Where's the beef?

When it comes to agriculture, the Budget for 2007-08 flatters to deceive. In his Budget speech, the finance minister said right at the outset that agriculture must top the agenda of policy-makers, and hold the first charge on resources. In subsequent remarks, he has said that the Budget's focus was on agriculture because industry and services were already doing well. In the Budget speech itself, the minister alluded to several areas which hold the key to the revival of the farm sector. But if you were to conclude from all this that the Budget would help revive the agriculture sector, you would have to think again. For, the bald truth is that the outlays proposed often do not measure up to the task at hand. Many of the plans and programmes which the Budget emphasises are already under implementation, and the stress is largely on lending them fresh impetus. Among the most significant of these areas are agricultural credit, risk management, irrigation and water conservation, agricultural extension (read technology transfer) and seed production, especially of pulses, whose prices have tended to shoot up on the back of output stagnation.

It is noteworthy, in fact praiseworthy, that the UPA government's target of doubling farm credit in three years has been achieved in two years and that the credit disbursal target for 2007-08 has been pitched at as high as Rs 2,25,000 crore. But, as a proportion of gross bank credit, this works out to just 12 per cent, against 21 per cent in the early 1970s, when the Green Revolution took root. For the Accelerated Irrigation Benefit Programme, which is a well-conceived approach for completing projects held up at the last mile, the hike in outlay is far too meagre to meet even half of the Bharat Nirman programme's target of creating 10 million hectares of additional irrigation potential by 2008-09. The case with the resources set apart for the newly-established Rainfed Area Authority, which is mandated to look after the water needs of nearly 60 per cent of the total farm land, besides the entire forest land that also constitutes a rainfed area, is no different.

Though increasing the production of certified seeds is critical for boosting crop yields, it does not really require substantial additional resources if ways could be conceived to get the job done through the private sector. As such, the announcement about involving research institutes, cooperative enterprises and private companies, is a welcome move. Where farmers' risk management is concerned, the proposal for weather-based insurance cover seems sound on paper, but its viability without heavy subsidies seems doubtful. Also well-intended is the proposition for inducting milch animals in the farming systems in the districts reporting farmers' suicides because livestock can provide much-needed income support during crop failures. But here again, the proposed allocation is good enough for financing the purchase of no more than 500 milch animals per district. This apart, the proposal to set up Agricultural Technology Management Agencies (ATMAs) in 300 more districts may not serve the intended purpose of technology transfer, considering the indifferent track record of the existing 262 ATMAs, headed mostly by district collectors. In view of all this, no one should expect the agriculture sector to achieve a quick turnaround or begin growing at 4 per cent.