Union Budget 2018-19: Is Agriculture an Enterprise?

The government’s focus on Agriculture, Health and Education would provide desired impetus to rural economy and for the health of nation Health Protection Scheme could be a game changer 

Union Budget 2018-19: Is Agriculture an Enterprise?

Given the current rural scenario, it was well expected that the government would pay adequate attention on agriculture and rural development by announcing some popular and positive measures in Union Budget 2018-19, the last full Budget of the current NDA government. One of the most important aspect of the Budget this year is that the Finance Minister has treated Agriculture as an enterprise while announcing the provision for the sector and measures announced are expected to fulfil the goal of doubling income of the farmers by 2022.  Overall, focus on agriculture, rural economy, inclusive health, infrastructure and MSMEs is very encouraging. 

Minimum Support Price (MSP) for kharif crops at 1.5 times cost of produce along with cluster-model approach for agricultural production would increase farm productivity and enhance farmers’ incomes in the coming times. Doubling the allocation in food processing from Rs. 715 crore to Rs. 1400 crore would boost food processing; specialized agro processing and financial institutions. Cultivation of horticulture crops in clusters will boost production and marketing. Further, Agri-market Development Fund with a corpus of Rs. 20 billion for developing agricultural markets would go a long way to help farmers. The extension of Kisan Credit Cards to fisheries, animal husbandry is appreciable.

“The budget is on expected lines and provides support to sections of the society, where it was needed the most. The agri and rural landscape were in some kind of distress and provision of over Rs 14.34 lakh crore to be spent on rural infrastructure should also add to the employment generation especially in the farm sector,” says Sandeep Jajodia, President,Assocham. 

The measures announced in Union Budget 2018 aims to further supplement government’s aim to double farmers income by 2022. One of the key demands of the farming community was an increase in Minimum Support Price (MSP) which has been enhanced on all Kharif crops to 1.5 times of the cost of production. This would help in ensuring that farmers get more realistic prices for their produce and would enhance their incomes. 

“A strong message to treat agriculture as an enterprise has been announced. The cluster approach for Horticulture crops would help in linking production to markets and ensuring farmer’s profitability. Setting up an Agriculture Market Infrastructure Fund with an outlay of Rs 2000 crore along with measures to establish mega food parks will go a long way in enhancing the export competitiveness of agriculture sector,” feels KC Ravi, Vice President, Public Policy, South Asia Syngenta. 

“The tax incentive to Farmer Producer Organizations (FPOs) would help in enhancing the effectiveness of organized farming community. The agricultural growth which has been suppressed in recent times would hopefully pick up with these measures and the government would bring a sharper focus on integration of technology, R&D, hybridization, and enabling public private partnerships. The other welcome features include, “Operation Greens”, increasing institutional credit for agriculture to INR 11 trillion and the further strengthening the e-NAM,” he adds.

Initiatives like Operation Green to stabilize prices of highly political and consumer sensitive onion and potato would help ease the retail inflation and would help the RBI in keeping interest rates on lower side. 
The rise in allocation of Rs. 1.38 lakh crore in FY19 from Rs. 1.22 lakh crore for government health and education programmes will facilitate socio-economic development in the country.

“While we see a clear focus on the infrastructure sector development in the rural areas, the plans for such development in the urban areas including wider connectivity across the length and breadth of the country have also got the needed attention in the budget,” according to Rashesh Shah,President,FICCI. 

The provision of Rs 5 lakh per family per year for medical reimbursement, under National Health Protection Scheme- “Aayushman Bharat” will go a long way to achieve the goals of Universal Health Coverage, according to NATHEALTH. 
“NATHEALH had recommended making health insurance mandatory and National Health Protection Scheme partly covers the insurance needs of the country. However, there are other critical needs which remain unmet- eg. according National Priority Sector Status to healthcare,” says Anjan Bose, Secretary General, NATHEALTH.

NATHEALTH applauded the government’s focus on Health Protection Scheme which would be the largest healthcare programme in the world.The government has announced an unprecedented Rs 5 lakh medical insurance cover per year for 10 crore families or 50 crore beneficiaries across the country.
Union Budget 2018-19 clearly focuses on growth by boosting rural economy and overall, it appears progressive along with some populist measures. 

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