Higher credit may help farmers adopt more scientific ways: Experts

Budget announced a credit target of Rs 10 lakh cr for FY18

Agriculture industry players and analysts have welcomed the Union Budget's provision of higher credit for farmers which, they say, could now encourage the latter to adopt more scientific ways of farming. 

In the Budget, the government announced a Rs 100,000 crore hike in the credit target for the next financial year to Rs 10 lakh crore as part of it's efforts to double farm incomes in the next five years.

"More liquidity in farmers’ hands will increase their spending at the various levels. It will encourage them to adopt scientific farming and use of drip irrigation and technology would also go up," said M G Shembekar, managing director of Nagpur-based Ankur Seeds Private Limited.

Union Finance Minister Arun Jaitley proposed to integrate fruits and vegetables growing farmers with agro processing units for better price realisation and reduction of post-harvest losses. As a result, a model law on contract farming would also be prepared and circulated among the states for adoption.

Chairman and Managing Director of Rasna Private Limited Piruz Khambatta, who also chairs the Confederation of Indian Industry's agro-food processing committee, said that the move would encourage more corporate involvement in the farming sector. 

"This will result into better returns for farmers. However, it depends on how well prepared the government is to implement the model law on contract farming," said Khambatta.

Companies also welcomed the government's proposal to denotify perishables from the agricultural produce market committee. According to Atul Chaturvedi, chief executive officer of Adani Wilmar and president of Solvent Extractors’ Association of India, the same would help remove middlemen and help farmers get more prices for their produce. 

"Also, the government wants to connect large numbers of mandis with the e-NAM which is also a welcomed step as better price realisation will increase the farmers' income," said Chaturvedi, adding that the results would, however, take some time to show.