Agriculture sector provides livelihoods to the over half of the population. When the adversaries of COVID-19 pandemic resulted into the Indian economy contracting 7-8 percent, according to Economic Survey, agriculture was the only sector which provided a shy of relief to the Indian economy by growing at 3.4 percent.
Considering the significance of agriculture sector in the Indian economy, Finance Minister Nirmala Sitharaman announced increasing target of agricultural credit to Rs 16.5 lakh crore for the FY22 and integrating 1,000 more APMC (Agricultural Produce Marketing Committee) mandis with e-National Agricultural Market (eNAM). However, agrochemicals sector, animal husbandry, poultry farming and women farmers have been left unnoticed in the budget.
Boosting Agricultural Credit
The budgetary target of Rs 16.5 lakh crore agricultural credit for FY22 is seen as encouraging farmers to invest on their farming practices. “Government’s agricultural credit target attuned to Rs. 16.5 lakh crore in FY22 is a welcome move. This will also encourage the farmers to invest more which will only contribute positively towards the growth of the country. Focus on ensuring increased credit flows to animal husbandry, dairy, and fisheries is something we had been advocating,” Amit Saraogi, Managing Director, Anmol Feeds said.
“The focus on the agriculture sector as expected has been satisfactory with key action points such as 1,000 more agricultural mandis are proposed to be integrated with e-National Agriculture Market (eNAM). The rising government spending for purchasing grains and pulses at support prices, with an aim to further strengthen the state-regulated markets, or APMCs is noteworthy,” he added.
However, Saraogi pointed out, “The budget had nothing specific related to animal husbandry. Minimum Support Price (MSP) should have also been fixed for the poultry industry so that poultry farmers do not get affected by the fluctuating market.”
The agrochemicals industry has been on the edge due to new regulations of banning 27 pesticide molecules in the year 2020. And therefore, the sector was seeking special attention from the government. However, the industry is not satisfied with the budget. “We do not have much for the agrochemical sector. The only upside is that the proposed increase of agriculture credit is likely to increase the purchasing power of the farmers, which will, in turn, become a factor of growth for the agrochemical sector, said Pradip Dave, President, Pesticides Manufacturers & Formulators Association of India (PMFAI).
Agrochemicals are an integral part of the green revolution and play a crucial role in increasing agricultural productivity. Over the years, the Indian crop protection industry has made significant progress in terms of enhanced crop yields and crop quality, as well as integration of global and local technologies to meet the overall requirement of Indian agriculture.
“Keeping in mind its potential, the Government has recently recognised agrochemicals as a champion sector, where India can become a major global manufacturing hub. However, for India to become a global hub for agri-inputs, Indian regulatory processes must match pace with the global regulatory eco-system. We would continue to urge the Indian government to implement a science-based, progressive and predictive regulatory regime, for the sector to achieve its true potential.” Asitava Sen, Chief Executive Officer, CropLife India
“With a view to reduce overall cost of production for farmers, the GST on agrochemicals could have been reduced from the current 18 percent to 12 percent. Further, the government should provide 200 percent weighted deduction on R&D expenses by agrochemical companies to encourage innovation and introduction of new technologies,” Sen said.
While making to one side happy, some areas were left unnoticed in the budget. Vidya Shah, Chairperson & CEO, EdelGive Foundation said, “In the agriculture sector, the Rs 40,000 crore allocation under the Rural Infrastructure Development Fund and the Micro-Irrigation corpus is welcomed. However, support to rural enterprises could also have been extended as these enterprises are leading the way to provide opportunities for those in the most marginalised locations.”
“We would have liked to see more focus on women in this budget. Women enterprises and women farmers need focused attention and support from the government through the different schemes available,” she added.
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