DMK govt lines up sops in Tamil Nadu's first exclusive farm budget

State may see highest disbursals of crop loans of Rs 1.45 trillion through NABARD

The DMK government in Tamil Nadu announced the first separate budget for agriculture in the state’s history and allocated Rs 34,221 crore for agriculture and related departments in 2021-22, while dedicating it to protesting farmers in the National Capital Region.

The state has also lined up a series of sops, including higher allocation for the crop insurance scheme and also taking steps to ensure credit availability to farmers, in addition to higher allocation for free power to farmers. The state may see one of the highest disbursals of crop loans of Rs 1.45 trillion through National Bank for Agricultural and Rural Development (NABARD) in 2021-22. In the budget presented by agriculture minister MRK Panneerselvam, he allocated Rs 2,327 crore for the implementation of the crop insurance scheme in 2021-22 and also announced the plans to set up a separate division in the agriculture department for organic farming.

The state has also urged the Centre government to revisit its decision to reduce the Centre premium under the Crop Insurance Scheme, which increased the state’s share significantly. The state said that it will ensure the disbursement of credit through financial institutions like NABARD. NABARD has already prepared a detailed plan in its potential linked credit plan for the year 2021-2022 to provide a sum of Rs 1,45,509 crore as farm credit and Rs 9,607 crore as credit for agricultural infrastructure facilities.

The state is providing free electricity to 22,19,000 electric motors of farmers in Tamil Nadu, thereby providing an average of Rs 20,000 for each pumpset per annum. For this purpose, an amount of Rs. 4,508 crore was allocated to Tamil Nadu Electricity Board for the current financial year. The state has also announced a 70 per cent subsidy for providing around 5,000 solar-powered pump sets. This scheme will be implemented at an outlay of Rs 115 crore with State, Union Government funds.

The government will provide an incentive of Rs 15,000 per hecatre for farmers involved in vegetable cultivation, sugarcane procurement price will be increased to Rs 2,900 per tonne from Rs 2,750. The budget also proposed a strategic plan to bring an area of 11.75 lakh hectares of fallow lands into productive land in the next ten years.

In a move that may benefit around 600,000 farmers, the state has increased the incentive price for paddy procurement in the state, following which paddy Grade-A varieties will be procured at Rs 2,060 per quintal and common varieties at Rs 2,015 per quintal. This is compared to a Centre fixed price of Rs 1,960 quintal for Grade-A varieties and Rs 1,940 per quintal for common paddy varieties.

To insulate farmers from market fluctuations and reduce dependency on a single marketing source, the state will also introduce e-auctioning in all regulated markets. Through this, all the regulated markets, mandis and farmers producer organizations will be brought under the purview of a software platform and will be linked with traders at national level.