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Budget 2019: 5 key takeaways for farmers from Piyush Goyal's speech

BusinessToday.In     February 1, 2019

It was clear from the get-go that Modi government's Union Budget 2019 would favour the farmers a great deal. And the government has delivered on these expectations, to some extent. An income support scheme for "vulnerable farmer families", a couple of interest subvention announcements, and new entities to look after animal husbandry and fisheries were part of the Budget speech Interim Finance Minister Piyush delivered before the Parliament on Friday.

Presenting the Budget 2019 before the Lok Sabha, Goyal said that the pro-farmer policies by the government have helped the cultivators to attain record levels of agricultural produce. Reiterating the aim to double farmers' income, he also mentioned the move to increase minimum support price for 22 crops at minimum 50 per cent more than the cost.

"During the last five years, for providing affordable loans to farmers, the amount of interest subvention has been doubled. The crop loan to farmers increased to Rs 11.68 lakh crore in year 2018-19. We have made genuine efforts to remove the hardships of farmers by providing them Soil Health Cards, quality seeds, irrigation scheme and Neem Coated Urea to remove shortage of fertilisers," Goyal said.

Below are the crucial proposals from the Budget 2019 that have been aimed at bolstering the primary economic sector of the country:

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Direct income support under PM-KISAN

To ensure assured income support to marginal and small farmers, Goyal announced the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme in the Union Budget 2019. This programme will provid direct income support of Rs 6,000 every year to vulnerable landholding farmer families, with cultivable land up to two hectares. An outlay of Rs 75,000 crore has been proposed for the scheme which is estimated to benefit 12 crore farmers.

"PM-KISAN would not only provide assured supplemental income to the most vulnerable farmer families, but would also meet their emergent needs especially before the harvest season. PM-KISAN would pave the way for the farmers to earn and live a respectable living," Goyal said.

The programme would be effective on retrospective basis from December 1, 2018. The first instalment for the period up to March 31, 2019 would be paid during this year itself.

However, Rs 6,000 a year promised under the PM-KISAN programme translates to less than Rs 17 a day to farmer families. This could give way to reservations over the effectiveness of the scheme.

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Loan incentives for calamity-hit farmers

Goyal proposed an incentive for calamity-stricken famers against their crop loans. Under the extant rules, crop loans in the name of farmers coping with natural disasters are rescheduled and an interest subvention of 2 per cent is provided for the first year of their rescheduled loan.

As per the proposal in the Union Budget 2019, farmers affected by natural calamities will get an incentive of 3 per cent on repaying their loans on time. This will be in addition to the 2 per cent interest subvention that they get now.

"Our Government has now decided that all farmers affected by severe natural calamities, where assistance is provided from National Disaster Relief Fund (NDRF), will be provided the benefit of interest subvention of 2 per cent and prompt repayment incentive of 3 per cent for the entire period of reschedulement of their loans," Goyal said.

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Relief in loans under Kisan Credit Card

The Union Budget 2019 proposed 2 per cent interest subvention against loan availed through Kisan Credit Card in case of farmers engaged in animal husbandry and fisheries. They will also get 3 per cent incentive over and above it if they repay their loans within the stipulated time frame.

"To ensure provision of easy and concessional credit and to bring all farmers under KCC fold, our Government has decided to initiate a comprehensive drive with a simplified application form," Goyal further said.

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Rashtriya Kamdhenu Aayog for bovine welfare

In his Budget speech, Goyal announced the formation of a Rashtriya Kamdhenu Aayog to upscale sustainable genetic up-gradation of cow resources and to enhance production and productivity of cows. The commission will also look after effective implementation of laws and welfare schemes for cows.

Goyal further added that the allocation for Rashtriya Gokul Mission has been increased to Rs 750 crore in the current year itself.

New Department of Fisheries

To dedicatedly work for development of fisheries, the government has proposed a separate Department of Fisheries in the Budget 2019. Presenting the Budget, Goyal said that India is the second-largest fish-producing nation, accounting for 6.3 per cent of the total global production with an annual growth of over 7 per cent in recent years.

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