Don’t miss the latest developments in business and finance.

Home / Content / B2B Connect / Chemicals / Government's focus on agriculture to give farm & firm a boost

Government's focus on agriculture to give farm & firm a boost

Research shows that the year agriculture does well, the economy does well too, says Rajesh Aggarwal

Government’s focus on agriculture to give farm & firm a boost
Premium
Rajesh Aggarwal
Last Updated : Mar 29 2017 | 3:40 PM IST
Connect with us
Facebook IconLinkedIN Icon
If the Prime Minister Narendra Modi’s recent pronouncements and Finance Minister Arun Jaitley’s budget are any indication, agriculture and allied industries in India are set to see the much-awaited turnaround. The fact that ‘farmers’ and ‘rural development’ figured in the key focus areas of the Union Budget and the allocation for these sectors (Rs 1.87 trillion) is up by 24 percent is good news. The slew of new schemes, including the model law for contract farming that the government plans to bring in, is also an indicator of the government’s resolve to revitalise the rural economy. The new law is likely to fetch farmers a better price for their produce and be a win-win for both farmers and contractors.

Measures to incentivise farming, for instance, reducing the interest rate on farm loans was much needed, especially to make up for the losses the agriculture sector has suffered in the wake of demonetisation. The biggest problem has been farmers not getting the right remuneration for their produce to make farming a profitable activity. The minimum support price (MSP) needs to be monitored and revised as per the conditions so that farmers get adequate return of their produce. Today, if you talk to farmers, they say production is increasing, but because of low MSPs, it is futile to work hard and increase the production.

In a country where agriculture is largely dependent on monsoon rains, the emphasis on ‘drought-proofing’ gram panchayats through leveraging NREGA funds makes economic sense. The decision to set up a dedicated micro-irrigation fund with an initial corpus of Rs 5000 crore could make a huge difference and free farmers from the vagaries of the monsoons. 

The government’s decision to provide 1.5 lakh gram panchayats with broadband is a step aimed at ensuring their integration in the digital economy through the electronic National Agriculture Market (e-NAM) platform.

In the area of skill development for rural youth, too, building their skills in modern agricultural methods, including use of agricultural equipment, their maintenance and repairs can create employment opportunities as farming in India gets increasingly mechanised. The government’s target is to have 10,000 skilled technicians among NREGA workers. 

The increase in the allocation of government’s flagship crop insurance scheme, the Pradhan Mantri Fasal Bima Yojana from Rs 5000 crore Rs 9000 crore and the coverage area from 30 to 40 per cent of the cropped area, soil health card scheme and mini soil testing labs in all 648 Krishi Vigyan Kendras (farm research institutes) to be run by rural entrepreneurs, are all aimed at giving agriculture and related industries a boost. But it’s the implementation of these schemes which will be more important.  

It is hoped that the government’s decision to involve NABARD (National Bank for Agriculture and Rural Development), the government’s apex rural bank, with implementing schemes to improve access to irrigation, will boost agriculture and allied industries.

Rajesh Aggarwal, MD, Insecticides India Ltd
Delisting perishables such as vegetables and fruits from Agriculture Produce Marketing Committees (APMCs) and allowing farmers to sell such items directly to consumers will get them a better price and boost the rural market. Till now, farmers were required to sell such produce in markets managed by APMCs.

A Rs 10 trillion farm credit and a special support of Rs 1,900 crore to cooperative banks to bring them onto the core banking platform, will hopefully ensure a seamless flow of credit to small and marginal farmers who borrow from cooperative banks.

With generous central allocations, a host of well-intentioned schemes and the support of state governments and agricultural research institutions it is hoped that Indian agriculture and allied industries will get the much needed push. 

Research shows that the year agriculture does well, the economy does well too, and so the growing importance of the farm sector. If we use the resources the government is putting in, it can help in the diversification of livelihood, achieve greater agricultural productivity through irrigational facilities, augment farm mechanisation, boost the service sector and create new jobs. 

The government is aggressively pursuing a farmer-centric development approach with bottom up planning to achieve the goal of doubling farmers’ income over the next five years. This will hopefully drive rural demand and give industry and economy a boost.

But above everything else, what is really needed is farmer education and training. The government needs to focus on this with incentives for companies which are involved in this effort.  A stronger institutional and policy framework for the implementation of technology and its tools in Indian agricultural cannot be overemphasised.
_______________________________________________________________________________________________
Rajesh Aggarwal is managing director of Insecticides India Ltd

Connect with us on WhatsApp

More From This Section

MNCs plan expansion of polyurethane business in India as demand picks up

Global oil industry: What's there for India in 2017?

New rules under Labour Laws to reduce compliance burden for companies

Godrej Consumer Products: Where science rocks

First Published: Mar 29 2017 | 3:31 PM IST

Explore News

Next Story