming models.
The annual budget should significantly increase allocations for irrigation, warehousing and cold storage, food processing infrastructure, agricultural R&D, farmer training programs, and access to credit and crop insurance. Drip irrigation, which uses water far more efficiently than flood irrigation, should be subsidized to expand its coverage from the current 10% of farmland. Investments in cold storage and food processing near production areas can reduce post-harvest losses and support farmer incomes. Agricultural R&D spending should be doubled to find solutions for raising yields, climate resilience, mechanization, biofortification, and precision agriculture. Farmer Producer Organizations which allow smallholders to aggregate their production and gain economies of scale, should receive financial support and training.
The budget must also expand allocations for rural infrastructure like all-weather roads, electricity, broadband internet, and soil testing facilities. Electricity subsidies for farmers should be maintained and a program launched to solarize agricultural feeders and pump-sets.
For marginal and small farmers, minimum income support schemes can guarantee a basic living standard and prevent distress sales of land holdings. The PM-KISAN direct cash transfers should be expanded and other input subsidies carefully reviewed to determine their impact vs costs.
However, to truly transform Indian agriculture, more fundamental policy reforms are needed along with budgetary support:
First, agricultural markets must be liberalized to give farmers flexibility in cropping choices and ability to directly sell to agribusinesses, exporters and retail chains. This can be enabled by revamping the APMC mandi rules. Related cold storage, warehouse and transport infrastructure will enable linkages between production regions and consumption centers.
Second, secure land leasing markets must be fostered where small farmers can opt to lease their land to larger producer companies on attractive terms, rather than sell land outright. Contract farming models can also help tie smallholders into modern value chains. The land ownership ceiling laws may be relaxed to enable emergence of larger corporate farms.
Third, sustainability and climate resilience of agriculture need to be strengthened by promoting less water-intensive crops and farming techniques. Community watershed development programs with village-level participation can improve rainwater harvesting and groundwater recharge. Soil health cards and micronutrient availability will further enhance land productivity and food value.
Fourth, diversification into horticulture, organics, and food processing should be encouraged to enhance farmer incomes, while developing agriculture into a modern sector integrated with food processing and export.
Finally, the growing role of technology in agriculture, from drones and remote sensing to AI and IoT, needs to be leveraged. Digital agriculture infrastructure like the AGRIStack and Unified Farmer Service Interface should be priorities.
Implementing these budgetary allocations and policy reforms will be challenging. Farm subsidies and rural votes are politically sensitive. Land reform is contentious. Scaling up irrigation has proved difficult. However, the ideas outlined constitute a roadmap for transforming Indian agriculture into an innovative, sustainable and farmer-centric sector integrated with the larger food system.
Corporatization and larger farms should not displace smallholders but rather integrate them into value chains. With the right budgetary support, investments, incentives and implementation capabilities, Indian agriculture can be revitalized. Farmers will gain higher, stable incomes. Consumers will receive ample, nutritious food. Sustainability will improve. And the economy as a whole will benefit from the vitality of a sector engaging half the population.
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